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DEPARTMENT OF FOREIGN AFFAIRS, petitioner, vs.

NATIONAL LABOR RELATIONS


COMMISSION, HON. LABOR ARBITER NIEVES V. DE CASTRO and JOSE C. MAGNAYI,
respondents

G.R. No. 113191, September 18, 1996

Vitug, J.

FACTS

On January 27, 1993, private respondent Jose C. Magnayi initiated NLRC-NCR Case for his
alleged illegal dismissal by Asian Development Bank (ADB) and the latter's violation of the "labor-
only" contracting law. Two summonses were served, one sent directly to the ADB and the other through
the Department of Foreign Affairs (DFA). Forthwith, the ADB and the DFA notified respondent Labor
Arbiter that the ADB, as well as its President and Office, were covered by an immunity from legal
processes except for borrowing, guaranties or the sale of securities pursuant to the Agreement
Establishing the Asian Development Bank (the "Charter") and the Agreement Between the Bank and the
Government of the Philippines regarding the Banker's Headquarters (the "Headquarters Agreement).
The Labor Arbiter took cognizance of the complaint on the impression that the ADB had waived
its diplomatic immunity from suit and thus, rendered his decision declaring the complainant as a regular
employee of ADB and the termination of his services as illegal.
The ADB did not appeal the decision. Instead, the DFA referred the matter to the National Labor
Relations Commission (NLRC); in its referral, the DFA sought a "formal vacation of the void
judgment". Failing to obtain a favorable decision from the NLRC, DFA filed a petition for certiorari in
the Supreme Court.

ISSUES

1. Whether or not ADB is correct in invoking its immunity from suit


2. Whether or not ADB has descended to the level of an ordinary party to a commercial transaction
giving rise to a waiver of its immunity from suit
3. Whether or not the DFA has the legal standing to file the petition

RULING

1. Yes. The ADB is correct in invoking its immunity from suit. The stipulations of both the Charter
and the Headquarter's Agreement establish that, except in the specified cases of borrowing and
guarantee operations, as well as the purchase, sale and underwriting of securities, the ADB
enjoys immunity from legal process of every form. The Bank's officers, on their part, enjoy
immunity in respect of all acts performed by them in their official capacity. The granting of these
immunities and privileges are treaty covenants and commitments voluntarily assumed by the
Philippine Government. Being an international organization that has been extended diplomatic
status, the ADB is independent of the municipal law.
2. No. ADB has not descended to the level of an ordinary party to a commercial transaction giving
rise to a waiver of its immunity from suit. The court ruled that the service contracts referred to by
private respondent have not been intended by the ADB for profit or gain but are official acts over
which a waiver of immunity would not attack.
3. Yes. DFA has the legal standing to file the present petition. Its function includes the
determination of persons and institutions covered by diplomatic immunities, a determination
which, when challenged, entitles it to seek relief from the court so as not to seriously impair the
conduct of the country's foreign relations. The DFA must be allowed to plead its case whenever
necessary or advisable to enable it to help to keep the credibility of the Philippine government
before the international community.
NEMESIO C. VIDAD, EXUPERIO BANTOTO, CRISTITO TEVES and LLOYD SIEGFRIED SIA,
petitioners, vs. REGIONAL TRIAL COURT OF NEGROS ORIENTAL, BRANCH 42, SOLICITOR
GENERAL’S OFFICE, MARCELO M. MONTES, GENEROSO CAPUYAN and TEOFILO GOMEZ,
respondents

G.R. No. 98084, October 18, 1993

Vitug, J.

FACTS

A group of public school teachers in Negros Oriental held a strike from their school classes from September 19-21,
1990 to demand the release of their salaries by the Department of Budget and to assail the alleged corruption in Department
of Education, Culture and Sports (DECS). DECS Regional Director Teofilo Gomez issued a return-to-work order with a
warning that those who fail to do so within 24 hours would be facing administrative charges. The order went unheeded.
Thus, administrative complaints were filed and the teachers were given five days from receipt of the complaints to submit
their answers and supporting documents.

