state - nature of liability

7/29/2019 State - Nature of Liability

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MARCOS MENDOZA vs. FRANCISCO DE LEON

FIRST DIVISION

[G.R. No. 9596. February 11, 1916.]

MARCOS MENDOZA, plaintiff-appellee,vs. FRANCISCO DE LEON ET AL.,defendants-appellants.

Luis Morales for the appellants.

Hugo Sansano for appellee.

SYLLABUS

1. MUNICIPAL CORPORATIONS;

GOVERNMENTAL POWERS AND CORPORATE

POWERS; LIABILITY TO PRIVATE PERSONS.

The Municipal Code confers both governmental andbusiness or corporate powers upon municipal

corporations. For the exercise of the former it is not liableto private persons. It's liability to them for the wrongful

exercise of the latter is the same as that of a privatecorporation or individual.

2. ID.; ID.; ID.; OFFICERS AND AGENTS Officers and agents of municipal corporations charged

with the performance of governmental duties which aretheir nature legislative, judicial, or quasi-judicial, are not

liable for the consequences of their official act unless it

be shown that they act willfully and maliciously, with theexpress purpose of inflicting injury upon the plaintiff.

3. ID.; ID.; ID.; ID. Officers of municipalitiescharged with the administration of patrimonial property

of a municipal corporation are liable for mismanagementof its affairs as are directors or managing officers of

private corporations; not for mere mistakes of judgment,but only when their acts are so far opposed to the true

interests of the municipality as to lead to the clearinference that no one thus acting could have been

influenced by any honest desire to secure such interests,but that they must have acted with an intent to subserve

some outside purpose regardless of the consequences tothe municipality and in a manner inconsistent with its

interest.4. ID.; ID.; ID.; ID. The defendant councillors

regularly leased an exclusive ferry privilege to theplaintiff for two years. After continuous user of a little

more than one year, they forcibly evicted him on thepretext that he was not operating the ferry leased to him.

Held: Under the evidence of record, that there is nomanner of doubt that this pretext was absolutely without

foundation and as there was therefore no occasion

whatever for rescinding the contract, the defendant

councillors are liable personally for the damagesresulting to the lessee by their wrongful action.

D E C I S I O N

TRENT, Jp:


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This is an action for damages against theindividual members of the municipal council of the

municipality of Villasis, Pangasinan, for the revocation

of the lease of an exclusive ferry privilege awarded to the

plaintiff under the provisions of Act. No. 1634 of thePhilippine Commission. After user of a little more than

one year, the plaintiff was forcibly ejected under and inpursuance of a resolution adopted by the herein

defendants, awarding a franchise for the same ferry toanother person.

Municipalities of the Philippine Islands organizedunder the Municipal Code have both governmental and

corporate or business functions. Of the first class are theadoption of regulations against fire and disease,

preservation of the public peace maintenance ofmunicipal prisons, establishment of primary schools and

post-offices, etc. Of the latter class are the establishmentof municipal waterworks for the use of the inhabitants,

the construction and maintenance of municipalslaughterhouses, markets, stables, bathing

establishments, wharves, ferries, and fisheries. Act No.1634 provides that the use of each fishery, fish-breeding

ground, ferry, stable, market, slaughterhouse belonging

to any municipality or township shall be let to the highestbidder annually or for such longer period not exceeding

five years as may have been previously approved by the

provincial board of the province in which themunicipality or township is located.

The twofold character of the powers of amunicipality, under our Municipal Code (Act No. 82) is

so apparent and its private or corporate powers so

numerous and important that we find no difficulty in

reaching the conclusion that the general principlesgoverning the liability of such entities to private

individuals as enunciated in the United States are

applicable to it. The distinction between governmental

powers on the one hand, and corporate or proprietary orbusiness powers on the other, as the latter class is

variously described in the reported cases, has long beenrecognized in the United States and there is no dissent

from the doctrine.

In Wilcox vs. City of Rochester (190 N.Y., 137), it

was said:

"The broad general doctrine of the

Maxmilian case (Maxmilian vs. Mayor, etc.,New York, 62 N.Y., 160), which is certainly

not now open to question in the courts of thisState, is that 'two kinds of duties are imposed

on municipal corporations, the onegovernmental and a branch of the general

administration of the state, the otherquasiprivate or corporate;' and 'that in the exercise

of the latter duties the municipality is liablefor the acts of its officers and agents, while in

the former it is not.' (Cullen, J., in Lefrois vs

Co. of Monroe, 162 N.Y., 563, 567.)"

The Maxmilian case is quoted with approval in

Bond vs. Royston (130 Ga., 646).

In Co. Comm's of Anne Arundel Co. vs. Duckett(20 Md., 468, 476; 83 Am. Dec., 557), it was said:

"With the regard to the liability of apublic municipal corporation for the acts of its

officers, the distinction is between an exercise


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of those legislative powers which it holds forthe public purposes, and as part of the

government of the country, and those private

franchises which belong to it, as a creation of

the law; within the sphere of the former, itenjoys the exemption of the government, from

responsibility for its own acts, and for the actsof those who are independent corporate

officers, deriving their rights and duties fromthe sovereign power. But in regard to the

latter, it is responsible for the acts of thosewho are in law its agents, though they may

not be appointed by itself."

This case is quoted with approval in Trammell vs.

Russellville (34 Ark., 105; 36 Am. Rep., 1); and inMcIlheney vs. Wilmington (127 N. C., 146; 50 L. R. A.,

470).

In Cummings vs. Lobsitz (42 Okla., 704; L. R. A.,

N. S., 1915 B, p. 415), it was said:

"A distinction is made between the

liability of a municipal corporation for theacts of its own officers in the exercise of

powers which it possesses for the publicpurpose and which it holds as agent of the

state, and those powers which embrace private

or corporate duties and are exercised for the

advantage of the municipality and itsinhabitants. When the acts of its officers come

within the powers which it has as agent of thestate, it is exempt from liability for its own

acts and the acts of its officers; if the acts of

the officer or agent of the city are for the

special benefit of the corporation in its privateor corporate interest, such officer is deemed

the agent or servant of the city, but where the

act is not in relation to a private or corporate

interest of the municipality, but for the benefitof the public at large, such acts by the agents

and servants are deemed to be acts by publicor state officers, and for the public benefit."

