CONSENT OF THE STATE

A. Express Consent
a. Authority providing consent
Republic v. Feliciano

The failure of the petitioner to assert the defense of immunity from suit when the case was tried
before the court a quo, as alleged by private respondent, is not fatal. It is now settled that such
defense "may be invoked by the courts sua sponte at any stage of the proceedings." 4

Private respondent contends that the consent of petitioner may be read from the Proclamation itself,
when it established the reservation " subject to private rights, if any there be. " We do not agree. No
such consent can be drawn from the language of the Proclamation. The exclusion of existing private
rights from the reservation established by Proclamation No. 90 can not be construed as a waiver of
the immunity of the State from suit. Waiver of immunity, being a derogation of sovereignty, will not
be inferred lightly. but must be construed in strictissimi juris. 5 Moreover, the Proclamation is not a
legislative act. The consent of the State to be sued must emanate from statutory authority. Waiver of
State immunity can only be made by an act of the legislative body.

Neither is there merit in respondent's submission, which the respondent appellate

court sustained, on the basis of our decision in the Begosa case, 6 that the present
action is not a suit against the State within the rule of State immunity from suit,
because plaintiff does not seek to divest the Government of any of its lands or its
funds. It is contended that the complaint involves land not owned by the State, but
private land belonging to the plaintiff, hence the Government is not being divested of
any of its properties. There is some sophistry involved in this argument, since the
character of the land sought to be recovered still remains to be established, and the
plaintiff's action is directed against the State precisely to compel the latter to litigate
the ownership and possession of the property. In other words, the plaintiff is out to
establish that he is the owner of the land in question based, incidentally, on an
informacion posesoria of dubious value, and he seeks to establish his claim of
ownership by suing the Republic of the Philippines in an action in personam

b. Money Claims

ARISING FROM CONTRACT

ACT NO. 3083 - AN ACT DEFINING THE CONDITIONS UNDER WHICH THE GOVERNMENT
OF THE PHILIPPINE ISLANDS MAY BE SUED

Section 1. Complaint against Government. Subject to the provisions of this Act, the
Government of the Philippine Islands hereby consents and submits to be sued upon any
moneyed claim involving liability arising from contract, expressed or implied, which
could serve as a basis of civil action between private parties.

Sec. 2. A person desiring to avail himself of the privilege herein conferred must show
that he has presented his claim to the Insular Auditor 1 and that the latter did not
decide the same within two months from the date of its presentation.
Sec. 3. Venue. Original actions brought pursuant to the authority conferred in this Act
shall be instituted in the Court of First Instance of the City of Manila or of the province
were the claimant resides, at the option of the latter, upon which court exclusive
original jurisdiction is hereby conferred to hear and determine such actions.

Sec. 4. Actions instituted as aforesaid shall be governed by the same rules of procedure,
both original and appellate, as if the litigants were private parties.

Sec. 5. When the Government of the Philippine Island is plaintiff in an action instituted
in any court of original jurisdiction, the defendant shall have the right to assert therein,
by way of set-off or counterclaim in a similar action between private parties.

Sec. 6. Process in actions brought against the Government of the Philippine Islands
pursuant to the authority granted in this Act shall be served upon the Attorney-General
2 whose duty it shall be to appear and make defense, either himself or through
delegates.

Sec. 7. Execution. No execution shall issue upon any judgment rendered by any court
against the Government of the Philippine Islands under the provisions of this Act; but a
copy thereof duly certified by the clerk of the Court in which judgment is rendered shall
be transmitted by such clerk to the Governor-General, 3 within five days after the same
becomes final.

Sec. 8. Transmittal of Decision. The Governor-General, 4 at the commencement of

each regular session of the Legislature, 5 shall transmit to that body for appropriate
action all decisions so received by him, and if said body determine that payment should
be made, it shall appropriate the sum which the Government has been sentenced to
pay, including the same in the appropriations for the ensuing year.

Sec. 9. This Act shall take effect on its approval.

