Officeco to present countervailing Facts: On 7 April 1986, in connectionevidence to support its request. with criminal proceedings initiated in the Philippines to locate, sequesterInstead of complying with the PCGG for it to submit and seek restitution of alleged ill-requirement countervailing evidence, on 12 gotten wealth amassed by the Marcoses and other accused from theSeptember 1994, Officeco filed the Philippine Government, the Office ofcomplaint, which was docketed as Civil the Solicitor General (OSG) wrote the Case No. 0164 of the Sandiganbayan. Federal Office for Police Matters inThe complaint prayed for the PCGG Berne, Switzerland, requestingand the OSG to officially advise the assistance for the latter office to: (a) Swiss government to exclude from the ascertain and provide the OSG withfreeze or sequestration order the information as to where and in whichaccount of Officeco with BTAG and to release the said cantons the ill-gotten fortune of the unconditionally account to Officeco. SB accordingly Marcoses and other accused are located, the names of the depositors moved to dismiss the case but was and the banks and the amountsdenied Thus this case where PCGG involved; and (b) take necessary alleges the that the case shoukd be precautionary measures, such as dismissed on the following grounds: sequestration, to freeze the assets in order to preserve their existing value (1) res judicata; (2) lack of jurisdiction and prevent any further transfer on account of the act of state thereof (herein referred to as the IMAC doctrine; (3) lack of cause of action for being premature for failure to request. On 29 May 1986, the Office ofexhaust administrative remedies; and the District Attorney in Zurich,(4) lack of cause of action for the pursuant to the OSGs request, issuedreason that mandamus does not lie to an Order directing the Swiss Banks incompel performance of a discretionary Zurich to freeze the accounts of theact, there being no showing of grave accused in PCGG I.S. No. 1 and in theabuse of discretion on the part of List of Companies and Foundations.petitioners. In compliance with said Order, Bankers Trust A.G. (BTAG) of Zurich froze theIssue: Whether or not there is a lack of accounts of Officeco Holdings, N.V. jurisdiction in the account of the (Officeco). Officeco appealed the Order ofdoctrine of the "act of state." the District Attorney to the Attorney General of the Canton of Zurich. TheRuling: Every sovereign state is bound Attorney General affirmed the Order of to respect the independence of every the District Attorney. Officeco further appealed to the Swiss Federal Court, other state, and the courts of one which likewise dismissed the appeal country will not sit in judgment on the acts of the government of another, on 31 May 1989. Thereafter, in late 1992,done within its territory. Redress of Officeco made representations withgrievances by reason of such acts the OSG and the PCGG for them tomust be obtained through the means officially advise the Swiss Federalopen to be availed of by sovereign
Gunigundo vs. SB
powers as between themselves.
considered, the act of state doctrine It is petitioners contention thatfinds no application in this case and the Sandiganbayan could not grant orpetitioners resort to it is utterly deny the prayers in [Officecos]mislaid. complaint without first examining and scrutinizing the freeze order of theWHEREFORE, premises considered, Swiss officials in the light of the the instant petition is DISMISSED. evidence, which however is in the possession of said officials and that it would therefore sit in judgment on the acts of the government of another country. We disagree. The parameters of the use of the act of state doctrine were clarified Municher vs. CA in Banco Nacional de Cuba v. Sabbatino. There, the U.S. SupremeFacts: Court held that international law does Khosrow Minucher is the Labor not require the application of this Attach of the Embassy of Iran in the doctrine nor does it forbid thePhil. Arthur Scalzo, then connected application of the rule even if it is with the American Embassy in Manila, claimed that the act of state inwas introduced to him by Jose Inigo question violated international law.(an informer belonging to the military Moreover, due to the doctrinesintelligence community). peculiar nation-to-nation character, in Accdg. to Inigo, Scalzo was practice the usual method for an interested in buying Iranian products individual to seek relief is to exhaustlike caviar and carpets. Minucher local remedies and then repair to thecomplained to Scalzo about his executive authorities of his own state problems with the American Embassy to persuade them to champion hisregarding the expired visas of his wife, claim in diplomacy or before an Abbas Torabian. Offering help, Scalzo international tribunal. gave Minucher a calling card showing Even assuming thatthat the former is an agent of the Drug international law requires theEnforcement Administration (DEA) application of the act of state doctrine,assigned to the American Embassy in it bears stressing that theManila. As a result, Scalzo expressed Sandiganbayan will not examine andhis intent to buy caviar and further review the freeze orders of the promised to arrange the renewal of concerned Swiss officials in Civil Casethe visas. No. 0164. The Sandiganbayan will not Scalzo went to Minucher's require the Swiss officials to submit toresidence and asked to be entrusted its adjudication nor will it settle awith Persian silk carpets, for which he dispute involving said officials. In fact, had a buyer. The next day, Scalzo as prayed for in the complaint, thereturned and claimed that he had Sandiganbayan will only review andalready made arrangements with his examine the propriety of maintainingcontacts concerning the visas and PCGGs position with respect toasked for $2,000. Officecos accounts with BTAG for the It turned out that Scalzo purpose of further determining theprepared a plan to frame-up a propriety of issuing a writ against the Minucher and wife for alleged heroin PCGG and the OSG. Everythingtrafficking. Both were falsely arrested
and charged with violations of theRuling:
Dangerous Drugs Act. No. Jurisdiction over the person Minucher prays for actual andof the defendant is acquired by either compensatory damages. However,voluntary appearance or by the counsel for Scalzo filed a motion toservice of summons. In the case, quash summons alleging that theScalzo's counsel filed a motion to defendant is beyond the processes of quash, which, in effect already waived the Philippine court for the action forany defect in the service of summons damages is a personal action and that by earlier asking an extension to file Scalzo is outside the Philippines. time to file an Answer and filing an TC denied the motion. CAAnswer with Counterclaim. dismissed the motion for lack of merit The complaint for damages on the basis of the erroneouscannot be dismissed. Said complaint assumption that because of thecontains sufficient allegations which Diplomatic Note (advising the DFA thatindicate that Scalzo committed Scalzo is a member of the USimputed acts in his personal capacity diplomatic mission investigatingand outside the scope of his official Minucher for drug trafficking), Scalzoduties and functions. The TC gave is clothed with diplomatic immunity. credit to Minucher's theory that he was a victim of frame-up hence, there Issue: is a prima facie showing that Scalzo Whether or not a complaint forcould be held personally liable for his damages be dismissed in the soleacts. Further, Scalzo did not come basis of a statement complained in a forward with evidence to, prove that Diplomatic Note. he acted in his official capacity.