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Illuh Asaali vs Commissioner of Customs

26 SCRA 382 – Civil Law – Preliminary Title – Territoriality of


Philippine Laws
Criminal Law – Characteristics of Penal Laws – Territoriality
In 1950, customs officers intercepted 5 ships owned by Illuh
Asaali et al. Said ships were found to be from Borneo and were
on their way to a port in Tawi-tawi, Sulu. On board the ships
were rattan products and cigarettes. The customs confiscated
said items on the ground that Asaali et al do not have the
required import permits for the said goods.
Asaali questioned the legality of the seizure as he contended
that the customs officers did not intercept them within Philippine
waters but rather, they were intercepted in the high seas. Hence,
according to Asaali, Philippine import laws have no application to
the case at bar.
ISSUE: Whether or not Asaali’s contention is correct.
HELD: No. Asaali’s contention is without merit. The Revised
Penal Code leaves no doubt as to its applicability and
enforceability not only within the Philippines, its interior waters
and maritime zone, but also outside of its jurisdiction against
those committing offense while on a Philippine ship. The ships
intercepted were of Philippine registry.
Further, it has been an establish principle that a state has the
right to protect itself and its revenues, a right not limited to its
own territory but extending to the high seas. The authority of a
nation within its own territory is absolute and exclusive. The
seizure of a vessel within the range of its cannon by a foreign
force is an invasion of that territory, and is a hostile act which it is
its duty to repel. But its power to secure itself from injury may
certainly be exercised beyond the limits of its territory.
Case Title: US vs Bull, 15 Phil 7
Subject Matter: Applicability of Art. 2 of the Revised Penal Code
Facts:
On December 2, 1908, a steamship vessel engaged in the transport of animals named
Stanford commanded by H.N. Bull docked in the port of Manila, Philippines. It was found
that said vessel from Ampieng, Formosa carried 674 heads of cattle without providing
appropriate shelter and proper suitable means for securing the animals which resulted for
most of the animals to get hurt and others to have died while in transit.

This cruelty to animals is said to be contrary to Acts No. 55 and No. 275 of the Philippine
Constitution. It is however contended that cases cannot be filed because neither was it said
that the court sitting where the animals were disembarked would take jurisdiction, nor did it
say about ships not licensed under Philippine laws, like the ships involved.

Issue:
Whether or not the court had jurisdiction over an offense committed on board a foreign ship
while inside the territorial waters of the Philippines.

Held:
Yes. When the vessel comes within 3 miles from the headlines which embrace the entrance
of Manila Bay, the vessel is within territorial waters and thus, the laws of the Philippines
shall apply. A crime committed on board a Norwegian merchant vessel sailing to the
Philippines is within the jurisdiction of the courts of the Philippines if the illegal conditions
existed during the time the ship was within the territorial waters - regardless of the fact that
the same conditions existed when the ship settled from the foreign port and while it was on
the high seas,

In light of the above restriction, the defendant was found guilty and sentenced to pay a fine of
two hundred and fifty pesos with subsidiary imprisonment in case of insolvency, and to pay
the costs.
Holy See vs. Rosario G.R. 101949 (1994)
Facts of the Case:

Petitioner in this case is the Holy See (who exercises sovereignty over the Vatican City in
Rome Italy and is represented in the Philippines by the Papal Nuncio. Respondent in this case
is Hon. Edilberto Rosario in his capacity as the Presiding Judge of RTC Makati, Branch 61
and Starbright Sales Enterprises, a domestic corporation engaged in the real estate business.

The petition started from a controversy over a parcel of land. Lot 5A registered under the
name of the Holy See, is connected to Lot 5B and 5D under the name of Philippine Realty
Corporation. The land was donated by the Archdiocese of Manila to the Papal Nuncio which
represented the Holy See who exercises sovereignty over the Vatican City, Rome Italy for his
residence.

The said lots were sold to Ramon Licup who assigned his rights to respondents Starbright
Sales, Inc.