The distinction is also recognized by Dillon in hiswork on Municipal Corporations (5th ed.) sections 38

and 39.

As is indicated in some of the above quoted cases,

the municipality is not liable for the acts of its officers oragents in the performance in the performance of its

governmental functions. Governmental affairs do not losetheir governmental character by being delegated to the

municipal government. Nor does the fact that such dutiesare performed by such officers of the municipality which,

for convenience, the state allows the municipality toselect, change their character. To preserve the peace,

protect the morals and health of the community and so onis to administer government, whether it be done by the

central government itself or is shifted to a local

organization. And the state being immune for injuries

suffered by private individuals in the administration ofstrictly governmental functions, like immunity is enjoyed

by the municipality in the performance of the sameduties, unless it is expressly made liable by statute.

"The state cannot, without its consentexpressed through legislation, be sued for

injuries resulting from an act done in the

exercise of its lawful governmental powers


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and pertaining to the administration ofgovernment. . . . Municipal corporations are

agents of the state in the exercise of certain

governmental powers. The preservation of the

health and peace of its inhabitants and fireprotections afforded the property owner, are

governmental functions." (Burke vs. City ofSouth Omaha, 79 Neb., 793)

In Nicholson vs. Detroit (129 Mich., 246; 56. L. R.A., 601), it was said:

"It is the well-settled rule that the stateis not liable to private persons who suffer

injuries through negligence of its officers and the rule extends to townships and cities

while in the performance of state

functions, imposed upon them by the law.

This subject is fully discussed in Detroit vs.Blackeby (21 Mich., 84; 4 Am. Rep., 450). It

was there held that cities are governmentalagencies, and that their 'officers are in no such

sense municipal agents; that their negligenceis the neglect of the municipality; nor will

their misconduct be chargeable against them,

unless the act complained of be either

authorized or ratified.' And in a large numberof cases it has been held that there is no such

liability on the part of such governmentalagency unless it has been imposed by statute,

and in such case it is necessarily limited bythe statute."

In Claussen vs City of Luverne (103 Minn., 491;

15 L. R. A., N. S., 698), it was said:

"It is elementary that neither the statenor any of the subdivisions, like a

municipality, through which it operates, is

liable for torts committed by public officers,

save in definitely excepted classes of cases.The exemption is based upon the sovereign

character of the state and its agencies, andupon the absence of obligation, and not on the

ground that by no means for remedy has beenprovided. 'The government,' said Mr. Justice

Story, 'does not undertake to guarantee to anyperson the fidelity of the officers or agents

whom it employs, since that would involve it

in all its operations in endless

embarrassments, difficulties and losses, whichwould be subversive of the public interest.'

(U.S. vs Kirkpatrick, 9 Wheat., 720; 6 L. ed.,199; Beers vs. Arkansas, 20 How., 527; 15 L.

ed., 991) This general exemption has beenapplied to municipal corporations in so far as

the acts complained of were, in the languageof the memorandum of the trial court, 'done in

exercising powers for the public at large as a

governing agency.' While so acting, the citycannot be held liable for misfeasance; and . . .the rule ofrespondeat superiorhas no

application."

Nor are officers or agents of the Governmentcharged with the performance of governmental duties

which are in their nature legislative, or quasi judicial,

liable for the consequences of their official acts, unless it


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be shown that they act willfully and maliciously, andwith the express purpose of inflicting injury upon the

plaintiff. If they exercise their honest judgment in the

performance of their duties, their errors cannot be

charged against them. (People vs. May, 251 Ill., 54; SaltLake County vs. Clinton [Utah, 1911], 117 Pac., 1075;

Comanche County vs. Burks (Tex. Civ. App., 19140, 166S. W., 470; Monnier vs. Godbold, 1166 La., 165; 5 L. R.

A., N. S., 463; Ray vs. Dodd, 132 Mo. App., 444;Johnson vs. Marsh, 82 N. J. L., 4; Gregory vs. Brooks, 37

Conn., 365; Lecourt vs. Gaster, 50 La. Ann., 521.) So itmay be said that in so far as its governmental functions

are concerned, a municipality is not liable at all, unless

expressly made by statute; nor are its officers, so long as

they perform their duties honestly and in good faith. Themost common illustration of both phases of this rule is

the action for false imprisonment so often broughtagainst a municipality or a municipal officer. (Bartlett vs.

City of Columbus, 101 Ga., 300; 44 L. R. A. 795; Petersvs. City of Lindsborg, 40 Kan., 654.) So, in Field vs. City

of Des Moines (39 Iowa, 575), it was held that amunicipality, acting under authority given it by the

central government to destroy houses in the path of a

conflagration, was not liable in damages in the absenceof a statute expressly making it so.

From what has already been said, it should be clear

that a municipality is not exempt from liability for thenegligent performance of its corporate or proprietary or

business functions. In the administration of itspatrimonial property, it is to be regarded as a private

corporation or individual 153113-13 so far as its liabilityto third persons on contract or in tort is concerned. Its

contracts, valid entered into, may be enforced and

damages may be collected from it for the torts of itsofficers or agents within the scope of their employment

in precisely the same manner and to the same extent as

those of private corporations or individuals. As to such

matters the principles respondeat superiorapplies. It isfor these purposes that the municipality is made liable to

suits in the courts.

"Municipal corporations are subject to

be sued upon contracts and in tort. In aprevious chapter we have considered at length

the authority of such corporations to makecontracts, the mode of exercising, and the

effect of transcending the power. This leavesbut little to add in this place respecting their

liability in actions ex contractu. Upon anauthorized contractthat is, upon a contract

within the scope of the charter or legislativepowers of the corporation and duly made by

the proper officers or agents they are liablein the same manner and to the same extent as

private corporations or natural persons."(Dillon on Municipal Corporations, 5th ed.,

sec. 1610.)