The teachers filed with the RTC of Dumaguete a complaint for injunction, prohibition and damages, with a prayer
for preliminary injunction against the DECS officials. A temporary restraining order, prohibiting the defendants from
continuing with the administrative investigation, was granted by the court. The defendants filed their answer followed by a
motion to dismiss. On the other hand, the school teachers moved to strike out the appearance on the Office of the Solicitor
General and to declare the defendants in default. Both motions were denied by the court.

From this denial, both parties filed their respective petitions for certiorari, prohibition and mandamus under Rule 65
of the Rules of Court.

ISSUES

1. Whether or not the Office of the Solicitor General may properly represent the defendants in the Regional Trial
Court cases

RULING

1. Yes. The Office of the Solicitor General may properly represent the defendants in the Regional Trial Court cases.
In this case, the court ruled that the OSG did not act improperly in deciding to represent the DECS Officials in the
above cases. PD 487 and the Administrative Code of 1987 provide that the OSG shall represent the Government
in the SC and the CA in all criminal proceedings, represent the Government and its officers in the SC, the CA and
all other courts or tribunals in all civil actions and special proceedings in which the Government or any officer
thereof in his official capacity is a party.
JOSE G. EBRO III, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, INTERNATIONAL
CATHOLIC MIGRATION COMMISSION, JON DARRAH, ALEX DY-REYES, CARRIES WILSON, and
MARIVIC SOLIVEN, respondents

G.R. No. 110187, September 4, 1996

Mendoza, J.

FACTS

On June 24, 1985, petitioner Jose G. Ebro III was employed by private respondent International Catholic
Migration Commission (ICMC) to teach English as a Second Language and Cultural Orientation Training Program at the
refugee processing center. ICMC is a non-profit agency engaged in international humanitarian and voluntary work. It
is duly registered with the United Nations Economic and Social Council (ECOSOC) and enjoys
Consultative Status, Category II. It was one of the agencies accredited by the Philippine government to
operate the refugee processing center at Sabang, Morong, Bataan. The employment contract provides for
the salary of the petitioner and other benefits as well as the conditions on the termination of
employment.

After six months, ICMC terminated the services of the petitioner for his failure to meet the
requirements cited by the organization. On February 4, 1986, petitioner filed a complaint for illegal
dismissal, unfair labor practice, underpayment of wages, accrued leave pay, 14 th month pay, damages,
attorney’s fees and expenses for litigation against the private respondents.

After the parties had formally offered their evidence, private respondents, among other things,
invoked ICMC’s diplomatic immunity on the basis of the Memorandum of Agreement signed on July
15, 1988 between the Philippine government and ICMC. The Labor Arbiter ruled in favor of the
petitioner. However, both parties appealed to the NLRC.

NLRC ordered the case dismissed on the ground that, under the Memorandum of Agreement
between the Philippine government and ICMC, the latter was immune from suit.Petitioner moved for
reconsideration, arguing among other things, that the Memorandum of Agreement could not be given
retroactive effect and that in any case ICMC had waived its immunity by consenting to be sued.
However, petitioner’s motion was denied by the NLRC in its resolution dated March 4, 1993. Hence, the
petition.

ISSUE
1. Whether or not the Memorandum of Agreement executed on July 15, 1988 gave ICMC
immunity from suit.
RULING
1. Yes. The Memorandum of Agreement executed on July 15, 1988 gave ICMC immunity from
suit. The grant of immunity to ICMC is in virtue of the Convention on the Privileges and
Immunities of Specialized Agencies of the United Nations, adopted by the UN General
Assembly on November 21, 1947, and concurred in by the Philippine Senate on May 17, 1949.
This convention has the force and effect of law, considering that under the Constitution, the
Philippines adopts the generally accepted principles of international law as part of the law of the
land. The Memorandum of Agreement in question merely carries out Philippine governments
obligation under the Convention.
REPUBLIC OF THE PHILIPPINES, petitioner-appellee, vs. PABLO FELICIANO and
INTERMEDIATE APPELLATE COURT, respondents-appellant
G.R. No. 70853, March 12, 1987

Yap, J.

