Separation of Powers REPUBLIC v.

GINGOYON (2005) Facts: NAIA 3, a project between the Government and the Philippine International Air Terminals Co., Inc (PIATCO) was nullified. Planning to put NAIA 3 facilities into immediate operation, the Government, through expropriation filed a petition to be entitled of a writ of possession contending that a mere deposit of the assessed value of the property with an authorized government depository is enough for the entitlement to said writ (Rule 67 of the Rules of Court). However, respondents avers that before an entitlement of the writ of possession is issued, direct payment of just compensation must be made to the builders of the facilities, citing RA No. 8974 and a related jurisprudence (2004 Resolution Issue: Whether the RA 8974 can amend the Rules of Court Dissenting Opinion R.A. No. 8974 cannot amend Rule 67 Article VIII, sec. 5 of the 1987 Constitution gave the Supreme Court the following powers: (5) Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice, and procedure in all courts, the admission to the practice of law, the Integrated Bar, and legal assistance to the underprivileged. Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases, shall be uniform for all courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules of procedure of special courts and quasi-judicial bodies shall remain effective unless disapproved by the Supreme Court. In Echegaray v. Secretary of Justice we emphasized that the 1987 Constitution strengthened the rule making power of this Court, thus: The 1987 Constitution molded an even stronger and more independent judiciary. Among others, it enhanced the rule making power of this Court. The rule making power of this Court was expanded. This Court for the first time was given the power to promulgate rules concerning the protection and enforcement of constitutional rights. But most importantly, the 1987 Constitution took away the power of Congress to repeal, alter, or supplement rules concerning pleading, practice and procedure. In fine, the power to promulgate rules of pleading, practice and procedure is no longer shared by this Court with Congress Undoubtedly, Rule 67 is the rule this Court promulgated to govern the proceedings in expropriation cases filed in court. It has been the undeviating rule for quite a length of time. Following Article VIII, section 5(5) of the 1987 Constitution and the Echegaray jurisprudence, Rule 67 cannot be repealed or amended by Congress. This prohibition against non- repeal or non-amendment refers to any part of Rule 67 for Rule 67 is pure procedural law. Consequently, the Court should not chop Rule 67 into pieces and hold that some can be changed by Congress but others can be changed. The stance will dilute the rule making power of this Court which cannot be allowed for it will weaken its institutional independence.

State Immunity China National Machinery and Equipment Corp. v. Santamaria (2012) Facts: CNMEG and NorthRail entered into Memorandum of Understanding for the feasibility study on apossible railway line from Manila to La Union ( NorthRail Project). CNMEG and NorthRail executed a Contract of Agreement for the construction of the Phase 1 of Northrail. The respondents filed a Complaint for Annulment of Contract and Injunction in the RTC of Makati. CNMEG filed a motion to dismiss. CNMEG filed a motion to dismiss arguing that the Trial Court did not have jurisdiction over its person as it was an agent of the Chinese government making it immune from suit, and the subject matter as the Northrail was product of an executive agreement. Issue: Whether CNMEG is entitled to immunity precluding it from being sued before a local court Held: CNMEG claims immunity on the ground that the Aug 30 MOU on the financing of the Northrail Project was signed by the Philippine and Chinese governments, and its assignment as the Primary Contractor meant that it was bound to perform a governmental function on behalf of China. However, the Loan Agreement, which originated from the same Aug 30 MOU, belies this reasoning, viz: Article 11. xxx (j) Commercial Activity The execution and delivery of this Agreement by the Borrower constitute, and the Borrowers performance of and compliance with its obligations under this Agreement will constitute, private and commercial acts done and performed for commercial purposes under the laws of the Republic of the Philippines and neither the Borrower nor any of its assets is entitled to any immunity or privilege (sovereign or otherwise) from suit, execution or any other legal process with respect to its obligations under this Agreement, as the case may be, in any jurisdiction. Notwithstanding the foregoing, the Borrower does not waive any immunity with respect of its assets which are (i) used by a diplomatic or consular mission of the Borrower and (ii) assets of a military character and under control of a military authority or defense agency and (iii) located in the Philippines and dedicated to public or governmental use (as distinguished from patrimonial assets or assets dedicated to commercial use). (Emphasis supplied.) (k) Proceedings to Enforce Agreement In any proceeding in the Republic of the Philippines to enforce this Agreement, the choice of the laws of the Peoples Republic of China as the governing law hereof will be recognized and such law will be applied. The waiver of immunity by the Borrower, the irrevocable submissions of the Borrower to the non-exclusive jurisdiction of the courts of the Peoples Republic of China and the appointment of the Borrowers Chinese Process Agent is legal, valid, binding and enforceable and any judgment obtained in the Peoples Republic of China will be if introduced, evidence for enforcement in any proceedings against the Borrower and its assets in the Republic of the Philippines provided that (a) the court rendering judgment had jurisdiction over the subject matter of the action in accordance with its jurisdictional rules, (b) the Republic had notice of the proceedings, (c) the judgment of the court was not obtained through collusion or fraud, and (d) such judgment was not based on a clear mistake of fact or law. Further, the Loan Agreement likewise contains this express waiver of immunity: 15.5 Waiver of Immunity The Borrower irrevocably and unconditionally waives, any immunity to which it or its property may at any time be or become entitled, whether characterized as sovereign immunity or otherwise, from any suit, judgment, service of process upon it or any agent, execution on judgment, set-off, attachment prior to judgment, attachment in aid of execution to which it or its assets may be entitled in any legal action or proceedings with respect to this Agreement or any of the transactions contemplated hereby or hereunder. Notwithstanding the foregoing, the Borrower does not waive any immunity in respect of its assets which are (i) used by a diplomatic or consular mission of the Borrower, (ii) assets of a military character and under control of a military authority or defense agency and (iii) located in the Philippines and dedicated to a public or governmental use (as distinguished from patrimonial assets or assets dedicated to commercial use).

