GALLARDO, TATIANA LOUISE C.

Local Government

CITY OF MANILA, and EVANGELINE SUVA

vs.
HON. INTERMEDIATE APPELLATE COURT, et al.

G.R. No. 71159 November 15, 1989

PARAS,J.:

STATEMENT OF FACTS:

Vivencio Sto. Domingo, Sr. deceased husband of plaintiff Irene Sto. Domingo and father of the litigating minors,
died on June 4,1971 and buried on June 6,1971 in Lot No. 159, Block No. 194 of the North Cemetery which lot was leased
by the city to Irene Sto. Domingo from June 6, 1971 to June 6, 2021. Full payment of the rental therefor of P50.00 is
evidenced by the said receipt which appears to be regular on its face. Apart from the aforementioned receipt, no other
document was executed to embody such lease over the burial lot in question.

In accordance with Administrative Order No. 5, the City Mayor of Manila prescribing uniform procedure and
guidelines in the processing of documents pertaining to and for the use and disposition of burial lots and plots within the
North Cemetery, subject lot was certified on January 25, 1978 as ready for exhumation. On the basis of such certification,
the authorities of the North Cemetery then headed by defendant Joseph Helmuth authorized the exhumation and removal
from subject burial lot the remains of the late Vivencio Sto. Domingo, Sr., placed the bones and skull in a bag or sack and
kept the same in the depository or bodega of the cemetery. Subsequently, the same lot in question was rented out to another
lessee so that when the plaintiffs herein went to said lot on All Souls Day in their shock, consternation and dismay, that the
resting place of their dear departed did not anymore bear the stone marker which they lovingly placed on the tomb. Indignant
and disgusted over such a sorrowful finding.

STATEMENT OF THE CASE:

This is a petition for review on certiorari seeking to reverse and set aside: (a) the Decision of the Intermediate
Appellate Court now Court of Appeals 1 promulgated on May 31, 1984 in AC-G.R. CV No. 00613-R entitled Irene Sto.
Domingo et al., v. City Court of Manila et al., modifying the decision of the then Court of First Instance of Manila, Branch
VIII 2 in Civil Case No. 121921 ordering the defendants (herein petitioners,) to give plaintiffs (herein private respondents)
the right to use a burial lot in the North Cemetery corresponding to the unexpired term of the fully paid lease sued upon, to
search the remains of the late Vivencio Sto. Domingo, Sr. and to bury the same in a substitute lot to be chosen by the
plaintiffs; and (b) the Resolution of the Court of Appeals dated May 28, 1985 denying petitioner's motion for reconsideration.

ISSUE:

Whether or not the operations and functions of a public cemetery are a governmental, or a corporate or proprietary function
of the City of Manila.
RULING:

Under Philippine laws, the City of Manila is a political body corporate and as such endowed with the faculties of
municipal corporations to be exercised by and through its city government in conformity with law, and in its proper corporate
name. It may sue and be sued, and contract and be contracted with. Its powers are twofold in character-public, governmental
or political on the one hand, and corporate, private and proprietary on the other. Governmental powers are those exercised
in administering the powers of the state and promoting the public welfare and they include the legislative, judicial, public
and political. Municipal powers on the one hand are exercised for the special benefit and advantage of the community and
include those which are ministerial, private and corporate. In connection with the powers of a municipal corporation, it may
acquire property in its public or governmental capacity, and private or proprietary capacity. The New Civil Code divides such
properties into property for public use and patrimonial properties (Article 423), and further enumerates the properties for
public use as provincial roads, city streets, municipal streets, the squares, fountains, public waters, promenades, and public
works for public service paid for by said provisions, cities or municipalities, all other property is patrimonial without prejudice
to the provisions of special laws.

Under the foregoing considerations and in the absence of a special law, the North Cemetery is a patrimonial
property of the City of Manila which was created by resolution of the Municipal Board. The City of Manila furthermore
prescribes the procedure and guidelines for the use and dispositions of burial lots and plots within the North Cemetery
through Administrative Order No. 5. With the acts of dominion, there is, therefore no doubt that the North Cemetery is within
the class of property which the City of Manila owns in its proprietary or private character. Furthermore, there is no dispute
that the burial lot was leased in favor of the private respondents. Hence, obligations arising from contracts have the force
of law between the contracting parties. Thus a lease contract executed by the lessor and lessee remains as the law between
them. Therefore, a breach of contractual provision entitles the other party to damages even if no penalty for such breach is
prescribed in the contract.