Approved: March 16, 1923

Commonwealth Act No. 327.An Act fixing the time within which the Auditor General
shall render his decisions and prescribing the manner of appeal therefrom.

Be it enacted by the National Assembly of the Philippines:

SECTION 1. In all cases involving the settlement of accounts or claims, other than those
of accountable officers, the Auditor General shall act and decide the same within sixty
days, exclusive of Sundays and holidays, after their presentation. If said accounts or
claims need reference to other persons, office or offices, or to a party interested, the
period aforesaid shall be counted from the time the last comment necessary to a proper
decision is received by him. With respect to the accounts of accountable officers, the
 Auditor General shall act on the same within one hundred days after their submission,
Sundays and holidays excepted.
In case of accounts or claims already submitted to but still pending decision by the
Auditor General on or before the approval of this Act, the periods provided in this
section shall commence from the date of such approval.

SEC. 2. The party aggrieved by the final decision of the Auditor General in the settlement
of an account or claim may, within thirty days from receipt of the decision, take an
appeal in writing:
(a) To the President of the United States, pending the final and complete withdrawal of
her sovereignty over the Philippines, or
(b) To the President of the Philippines, or
(c) To the Supreme Court of the Philippines if the appellant is a private person or entity.

If there are more than one appellant, all appeals shall be taken to the same authority
resorted to by the first appellant.

From a decision adversely affecting the interests of the Government, the appeal may be
taken by the proper head of the department or in case of local governments by the head
of the office or branch of the Government immediately concerned.

The appeal shall specifically set forth the particular action of the Auditor General to
which exception is taken with the reasons and authorities relied on for reversing such
decision.

SEC. 3. This Act shall take effect upon its approval.

Approved, June 18, 1938.

PD 1445

Section 32. Government contracts for auditing, accounting, and related services.

1. No government agency shall enter into any contract with any private person or firm
for services to undertake studies and services relating to government auditing,
including services to conduct, for a fee, seminars or workshops for government
personnel on these topics, unless the proposed contract is first submitted to the
Commission to enable it to determine if it has the resources to undertake such
studies or services. The Commission may engage the services of experts from the
public or private sector in the conduct of these studies.

2. Should the Commission decide not to undertake the study or service, it shall
nonetheless have the power to review the contract in order to determine the
reasonableness of its costs.
Section 85. Appropriation before entering into contract.

1. No contract involving the expenditure of public funds shall be entered into unless
there is an appropriation therefor, the unexpended balance of which, free of other
obligations, is sufficient to cover the proposed expenditure.

2. Notwithstanding this provision, contracts for the procurement of supplies and

materials to be carried in stock may be entered into under regulations of the
Commission provided that when issued, the supplies and materials shall be charged
to the proper appropriation account.

COMPENSATION CLAIM
DA v. NLRC
The rule, in any case, is not really absolute for it does not say that the state may not be
sued under any circumstances. On the contrary, as correctly phrased, the doctrine only
conveys, "the state may not be sued without its consent;" its clear import then is that
the State may at times be sued. 12 The States' consent may be given expressly or
impliedly. Express consent may be made through a general law13 or a special law. 14 In
this jurisdiction, the general law waiving the immunity of the state from suit is found in
Act No. 3083, where the Philippine government "consents and submits to be sued upon
any money claims involving liability arising from contract, express or implied, which
could serve as a basis of civil action between private parties." 15 Implied consent, on the
other hand, is conceded when the State itself commences litigation, thus opening itself
to a counterclaim16 or when it enters into a contract. 17 In this situation, the government
is deemed to have descended to the level of the other contracting party and to have
divested itself of its sovereign immunity. This rule, relied upon by the NLRC and the
private respondents, is not, however, without qualification. Not all contracts entered
into by the government operate as a waiver of its non-suability; distinction must still be
made between one which is executed in the exercise of its sovereign function and
another which is done in its proprietary capacity. 18