Thus, despite petitioners claim that th e EXIM Bank extended financial assistance to Northrail because the bank was mandated by the Chinese government, and not because of any motivation to do business in the Philippines,it is clear from the foregoing provisions that the Northrail Project was a purely commercial transaction. Admittedly, the Loan Agreement was entered into between EXIM Bank and the Philippine government, while the Contract Agreement was between Northrail and CNMEG. Although the Contract Agreement is silent on the classification of the legal nature of the transaction, the foregoing provisions of the Loan Agreement, which is an inextricable part of the entire undertaking, nonetheless reveal the intention of the parties to the Northrail Project to classify the whole venture as commercial or proprietary in character. Thus, piecing together the content and tenor of the Contract Agreement, the Memorandum of Understanding dated 14 September 2002, Amb. Wangs letter dated 1 October 2003, and the Loan Agreement would reveal the desire of CNMEG to construct the Luzon Railways in pursuit of a purely commercial activity performed in the ordinary course of its business. DEPARTMENT OF EDUCATION, DIVISION OF ALBAY v. ONATE (2007) Facts: Onate Spouses owns the disputed lot. In 1940 Bagumbayan Elementary School was constructed on a portion of the lot. The Dep Ed developed and built various school buildings and facilities on the lot. The grand child of the spouses filed a case in the RTC of Legaspi for reconstitution proceedings. The Dep Ed responded that the Municpality of Daraga donated the disputed lot. Issue: Whether CA erred in ruling that DEPED may be sued in violation of the States immunity from suit Held: The threshold issue is whether petitioner DECS can be sued in Civil Case No. 8715 without its consent. A supplementary issue is whether petitioner DECS can be sued independently of the Republic of the Philippines. We rule that petitioner DECS can be sued without its permission as a result of its being privy to the Deed of Donation executed by the Municipality of Daraga, Albay over the disputed property. When it voluntarily gave its consent to the donation, any dispute that may arise from it would necessarily bring petitioner DECS down to the level of an ordinary citizen of the State vulnerable to a suit by an interested or affected party. It has shed off its mantle of immunity and relinquished and forfeited its armor of non-suability of the State. The auxiliary issue of non-joinder of the Republic of the Philippines is likewise resolved in the negative. While it is true that petitioner is an unincorporated government agency, and as such technically requires the Republic of the Philippines to be impleaded in any suit against the former, nonetheless, considering our resolution of the main issue below, this issue is deemed mooted. Besides, at this point, we deem it best to lift such procedural technicality in order to finally resolve the long litigation this case has undergone. Moreover, even if we give due course to said issue, we will arrive at the same ruling. The Republic of the Philippines need not be impleaded as a party-defendant in Civil Case No. 8715 considering that it impliedly gave its approval to the involvement of petitioner DECS in the Deed of Donation. In a situation involving a contract between a government department and a third party, the Republic of the Philippines need not be impleaded as a party to a suit resulting from said contract as it is assumed that the authority granted to such department to enter into such contract carries with it the full responsibility and authority to sue and be sued in its name.