DOCTRINE/PRINCIPLE:

Governmental powers are those exercised in administering the powers of the state and promoting the public welfare
and they include the legislative, judicial, public and political.

Municipal powers are exercised for the special benefit and advantage of the community and include those which are
ministerial, private and corporate.

Doctrine of respondent superior that the superior or employer must answer civilly for the negligence or want of skill of
its agent or servant in the course or line of his employment, by which another who is free from contributory fault, is injured.
Municipal corporations under the conditions herein stated, fall within tile operation of this rule of law, and are liable
accordingly, to civil actions for damages when the requisite elements of liability co-exist.
 MUNICIPALITY OF SAN FERNANDO, LA UNION
vs.
HON. JUDGE ROMEO N. FIRME, et al.

G.R. No. L-52179 April 8, 1991

MEDIALDEA, J.:

STATEMENT OF FACTS:

Petitioner is a municipal corporation existing under and in accordance with the laws of the Republic of the
Philippines. At about 7 am of December 16, 1965, a collision occurred involving a passenger jeepney driven by Bernardo
Balagot and owned by the Estate of Macario Nieveras, a gravel and sand truck driven by Jose Manandeg and owned by
Tanquilino Velasquez and a dump truck of the petitioner and driven by Alfredo Bislig. Several passengers of the jeepney
including Laureano Baniña Sr. died as a result of the injuries they sustained and 4 others suffered physical injuries.

Private respondents instituted an action against Nieveras and Balagot before the CFI. The defendants filed a
third party complaint against petitioner and Bislig. The complaint was then amended to implead petitioner and Bislig.
Petitioner raised as defense lack of cause of action, non suability of the State, prescription and negligence of the owner
and driver of the jeepney.

The trial court rendered a decision ordering the petitioner and Bislig to pay the plaintiffs. The owner and driver of
the jeepney were absolved from liability. Petitioner filed an MR which was dismissed for having been filed out of time.

STATEMENT OF THE CASE:

This is a petition for certiorari with prayer for the issuance of a writ of preliminary mandatory injunction seeking
the nullification or modification of the proceedings and the orders issued by the respondent Judge Romeo N. Firme, in his
capacity as the presiding judge of the Court of First Instance of La Union, Second Judicial District, Branch IV, Bauang, La
Union in Civil Case No. 107-BG, entitled "Juana Rimando Baniña, et al. vs. Macario Nieveras, et al." dated November 4,
1975; July 13, 1976; August 23,1976; February 23, 1977; March 16, 1977; July 26, 1979; September 7, 1979; November
7, 1979 and December 3, 1979 and the decision dated October 10, 1979 ordering defendants Municipality of San
Fernando, La Union and Alfredo Bislig to pay, jointly and severally, the plaintiffs for funeral expenses, actual damages
consisting of the loss of earning capacity of the deceased, attorney's fees and costs of suit and dismissing the complaint
against the Estate of Macario Nieveras and Bernardo Balagot.

ISSUE:

(1) Whether or not the respondent court committed grave abuse of discretion when it deferred and failed to resolve
the defense of Non-Suability of the State amounting to lack of jurisdiction in a motion to dismiss.

(2) Whether or not petitioner Municipality of San Juan is liable for the torts committed by its employee.

RULING:

1) The respondent judge did not commit grave abuse of discretion when in the exercise of its judgement. It
arbitrarily failed to resolve the vital issue of non-suability of the State in the guise of the Municipality. However,
 the judge acted in excess of his jurisdiction when in his decision, he held the municipality liable for the quasi-
delict committed by its regular employee. Article XVI, Section 3 of the 1987 Constitution expressly provide that
“the State may not be sued without its consent” Municipal Corporations like provinces and cities, are agencies of
the State when they are engaged in governmental functions and thereof should enjoy the sovereign immunity
from suits. Nevertheless, they are subject to suit even in the performance of such functions because their charter
provides that they can sue and be sued.

2) The issue whether or not a municipality is liable for the torts committed by its employee depends on whether or
not the employee, the driver in this case, acting in behalf of the municipality is performing governmental or
propriety functions.