But, be that as it may, the claims of private respondents, i.e. for underpayment of wages, holiday
pay, overtime pay and similar other items, arising from the Contract for Service, clearly constitute
money claims. Act No. 3083, aforecited, gives the consent of the State to be "sued upon any
moneyed claim involving liability arising from contract, express or implied, . . . Pursuant, however, to
Commonwealth Act ("C.A.") No. 327, as amended by Presidential Decree ("P.D.") No. 1145, the
money claim first be brought to the Commission on Audit. Thus, in Carabao, Inc., vs. Agricultural
Productivity Commission, 20 we ruled:

(C)laimants have to prosecute their money claims against the Government under
Commonwealth Act 327, stating that Act 3083 stands now merely as the general law
waiving the State's immunity from suit, subject to the general limitation expressed in
Section 7 thereof that "no execution shall issue upon any judgment rendered by any
Court against the Government of the (Philippines), and that the conditions provided
 in Commonwealth Act 327 for filing money claims against the Government must be
strictly observed."

The universal rule that where the State gives its consent to be sued by private parties
either by general or special law, it may limit the claimant's action "only up to the
completion of proceedings anterior to the stage of execution" and that the power of the
Courts ends when the judgment is rendered, since government funds and properties may
not be seized under writs or execution or garnishment to satisfy such judgments, is
based on obvious considerations of public policy. Disbursements of public funds must be
covered by the correspondent appropriation as required by law. The functions and
public services rendered by the State cannot be allowed to be paralyzed or disrupted by
the diversion of public funds from their legitimate and specific objects, as appropriated
by law.23

MONEY CLAIM INCORPORATED IN OTHER CLAIMS

Africa v. PCGG
Incorporating a monetary claim in the complaint will not convert the special civil action
for injunction into a mere claim for damages which would otherwise call for the
application of the rule on non-suability of the State. 25 The complaints for injunction do
not seek money judgments from nor do they demand any affirmative performance by
the State in its political capacity which would call for immunity from suit. The doctrine of
state immunity from suit applies only in actions resulting in adverse consequences on
the public treasury, whether in the disbursement of funds or loss of property. 26

c. Torts committed by special agents

CHAPTER 2 Quasi-delicts
Article 2176. Whoever by act or omission causes damage to another, there being fault
or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is
no pre-existing contractual relation between the parties, is called a quasi-delict and is
governed by the provisions of this Chapter. (1902a)

Article 2180. The obligation imposed by article 2176 is demandable not only for one's
own acts or omissions, but also for those of persons for whom one is responsible.
XXX
The State is responsible in like manner when it acts through a special agent; but not
when the damage has been caused by the official to whom the task done properly
pertains, in which case what is provided in article 2176 shall be applicable.
XXX
The responsibility treated of in this article shall cease when the persons herein
mentioned prove that they observed all the diligence of a good father of a family to
prevent damage. (1903a)
 Fontanilla v. Maliaman

The liability of the State has two aspects. namely:

1. Its public or governmental aspects where it is liable for the tortious acts of
special agents only.

2. Its private or business aspects (as when it engages in private enterprises)

where it becomes liable as an ordinary employer. (p. 961, Civil Code of the
Philippines; Annotated, Paras; 1986 Ed. ).

In this jurisdiction, the State assumes a limited liability for the damage caused by the tortious acts or
conduct of its special agent.

Under the aforequoted paragrah 6 of Art. 2180, the State has voluntarily assumed liability for acts
done through special agents. The State's agent, if a public official, must not only be specially
commissioned to do a particular task but that such task must be foreign to said official's usual
governmental functions. If the State's agent is not a public official, and is commissioned to perform
non-governmental functions, then the State assumes the role of an ordinary employer and will be
held liable as such for its agent's tort. Where the government commissions a private individual for a
special governmental task, it is acting through a special agent within the meaning of the provision.
(Torts and Damages, Sangco, p. 347, 1984 Ed.)

