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Case 1

USA vs Ruiz
Doctrine of Immunity from Suit

Caption: USA VS RUIZ


G.R. No. L-35645 136 scra 487 May 22, 1985
UNITED STATES OF AMERICA, CAPT. JAMES E. GALLOWAY, WILLIAM I.
COLLINS and ROBERT GOHIER, petitioners,
vs.
HON. V. M. RUIZ, Presiding Judge of Branch XV, Court of First Instance of Rizal and
ELIGIO DE GUZMAN & CO., INC., respondents.

Facts:
This is a petition to review, set aside certain orders and restrain perpetually the
proceedings done by Hon. Ruiz for lack of jurisdiction on the part of the trial court.

The United States of America had a naval base in Subic, Zambales. The base was
one of those provided in the Military Bases Agreement between the Philippines and
the United States. Sometime in May, 1972, the United States invited the submission
of bids for a couple of repair projects. Eligio de Guzman land Co., Inc. responded to
the invitation and submitted bids. Subsequent thereto, the company received from
the US two telegrams requesting it to confirm its price proposals and for the name of
its bonding company. The company construed this as an acceptance of its offer so
they complied with the requests. The company received a letter which was signed by
William I. Collins of Department of the Navy of the United States, also one of the
petitioners herein informing that the company did not qualify to receive an award for
the projects because of its previous unsatisfactory performance rating in repairs, and
that the projects were awarded to third parties. For this reason, a suit for specific
performance was filed by him against the US.

Issues:
Whether or not the US naval base in bidding for said contracts exercise
governmental functions to be able to invoke state immunity.

Discussions:
The traditional role of the state immunity exempts a state from being sued in the
courts of another state without its consent or waiver. This rule is necessary
consequence of the principle of independence and equality of states. However, the
rules of international law are not petrified; they are continually and evolving and
because the activities of states have multiplied. It has been necessary to distinguish
them between sovereign and governmental acts (jure imperii) and private,
commercial and proprietary acts (jure gestionis). The result is that State immunity
now extends only to acts jure imperil. The restrictive application of State immunity is
now the rule in the United States, the United Kingdom and other states in western
Europe.

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Rulings:
Yes. The Supreme Court held that the contract relates to the exercise of its
sovereign functions. In this case the projects are an integral part of the naval base
which is devoted to the defense of both the United States and the Philippines,
indisputably a function of the government of the highest order, they are not utilized
for nor dedicated to commercial or business purposes.

The restrictive application of state immunity is proper only when the proceedings
arise out of commercial transactions of the foreign sovereign. Its commercial
activities of economic affairs. A state may be descended to the level of an individual
and can thus be deemed to have tacitly given its consent to be sued. Only when it
enters into business contracts.

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Case 2

Facts:
Respondent filed a case against petitioner for violation of “Labor only” law in the
Larbor arbiter. Petitioner thru the DFA notified the respondent that it was immune
from suit except in cases of borrowing of money, guaranties and sale of securities as
provided by its charter. Even after the notification, the LA still proceed to take
cognizance of the case and rendered decision adverse to that of the petitioner under
the impression that the latter has waived its immunity.
Private respondent argues that, by entering into service contracts with different
private companies, ADB has descended to the level of an ordinary party to a
commercial transaction giving rise to a waiver of its immunity from suit
Issue:
-
Won the petitioner was immune from suit.
Held:

Yes, the petitioner is immune from suit


The charter of the said corporation provides that it is immune from suit, except in
casesof borrowing money, guaranties, and sale of its securities.

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Case 3

INTERNATIONAL CATHOLIC MIGRATION COMMISSION vs CALLEJA


G.R. No. 85750
September 28, 1990
FACTS: ICMC was one of those accredited by the Philippine Government to operate
the refugee processing center in Morong, Bataan. It was incorporated in New York,
USA, at the request of the Holy See, as a non-profit agency involved in international
humanitarian and voluntary work.
IRRI on the other hand was intended to be an autonomous, philanthropic, tax-free,
non-profit, non-stock organization designed to carry out the principal objective of
conducting “basic research on the rice plant, on all phases of rice production,
management, distribution and utilization with a view to attaining nutritive and
economic advantage or benefit for the people of Asia and other major rice-growing
areas through improvement in quality and quantity of rice.”
The labor organizations in each of the above mentioned agencies filed a petition for
certification election, which was opposed by both, invoking diplomatic immunity.
ISSUE: Are the claim of immunity by the ICMC and the IRRI from the application of
Philippine labor laws valid?
HELD: YES
There are basically three propositions underlying the grant of international
immunities to international organizations. These principles, contained in the ILO
Memorandum are stated thus:
1) international institutions should have a status which protects them against control
or interference by any one government in the performance of functions for the
effective discharge of which they are responsible to democratically constituted
international bodies in which all the nations concerned are represented;
2) no country should derive any national financial advantage by levying fiscal
charges on common international funds; and
3) the international organization should, as a collectivity of States members, be
accorded the facilities for the conduct of its official business customarily extended to
each other by its individual member States.
The theory behind all three propositions is said to be essentially institutional in
character. “It is not concerned with the status, dignity or privileges of individuals, but
with the elements of functional independence necessary to free international
institutions from national control and to enable them to discharge their
responsibilities impartially on behalf of all their members. The raison d’etre for these
immunities is the assurance of unimpeded performance of their functions by the
agencies concerned.
**
ICMC’s and IRRI’s immunity from local jurisdiction by no means deprives labor of its
basic rights, which are guaranteed by our Constitution.
For, ICMC employees are not without recourse whenever there are disputes to be
settled. Section 31 of the Convention on the Privileges and Immunities of the
Specialized Agencies of the United Nations provides that “each specialized agency
shall make provision for appropriate modes of settlement of: (a) disputes arising out
of contracts or other disputes of private character to which the specialized agency is
a party.” Moreover, pursuant to Article IV of the Memorandum of Agreement between