Governmental vs. Proprietary functions

Municipal Corporations exist in dual capacity and so are their functions. (1) They exercise the right
springing from sovereignty and while in performance of the duties, their acts are political and governmental. The
officers and agents are public functionaries performing public service (2) In the other capacity, the municipalities
exercise a private, proprietary or corporate right arising from their legal persons and not as public agencies. The
officers and agents in the performance of such functions act in behalf of the municipalities in their corporate or
individual capacity and not sovereign power.

In the case at bar, the driver of the dump truck insists that “he was on his way to the Naguilian River to
get a load of sand and gravel for the repair of the streets” In the absence of evidence to the contray, the
Supreme Court rules that the driver was perfroming duties pertaining to his office as it was ruled in Palafox, et vs.
Province of Ilocos that construction of of roads are admittedly governmental activities.

The court grants the petition and absolves the municipality of any liability in favor of the private respondents

DOCTRINE/PRINCIPLE:

The doctrine of non-suability of the State is expressly provided for in Article XVI, Section 3 of the Constitution, to wit:
"the State may not be sued without its consent." Express consent may be embodied in a general law or a special law. The
standing consent of the State to be sued in case of money claims involving liability arising from contracts is found in Act
No. 3083. A special law may be passed to enable a person to sue the government for an alleged quasi-delict. Consent is
implied when the government enters into business contracts, thereby descending to the level of the other contracting
party, and also when the State files a complaint, thus opening itself to a counterclaim.

Municipal Corporations exist in dual capacity and so are their functions. (1) They exercise the right springing from
sovereignty and while in performance of the duties, their acts are political and governmental. The officers and agents are
public functionaries performing public service (2) In the other capacity, the municipalities exercise a private, proprietary or
corporate right arising from their legal persons and not as public agencies. The officers and agents in the performance of
such functions act in behalf of the municipalities in their corporate or individual capacity and not sovereign power.
 FRANCISCO U. DACANAY
vs.
MAYOR MACARIO ASISTIO, JR., et al.

G.R. No. 93654 May 6, 1992

GRIÑO-AQUINO, J.:

STATEMENT OF FACTS:

On 5 January 1979, MMC Ordinance 79-02 was enacted by the Metropolitan Manila Commission, designating
certain city and municipal streets, roads and open spaces as sites for flea markets. Pursuant thereto, the Caloocan City
mayor opened up 7 flea markets in that city. One of those streets was the “Heroes del ’96" where the Francisco Dacanay
lives. Upon application of vendors Rodolfo Teope, Mila Pastrana, Carmen Barbosa, Merle Castillo, Bienvenido Menes,
Nancy Bugarin, Jose Manuel, Crisaldo Paguirigan, Alejandro Castron, Ruben Araneta, Juanita and Rafael Malibaran, and
others, the city mayor and city engineer, issued them licenses to conduct vending activities on said street. In 1987,
Antonio Martinez, as OIC city mayor of Caloocan City, caused the demolition of the market stalls on Heroes del ’96, V.
Gozon and Gonzales streets.

To stop Mayor Martinez’ efforts to clear the city streets, Teope, Pastrana and other stall owners filed an action for
prohibition against the City of Caloocan, the OIC City Mayor and the City Engineer and/or their deputies before the RTC
Caloocan City (Branch 122, Civil Case C-12921), praying the court to issue a writ of preliminary injunction ordering these
city officials to discontinue the demolition of their stalls during the pendency of the action. The court issued the writ prayed
for. However, on 20 December 1987, it dismissed the petition and lifted the writ of preliminary injunction which it had
earlier issued. However, shortly after the decision came out, the city administration in Caloocan City changed hands. City
Mayor Macario Asistio, Jr. did not pursue the latter’s policy of clearing and cleaning up the city streets. Invoking the trial
court’s decision, Francisco Dacanay wrote a letter to Mayor Asistio calling his attention to the illegally-constructed stalls
on Heroes del ’96 street and asked for demolition on 7 March 1988, wrote a follow-up letter to the mayor and the city
engineer on 7 April 1988, and without receiving any response, sought the intervention of President Aquino through a
letter. These letter was referred to the city mayor for appropriate action.