FACTS

The appeal was filed by 86 settlers of Barrio of Salvacion, representing the Republic of the
Philippines to dismiss the complaint filed by Feliciano, on the ground that the Republic of the
Philippines cannot be sued without its consent.

Prior to this appeal, respondent Pablo Feliciano filed a complaint with the Court of First Instance
against the Republic of the Philippines, represented by the Land Authority, for the recovery of
ownership and possession of a parcel of land consisting of four lots. The trial court rendered a decision
declaring Lot No. 1 to be the private property of Feliciano and the rest of the property, Lots 2, 3 and 4,
reverted to the public domain.

The trial court reopened the case due to the filing of a motion to intervene and to set aside the
decision of the trial court by 86 settlers, alleging that they had been in possession of the land for more
than 20 years under claim of ownership. The trial court ordered the settlers to present their evidence but
they did not appear at the day of presentation of evidence. Feliciano, on the other hand, presented
additional evidence. Thereafter, the case was submitted for decision and the trial court ruled in favor of
Feliciano.

The settlers immediately filed a motion for reconsideration. The case was reopened to allow
them to present their evidence. But before this motion was acted upon, Feliciano filed a motion for
execution with the Appellate Court but it was denied. The settlers filed a motion to dismiss on the
ground that the Republic of the Philippines cannot be sued without its consent and hence the action
cannot prosper. The motion was opposed by Feliciano.

ISSUE
1. Whether or not the state can be sued for recovery and possession of a parcel of land.

RULING

1. No. The state cannot be sued for recovery and possession of a parcel of land. The doctrine of
non-suability of the State has proper application in this case. The plaintiff has impleaded the
Republic of the Philippines as defendant in an action for recovery of ownership and possession
of a parcel of land, bringing the State to court just like any private person who is claimed to be
usurping a piece of property. A suit for the recovery of property is not an action in rem, but an
action in personam. It is an action directed against a specific party or parties, and any judgment
therein binds only such party or parties. The complaint filed by plaintiff, the private respondent
herein, is directed against the Republic of the Philippines, represented by the Land Authority, a
governmental agency created by Republic Act No. 3844. The complaint is clearly a suit against
the State, which under settled jurisprudence is not permitted, except upon a showing that the
State has consented to be sued, either expressly or by implication through the use of statutory
language too plain to be misinterpreted. There is no such showing in the instant case. Worse, the
complaint itself fails to allege the existence of such consent.
VETERANS MANPOWER AND PROTECTIVE SERVICES, INC., petitioner, vs. THE COURT
OF APPEALS, THE CHIEF OF PHILIPPINE CONSTABULARY and PHILIPPINE
CONSTABULARY SUPERVISORY UNIT FOR SECURITY AND INVESTIGATION
AGENCIES (PC-SUSIA), respondents.

G.R. No. 91359, September 25, 1992

Grino-Aquino, J.

FACTS

Veterans Manpower and Protective Services, Inc. (VMPSI) alleges that the provisions under
Section 4 and 17 of Republic Act No. 5487 or the Private Security Agency Law violate the 1987
Constitution against monopolies, unfair competition and combinations in restraint of trade, and tend to
favor and institutionalize the Philippine Association of Detective and Protective Agency Operators, Inc.
(PADPAO) which is monopolistic because it has an interest in more than one security agency.

Respondent VMPSI likewise questions the validity of paragraph 3, subparagraph (g) of the
Modifying Regulations on the Issuance of License to Operate and Private Security Licenses and
Specifying Regulations for the Operation of PADPAO issued by then PC Chief Lt. Gen. Fidel V.
Ramos, through Col. Sabas V. Edades, requiring that “all private security agencies/company security
forces must register as members of any PADPAO Chapter organized within the Region where their main
offices are located...”. As such membership requirement in PADPAO is compulsory in nature, it
allegedly violates legal and constitutional provisions against monopolies, unfair competition and
combinations in restraint of trade. A Memorandum of Agreement was executed by PADPAO and the PC
Chief, which fixed the minimum monthly contract rate per guard for eight (8) hours of security service
per day at P2,255.00 within Metro Manila and P2,215.00 outside of Metro Manila.

