RP INDONESIA VS VIZON

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:

1. Whether or not the Republic of Indonesia can invoke the doctrine of sovereign immunity
from suit.
2. 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 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:

1. 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.
2. 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:
o 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;
o 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;
o 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.
Nicolas vs Romulo
Daniel Smith committed the crime of rape against Nicole. He was convicted of the said
crime and was ordered by the court to suffer imprisonment. Smith was a US serviceman
convicted of a crime against our penal laws and the crime was committed within the
country’s jurisdiction. But pursuant to the VFA, a treaty between the US and Philippines, the
US embassy was granted custody over Smith. Nicole, together with the other petitioners
appealed before the SC assailing the validity of the VFA. Their contention is that the VFA
was not ratified by the US senate in the same way our senate ratified the VFA.
ISSUE: Is the VFA void and unconstitutional & whether or not it is self-executing.
HELD: The VFA is a self-executing Agreement because the parties intend its provisions to
be enforceable, precisely because the VFA is intended to carry out obligations and
undertakings under the RP-US Mutual Defense Treaty. As a matter of fact, the VFA has
been implemented and executed, with the US faithfully complying with its obligation to
produce Smith before the court during the trial.
The VFA is covered by implementing legislation inasmuch as it is the very purpose and
intent of the US Congress that executive agreements registered under this Act within 60
days from their ratification be immediately implemented. The SC noted that the VFA is not
like other treaties that need implementing legislation such as the Vienna Convention. As
regards the implementation of the RP-US Mutual Defense Treaty, military aid or assistance
has been given under it and this can only be done through implementing legislation. The
VFA itself is another form of implementation of its provisions.

Holy See vs. Rosario G.R. 101949 (1994)

Facts of the Case:

Petitioner in this case is the Holy See (who exercises sovereignty over the Vatican City in Rome Italy
and is represented in the Philippines by the Papal Nuncio. Respondent in this case is Hon. Edilberto
Rosario in his capacity as the Presiding Judge of RTC Makati, Branch 61 and Starbright Sales
Enterprises, a domestic corporation engaged in the real estate business.

The petition started from a controversy over a parcel of land. Lot 5A registered under the name of the
Holy See, is connected to Lot 5B and 5D under the name of Philippine Realty Corporation. The land
was donated by the Archdiocese of Manila to the Papal Nuncio which represented the Holy See who
exercises sovereignty over the Vatican City, Rome Italy for his residence.

The said lots were sold to Ramon Licup who assigned his rights to respondents Starbright Sales, Inc.
When the squatters refused to vacate the lots, a dispute arose between these two parties because both
were unsure as to whose responsibility was it to evict the squatters from the said lots. Respondent
Starbright insists that the Holy See should clear the property while Holy See says that Starbright
should do it or the earnest money will be returned.

Since Starbright refused to clear the property, Msgr. Cirilios, the agent, returned P100k earnest
money. The same lots were sold to Tropicana Properties.

Starbright filed a suit for annulment of sale, specific performance and damages against Msgr.
Cirilios, Philippine Realty Corporation and Tropicana. The Holy See moved to dismiss the petition
for lack of jurisdiction based on sovereign immunity of suit. The RTC denied the motion on the
ground that the petitioner already shed off its sovereign immunity by entering into a business
contract.

Issue:

Can the Holy See invoke sovereign immunity?

Court Ruling:

YES. The Court held that the Holy See may properly invoke sovereign immunity for its non-
suability. In Article 31 (A) of the 1961 Vienna Convention on Diplomatic Relations, diplomatic
envoy (a representative government who is sent on a special diplomatic mission) shall be granted
immunity from civil and administrative jurisdiction of the receiving state over any real action relating
to private immovable property.

The DFA certified that the Embassy of the Holy See is a duly accredited diplomatic missionary to the
Republic of the Philippines and is thus exempted from local jurisdiction and is entitled to immunity
rights of a diplomatic mission or embassy in this Court.

While the said lot was acquired and bought in the ordinary cause of real estate business, its
acquisition and disposal were not made for profit but claimed that it acquired the said property for its
mission or the Apostolic Nunciature of the Philippines.
Besides, the act of selling the land concerned is non-proprietary in nature, or is not covered by a
patent or trademark. The transfer and disposal of property are likewise clothed with a governmental
character as the petitioner did not buy and sell the land for gain but merely because they cannot evict
the said squatters in the property

DFA vs NLRC Case Digest

Diplomatic Immunity, Suits against International Agencies

Facts:

On 27 January 1993, private respondent Magnayi filed an illegal dismissal case against
Asian Development Bank. Two summonses were served, one sent directly to the ADB
and the other through the Department of Foreign Affairs. ADB and the DFA notified
respondent Labor Arbiter that the ADB, as well as its President and Officers, were
covered by an immunity from legal process except for borrowings, guaranties or the
sale of securities pursuant to Article 50(1) and Article 55 of the Agreement Establishing
the Asian Development Bank (the "Charter") in relation to Section 5 and Section 44 of
the Agreement Between The Bank and The Government Of The Philippines Regarding
The Bank's Headquarters (the "Headquarters Agreement").