On 3 April 1989, Dacanay filed a complaint against Mayor Asistio and Engineer Sarne (OMB-0-89-0146) in the
Office of the Ombudsman. After conducting a preliminary investigation, the Ombudsman rendered a final evaluation and
report on 28 August 1989, finding that the Mayor’s and the City Engineer’s inaction is purely motivated by their perceived
moral and social responsibility toward their constituents, but “the fact remains that there is an omission of an act which
ought to be performed, in clear violation of Sections 3(e) and (f) of RA 3019.” The Ombudsman recommended the filing of
the corresponding information in court.

As the stallholders continued to occupy Heroes del ’96 Street, through the tolerance of the city officials, and in
clear violation of the decision in Civil Case C-12921, Dacanay filed a petition for mandamus on 19 June 1990, praying that
the city officials be ordered to enforce the final decision in Civil Case C-12921 which upheld the city mayor’s authority to
order the demolition of market stalls on V. Gozon, Gonzales and Heroes del ’96 Streets and to enforce PD 772 and other
pertinent laws.

The Supreme Court established that Dacanay and the general public have a legal right to the relief demanded
and that the city officials have the corresponding duty, arising from public office, to clear the city streets and restore them
to their specific public purpose (Enriquez vs. Bidin, 47 SCRA 183; City of Manila vs. Garcia et al., 19 SCRA 413 citing
Unson vs. Lacson, 100 Phil. 695), and thus ordered the City Mayor and City Engineer of Caloocan City or their
successors in office to immediately enforce and implement the decision in Civil Case C-1292 declaring that Heroes del
’96, V. Gozon, and Gonzales Streets are public streets for public use, and they are ordered to remove or demolish, or
cause to be removed or demolished, the market stalls occupying said city streets with utmost dispatch within 30 days from
notice of the decision; the decision being immediately executory.
STATEMENT OF THE CASE:

This is a petition for mandamus to the non-action of the city government of Caloocan in accordance with the
decision of the RTC to evict the occupants of a flea market located in the streets of Caloocan.

ISSUE:

Whether or not streets or thoroughfares be leased a licensed to market stallholders by virtue of a city ordinance or
resolution of the Metro Manila Commission.

RULING:

No. A Public Street is property for public use hence outside the commerce of man (Arts. 420,
424, Civil Code). Being outside the commerce of man, it may not be the subject of lease or
other contract. Being outside the commerce of man, it may not be the subject of lease or
other contract.

The vested right of the public to use city streets for the purpose they were intended to
serve such as or traveling.

Any executive order or city resolution cannot change the nature of the public street
because it is going to be contrary to the general law.

DOCTRINE/PRINCIPLE:

Properties for public use may not be leased to private individuals. Such lease is null and void for the reason that
a municipal council cannot withdraw part of the plaza from public use. If possession has already been given, the lessee
must restore possession by vacating it and the municipality must thereupon restore to him any sums it may have collected
as rent.
 HON. GABRIEL LUIS QUISUMBING, et al.
vs.
HON. GWENDOLYN F. GARCIA, et al.

G.R. No. 175527 December 8, 2008

TINGA, J.:

STATEMENT OF FACTS:

COA conducted a financial audit on the Province of Cebu and found out that several contracts were not
supported with a Sangguniang Panlalawigan resolution authorizing the Provincial Governor to enter into a contract, as
required under Section 22 of R.A. No. 7160. Gov Garcia sought reconsideration of this findings. However, without waiting
for its resolution, filed an action for declaratory relief with the RTC. Gov claimed that the no prior authorization is required
because the expenditures incurred are already authorized by the appropriation ordinances of the previous year which are
deemed re-enacted. RTC ruled that no prior authorization is required. SC ruled that the case must be remanded because
the action for declaratory relief is not proper and must be dismissed due to the breach committed prior to the filing of the
action. The trial court should have determined the character of the questioned contracts, i.e., whether they were mere
disbursements pursuant to the ordinances supposedly passed by the sanggunian, or new contracts which requires
authorization of the provincial board.

STATEMENT OF THE CASE:

Gabriel Luis Quisumbing (Quisumbing), Estrella P. Yapha, Victoria G. Corominas, and Raul D. Bacaltos
(Bacaltos), collectively petitioners, assail the Decision 1 [1] of the Regional Trial Court (RTC) of Cebu City, Branch 9, in
Civil Case No. CEB-31560, dated July 11, 2006, which declared that under the pertinent provisions of Republic Act No.
7160 (R.A. No. 7160), or the Local Government Code, and Republic Act No. 9184 (R.A. No. 9184), or the Government
Procurement Reform Act, respondent Cebu Provincial Governor Gwendolyn F. Garcia (Gov. Garcia), need not secure the
prior authorization of the Sangguniang Panlalawigan before entering into contracts committing the province to monetary
obligations.