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ICMC the the Philippine Government, whenever there is any abuse of privilege by
ICMC, the Government is free to withdraw the privileges and immunities accorded.
Neither are the employees of IRRI without remedy in case of dispute with
management as, in fact, there had been organized a forum for better management-
employee relationship as evidenced by the formation of the Council of IRRI
Employees and Management (CIEM) wherein “both management and employees
were and still are represented for purposes of maintaining mutual and beneficial
cooperation between IRRI and its employees.”
NOTES:
The term “international organization” is generally used to describe an organization
set up by agreement between two or more states. Under contemporary international
law, such organizations are endowed with some degree of international legal
personality such that they are capable of exercising specific rights, duties and
powers. They are organized mainly as a means for conducting general international
business in which the member states have an interest. The United Nations, for
instance, is an international organization dedicated to the propagation of world
peace.
“Specialized agencies” are international organizations having functions in particular
fields.

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Case 4

Republic of Indonesia vs Vinzon


doctrine of sovereign immunity

REPUBLIC OF INDONESIA VS VINZON


G.R. No. 154705 405 SCRA 126 June 26, 2003
THE REPUBLIC OF INDONESIA, HIS EXCELLENCY AMBASSADOR
SOERATMIN, and MINISTER COUNSELLOR AZHARI KASIM, petitioners,
vs.
JAMES VINZON, doing business under the name and style of VINZON TRADE AND
SERVICES, respondent.

Facts:
This is a petition for review of the decision made by Court of Appeals in ruling that
the Republic of Indonesia gave its consent to be sued and voluntarily submitted itself
to the laws and jurisdiction of Philippine courts and that petitioners Ambassador
Soeratmin and Minister Counsellor Kasim waived their immunity from suit.

Petitioner, Republic of Indonesia, represented by its Counsellor, Siti Partinah,


entered into a Maintenance Agreement with respondent James Vinzon, sole
proprietor of Vinzon Trade and Services. The equipment covered by the
Maintenance Agreement are air conditioning units and was to take effect in a period
of four years.

When Indonesian Minister Counsellor Kasim assumed the position of Chief of


Administration, he allegedly found respondent’s work and services unsatisfactory
and not in compliance with the standards set in the Maintenance Agreement. Hence,
the Indonesian Embassy terminated the agreement.

The respondent claims that the aforesaid termination was arbitrary and unlawful.
Hence, he filed a complaint against the petitioners which opposed by invoking
immunity from suit.

Issues:
Whether or not the Republic of Indonesia can invoke the doctrine of sovereign
immunity from suit.
Whether or not petitioners Ambassador Soeratmin and Minister Counsellor Kasim
may be sued herein in their private capacities.

Discussions:

The rule that a State may not be sued without its consent is a necessary
consequence of the principles of independence and equality of States. The practical
justification for the doctrine of sovereign immunity is that there can be no legal right
against the authority that makes the law on which the right depends. In the case of
foreign States, the rule is derived from the principle of the sovereign equality of

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States, as expressed in the maxim par in parem non habet imperium. All states are
sovereign equals and cannot assert jurisdiction over one another.] A contrary attitude
would “unduly vex the peace of nations”.

The rules of International Law, however, are not unbending or immune to change.
The increasing need of sovereign States to enter into purely commercial activities
remotely connected with the discharge of their governmental functions brought about
a new concept of sovereign immunity. This concept, the restrictive theory, holds that
the immunity of the sovereign is recognized only with regard to public acts or acts
jure imperii (public acts of the government of a state), but not with regard to private
acts or acts jure gestionis (the commercial activities of a state.)

Rulings:
The Supreme Court ruled that the republic of Indonesia cannot be deemed to have
waived its immunity to suit. The mere entering into a contract by a foreign state with
a private party cannot be construed as the ultimate test of whether or not it is an act
juri imperii or juri gestionis. Such act is only the start of the inquiry. There is no
dispute that the establishment of a diplomatic mission is an act juri imperii. The state
may enter into contracts with private entities to maintain the premises, furnishings
and equipment of the embassy. The Republic of Indonesia is acting in pursuit of a
sovereign activity when it entered into a contract with the respondent. The
maintenance agreement was entered into by the Republic of Indonesia in the
discharge of its governmental functions. It cannot be deemed to have waived its
immunity from suit.

Article 31 of the Vienna Convention on Diplomatic Relations provides that a


diplomatic agent shall enjoy immunity from the criminal jurisidiction of the receiving
State. He shall also enjoy immunity from its civil and administrative jurisdiction,
except in the case of: a real action relating to private immovable property situated in
the territory of the receiving State, unless he holds it on behalf of the sending State
for the purposes of the mission; an action relating to succession in which the
diplomatic agent is involved as executor, administrator, heir or legatee as a private
person and not on behalf of the sending State; an action relating to any professional
or commercial activity exercised by the diplomatic agent in the receiving State
outside his official functions.

The Solicitor General believes that said act may fall under subparagraph (c) thereof,
but said provision clearly applies only to a situation where the diplomatic agent
engages in any professional or commercial activity outside official functions, which is
not the case herein.

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Case 5
Case 6

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