The same author says in section 1647:

"The rule of law is a general one, that

the superior or employer must answer civilly

for the negligence or want of skill of his agentor servant in the course or line of his

employment, by which another, who is freefrom contributory fault, is injured. Municipal

corporations, under the conditions herein

stated, fall within the operation of this rule of


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law, and are liable, accordingly, to civilactions for damages when the requisite

elements of liability coexist. To create such

liability, it is fundamentally necessary that the

act done which is injurious to others must bewithin the scope of the corporate powers as

prescribed by charter or positive enactment(the extent of which powers all persons are

bound, at their peril, to know); in other words,it must not be ultra vires in the sense that it is

not within the power or authority of thecorporation to act in reference to it under any

circumstances. If the act complained of

necessarily lies wholly outside of the general

or special powers of the corporation asconferred in its charter or by statute, the

corporation can in no event be liable to anaction for damages, whether it directly

commanded the performance of the act orwhether it be done by its officers without its

express command; for a corporation cannot ofcourse, be impliedly liable to a greater extent

than it could make itself by express corporate

vote or action."It often happens that the same agent or agency has

both a governmental and a corporate character. Such, for

instance, are a municipal water system designed both forprotection against fire (a governmental function) and to

supply water to the inhabitants for profit (a corporatefunction) (Omaha Water Co., vs. Omaha, 12 L. R. A., N.

S. 736; 77 C. C. A., 267; 147 Fed., 1; Judson vs. Boroughof Winsted, 80 Conn., 384; 15 L. R. A., N. S., 91); a

municipal light plant both for lighting the streets (a

governmental function) and for furnishing light to theinhabitants at a profit (a corporate function) (Fisher vs.

New Bern, 140 N. C., 506; 111 Am. St. Rep., 857); an

agent who is at the same time a police officer and a

caretaker of a municipal toll bridge (Woodhull vs.Mayor, etc., of New York, 150 N. Y., 450). It is, also,

sometimes the case that considerable difficulty isexperienced in determining whether a particular

municipal duty is governmental or corporate.

But questions such as these do not arise in the case

at bar. Here it is clear that the leasing of a municipal ferryto the highest bidder for a specified period of time is not

a governmental but corporate function. Such a lease,when validly entered into, constitutes a contract with the

lessee which the municipality is bound to respect. Thematter is thus summed up by Dillon on Municipal

Corporations (5th ed., sec. 1306):

"Ordinances made by municipalities

under charter or legislative authority,containing grants to water and light

companies and other public servicecorporations of the right to use the street

pipes, mains, etc., upon the condition of the

performance of service by the grantee, are,

after acceptance and performance by thegrantee, contracts protected by the prohibition

of the Federal Constitution against theenactment of any State Law impairing the

obligation of contracts."

Again, this author, adopting the language of the

court inIn re Fay (15 Pick. [Mass.], 243), says, in section

277:


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"If a municipal corporation, seized of aferry, lease the same, through the agency of

the mayor and aldermen, with a covenant of

quiet enjoyment, this covenant will not

restrain the mayor and aldermen fromexercising the powers vested in them by

statute, to license another ferry over the samewaters, if in their judgment (which cannot be

reviewed by the courts) the public necessityand convenience require it. On such a

covenant the city may be liable to thecovenantees; but the powers vested in the city

officers as trustees of the public cannot be

thus abrogated. If, however, the city in its

corporate capacity is the legal owner of anexclusive franchise, its grantees or lessees

would hold it, notwithstanding any license toothers, whether granted by the mayor and

aldermen or any other tribunal."

It seems clear, therefore, that under the provisions

of the Municipal Code and Act No. 1634, above referredto, the plaintiff had a vested right to the exclusive

operation of the ferry in question for the period of his

lease. Were the municipality a party to this action, itwould be patent that a judgment for damages against it

for the rescission of the contract would be proper. This,

be it said, is the usual method of exacting damages, eitherex contractu orex delicto arising from the exercise of

corporate powers of municipalities. But the presentaction is against the members of the municipal council

personally, and the question arise: Are they liable? Inadministering the patrimonial property of municipalities,

the municipal council occupies, for most purposes, the

position of a board of directors of a private corporation.In disposing of the local public utilities, if the term may

be used, such as the fishing and ferry rights, etc., they

must exercise considerable judgment. It requires some

considerable amount of business acumen to compelperformance on the part of lessees of these privileges in

accordance with the terms of their leases and in a mannerin which will not cause the property to deteriorate.

Questions must continually arise which are not expresslyprovided for in the contracts and which must be settled, if

possible, in a manner that will preserve the just claims ofthe municipality. Indeed, it is not at all improbable that

on occasion the councilors may have reason to believe

that a particular contract has been rescinded by the other

party or has never been legally entered into, in both ofwhich cases, decisive steps must be taken to safeguard

the interest of the municipality. Thus, in Municipality ofMoncada vs. Cajuigan (21 Phil. Rep., 184), the lessee of

a municipal fishery was evicted for failing to pay hisquarterly rents. The municipal authorities rightly held

that the contract was rescinded but forcibly evicted thelessee instead of resorting to the courts. Hence, in an

action by the municipality against the lessee and his

bondsmen to recover rent arrears, damages were allowedthe lessee on his counterclaim for the loss caused by theforcible eviction. Nevertheless, we do not think the

councilors could have been personally held liable for

their error in resorting to forcible eviction of the lessee.

Theirs was an error of judgment, and honest mistake ontheir part as to the rights of the municipality in the

premises. We think the rule of personal liability shouldbe with municipal councilors in such matters as it is with


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the directors or managers of an ordinary privatecorporation.

"Under the rule that directors are notliable for mistakes of judgment, it follows

naturally that they are not liable for themismanagement of the corporate affairs where

such mismanagement is a mistake ofjudgment. The wisdom of this rule is not only

approved by common experience but by lawwriters and all courts. A rule so rigid as to

hold directors personally liable for honestmistakes in corporate management would

deter all prudent business men from acceptingsuch positions. The remedy of stockholders in

all such cases is by a change in the directory. .. . The rule is that the courts will not interfere

even in doubtful cases. But directors andmanaging directors may be liable for

mismanagement to warrant the interpositionof a court either as against the contemplated

action of the directors, or a majority of thestockholders, or to give relief by way of

damages after the action has been taken; a

case must be made out which plainly showsthat such action is so far opposed to the true

interests of the corporation itself as to lead to

the clear inference that no thus acting couldhave been influenced by any honest desire to

secure such interests, but that he must haveacted with an intent to subserve some outside

purpose, regardless of the consequences to thecorporation, and in a manner inconsistent with

its interests." (Thompson on Corporations,sec. 1298.)