When the squatters refused to vacate the lots, a dispute arose between these two parties
because both were unsure as to whose responsibility was it to evict the squatters from the said
lots. Respondent Starbright insists that the Holy See should clear the property while Holy
See says that Starbright should do it or the earnest money will be returned.

Since Starbright refused to clear the property, Msgr. Cirilios, the agent, returned P100k
earnest money. The same lots were sold to Tropicana Properties.

Starbright filed a suit for annulment of sale, specific performance and damages against Msgr.
Cirilios, Philippine Realty Corporation and Tropicana. The Holy See moved to dismiss the
petition for lack of jurisdiction based on sovereign immunity of suit. The RTC denied the
motion on the ground that the petitioner already shed off its sovereign immunity by entering
into a business contract.

Issue:

Can the Holy See invoke sovereign immunity?

Court Ruling:

YES. The Court held that the Holy See may properly invoke sovereign immunity for its non-
suability. In Article 31 (A) of the 1961 Vienna Convention on Diplomatic Relations,
diplomatic envoy (a representative government who is sent on a special diplomatic mission)
shall be granted immunity from civil and administrative jurisdiction of the receiving state
over any real action relating to private immovable property.
The DFA certified that the Embassy of the Holy See is a duly accredited diplomatic
missionary to the Republic of the Philippines and is thus exempted from local jurisdiction
and is entitled to immunity rights of a diplomatic mission or embassy in this Court.

While the said lot was acquired and bought in the ordinary cause of real estate business, its
acquisition and disposal were not made for profit but claimed that it acquired the said
property for its mission or the Apostolic Nunciature of the Philippines.

Besides, the act of selling the land concerned is non-proprietary in nature, or is not covered
by a patent or trademark. The transfer and disposal of property are likewise clothed with a
governmental character as the petitioner did not buy and sell the land for gain but merely
because they cannot evict the said squatters in the property.
G.R. No. 108813