ISSUE:

Whether or not prior approval by the Sangguniang Panlalawigan is required before Gov. Garcia could have
validly entered into the questioned contracts.

RULING:

The Court held that the case should be remanded to the lower court and treated as an ordinary civil action rather
than as a declaratory relief action. The lower court was directed to admit further evidence in order to determine the nature
of the questioned contracts entered into by Gov. Garcia, and the existence of ordinances authorizing her acts.
Nonetheless, the Supreme Court laid out the framework for the lower court’s guidance in resolving the issue.

Requirement of prior authorization by the Sanggunian

Sec. 22(c) of R.A. No. 7160 provides:
Sec. 22. Corporate Powers.–(a) Every local government unit, as a corporation, shall have the following powers:
xxx
(c) Unless otherwise provided in this Code, no contract may be entered into by the local chief executive in behalf of the
local government unit without prior authorization by the sanggunian concerned. A legible copy of such contract shall be
posted at a conspicuous place in the provincial capitol or the city, municipal or barangay hall.

Prior authorization by the sanggunian concerned is required before the local chief executive may enter into
contracts on behalf of the local government unit.
Gov. Garcia argued that Sections 306 and 346 of R.A. No. 7160 are the exceptions to Sec. 22(c) and operate to allow her
to enter into contracts on behalf of the Province of Cebu without further authority from the Sangguniang Panlalawigan.

However, the Court noted that Sec. 306 of R.A. No. 7160 merely contains a definition of terms. Read in
conjunction with Sec. 346, Sec. 306 authorizes the local chief executive to make disbursements of funds in accordance
with the ordinance authorizing the annual or supplemental appropriations. The "ordinance" referred to in Sec. 346 pertains
to that which enacts the local government unit’s budget, for which reason no further authorization from the local council is
required, the ordinance functioning, as it does, as the legislative authorization of the budget.

To construe Sections 306 and 346 of R.A. No. 7160 as exceptions to Sec. 22(c) would render the requirement of
prior sanggunian authorization superfluous, useless and irrelevant. There would be no instance when such prior
authorization would be required. Yet, this is obviously not the effect Congress had in mind when it required the prior
authorization of the sanggunian concerned.

Sec. 323 of R.A. No. 7160 provides that in case of a reenacted budget, "only the annual appropriations for
salaries and wages of existing positions, statutory and contractual obligations, and essential operating expenses
authorized in the annual and supplemental budgets for the preceding year shall be deemed reenacted and disbursement
of funds shall be in accordance therewith."

As indicated by the word "only" preceding the above enumeration, the items for which disbursements may be
made under a reenacted budget are exclusive. Clearly, contractual obligations which were not included in the previous
year’s annual and supplemental budgets cannot be disbursed by the local government unit. New contracts entered into by
the local chief executive require the prior approval of the sanggunian.

To give life to the intendment of the law and to avoid a construction which would render Sec. 22(c) of R.A. No.
7160 meaningless, disbursement should be understood to pertain to payments for statutory and contractual obligations
which the sanggunian has already authorized thru ordinances enacting the annual budget and are therefore already
subsisting obligations of the local government unit. Contracts are those which bind the local government unit to new
obligations for which the local chief executive needs prior authority from the sanggunian.

Following are other provisions of R.A. No. 7160 which support petitioners’ stand: (a) Sec. 465, Art. 1, Chapter 3
states that the provincial governor shall "[r]epresent the province in all its business transactions and sign in its behalf all
bonds, contracts, and obligations, and such other documents upon authority of the Sangguniang Panlalawigan or
pursuant to law or ordinances;" (b) Sec. 468, Art. 3 also establishes the sanggunian’s power, as the province’s legislative
body, to authorize the provincial governor to negotiate and contract loans, lease public buildings held in a proprietary
capacity to private parties, among other things.
What the trial court should have done

As things stand, the declaration of the trial court to the effect that no prior authorization is required when there is
a prior appropriation ordinance enacted does not put the controversy to rest. The question which should have been
answered by the trial court was whether, during the period in question, there did exist ordinances (authorizing Gov. Garcia
to enter into the questioned contracts) which rendered the obtention of another authorization from the Sangguniang
Panlalawigan superfluous. It should also have determined the character of the questioned contracts, i.e., whether they
were, as Gov. Garcia claims, mere disbursements pursuant to the ordinances supposedly passed by the sanggunian or,
as petitioners claim, new contracts which obligate the province without the provincial board’s authority.