In the case at bar, there is not a scintilla of

evidence that there was any justifiable reason for forcibly

evicting the plaintiff from the ferry which he had leased.On the contrary, the defendant councilors attempted tojustify their action on the ground that the ferry which he

was operating was not the one leased to him; this in spiteof the fact the vice-president had personally placed him

in possession of it more than a year before, and the factthat he had operated this ferry for over a year, evidently

with the knowledge of the defendants. The evidence is soclear that the ferry of which the plaintiff was

dispossessed was the one which he had leased that noreasonable man would entertain any doubt whatever upon

the question. Hence, we cannot say that in rescinding thecontract with the plaintiff, thereby making the

municipality liable to an action for damages for no validreason at all, the defendant councilors were honestly

acting for the interests of the municipality. We are,therefore, of the opinion that the defendants are liable

jointly and severally for the damages sustained by the

plaintiff from the rescission of his contract of lease of the

ferry privilege in question. In reaching this conclusion,we have not failed to take into consideration the rule

enunciated in Dennison vs. The Moro Province (R. G.No. 8173, March 28, 1914; not reported), nor the

distinction made by the courts in the United Statesbetween the liability of a municipal corporation, made

such by acceptance of a village or city charter, and the

involuntary quasi corporations known as counties, towns,


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schools districts, and especially the townships of NewEngland. Upon the question of the amount of damages

sustained, we accept the findings of the lower court.

For the foregoing reasons, the judgment appealed

from is affirmed, with costs. So ordered.

Arellano, C. J., Torres, Johnson, andAraullo, JJ.concur.

Moreland, J. concurs in the result.

THIRD DIVISION

[G.R. Nos. 71998-99. June 2, 1993.]

EMILIANO R. DE LOS SANTOS,

SPOUSES NORMA A. PADILLA and

ISIDORO L. PADILLA and the HEIRSOF FRANCISCO DAYRIT, petitioners,vs.

THE HONORABLE INTERMEDIATE

APPELLATE COURT, HON. JUDGE

CICERO C. JURADO, NESTOR

AGUSTIN and EDILBERTO CADIENTE,respondents.

Isidoro L. Padilla for petitioners.

Joaquin G. Mendoza for E. Cadiente.

D E C I S I O N

ROMERO, Jp:

Questioned in the instant petition for review on certiorari is

the Decision of the then Intermediate Appellate Court1affirming the December 1, 1982 Order of the then Court of

First Instance of Rizal, Branch XXII at Pasig2in Civil Case

Nos. 46800 and 46801 which states in toto: Cdpr

"It appearing that the construction of the roadand creek in question was a project

undertaken under the authority of the Ministerof Public Works, the funding of which was

the responsibility of the National Governmentand that the defendants impleaded herein are

Edilberto Cadiente and Nestor Agustin and

not the Republic of the Philippines whichcannot be sued without its consent, this Court

hereby resolves to dismiss these two (2) cases

without pronouncement as to costs.

SO ORDERED."

Civil Case Nos. 46800 and 46801 were both filed on July13, 1982 by petitioners who are co-owners under TCT No.

329945 of a parcel of land located in Barrio Wawa,Binangonan, Rizal with an area of nineteen thousand sixty-

one (19,061) square meters. In Civil Case No. 46800,petitioners alleged in the petition for prohibition that in

October 1981, without their knowledge or consent, LorenzoCadiente, a private contractor and the Provincial Engineer of

Rizal constructed a road nine (9) meters wide and one

hundred twenty-eight meters and seventy centimeters

(128.70) long occupying a total area of one thousand onehundred sixty-five (1,165) square meters of their land. prcd
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Petitioners added that aside from the road, the saidrespondents also constructed, without their knowledge and

consent, an artificial creek twenty-three meters and twenty

centimeters (23.20) wide and one hundred twenty-eight

meters and sixty-nine centimeters long (128.69) occupyingan area of two thousand nine hundred six (2,906) square

meters of their property. Constructed in a zigzag manner, thecreek meandered through their property.

Alleging that if completed, the road and the creek would

"serve no public profitable and practicable purpose but for

respondents' personal profit, to the great damage andprejudice of the taxpayers and the petitioners," the same

petitioners invoked their rights under Art. IV, Secs. 1 and 2,of the Bill of Rights of the 1973 Constitution and prayed for

the issuance of a restraining order or a writ of preliminaryinjunction to stop the construction. They also prayed that

after hearing on the merits, judgment be rendered: (1)declaring illegal the construction of the road and artificial

creek which was made without their knowledge and consent,

"without due process and without just compensation and in

violation of the provision of statute law and of the PhilippineConstitution;" (2) issuing a permanent prohibition; (3)

ordering respondents to pay petitioners "jointly andcollectively" P15,000.00 as attorney's fees and P600.00 for

each appearance, and (4) ordering the respondents to pay thecosts of the suit.3

An action for damages, Civil Case No. 46801, on the otherhand, was founded on Art. 32, paragraphs 6 and 7 of the

Civil Code and the constitutional provisions on the rightagainst deprivation of property without due process of law

and without just compensation.

Thereafter, the two cases were consolidated. On November11, 1982, the Solicitor General filed a motion to dismiss

both cases on the following grounds: (a) with respect to

Civil Case No. 46800, the pendency of Civil Case No.

46801 which involved the same parties and cause of action;(b) both cases were in reality suits against the state which

could not be maintained without the State's consent; and (c)lack of cause of action.

Consequently, the lower court issued the aforequoted Order

of December 1, 1982. Their motion for the reconsideration

of said Order having been denied, petitioners elevated (to)the cases to this Court through an "appeal by certiorari"

which was docketed as G.R. No. 63610. The SecondDivision of this Court, however, referred the cases to the

then Intermediate Appellate Court pursuant to Sec. 16 of theInterim Rules.4In due course, the appellate court rendered

a Decision on May 22, 1985 which disposed of the casesthus:

"Accordingly, the two actions cannot bemaintained. They are in reality suits against

the state which has not given its consent to besued (Minister [sic] vs. CFI, 40 SCRA 464;

Isberto vs. Raquiza, 67 SCRA 116; Begosa v.Chairman, PVA, 32 SCRA 466). Appellants'

remedy lies elsewhere.