The Labor Arbiter took cognizance of the complaint on the impression that the ADB had
waived its diplomatic immunity from suit and, in time, rendered a decision in favor
Magnayi. The ADB did not appeal the decision. Instead, on 03 November 1993, the DFA
referred the matter to the NLRC; in its referral, the DFA sought a "formal vacation of
the void judgment." When DFA failed to obtain a favorable decision from the NLRC, it
filed a petition for certiorari.

Issues:

1. Whether or not ADB is immune from suit

2. Whether or not 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

3. Whether or not the DFA has the legal standing to file the present petition

4. Whether or not the extraordinary remedy of certiorari is proper in this case

Held:

1. Under the Charter and Headquarters Agreement, the ADB enjoys immunity from legal
process of every form, except in the specified cases of borrowing and guarantee
operations, as well as the purchase, sale and underwriting of securities. The Bank’s
officers, on their part, enjoy immunity in respect of all acts performed by them in their
official capacity. The Charter and the Headquarters Agreement granting these
immunities and privileges are treaty covenants and commitments voluntarily assumed
by the Philippine government which must be respected.

Being an international organization that has been extended a diplomatic status, the
ADB is independent of the municipal law. "One of the basic immunities of an
international organization is immunity from local jurisdiction, i.e., that it is immune
from the legal writs and processes issued by the tribunals of the country where it is
found. The obvious reason for this is that the subjection of such an organization to the
authority of the local courts would afford a convenient medium thru which the host
government may interfere in their operations or even influence or control its policies
and decisions of the organization; besides, such subjection to local jurisdiction would
impair the capacity of such body to discharge its responsibilities impartially on behalf of
its member-states."
2. No. The ADB didn't descend to the level of an ordinary party to a commercial
transaction, which should have constituted a waiver of its immunity from suit, by
entering into service contracts with different private companies. “There are two
conflicting concepts of sovereign immunity, each widely held and firmly established.
According to the classical or absolute theory, a sovereign cannot, without its consent,
be made a respondent in the Courts of another sovereign. According to the newer or
restrictive theory, the immunity of the sovereign is recognized only with regard
to public acts or acts jure imperii of a state, but not with regard toprivate act or acts
jure gestionis.

“Certainly, the mere entering into a contract by a foreign state with a private party
cannot be the ultimate test. Such an act can only be the start of the inquiry. The logical
question is whether the foreign state is engaged in the activity in the regular course of
business. If the foreign state is not engaged regularly in a business or trade, the
particular act or transaction must then be tested by its nature. If the act is in pursuit of
a sovereign activity, or an incident thereof, then it is an act jure imperii, especially
when it is not undertaken for gain or profit.”

The service contracts referred to by private respondent have not been intended by the
ADB for profit or gain but are official acts over which a waiver of immunity would not
attach.

3. Yes. The DFA's function includes, among its other mandates, the determination of
persons and institutions covered by diplomatic immunities, a determination which,
when challenged, entitles it to seek relief from the court so as not to seriously impair
the conduct of the country's foreign relations. The DFA must be allowed to plead its
case whenever necessary or advisable to enable it to help keep the credibility of the
Philippine government before the international community. When international
agreements are concluded, the parties thereto are deemed to have likewise accepted
the responsibility of seeing to it that their agreements are duly regarded. In our
country, this task falls principally on the DFA as being the highest executive department
with the competence and authority to so act in this aspect of the international arena. In
Holy See vs. Hon. Rosario, Jr., this Court has explained the matter in good detail; viz:
"In Public International Law, when a state or international agency wishes to plead
sovereign or diplomatic immunity in a foreign court, it requests the Foreign Office of the
state where it is sued to convey to the court that said defendant is entitled to immunity.

"In the United States, the procedure followed is the process of 'suggestion,' where the
foreign state or the international organization sued in an American court requests the
Secretary of State to make a determination as to whether it is entitled to immunity. If
the Secretary of State finds that the defendant is immune from suit, he, in turn, asks
the Attorney General to submit to the court a 'suggestion' that the defendant is entitled
to immunity.