Certain functions and activities, which can be performed only by the government, are
more or less generally agreed to be "governmental" in character, and so the State is
immune from tort liability. On the other hand, a service which might as well be
provided by a private corporation, and particularly when it collects revenues from it,
the function is considered a "proprietary" one, as to which there may be liability for
the torts of agents within the scope of their employment.

Indubitably, the NIA is a government corporation with juridical personality and not a mere agency of
the government. Since it is a corporate body performing non-governmental functions, it now
becomes liable for the damage caused by the accident resulting from the tortious act of its driver-
employee. In this particular case, the NIA assumes the responsibility of an ordinary employer and as
such, it becomes answerable for damages.

This assumption of liability, however, is predicated upon the existence of negligence on the part of
respondent NIA. The negligence referred to here is the negligence of supervision.

At this juncture, the matter of due diligence on the part of respondent NIA becomes a
crucial issue in determining its liability since it has been established that respondent
is a government agency performing proprietary functions and as such, it assumes the
posture of an ordinary employer which, under Par. 5 of Art. 2180, is responsible for
the damages caused by its employees provided that it has failed to observe or
exercise due diligence in the selection and supervision of the driver.

Fontanilla v. Maliaman
On the basis of the foregoing considerations, We conclude that the National Irrigation
Administration is a government agency with a juridical personality separate and distinct from
the government. It is not a mere agency of the government but a corporate body performing
 proprietary functions. Therefore, it may be held liable for the damages caused by the negligent
act of its driver who was not its special agent.

GSIS v. Labung-Deang

We rule that the GSIS is liable for damages. We deny the petition for lack of merit.

GSIS, citing the sixth paragraph of Article 2180 of the Civil Code argues that as a GOCC, it falls
within the term "State" and cannot be held vicariously liable for negligence committed by its
employee acting within his functions.26

"Article 2180. The obligation imposed by Article 2176 is demandable not only for
one's own acts or omissions, but also for those of persons for whom one is
responsible.

xxx

"Employers shall be liable for the damages caused by their employees and
household helpers acting within the scope of their assigned tasks, even though the
former are not engaged in any business of industry.

"The State is responsible in like manner when it acts though a special agent, but not when
the damage has been caused by the official to whom the task was done properly pertains, in
which case what is provided in Article 2176 shall be applicable.

B. Implied Consent
a. Government submits itself to the courts jurisdiction
Republic v. Sandiganbayan

The jurisdiction of the Sandiganbayan has already been settled in Presidential Commission on Good
Government vs. Hon. Emmanuel G. Penal, etc., et al. 15 where the Court held that

... Under Section 2 of the President's Executive Order No. 14 issued on May
7, 1986, all cases of the Commission regarding 'the funds, Moneys, Assets,
and Properties Illegally Acquired or I Misappropriated by Former President
Ferdinand Marcos, Mrs. Imelda Romualdez Marcos, their Close Relatives,
Subordinates, Business Associates, Dummies, Agents, or Nominees whether
civil or criminal, are lodged within the 'exclusive and original jurisdiction of the
Sandiganbayan' and all incidents arising from, incidental to, or related to,
such cases necessarily fall likewise under the Sandiganbayan's exclusive
and original jurisdiction, subject to review on certiorari exclusively by the
Supreme Court. (emphasis supplied)

In reiterating the aforequoted ruling in six (6) subsequent cases 16 which were decided jointly, again,
the Court held that-

... the exclusive jurisdiction conferred on the Sandiganbayan would evidently

extend not only to the principal causes of action, i.e., the recovery of alleged
ill-gotten wealth, but also to 'all incidents arising from, incidental to, or related
to, such cases,' such as the dispute over the sale of the shares, the propriety
 of the issuance of ancillary writs or provisional remedies relative thereto, the
sequestration thereof, which may not be made the subject of separate
actions or proceedings in another forum.