Resort to appropriation ordinance is necessary

 The question of whether a sanggunian authorization separate from the appropriation ordinance is required
should be resolved depending on the particular circumstances of the case. Should the appropriation ordinance, for
instance, already contain in sufficient detail the project and cost of a capital outlay such that all that the local chief
executive needs to do after undergoing the requisite public bidding is to execute the contract, no further authorization is
required, the appropriation ordinance already being sufficient.
On the other hand, should the appropriation ordinance describe the projects in generic terms such as "infrastructure
projects," "inter-municipal waterworks, drainage and sewerage, flood control, and irrigation systems projects,"
"reclamation projects" or "roads and bridges," there is an obvious need for a covering contract for every specific project
that in turn requires approval by the sanggunian. Specific sanggunian approval may also be required for the purchase of
goods and services which are neither specified in the appropriation ordinance nor encompassed within the regular
personal services and maintenance operating expenses.

DOCTRINE/PRINCIPLE:

Disbursement, as used in Sec. 346, should be understood to pertain to payments for statutory and contractual
obligations which the sanggunian has already authorized thru ordinances enacting the annual budget and are therefore
already subsisting obligations of the local government unit.

Contracts, as used in Sec. 22(c) on the other hand, are those which bind the local government unit to new
obligations, with their corresponding terms and conditions, for which the local chief executive needs prior authority from
the sanggunian.
 LAUDENCIO TORIO, et al.
vs.
FONTANILLA

G.R. No. L-29993 October 23, 1978

MUNICIPALITY OF MALASIQUI
vs.
FONTANILLA

G.R. No. L-30183 October 23, 1978

MUÑOZ PALMA, J.:

STATEMENT OF FACTS:

The Municipal Council of Malasiqui, Pangasinan, passed Resolution No. 159 “to manage the 1959 Malasiqui
town fiesta celebration…” The “1959 Malasiqui Town Fiesta Executive Committee” was created, which, in turn, organized
a sub-committee on entertainment and stage. A “zarzuela” troupe, of which Vicente Fontanilla was a member, arrived for
their performance on January 22. During the “zarzuela”, the stage collapsed and Fontanilla was pinned underneath. He
was immediately hospitalized, but died the following day.

Fontanilla’s heirs filed a complaint to recover damages against the Municipality of Malasiqui, its Municipal
Council and all the Council’s individual members. The municipality invoked inter alia the defense that as a legally and duly
organized public corporation it performs sovereign functions and the holding of a town fiesta was an exercise of its
governmental functions from which no liability can arise to answer for the negligence of any of its agents.

The councilors maintained that they merely acted as the municipality’s agents in carrying out the municipal
ordinance and as such they are likewise not liable for damages as the undertaking was not one for profit; furthermore,
they had exercised due care and diligence in implementing the municipal ordinance.

After trial, the RTC dismisses the complaint, concluding that the Executive Committee had exercised due
diligence and care in selecting a competent man for the construction of the stage, and the collapse was due to forces
beyond the control of the committee. Consequently, the defendants were not liable for the death of Vicente Fontanilla.
Upon appeal, the Court of Appeals reversed the trial court’s decision and ordered all the defendants-appellees to pay
jointly and severally the heirs of Vicente Fontanilla the sums of P12,000.00 by way of moral and actual
damages:P1200.00 its attorney’s fees; and the costs.

STATEMENT OF THE CASE:

These Petitions for review present the issue of whether or not the celebration of a town fiesta authorized by a
municipal council under Sec. 2282 of the Municipal Law as embodied in the Revised Administrative Code is a
governmental or a corporate or proprietary function of the municipality.

A resolution of that issue will lead to another, viz the civil liability for damages of the Municipality of Malasiqui,
and the members of the Municipal Council of Malasiqui, province of Pangasinan, for a death which occurred during the
celebration of the town fiesta on January 22, 1959, and which was attributed to the negligence of the municipality and its
council members.
ISSUE:

(1) Whether or not the celebration of a town fiesta authorized by a municipal council a governmental or a
corporate function of the municipality?