"In the Philippines, the practice is for the foreign government or the international
organization to first secure an executive endorsement of its claim of sovereign or
diplomatic immunity. But how the Philippine Foreign Office conveys its endorsement to
the courts varies. In International Catholic Migration Commission vs. Calleja, 190 SCRA
130 (1990), the Secretary of Foreign Affairs just sent a letter directly to the Secretary
of Labor and Employment, informing the latter that the respondent-employer could not
be sued because it enjoyed diplomatic immunity. In World Health Organization vs.
Aquino, 48 SCRA 242 (1972), the Secretary of Foreign Affairs sent the trial court a
telegram to that effect. In Baer vs. Tizon, 57 SCRA 1 (1974), the U.S. Embassy asked
the Secretary of Foreign Affairs to request the Solicitor General to make, in behalf of
the Commander of the United States Naval Base at Olongapo City, Zambales, a
'suggestion' to respondent Judge. The Solicitor General embodied the 'suggestion' in a
manifestation and memorandum as amicus curiae.

"In the case at bench, the Department of Foreign Affairs, through the Office of Legal
Affairs moved with this Court to be allowed to intervene on the side of petitioner. The
Court allowed the said Department to file its memorandum in support of petitioner's
claim of sovereign immunity.

"In some cases, the defense of sovereign immunity was submitted directly to the local
courts by the respondents through their private counsels. In cases where the foreign
states bypass the Foreign Office, the courts can inquire into the facts and make their
own determination as to the nature of the acts and transactions involved."
4. Yes. Relative to the propriety of the extraordinary remedy of certiorari, the Court has,
under special circumstances, so allowed and entertained such a petition when (a) the
questioned order or decision is issued in excess of or without jurisdiction, or (b) where
the order or decision is a patent nullity, which, verily, are the circumstances that can be
said to obtain in the present case. When an adjudicator is devoid of jurisdiction on a
matter before him, his action that assumes otherwise would be a clear nullity.

Petition for certiorari is GRANTED, and the decision of the Labor Arbiter, dated 31
August 1993 is VACATED for being NULL AND VOID. (DFA vs NLRC, G.R. No.
113191, 18 September 1996)

WHO vs Aquino Case Digest

Diplomatic Immunity, Political Question, Suits against International Agencies

Facts:

Dr. Leonce Verstuyft was assigned by WHO to its regional office in Manila as Acting
Assistant Director of Health Services. His personal effects, contained in twelve
(12) crates, were allowed free entry from duties and taxes. Constabulary Offshore
Action Center (COSAC) suspected that the crates “contain large quantities of highly
dutiable goods” beyond the official needs of Verstuyft. Upon application of the COSAC
officers, Judge Aquino issued a search warrant for the search and seizure of the
personal effects of Verstuyft.

Secretary of Foreign Affairs Carlos P. Romulo advised Judge Aquino that Dr. Verstuyft is
entitled to immunity from search in respect for his personal baggage as accorded to
members of diplomatic missions pursuant to the Host Agreement and requested that
the search warrant be suspended. The Solicitor General accordingly joined Verstuyft for
the quashal of the search warrant but respondent judge nevertheless summarily denied
the quashal. Verstuyft, thus, filed a petition for certiorari and prohibition with the
SC. WHO joined Verstuyft in asserting diplomatic immunity.
Issue:

Whether or not personal effect of Verstuyft can be exempted from search and seizure
under the diplomatic immunity.

Held:

Yes. The executive branch of the Phils has expressly recognized that Verstuyft is
entitled to diplomatic immunity, pursuant to the provisions of the Host Agreement. The
DFA formally advised respondent judge of the Philippine Government's official position.
The Solicitor General, as principal law officer of the gorvernment, likewise expressly
affirmed said petitioner's right to diplomatic immunity and asked for the quashal of the
search warrant.

It is a recognized principle of international law and under our system of separation of

powers that diplomatic immunity is essentially a political question and courts should
refuse to look beyond a determination by the executive branch of the government,
and where the plea of diplomatic immunity is recognized and affirmed by the executive
branch of the government as in the case at bar, it is then the duty of the courts to
accept the claim of immunity upon appropriate suggestion by the principal law officer of
the government, the Solicitor General in this case, or other officer acting under his
discretion. Courts may not so exercise their jurisdiction by seizure and detention of
property, as to embarass the executive arm of the government in conducting foreign
relations.

The Court, therefore, holds the respondent judge acted without jurisdiction and with
grave abuse of discretion in not ordering the quashal of the search warrant issued by
him in disregard of the diplomatic immunity of petitioner Verstuyft. (World Health
Organization vs. Aquino, G.R. No. L-35131, November 29, 1972, 48 SCRA 243)