Facts:

The Appellant has been served final judgements twice, first from the Municipal Trial Court and
the second from the Court of First Instance (Regional Trial Court) regarding the appellant’s
violation against the Municipal Ordinance No. 14, Series of 1964 charged by the City Fiscal’s
Office of Olongapo for constructing a house inside the US Naval Base Reserve with the position
that the Philippines has diminished administrative jurisdiction over the territory because the
base was leased on to the American Navy Forces. Notwithstanding, the two (2) resolutions was
set aside by the Appellant and elevated it to the Court of Appeals with the resolution noting the
constitutional question raised and certified the case to the Supreme Court.
Issue:
Do the Philippines have a jurisdiction over the US Naval Base Reserve or is the Appellant’s
position that the Philippine Government doesn’t have an administrative jurisdiction over the US
Naval Base Reserve valid?
Ruling:
The Philippine Government has not abdicated its sovereignty over the bases as part of the
Philippine Territory. The consent was given in full as a matter of comity, courtesy, and
expediency to the United States Naval Forces, therefore, as reiterated in the view of Reagan vs.
Commissioner of Internal Revenue, “Nothing is better than that the Philippines being
independent and sovereign, its authority may be exercised over its entire domain. There is no
portion thereof that is beyond its power. Within its limits, its decrees are supreme, its
commands paramount. Its laws govern therein, and everyone to whom it applies must submit to
its terms. That is the extent of its jurisdiction, both territorial and personal. Necessarily,
likewise, it has to be exclusive. If it were not thus, there is a diminution of sovereignty.”
In view of the concept of sovereignty, Auto-Limitation lays down the theory relating to the
obligation of International Law in Georj Jellinek’s succinct language, “The property of the state-
force due to which it has exclusive legal capacity to self-determination and self-restriction” in
this case the American Naval Forces decline full exercise of the ceded rights from the Philippines
Therefore, the Supreme Court decision found the accused, Loreta Gozo, guilty beyond
reasonable doubt of a violation of Municipal Ordinance No. 14, series of 1964 and sentencing her
to pay a fine of P200.00 with subsidiary imprisonment in case of insolvency, and modified
insofar as she is required to demolish the house that is the subject matter of the case, and being
given a period of thirty days from the finality of this decision within which to obtain the required
permit. Only upon her failure to do so will that portion of the appealed decision requiring
demolition be enforced and the costs will be under the responsibility of the accused.