Appellants assert that the taking of their

property in the manner alleged in these twocases was without due process of law. This is

not correct. The appealed order has not closed

the door to appellants' right, if any, to just


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compensation for the alleged area of their landwhich was expropriated. The court below

dismissed the cases for lack of consent on the

part of the state to be sued herein. We repeat,

appellants' remedy for just compensation lieselsewhere.

WHEREFORE, the order appealed from is infull accord with the evidence and the law and

is hereby therefore affirmed in all its parts.

Costs against appellants.

SO ORDERED."5

Consequently, petitioners elevated the cases to this Court

through a petition for review on certiorari. The petition isanchored on the ruling of the Court inAmigable v. Cuenca6

which states: ". . . where the government takes awayproperty from a private landowner for public use without

going through the legal process of expropriation or

negotiated sale," a suit may properly be maintained against

the government.

We hold for the petitioners.

That the principle of state immunity from suit cannot beinvoked to defeat petitioners' claim has long been settled. In

Ministerio v. Court of First Instance of Cebu,7the Courtheld:

". . . The doctrine of governmental immunity

from suit cannot serve as an instrument for

perpetrating an injustice on a citizen. Had the

government followed the procedure indicated

by the governing law at the time, a complaintwould have been filed by it, and only upon

payment of the compensation fixed by the

judgment, or after tender to the party entitled

to such payment of the amount fixed, may it'have the right to enter in and upon the land so

condemned' to appropriate the same to thepublic use defined in the judgment. If there

were an observance of procedural regularity,petitioners would not be in the sad plaint they

are now. It is unthinkable then that preciselybecause there was a failure to abide by what

the law requires, the government would stand

to benefit. It is just as important, if not more

so, that there be fidelity to legal norms on thepart of the officialdom if the rule of law were

to be maintained. It is not too much to say thatwhen the government takes any property for

public use, which is conditioned upon thepayment of just compensation, to be judicially

ascertained, it makes manifest that it submitsto the jurisdiction of a court. There is no

thought then that the doctrine of immunity

from suit could still be appropriatelyinvoked."

We find the facts of theMinisterio case on all fours with the

instant cases insofar as the fact that the respondentgovernment officials executed a shortcut in appropriating

petitioners' property for public use is concerned. As in the

Amigable case, no expropriation proceedings were initiated

before construction of the projects began. In like manner,

nowhere in his pleadings in the cases at bar does the
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Solicitor General mention the fact that expropriationproceedings had in fact been undertaken before the road and

artificial creek were constructed. Thus, quoting the answer

of the defendants in Civil Case No. 46801, the Solicitor

General summarized the facts which defendants consideredas constituting justification for the construction as follows:

"10. The construction of the road and creek inquestion on the property which at the time

was said to be public property, was initiated,

and construction effected, through the usual

and ordinary course, as shown by thefollowing:

a. November 5, 1979 Engr.

Data who was the incumbent DistrictEngineer submitted (thru channels)

plans, program of works and detailed

estimates for approval of higherauthorities, thru the initiation of Mayor

Ynares and Assemblyman GilbertoDuavit;

b. February 18, 1980 RegionalDirector Eduardo L. Lagunilla, MPW

Region IV, EDSA, Quezon Cityendorsed said request to the Minister of

Public Works;

c. February 13, 1981

Assemblyman Gilberto Duavit sent a

hand-written follow-up note regarding

the project;

d. June 17, 1981 Theundersigned defendant Nestor Agustin

was designated Chief Civil Engineer of

the Rizal Engineering District, Vice

Engr. Cresencio Data who reached hiscompulsory retirement age;

e. September 23, 1981 Fundsin the amount of P588,000.00 was

released for partial implementation of

the project. The total amount requested

was P1,200,000.00;

f. October 19, 1981 The

undersigned submitted a request to the

MPWH Central Office seekingauthority to effect implementation of

the project;

g. October 29, 1981 The

Regional Director approved the plans

and program of works for the project inthe amount of P588,000.00;

h. November 11, 1981

TheHonorable Minister Jesus S. Hipolito

granted the request to undertake theimplementation of the project;

i. November 25, 1981 Projectimplementation was started;

j. March 3, 1982Construction

of rock bulkhead was completed;


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k. November 23, 1981 P249,000.00 was released for

improvement (deepening and diverting

of flow) of Binangonan River which

was a complimentary structure ofBinangonan port system;

l. April 19, 1982

Implementation was started. Contractfor this project was approved by the

Regional Director in favor ofEDILBERTO CADIENTE

CONSTRUCTION;

m. May 21, 1982 Deepening

slightly of the adjacent portion of therock bulkhead was completed.

11. The construction of the structures wasdone in good faith;

The construction of the roadway and

deepening of the creek was designed togenerate for the municipality of Binangonan,Rizal more benefits in the form of substantial

revenue from fishing industry, parking area,market rentals, development site, and road

system improvements. The area covered bysaid public improvements is part of the

Laguna Lake area which is submerged inwater even during dry season. The municipal

mayor of Binangonan, Rizal stated that saidarea is public property."8

Public respondents' belief that the property involved ispublic, even if buttressed by statements of other public

officials, is no reason for the unjust taking of petitioners'

property. As TCT No. 329945 shows, the property wasregistered under the Torrens system in the names of"Emiliano R. de los Santos, married to Corazon Dayrit; and

Norma Alabastro, married to Isidoro L. Padilla" as early as

March 29, 1971. Had the public respondents, including the

other officials involved in the construction, performed theirfunctions by exercising even the ordinary diligence expected

of them as public officials, they would not have failed tonote that the property is a private one. A public

infrastructure losses its laudability if, in the process ofundertaking it, private rights are disregarded. In this

connection, the Court said inRepublic v. Sandiganbayan:9

"It can hardly be doubted that in exercising

the right of eminent domain, the Stateexercises its jus imperii, as distinguished from

its proprietary rights orjus gestionis. Yet,even in that area, it has been held that where

private property has been taken inexpropriation 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."