Intervention is not an independent action, but is ancillary and supplemental to an existing litigation. 17
Hence, the private respondents' action for intervention in Civil Case No. 0025, not being an
independent action, is merely incidental to, or related to, the said civil case. Since the respondent
Sandiganbayan has the exclusive and original jurisdiction over Civil Case No. 0025, it has likewise
original and exclusive jurisdiction over the private respondents' action for intervention therein.

Now, considering that respondent Sandiganbayan has jurisdiction not only over Civil Case No. 0025
but also over the private respondents' action for intervention, any error or irregularity that it may have
committed in rendering its questioned resolutions, in the exercise of its jurisdiction, amounts to an
error of judgment, which is not correctable in the present petition for certiorari but by appeal.

Accordingly, this case may be dismissed outright without the Court having to pass
upon the other issues raised in the petition. However, considering that the litigation
below is of great public interest and involves a matter of public policy, the Court has
decided to review the other errors allegedly committed by respondent court in
rendering its questioned resolutions.

In this jurisdiction, the law on "intervention" is found in the Rules of Court. 18 Thus, a
person may, before or during a trial, be permitted by the court, in its discretion, to
intervene in an action, if he has legal interest in the matter in litigation, or in the success
of either of the parties or an interest against both, or when he is so situated as to be
adversely affected by a distribution or other disposition of property in the custody of
the court or of an officer thereof. 19

Expropriation

b. The state itself files a complaint

Republic v. Sandiganbayan April 17 1990

Finally, petitioner's contention that the claims of private respondents are cognizable not by
respondent Sandiganbayan but by the regular courts cannot be sustained. The jurisdiction of
Sandiganbayan in the recovery of "ill-gotten wealth" has already been decided by this Court in
Presidential Commission on Good Government v. Hon. Pea (159 SCRA 556, G.R. No. 77663, April
12, 1988) wherein it was held that:

. . . Under section 2 of the President's Executive Order No. 14, issued on May 17,
1986, all cases of the Commission regarding the Funds, Moneys, Assets, and
Properties Illegally Acquired or Misappropriated by Former President Ferdinand
Marcos, Mrs. Imelda Romualdez Marcos, their Close Relatives, Subordinates,
Business Associates, Dummies, Agents, or Nominees whether civil or criminal, are
lodged within the exclusive and original jurisdiction of the Sandiganbayan and all
incidents arising from incidental to, or related to, such cases necessarily fall likewise
under the Sandiganbayan's exclusive and original jurisdiction, subject to review on
certiorari exclusively by the Supreme Court.
 xxx xxx xxx

. . . Executive Order No. 14, which defines the jurisdiction over cases involving the ill-
gotten wealth of former President Marcos, his wife, Imelda, members of their
immediate family, close relatives, subordinates, close and/or business associates,
dummies, agents and nominees, specifically provides in section 2 that "The
Presidential Commission on Good Government shall file all such cases, whether civil
or criminal, with the Sandiganbayan which shall have exclusive and original
jurisdiction thereof. Necessarily, those who wish to question or challenge the
Commission's acts or orders in such cases is must seek recourse in the same court,
the Sandiganbayan, which is tested with exclusive and original jurisdiction. The
Sandiganbayan's decisions and final orders are in turn subject to review on certiorari
exclusively by this Court. (Emphasis supplied; the above-quoted ruling was reiterated
in Soriano v. Yuson, 164 SCRA 226, G.R. No. L-74910, August 10, 1988 and
accompanying cases).

Neither can the Court agree with petitioner's argument that the Sandiganbayan could very well be
swamped with original (sic) actions in respect of every conceivable act or order of the PCGG if
private respondents herein, as intervenors, were given sovereign consent to sue the Republic as it
would most patently be against the public policy embedded in Executive Orders No. 1, 2, 14 and
related issuances, namely, the urgent recovery of the ill-gotten assets with dispatch (Rollo, p. 19).
For one thing, intervention is never an independent action, but is ancillary and supplemental to the
existing litigation (Garcia v. David, supra). More importantly, the Court has already explained the
exclusivity of Sandiganbayan's jurisdiction on the recovery of "ill-gotten wealth" in PCGG v. Hon.
Pea (supra), thus:

