SSS Employees Association (PAFLU) v Soriano

Doctrine: Agencies exercising propriety functions are under the Corporation law
where employees can demand terms and conditions of employment as that of a
Corporation.
Facts:
SSS Employees Association (PAFLU) on Oct 20, 1960 demanded terms and
conditions of employment including request for recognition as a collegtive
bargaining agent.
The commission filed on Dec 15, 1960 before the Court of First Instance of
Manila a petition for declaratory relief asking that the SSS be declared as a
governmental agency performing governmental function so that its
employees may be prohibited from joining labor uniums and from compelling
petitioners to enter into a collective bargaining agreement.
The union answered the petition with a counter-prayer that SSS be declared
an angency of the government exercising proprietary functions.
Union filed before the Court of Industrial Relations for unfair labor practice
agains the Commission pursuant to Section 14, paragraph (b) of RA 875.
Issue: WON SSS is a government agency exercising proprietary functions.
Held: Yes, SSS is a government agency exercising proprietary functions
Ratio:

Only entities through which functions as that of the sovereignity of the

government could be considered part of the Government of the Republic of
the Philippines. There are where political authority is made effective and are
called municipal corporations. They do not include government entities which
are given corporate personality which are governed by the Corporation Law.
Their powers, duties and liabilities are determined by their corporate
charters.
Citing Bacani v National Coconut Corp.: The National Coconut Corporation
was declared to be an entity not exercising governmental functions because:
1. It is not a municipal corporation
2. Its powers are not exercised as an attribute of sovereignty
3. It was given separate personality and power separand and distinct
from the government
4. It may sue and be sued as any other private corporation
To apply to SSS:
1. Sss is not a municipal corporation. It is an agency to assist the civil
government of the country, it regulates and adminiter the local and
internal affairs of the city, town or district. It does not regulate or
administer the local affairs of a town, city or district
2. SSS has a personality of its own, it can sue and be sued. [4(k) RA 1161)
3. It is a ministrant: those that advance the general interest of the society
and is an optional function of the government.

4. Though it is created as an exercise of police power, it is not necessarily

serve a government function; the government can exist without it
5. Most of its functions are proprietary
SSS was compared to GSIS
1. Both has the power to adopt, amend and rescind rules and regulations
to carry out the provisions and purposes of the Act
2. Both has the power to enter into agreements for services and aids
3. Both has the power to establish branches wheneer and wherever it
may be necessary
4. Both has the power to adopt a budget, acquire property, real or
personal, for the attainment of its purpose.
5. Both can be sued and sue in court
6. Both are required to invest its funds
7. Appointment to both are through the same process
8. Both their funds are special
9. SSS was patterned to GSIS whih have a priprietary function.