PUNO, J.:
The immunity from suit of the Joint United States Military Assistance Group to
the Republic of the Philippines (JUSMAG-Philippines) is the pivotal issue in the
case at bench.
JUSMAG assails the January 29, 1993 Resolution of the NATIONAL
LABOR RELATIONSCOMMISSION (public respondent), in NLRC NCR
CASE NO. 00-03-02092-92, reversing the July 30, 1991 Order of the Labor
Arbiter, and ordering the latter to assume jurisdiction over the complaint for
illegal dismissal filed by FLORENCIO SACRAMENTO (private respondent)
against petitioner.
First, the undisputed facts.
Private respondent was one of the seventy-four (74) security assistance
support personnel (SASP) working at JUSMAG-Philippines.[1] He had been
with JUSMAG from December 18, 1969, until his dismissal on April 27, 1992.
When dismissed, he held the position of Illustrator 2 and was the incumbent
President of JUSMAG PHILIPPINES-FILIPINO CIVILIAN EMPLOYEES
ASSOCIATION (JPFCEA), a labor organization duly registered with the
Department of Labor and Employment. His services were terminated allegedly
due to the abolition of his position.[2] He was also advised that he was under
administrative leave until April 27, 1992, although the same was not charged
against his leave.
On March 31, 1992, private respondent filed a complaint with the Department of
Labor and Employment on the ground that he was illegally suspended and
dismissed from service by JUSMAG.[3] He asked for his reinstatement.
JUSMAG then filed a Motion to Dismiss invoking its immunity from suit as
an agency of the United States. It further alleged lack of employer-employee
relationship and that it has no juridical personality to sue and be sued.[4]
In an Order dated July 30, 1991, Labor Arbiter Daniel C. Cueto dismissed the
subject complaint "for want of jurisdiction."[5] Private respondent
appealed[6] to the National Labor Relations Commission (public respondent),
assailing the ruling that petitioner is immune from suit for alleged violation of
our labor laws.JUSMAG filed its Opposition,[7] reiterating its immunity from suit
for its non-contractual, governmental and/or public acts.
In a Resolution, dated January 29, 1993, the NLRC[8] reversed the ruling of the
Labor Arbiter as it held thatpetitioner had lost its right not to be sued.
The resolution was predicated on two grounds: (1) the principle of estoppel --
that JUSMAG failed to refute the existence of employer-employee relationship
under the "control test"; and (2) JUSMAG has waived its right to immunity from
suit when it hired the services of private respondent on December 18, 1969.
The NLRC relied on the case of Harry Lyons vs. United States of
America,[9] where the "United States Government (was considered to have)
waived its immunity from suit by entering into (a) contract of stevedoring
services, and thus, it submitted itself to the jurisdiction of the local courts."
Accordingly, the case was remanded to the labor arbiter for reception of evidence
as to the issue on illegal dismissal.
Hence, this petition. JUSMAG contends:
I
THE PUBLIC RESPONDENT COMMITTED GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION ?
A. IN REVERSING THE DECISION OF THE LABOR ARBITER AND IN NOT
AFFIRMING THE DISMISSAL OF THE COMPLAINT IT BEING A SUIT
AGAINST THE UNITED STATES OF AMERICA WHICH HAD NOT GIVEN ITS
CONSENT TO BE SUED; AND
B. IN FINDING WAIVER BY JUSMAG OF IMMUNITY FROM SUIT;
II
THE PUBLIC RESPONDENT COMMITTED GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION -
A. WHEN IT FOUND AN EMPLOYER-EMPLOYEE RELATIONSHIP BETWEEN
JUSMAG AND PRIVATE RESPONDENT; AND
B. WHEN IT CONSIDERED JUSMAG ESTOPPED FROM DENYING THAT
PRIVATE RESPONDENT IS ITS EMPLOYEE FOR FAILURE TO PRESENT
PROOF TO THE CONTRARY.
We find the petition impressed with merit.
It is meet to discuss the historical background of the JUSMAG to determine its
immunity from suit.
JUSMAG was created pursuant to the Military Assistance Agreement[10] dated
March 21, 1947, between the Government of the Republic of the Philippines and
the Government of the United States of America. As agreed upon, JUSMAG shall
consist of Air, Naval and Army group, and its primary task was to advise and
assist the Philippines, on air force, army and naval matters.[11]
Article 14 of the 1947 Agreement provides, inter alia, that "the cost of all services
required by the Group, including compensation of locally employed
interpreters, clerks, laborers, and other personnel,except personal
servants, shall be borne by the Republic of the Philippines."
This set-up was to change in 1991. In Note No. 22, addressed to the Department
of Foreign Affairs (DFA) of the Philippines, dated January 23, 1991, the Unites
States Government, thru its Embassy, manifested its preparedness "to provide
funds to cover the salaries of security assistance support
personnel and security guards, the rent of JUSMAG occupied buildings and
housing, and the cost of utilities.[12] This offer was accepted by our Government,
thru the DFA, in Note No. 911725, dated April 18, 1991.[13]
Consequently, a Memorandum of Agreement[14] was forged between the
Armed Forces of the Philippines and JUSMAG-Philippines, thru General
Lisandro C. Abadia and U.S. Brigadier General Robert G. Sausser. The Agreement
delineated the terms of the assistance-in-kind of JUSMAG for 1991, the relevant
parts of which read:
"a. The term salaries as used in this agreement include those for the security
guards currently contracted between JUSMAG and A' Prime Security Services
Inc., and the Security Assistance Support Personnel (SASP). x x x.
"b. The term Security Assistance Support Personnel (SASP) does not include
active duty uniformed members of the Armed Forces of the Philippines
performing duty at JUSMAG.
"c. It is understood that SASP are employees of the Armed Forces of