The rationale of the exclusivity of such jurisdiction is readily understood. Given the
magnitude of the past regime's "organized pillage" and the ingenuity of the
plunderers and pillagers with the assistance of the experts and best legal minds
available in the market, it is a matter of sheer necessity to restrict access to the lower
courts, which would have tied into knots and made impossible the commission's
gigantic task of recovering the plundered wealth of the nation, . . . (Emphasis
supplied)

It is therefore indubitable that in view of the extra-ordinary nature of sequestration,

parties who claim ownership or interest in the subject matter of sequestration
proceedings before the Sandiganbayan have no other recourse than intervention in
the litigation before the Sandiganbayan, whose decision is subject to review on
certiorari exclusively by this Court, for no other court or forum has jurisdiction over
proceedings for the recovery of ill-gotten wealth.

Republic v. Sandiganbayan November 21 1991

The State is, of course, immune from suit in the sense that it cannot, as a rule, be
sued without its consent. But it is axiomatic that in filing an action, it divests itself of
its sovereign character and sheds its immunity from suit, descending to the level of
an ordinary litigant. The PCGG cannot claim a superior or preferred status to the
State, even while assuming to represent or act for the State. 48

that the State makes no implied waiver of immunity by filing suit except
The suggestion 49

when in so doing it acts in, or in matters concerning, its proprietary or non-

 governmental capacity, is unacceptable; it attempts a distinction without support in
principle or precedent. On the contrary

The consent of the State to be sued may be given expressly or impliedly.

Express consent may be manifested either through a general law or a special
law. Implied consent is given when the State itself commences litigation or
when it enters into a contract. 50
The immunity of the State from suits does not deprive it of the right to sue private parties in its own courts. The state as plaintiff may avail itself of the different forms of actions open
to private litigants. In short, by taking the initiative in an action against the private parties, the state surrenders its privileged position and comes down to the level of the defendant.
The latter automatically acquires, within certain limits, the right to set up whatever claims and other defenses he might have against the state. . . . (Sinco, Philippine Political Law,
Tenth E., pp. 36-37, citing U.S. vs. Ringgold, 8 Pet. 150, 8 L. ed. 899)" 51

It can hardly be doubted that in exercising the right of eminent domain, the State exercises its jus imperii, as distinguished from its proprietary rights or jus gestionis. Yet, even in that area, it has been
held that where private property has been taken in expropriation without just compensation being paid, the defense of immunity from suit cannot be set up by the State against an action for payment
by the owner. 52

Republic v. Sandiganbayan March 6, 2006

In a last-ditch attempt to escape liability, petitioner Republic, through the PCGG,

xainvokes state immunity from suit.22 As argued, the order for it to pay the value of
the delinquent shares would fix monetary liability on a government agency, thus
necessitating the appropriation of public funds to satisfy the judgment claim.23 But, as
private respondent Benedicto correctly countered, the PCGG fails to take stock of
one of the exceptions to the state immunity principle, i.e., when the government itself
is the suitor, as in Civil Case No. 0034. Where, as here, the State itself is no less the
plaintiff in the main case, immunity from suit cannot be effectively invoked.24 For, as
jurisprudence teaches, when the State, through its duly authorized officers, takes the
initiative in a suit against a private party, it thereby descends to the level of a private
individual and thus opens itself to whatever counterclaims or defenses the latter may
have against it.25 Petitioner Republics act of filing its complaint in Civil Case No.
0034 constitutes a waiver of its immunity from suit. Being itself the plaintiff in that
case, petitioner Republic cannot set up its immunity against private respondent
Benedictos prayers in the same case.