(2) Whether or not the municipality liable for the death of Fontanilla?

(3) Whether or not the municipal councilors who enacted the ordinance and created the fiesta committee liable
for the death of Fontanilla?

RULING:

1.) The holding of the town fiesta in 1959 by the municipality of Malsiqui Pangasinan was an exercise of a private or
proprietary function of the municipality.

Section 2282 of the Chatter on Municipal Law of the Revised Administrative Code simply gives authority
to the municipality to celebrate a yearly fiesta but it does not impose upon it a duty to observe one. Holding a
fiesta even if the purpose is to commemorate a religious or historical event of the town is in essence an act for
the special benefit of the community and not for the general welfare of the public performed in pursuance of a
policy of the state. The mere fact that the celebration, as claimed was not to secure profit or gain but merely to
provide entertainment to the town inhabitants is not a conclusive test. For instance, the maintenance of parks is
not a source of income for the nonetheless it is private undertaking as distinguished from the maintenance of
public schools, jails, and the like which are for public service. No governmental or public policy of the state is
involved in the celebration of a town fiesta.

Municipal corporations exist in a dual capacity, and their functions are twofold. In one they exercise the right
springing from sovereignty, and while in the performance of the duties pertaining thereto, their acts are political
and governmental Their officers and agents in such capacity, though elected or appointed by the are
nevertheless public functionaries performing a public service, and as such they are officers, agents, and servants
of the state. In the other capacity, the municipalities exercise a private, proprietary or corporate right, arising from
their existence as legal persons and not as public agencies. Their officers and agents in the performance of such
functions act in behalf of the municipalities in their corporate or individual capacity, and not for the state or
sovereign power.

2.) Under the doctrine of respondent superior, petitioner-municipality is liable for damages for the death of Vicente
Fontanilla because the accident was attributable to the negligence of the municipality's officers, employees, or
agents.
Art. 2176, Civil Code: Whoever by act or omission causes damage to another, there being fault or
negligence, is obliged to pay for the damage done. . .

Art. 2180, Civil Code: The obligation imposed by article 2176 is demandable not only for one's own acts
or omission, but also for those of persons for whom one is responsible.

It was found that the stage was not strong enough considering that only P100.00 was appropriate for
the construction of two stages and while the floor of the "zarzuela" stage was of wooden planks, the post and
braces used were of bamboo material. The collapse of the stage was also attributable to the great number of
onlookers who mounted the stage. The municipality and/or its agents had the necessary means within its
command to prevent such an occurrence. But they failed take the necessary steps to maintain the safety of the
stage, particularly, in preventing non-participants or spectators from mounting and accumulating on the stage.
 Municipality cannot evade ability and/or liability under the fact that it was Jose Macaraeg who
constructed the stage. The municipality acting through its municipal council appointed Macaraeg as chairman of
the sub-committee on entertainment and in charge of the construction of the "zarzuela" stage. Macaraeg acted
merely as an agent of the Municipality. Under the doctrine of respondent superior mentioned earlier, petitioner is
responsible or liable for the negligence of its agent acting within his assigned tasks.

3.) The celebration of a town fiesta by the Municipality of Malasiqui was not a governmental function. The legal
consequence thereof is that the Municipality stands on the same footing as an ordinary private corporation with
the municipal council acting as its board of directors. It is an elementary principle that a corporation has a
personality, separate and distinct from its officers, directors, or persons composing it and the latter are not as a
rule co-responsible in an action for damages for tort or negligence culpa aquilla committed by the corporation's
employees or agents unless there is a showing of bad faith or gross or wanton negligence on their part. The
records do not show that municipal councilors directly participated in the defective construction of the "zarzuela"
stage or that they personally permitted spectators to go up the platform. Thus, they are absolved from liability.

DOCTRINE/PRINCIPLE:

A director, merely by reason of his office, is not personally stable for the torts of his corporation; he must be
shown to have personally voted for or otherwise participated in them.

Officers of a corporation 'are not held liable for the negligence of the corporation merely because of their official
relation to it, but because of some wrongful or negligent act by such officer amounting to a breach of duty which resulted
in an injury. To make an officer of a corporation liable for the negligence of the corporation there must have been upon his
part such a breach of duty as contributed to, or helped to bring about, the injury; that is to say, he must be a participant in
the wrongful act.