the Philippines (AFP).Therefore, the AFP agrees to appoint, for service
with JUSMAG, no more than 74 personnelto designated positions with
JUSMAG.
"d. SASP are under the total operational control of the Chief,
JUSMAG-Philippines. The term "Operational Control" includes, but is not
limited to, all personnel administrative actions, such as: hiring
recommendations; firing recommendations; position classification; discipline;
nomination and approval of incentive awards; and payroll computation.
Personnel administration will be guided by Annex E of JUSMAG-Philippines
Memo 10-2. For the period of time that there is an exceptional funding
agreement between the government of the Philippines and the
United States Government (USG), JUSMAG will pay the total payroll
costs for the SASP employees. Payroll costs include only regular salary;
approved overtime; costs of living allowance; medical insurance; regular
contributions to the Philippine Society Security System, PAG-IBIG Fund and
Personnel Economic Relief Allowance (PERA); and the thirteenth-month bonus.
Payroll costs do not include gifts or other bonus payments in addition to those
previously defined above. Entitlements not considered payroll costs under this
agreement will be funded and paid by the AFP.
"e. All SASP employed as of July 1, 1990 will continue their service with
JUSMAG at their current rate of pay and benefits up to 30 June 1991,
with an annual renewal of employment thereafter subject to renewal of
their appointment with the AFP (employees and rates of pay are indicated at
Enclosure 3). No promotion or transfer internal to JUSMAG of the listed
personnel will result in the reduction of their pay and benefits.
"f. All SASP will, after proper classification, be paid salaries and benefits at
established AFP civilian rates. Rules for computation of pay and allowances will
be made available to the Comptroller, JUSMAG, by the Comptroller, GHQ, AFP.
Additionally, any legally mandated changes in salary levels or methods of
computation shall be transmitted within 48 hours of receipt by Comptroller,
GHQ to Comptroller, JUSMAG.
"g. The AFP agrees not to terminate SASP without 60 days prior written notice to
Chief, JUSMAG-Philippines. Any termination of these personnel thought to be
necessary because of budgetary restrictions or manpower ceiling will be subject
to consultations between AFP and JUSMAG to ensure that JUSMAG's mission of
dedicated support to the AFP will not be degraded or harmed in any way.
"h. The AFP agrees to assume the severance pay/retirement pay
liability for all appointed SASP. (Enclosure 3 lists the severance pay
liability date for current SASP). Any termination of services, other than voluntary
resignations or termination for cause, will result in immediate payments of AFP
of all termination pay to the entitled employee. Vouchers for
severance/retirement pay and accrued bonuses and annual leave will be
presented to the Comptroller, GHQ, AFP, not later than 14 calendar days prior to
required date of payment.
"i. All SASP listed in Enclosure 3 will continue to participate in the Philippine
Social Security System.
A year later, or in 1992, the United States Embassy sent another note of similar
import to the Department of Foreign Affairs (No. 227, dated April 8, 1992),
extending the funding agreement for the salaries of SASP and security guards
until December 31, 1992.
From the foregoing, it is apparent that when JUSMAG took the services of private
respondent, it was performing a governmental function on behalf of the United
States pursuant to the Military Assistance Agreement dated March 21, 1947.
Hence, we agree with petitioner that the suit is, in effect, one against the United
States Government, albeit it was not impleaded in the complaint. Considering
that the United States has not waived or consented to the suit, the complaint
against JUSMAG cannot not prosper.
In this jurisdiction, we recognize and adopt the generally accepted principles of
international law as part of the law of the land.[15] Immunity of State from
suit is one of these universally recognized principles. In international law,
"immunity" is commonly understood as the exemption of the state and its organs
from the judicial jurisdiction of another state.[16] This is anchored on the principle
of the sovereign equality of states under which one state cannot assert
jurisdiction over another in violation of the maxim par in parem non habet
imperium (an equal has no power over an equal).[17]
Under the traditional rule of State immunity, a state cannot be sued in the courts
of another State, without its consent or waiver. However, in Santos, et al., vs.
Santos, et al.,[18] we recognized an exception to the doctrine of immunity from
suit by a state, thus:
"x x x. Nevertheless, if, where and when the state or its government enters into a
contract, through its officers or agents, in furtherance of a legitimate aim and
purpose and pursuant to constitutional legislative authority, whereby mutual or
reciprocal benefits accrue and rights and obligations arise therefrom, and if the
law granting the authority to enter into such contract does not provide for or
name the officer against whom action may be brought in the event of a breach
thereof, the state itself may be sued, even without its consent, because
by entering into a contract, the sovereign state has descended to the
level of the citizen and its consent to be sued is implied from the very
act of entering into such contract. x x x." (emphasis ours)
It was in this light that the state immunity issue in Harry Lyons, Inc., vs.
Unites States of America[19]was decided.
In the case of Harry Lyons, Inc., the petitioner entered into a contract with the