Public respondents' assertion that the project had been

completed on May 21, 1982 meets strong opposition from

the petitioners who insist that the project "until now is not


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yet finished."10This factual issue needs determinationwhich only the trial court can undertake. Thus, the need for a

full blown trial on the merits. We do not subscribe to the

appellate court's suggestion that the remedy of the

petitioners "lies elsewhere."

The filing of another case to determine just compensation issuperfluous. The issue may be threshed out below forpractical reasons in the event that it is shown later that it is

no longer possible to prohibit the public respondents from

continuing with the public work. As held in theAmigable

case, damages may be awarded the petitioners in the form oflegal interest on the price of the land to be reckoned from

the time of the unlawful taking.

WHEREFORE, the petition is hereby GRANTED and CivilCases Nos. 46800 and 46801 shall be REMANDED to the

lower court for trial on the merits after the Republic of the

Philippines shall have been impleaded as defendant in bothcases.

SO ORDERED.

Feliciano, Davide, Jr.andMelo, JJ., concur.

Bidin, J., is on leave.

Footnotes

1. Associate Justice Porfirio V. Sison,ponente, AssociateJustices Abdulwahid A. Bidin and Marcelino R.

Veloso, concurring.

2. Judge Gregorio G. Pineda, presiding.

3. Record of Civil Case No. 46800, pp. 4-5.

4. Rollo, p. 19.

5. Rollo, p. 22.

6. L-26400, February 29, 1972, 43 SCRA 360.

7. L-31635, August 31, 1971, 40 SCRA 464.

8. Comment of Public Respondents, pp. 3-5, quoting the

Motion to Dismiss, pp. 4-5, which in turn lifted theanswer in Civil Case No. 46801 of Nestor Agustin,

represented by then Solicitor General Estelito P.Mendoza, Assistant Solicitor General Ruben E.

Agpalo and Solicitor Gloria Fermo-Berin, pp. 3-4(Rollo, pp. 42-44).

9. G.R. No. 90478, November 21, 1991, 204 SCRA 212,231.

10. Petitioners, Reply to Comment, p. 2; Rollo, p. 56.
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EN BANC

[G.R. No. 90478. November 21, 1991.]

REPUBLIC OF THE PHILIPPINES

(PRESIDENTIAL COMMISSION ON

GOOD GOVERNMENT), petitioner,vs.SANDIGANBAYAN, BIENVENIDO R.

TANTOCO, JR. and DOMINADOR R.SANTIAGO, respondents.

Dominador R. Santiago for and in his own behalf and ascounsel for respondent Tantoco, Jr.

SYLLABUS

1. REMEDIAL LAW; COURTS; RAISON D'ETRE. The

resolution of controversies is, as everyone knows, the raisond'etre of courts. This essential function is accomplished by

first, the ascertainment of all the material and relevant factsfrom the pleadings and from the evidence adduced by the

parties, andsecond, after that determination of the facts has

been completed, by the application of the law thereto to theend that the controversy may be settled authoritatively,

definitely and finally.

2. ID.; ACTIONS; NATURE AND OBJECT OF

LITIGATIONS. Seventy-one years ago, inAlonso v.

Villamor, this Court described the nature and object oflitigation and in the process laid down the standards by

which judicial contests are to be conducted in this

jurisdiction. It said: "A litigation is not a game of

technicalities in which one, more deeply schooled andskilled in the subtle art of movement and position, entraps

and destroys the other. It is, rather a contest in which each

contending party fully and fairly lays before the court the

facts in issue and then brushing aside as wholly trivial andindecisive all imperfections of form and technicalities of

procedure, asks that justice be done on the merits. Lawsuits,unlike duels, are not to be won by a rapier's thrust.

Technicality, when it deserts its proper office as an aid tojustice and becomes its great hindrance and chief enemy,

deserves scant consideration from courts. There should beno vested right in technicalities. . . ."

3. ID.; ID.; PLEADINGS; ULTIMATE FACTS MUST BECONTAINED THEREIN. Every pleading "shall contain

in a methodical and logical form, a plain, concise and directstatement of the ultimate facts on which the party pleading

relies for his claim or defense, as the case may be, omittingthe statement of mere evidentiary facts."

4. ID.; ID.; ID.; BILL OF PARTICULARS, RESORTEDTO IF ULTIMATE FACTS ALLEGED ARE TOO

GENERAL. Parenthetically, if this requirement is notobserved, i.e., the ultimate facts are alleged too generally or

"not averred with sufficient definiteness or particularity toenable . . . (an adverse party) properly to prepare his

responsive pleading or to prepare for trial," a bill of

particulars seeking a "more definite statement" may be

ordered by the court on motion of a party. The office of abill of particulars is, however, limited to making more

particular or definite the ultimate facts in a pleading. It is notits office to supply evidentiary matters. And the common

perception is that said evidentiary details are made known to


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the parties and the court only during the trial, when proof isadduced on the issues of fact arising from the pleadings.

5. ID.; ID.; PARTIES SHOULD DISCOVER OR INFORMTHEMSELVES OF ALL THE FACTS RELEVANT TO

THE ACTION; MADE POSSIBLE THROUGH THE

DEPOSITION-DISCOVERY MECHANISM SET FORTHIN RULES 24 TO 29 OF THE RULES OF COURT. Thetruth is that "evidentiary matters" may be inquired into and

learned by the parties before the trial. Indeed, it is the

purpose and policy of the law that the parties before the

trial if not indeed even before the pre-trial shoulddiscover or inform themselves of all the facts relevant to the

action, not only those known to them individually, but alsothose known to their adversaries; in other words, the

desideratum is that civil trials should not be carried on in thedark; and the Rules of Court make this ideal possible

through the deposition-discovery mechanism set forth inRules 24 to 29. The experience in other jurisdictions has

been that ample discovery before trial, under proper

regulation, accomplished one of the most necessary ends of

modern procedure: it not only eliminates unessential issuesfrom trials thereby shortening them considerably, but also

requires parties to play the game with the cards on the tableso that the possibility of fair settlement before trial is

measurably increased."