Odin Security Agency (Odin) filed a complaint with PADPAO accusing VMPSI of cut-throat
competition by undercutting its contract rate for security services rendered to the Metropolitan
Waterworks and Sewerage System (MWSS), charging said customer lower than the standard minimum
rates provided in the Memorandum of Agreement dated May 12, 1986.

PADPAO found VMPSI guilty of cut-throat competition; hence, the PADPAO Committee on
Discipline recommended the expulsion of VMPSI from PADPAO and the cancellation of its license to
operate a security agency. The PC-SUSIA affirmed the findings and likewise recommended the
cancellation of VMPSI’s license. As a result, PADPAO refused to issue a clearance/certificate of
membership to VMPSI. VMPSI made a request letter to the PC Chief to set aside or disregard the
findings of PADPAO and consider VMPSI’s application for renewal of its license, even without a
certificate of membership from PADPAO.

ISSUE

1. Whether or not VMPSI’s complaint against the PC Chief and PC-SUSIA is a suit against the
State without its consent.

RULING

1. Yes. A public official may sometimes be held liable in his personal or private capacity if he acts
in bad faith, or beyond the scope of his authority or jurisdiction, however, since the acts for
which the PC Chief and PC-SUSIA are being called to account in this case, were performed as
part of their official duties, without malice, gross negligence, or bad faith, no recovery may be
had against them in their private capacities. Furthermore, the Supreme Court agrees with the
Court of Appeals that the Memorandum of Agreement dated May 12, 1986 does not constitute an
implied consent by the State to be sued. The consent of the State to be sued must emanate from
statutory authority, hence, a legislative act, not from a mere memorandum. Without such
consent, the trial court did not acquired jurisdiction over the public respondents. Petition for
review is denied and the judgment appealed from is affirmed in toto.
CASE DIGESTS

Cases:
 DEPARTMENT OF FOREIGN AFFAIRS, petitioner, vs. NATIONAL LABOR
RELATIONS COMMISSION, HON. LABOR ARBITER NIEVES V. DE CASTRO and
JOSE C. MAGNAYI, respondents G.R. No. 113191, September 18, 1996
 NEMESIO C. VIDAD, EXUPERIO BANTOTO, CRISTITO TEVES and LLOYD SIEGFRIED SIA,
petitioners, vs. REGIONAL TRIAL COURT OF NEGROS ORIENTAL, BRANCH 42, SOLICITOR
GENERAL’S OFFICE, MARCELO M. MONTES, GENEROSO CAPUYAN and TEOFILO
GOMEZ, respondents G.R. No. 98084, October 18, 1993
 JOSE G. EBRO III, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION,
INTERNATIONAL CATHOLIC MIGRATION COMMISSION, JON DARRAH, ALEX DY-
REYES, CARRIES WILSON, and MARIVIC SOLIVEN, respondents G.R. No. 110187, September 4,
1996
 REPUBLIC OF THE PHILIPPINES, petitioner-appellee, vs. PABLO FELICIANO and
INTERMEDIATE APPELLATE COURT, respondents-appellant G.R. No. 70853, March 12, 1987
 VETERANS MANPOWER AND PROTECTIVE SERVICES, INC., petitioner, vs. THE
COURT OF APPEALS, THE CHIEF OF PHILIPPINE CONSTABULARY and
PHILIPPINE CONSTABULARY SUPERVISORY UNIT FOR SECURITY AND
INVESTIGATION AGENCIES (PC-SUSIA), respondents. G.R. No. 91359, September 25,
1992

Prepared by:
CALLEJA, MELODY M.
University of Sto. Tomas-Legazpi
College of Law 1-B
7/24/18

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