United States Government for stevedoring services at the U.S. Naval Base, Subic
Bay, Philippines. It then sought to collect from the USgovernment sums of money
arising from the contract. One of the issues posed in the case was whether or not
the defunct Court of First Instance had jurisdiction over the defendant United
States, a sovereign state which cannot be sued without its consent. This Court
upheld the contention of Harry Lyons, Inc., that "when a sovereign state enters
into a contract with a private person, the state can be sued upon the theory that it
has descended to the level of an individual from which it can be implied that it
has given its consent to be sued under the contract."
The doctrine of state immunity from suit has undergone further metamorphosis.
The view evolved that the existence of a contract does not, per se, mean that
sovereign states may, at all times, be sued in local courts. The complexity of
relationships between sovereign states, brought about by their increasing
commercial activities, mothered a more restrictive application of the
doctrine.[20] Thus, in United States of America vs. Ruiz,[21] we clarified that
our pronouncement in Harry Lyons, supra, with respect to the waiver of State
immunity, was obiter and "has no value as an imperative authority."
As it stands now, the application of the doctrine of immunity from suit has
been restricted to sovereign orgovernmental activities (jure
imperii).[22] The mantle of state immunity cannot be extended
tocommercial, private and proprietary acts (jure gestionis). As aptly
stated by this Court (En banc) inUS vs. Ruiz, supra:
"The restrictive application of State immunity is proper when the proceedings
arise out of commercial transactions of the foreign sovereign, its commercial
activities or economic affairs. Stated differently, a State may be said to have
descended to the level of an individual and thus can be deemed to have tacitly
given its consent to be sued only when it enters into business contracts. It
does not apply where the contract relates to the exercise of its sovereign
functions."(emphasis ours)
We held further, that the application of the doctrine of state immunity depends
on the legal nature of the act.Ergo, since a governmental
function was involved -- the transaction dealt with the improvement of
thewharves in the naval installation at Subic Bay -- it was held that the United
States was not deemed to have waived its immunity from suit.
Then came the case of United States vs. Hon. Rodrigo, et al.[23] In said
case, Genove was employed as a cook in the Main Club located at U.S. Air
Force Recreation Center, John Hay Air Station. He was dismissed from service
after he was found to have polluted the stock of soup with urine. Genove
countered with a complaint for damages. Apparently, the restaurant services
offered at the John Hay Air Station partake of the nature of a business enterprise
undertaken by the United States government in its proprietary capacity. The
Court then noted that the restaurant is well known and available to the general
public, thus, the services are operated for profit, as a commercial and not a
governmental activity. Speaking through Associate Justice Isagani Cruz, the
Court (En Banc) said:
"The consequence of this finding is that the petitioners cannot invoke the
doctrine of state immunity to justify the dismissal of the damage suit against
them by Genove. Such defense will not prosper even if it be established that they
were acting as agents of the United States when they investigated and later
dismissed Genove. For that matter, not even the United States government itself
can claim such immunity. The reason is that by entering into the employment
contract with Genove in the discharge of itsproprietary functions,it
impliedly divested itself of its sovereign immunity from suit." (emphasis ours)
Conversely, if the contract was entered into in the discharge of
its governmental functions, the sovereign state cannot be deemed to have
waived its immunity from suit.[24] Such is the case at bench. Prescinding from this
premise, we need not determine whether JUSMAG controls the employment
conditions of the private respondent.
We also hold that there appears to be no basis for public respondent to rule that
JUSMAG is estoppel from denying the existence of employer-employee
relationship with private respondent. On the contrary, in its Opposition before
the public respondent, JUSMAG consistently contended that the (74) SASP,
including private respondent, working in JUSMAG, are employees of the Armed
Forces of the Philippines. This can be gleaned from: (1) the Military Assistance
Agreement, supra, (2) the exchange of notes between our Government, thru
Department of Foreign Affairs, and the Unites States, thru the US Embassy to the
Philippines, and (3) the Agreement on May 21, 1991, supra, between the Armed
Forces of the Philippines and JUSMAG.
We symphatize with the plight of private respondent who had served JUSMAG
for more than twenty (20) years. Considering his length of service with JUSMAG,
he deserves a more compassionate treatment. Unfortunately, JUSMAG is beyond
the jurisdiction of this Court. Nonetheless, the Executive branch, through the
Department of Foreign Affairs and the Armed Forces of the Philippines, can take
the cudgel for private respondent and the other SASP working for JUSMAG,
pursuant to the aforestated Military Assistance Agreement.
IN VIEW OF THE FOREGOING, the petition for certiorari is GRANTED.
Accordingly, the impugned Resolution dated January 29,1993 of the National
Labor Relations Commission is REVERSED and SET ASIDE. No costs.
SO ORDERED.
Narvasa, C.J., (Chairman), Regalado, and Mendoza, JJ., concur.
LIANG VS PEOPLE OF THE PHILIPPINES GR no. 125865 January 28, 2000