6. ID.; ID.; MODES OF DISCOVERY; PURPOSE. The

various modes or instruments of discovery are meant toserve (1) as a device, along with the pre-trial hearing under

Rule 20, to narrow and clarify the basic issues between theparties, and (2) as a device for ascertaining the facts relative

to those issues. The evident purpose is, to repeat, to enable

the parties, consistent with recognized privileges, to obtainthe fullest possible knowledge of the issues and facts before

civil trials and thus prevent that said trials are carried on in

the dark.

7. ID.; ID.; ID.; FIELD OF INQUIRY. To this end, the

field of inquiry that may be covered by depositions orinterrogatories is as broad as when the interrogated party iscalled as a witness to testify orally at trial. The inquiry

extends to all facts which are relevant, whether they be

ultimate or evidentiary, excepting only those matters which

are privileged. The objective is as much to give every partythe fullest possible information of all the relevant facts

before the trial as to obtain evidence for use upon said trial.The principle is reflected in Section 2, Rule 24 (governing

depositions) of the Revised Rules of Court.

8. ID.; ID.; ID.; ACCORDED A BROAD AND LIBERAL

TREATMENT AND AVAILABLE TO BOTH PARTIES.What is chiefly contemplated is the discovery of every bit

of information which may be useful in the preparation fortrial, such as the identity and location of persons having

knowledge of relevant facts; those relevant facts themselves;and the existence, description, nature, custody, condition,

and location of any books, documents, or other tangiblethings. Hence, "the deposition-discovery rules are to be

accorded a broad and liberal treatment. No longer can the

time-honored cry of 'fishing expedition' serve to preclude a

party from inquiring into the facts underlying his opponent'scase. Mutual knowledge of all the relevant facts gathered by

both parties is essential to proper litigation. To that end,either party may compel the other to disgorge whatever facts

he has in his possession. The deposition-discovery


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procedure simply advances the stage at which the disclosurecan be compelled from the time of trial to the period

preceding it, thus reducing the possibility of surprise."

9. ID.; ID.; ID.; ID.; MAY BE AVAILED OF WITHOUT

LEAVE OF COURT AND GENERALLY WITHOUT

COURT INTERVENTION.

In line with this principle ofaccording liberal treatment to the deposition-discoverymechanism, such modes of discovery as (a) depositions

(whether by oral examination or written interrogatories)

under Rule 24, (b) interrogatories to parties under Rule 25,

and (c) requests for admissions under Rule 26, may beavailed ofwithout leave of court, and generally, without

court intervention.

10. ID.; ID.; ID.; ID.; ID.; EXCEPTION.

The Rules ofCourt explicitly provide that leave of court is not necessary

to avail of said modes of discovery after an answer to the

complaint has been served. It is only when an answer hasnot yet been filed (but after jurisdiction has been obtained

over the defendant or property subject of the action) thatprior leave of court is needed to avail of these modes of

discovery, the reason being that at that time the issues arenot yet joined and the disputed facts are not clear. On the

other hand, leave of court is required as regards discovery by(a) production or inspection of documents or things in

accordance with Rule 27, or (b) physical and mental

examination of persons under Rule 28, which may be

granted upon due application and a showing of due cause.

11. ID.; ID.; ID.; LIMITATIONS.Of course, there are

limitations to discovery, even when permitted to be

undertaken without leave and without judicial intervention.

"As indicated by (the) Rules . . ., limitations inevitably arisewhen it can be shown that the examination is being

conducted in bad faith or in such a manner as to annoy,

embarrass, or oppress the person subject to the inquiry. And

. . . further limitations come into existence when the inquirytouches upon the irrelevant or encroaches upon the

recognized domains of privilege" In fine, the liberty of aparty to make discovery is well nigh unrestricted if the

matters inquired into are otherwise relevant and notprivileged, and the inquiry is made in good faith and within

the bounds of the law.

12. ID.; ID.; ID.; INTERROGATORIES; MAY BE

AVAILED OF WITHOUT LEAVE OF COURT AFTERANSWER HAD BEEN SERVED; LEAVE OF COURT

NECESSARY BEFORE FILING OF ANSWER.

Itshould initially be pointed out as regards the private

respondents "Motion for Leave to File Interrogatories" datedFebruary 1, 1988 that it was correct for them to seek

leave to serve interrogatories, because discovery was being

availed ofbefore an answer had been served. In such a

situation, i.e., "after jurisdiction has been obtained over anydefendant or over property subject of the action" but before

answer, Section 1 of Rule 24 (treating of depositions), inrelation to Section 1 of Rule 25 (dealing with interrogatories

to parties) explicitly requires "leave of court." But there wasno need for the private respondents to seek such leave to

serve their "Amended Interrogatories to Plaintiffs (datedAugust 2, 1989) after they had filed their answer to the

PCGG's complaint, just as there was no need for the

Sandiganbayan to act thereon.


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13. ID.; ID.; ID.; ID.; IF A PARTY SERVED WITHINTERROGATORIES IS A JURIDICAL ENTITY, THE

SAME MAY BE ANSWERED BY ANY COMPETENT

OFFICER; RULE APPLIED BY ANALOGY TO THE

PCGG. The petitioner's first contention that theinterrogatories in question are defective because they (a) do

not name the particular individuals to whom they arepropounded, being addressed only to the PCGG, and (b) are

"fundamentally the same matters . . . (private respondents)sought to be clarified through their aborted Motion . . . for

Bill of Particulars"are untenable and quickly disposed of.The first part of petitioner's submission is adequately

confuted by Section 1, Rule 25 which states that if the party

served with interrogatories is a juridical entity such as "a

public or private corporation or a partnership or association,"

the same shall be "answered . . . by any officer thereofcompetent to testify in its behalf." There is absolutely noreason why this proposition should not be applied by

analogy to the interrogatories served on the PCGG. That theinterrogatories are addressed only to the PCGG, without

naming any specific commissioner or officer thereof, isutterly of no consequence, and may not be invoked as a

reason to refuse to answer. As the rule states, the

interrogatories shall be answered "by any officer thereofcompetent to testify in its behalf."