In fact, by entering into a Compromise Agreement with private respondent Benedicto,

petitioner Republic thereby stripped itself of its immunity from suit and placed itself in
the same level of its adversary. When the State enters into 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, the State may be sued even without its
express consent, precisely because by entering into a contract the sovereign
descends to the level of the citizen. Its consent to be sued is implied from the very
act of entering into such contract,26 breach of which on its part gives the
corresponding right to the other party to the agreement.

c. Government entering into business contracts

Blaquera v. Alcala
. . . Firstly, the provisions of RA #6971 insofar as the coverage is concerned refer to
business enterprises including government owned and/or controlled corporations
performing proprietary functions.
Sec. 1a of the Supplemental Rules Implementing RA #6971 classified such coverage as:
 All business enterprises, with or without existing duly certified labor organizations,
including government owned and/or controlled corporations performing proprietary
functions which are established solely for business or profit and accordingly excluding
those created, maintained or acquired in pursuance of a policy of the State enunciated
in the Constitution, or by law and those whose officers and employess are covered by
the Civil Service. (emphasis supplied)

Untenable is petitioners' contention that the herein respondents be held personally

liable for the refund in question. Absent a showing of bad faith or malice, public officers
are not personally liable for damage resulting from the performance of official duties. 36
Every public official is entitled to the presumption of good faith in the discharge of
official duties. 37 Absent any showing of bad faith or malice, there is likewise a
presumption of regularity in the performance of official duties. 38
In upholding the constitutionality of AO 268 and AO 29, the Court reiterates the well-
entrenched doctrine that "in interpreting statutes, that which will avoid a finding of
unconstitutionality is to be preferred." 39
Considering, however, that all the parties here acted in good faith, we cannot
countenance the refund of subject incentive benefits for the year 1992, which amounts
the petitioners have already received. Indeed, no indicia of bad faith can be detected
under the attendant facts and circumstances. The officials and chiefs of offices
concerned disbursed such incentive benefits in the honest belief that the amounts given
were due to the recipients and the latter accepted the same with gratitude, confident
that they richly deserve such benefits.

PTA v. PGDEI

PTA was acting in a proprietary character

PTA also erred in invoking state immunity simply because it is a government entity. The application
of state immunity is proper only when the proceedings arise out of sovereign transactions and not in
cases of commercial activities or economic affairs. The State, in entering into a business contract,
descends to the level of an individual and is deemed to have tacitly given its consent to be sued.13

Since the Intramuros Golf Course Expansion Projects partakes of a proprietary

character entered into between PTA and PHILGOLF, PTA cannot avoid its financial
liability by merely invoking immunity from suit.

d. Government acquires properties from donation

DEPED Albay v. Onate

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.44
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.

e. When inequitable for government to claim immunity

f. Estoppel
SAFDAC v. NLRC
Private respondent Yong's invocation of estoppel is unavailing. The issue of estoppel on
the part of petitioner to timely raise the question of jurisdiction has been squarely
passed upon in Southeast Asian Fisheries Development Center-Aquaculture Department
v. National Labor Relations Commission, 206 SCRA 283 (1992). In said case, we
reiterated the general rule that estoppel does not apply to confer jurisdiction to a
tribunal that has none over a cause of action. As we explained in, Calimlim v. Ramirez,
118 SCRA 399 (1982), there were exceptional circumstances involved in the Tijam case
which justified the exception to the general rule enunciated therein. In the Tijam case, a
complaint for the collection of P1,908.00 was filed on July 19, 1948 in the Court of First
Instance of Cebu when under the Judiciary Act of 1948, it was the Municipal Court that
had jurisdiction thereof. It was only in 1963 or long after the decision of the trial court
had become final and executory that a motion to dismiss the complaint was filed.
At any rate, we rule that the Tijam case applies only to ordinary litigants and not to
parties which enjoy sovereign or diplomatic immunity. With respect to foreign states
and international organizations, the immunity from suit or the jurisdiction of local courts
can only be waived expressly by said entities and not by the employees or agents
(Salonga and Yap, Public International Law 114-115 [5th ed.]; Akehurst, A Modern
Introduction to International Law 118 [5th ed.]).