Petitioner: Jeffrey Liang


Respondent: People of the Philippines

FACTS:
Petitioner is an economist working with the Asian Development Bank (ADB). Sometime
in 1994, for allegedly uttering defamatory words against fellow ADB worker Joyce
Cabal, he was charged before the MeTC of Mandaluyong City with two counts of oral
defamation. Petitioner was arrested by virtue of a warrant issued by the MeTC. After
fixing petitioner’s bail, the MeTC released him to the custody of the Security Officer of
ADB. The next day, the MeTC judge received an “office of protocol” from the DFA
stating that petitioner is covered by immunity from legal process under section 45 of the
Agreement between the ADB and the Philippine Government regarding the Headquarters
of the ADB in the country. Based on the said protocol communication that petitioner is
immune from suit, the MeTC judge without notice to the prosecution dismissed the
criminal cases. The latter filed a motion for reconsideration which was opposed by the
DFA. When its motion was denied, the prosecution filed a petition for certiorari and
mandamus with the RTC of Pasig City which set aside the MeTC rulings and ordered the
latter court to enforce the warrant of arrest it earlier issued. After the motion for
reconsideration was denied, the petitioner elevated the case to the SC via a petition for
review arguing that he is covered by immunity under the Agreement and that no
preliminary investigation was held before the criminal case.

ISSUES:
(1) Whether or not the petitioner’s case is covered with immunity from legal process with
regard to Section 45 of the Agreement between the ADB and the Philippine Gov’t.
(2) Whether or not the conduct of preliminary investigation was imperative.

HELD:
(1) NO. The petitioner’s case is not covered by the immunity. Courts cannot blindly adhere
to the communication from the DFA that the petitioner is covered by any immunity. It
has no binding effect in courts. The court needs to protect the right to due process not
only of the accused but also of the prosecution. Secondly, the immunity under Section 45
of the Agreement is not absolute, but subject to the exception that the acts must be done
in “official capacity”. Hence, slandering a person could not possibly be covered by the
immunity agreement because our laws do not allow the commission of a crime, such as
defamation, in the name of official duty.
(2) NO. Preliminary Investigation is not a matter of right in cases cognizable by the MeTC
such as this case. Being purely a statutory right, preliminary investigation may be
invoked only when specifically granted by law. The rule on criminal procedure is clear
that no preliminary investigation is required in cases falling within the jurisdiction of the
MeTC.

Hence, SC denied the petition.