14. ID.; ID.; ID.; SUBJECT OF DISCOVERYDIFFERENTIATED FROM SUBJECT OF BILL OF

PARTICULARS.That the matters on which discovery isdesired are the same matters subject of a prior motion for

bill of particulars addressed to the PCGG's amended

complaintand denied for lack of meritis beside thepoint. Indeed, as already pointed out above, a bill of

particulars may elicit only ultimate facts, not so-called

evidentiary facts. The latter are without doubt proper subject

of discovery.

15. ID.; ID.; ID.; INTERROGATORIES; GROUNDS FOROBJECTION.Neither may it be validly argued that theamended interrogatories lack specificity. The merest glance

at them disproves the argument. The interrogatories are

made to relate to individual paragraphs of the PCGG's

expanded complaint and inquire about details of the ultimatefacts therein alleged. What the PCGG may properly do is to

object to specific items of the interrogatories, on the groundof lack of relevancy, or privilege, or that the inquiries are

being made in bad faith, or simply to embarass or oppress it.But until such an objection is presented and sustained, the

obligation to answer subsists.

16. ID.; ID.; ID.; ID.; ID.; INQUIRY ON FACTUAL

MATTERS, NOT A GROUND.That the interrogatoriesdeal with factual matters which will be part of the PCGG's

proof upon trial, is not ground for suppressing them either.As already pointed out, it is the precise purpose of discovery

to ensure mutual knowledge of all the relevant facts on thepart of all parties even before trial, this being deemed

essential to proper litigation. This is why either party may

compel the other to disgorge whatever facts he has in his

possession; and the stage at which disclosure of evidence ismade is advanced from the time of trial to the period

preceding it.


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17. ID.; EVIDENCE; A PARTY MAY MAKE HISADVERSARY HIS WITNESS; RULE APPLIED IN CASE

AT BAR. Also unmeritorious is the objection that the

interrogatories would make PCGG Commissioners and

officers witnesses, in contravention of Executive Order No.14 and related issuances. In the first place, there is nothing at

all wrong in a party's making his adversary his witness. Thisis expressly allowed by Section 6, Rule 132 of the Rules of

Court.

18. ID.; ACTIONS; MODES OF DISCOVERY;

INTERROGATORIES; PERMIT PARTIES TO ENGAGEON A "FISHING EXPEDITION". The PCGG insinuates

that the private respondents are engaged on a "fishingexpedition," apart from the fact that the information sought

is immaterial since they are evidently meant to establish aclaim against PCGG officers who are not parties to the

action. It suffices to point out that "fishing expeditions" areprecisely permitted through the modes of discovery.

19. ID.; ID.; COUNTERCLAIM; A DEFENDANT WHOFILES A COUNTERCLAIM CAN IMPLEAD PERSONS

STRANGERS TO THE ACTION. A defendant who filesa counterclaim against the plaintiff is allowed by the Rules

to implead persons (therefore strangers to the action) asadditional defendants on said counterclaim. This may be

done pursuant to Section 14, Rule 6 of the Rules.

20. REMEDIAL LAW; ACTIONS; MODES OF

DISCOVERY; INTERROGATORIES; PCGG'SIMMUNITY FROM SUIT; NOT A GROUND TO REFUSE

TO ANSWER THE INTERROGATORIES. The PCGG's

assertion that it or its members are not amenable to any civil

action "for anything done or omitted in the discharge of thetask contemplated by . . . (Executive) Order (No. 1)," is not

a ground to refuse to answer the interrogatories. The

disclosure of facts relevant to the action and which are not

self-incriminatory or otherwise privileged is one thing; thematter of whether or not liability may arise from the facts

disclosed in light of Executive Order No. 1, is another. Nodoubt, the latter proposition may properly be set up by way

of defense in the action.

21. ID.; ID.; ID.; ID.; ANSWER THERETO MAY BE

UTILIZED AS FOUNDATION FOR ACOUNTERCLAIM.The apprehension has been

expressed that the answers to the interrogatories may beutilized as foundation for a counterclaim against the PCGG

or its members and officers. They will be. The privaterespondents have made no secret that this is in fact their

intention. Withal, the Court is unable to uphold theproposition that while the PCGG obviously feels itself at

liberty to bring actions on the basis of its study and

appreciation of the evidence in its possession, the parties

sued should not be free to file counterclaims in the sameactions against the PCGG or its officers for gross neglect or

ignorance, if not down right bad faith or malice in thecommencement or initiation of such judicial proceedings, or

that in the actions that it may bring, the PCGG may opt notto be bound by rules applicable to the parties it has sued,

e.g., the rules of discovery.

22. CONSTITUTIONAL LAW; STATE IMMUNITY

FROM SUIT; MAY BE WAIVED BY FILING OFACTIONS; THE PCGG CANNOT CLAIM A SUPERIOR

STATUS TO THE STATE; IT MAY BE REQUIRED TO


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TESTIFY OR PRODUCE EVIDENCE IN ANY JUDICIALPROCEEDING IT HAS ITSELF INITIATED. The

PCGG's postulation that none of its members may be

"required to testify or produce evidence in any judicial . . .

proceeding concerning matters within its officialcognizance," has no application to a judicial proceeding it

has itself initiated. As just suggested, the act of bringing suitmust entail a waiver of the exemption from giving evidence;

by bringing suit it brings itself within the operation andscope of all the rules governing civil actions, including the

rights and duties under the rules of discovery. Otherwise, theabsurd would have to be conceded, that while the parties it

has impleaded as defendants may be required to "disgorge

all the facts" within their knowledge and in their possession,

it may not itself be subject to a like compulsion. The State

is, of course, immune from suit in the sense that it cannot, asa rule, be sued without its consent. But it is axiomatic that infiling an action, it divests itself of its sovereign character and

sheds its immunity from suit, descending to the level of anordinary litigant. The PCGG cannot claim a superior or

preferred status to the State, even while assuming torepresent or act for the State.

23. ID.; ID.; CONSENT TO BE SUED MAY BE GIVENEXPRESSLY OR IMPLIEDLY; WAIVER APPLIES

EVEN IF STATE IS PERFORMING GOVERNMENTALFUNCTION. The suggestion that the State makes no

implied waiver of immunity by filing suit except when in sodoing 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." "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 mayavail itself of the different forms of actions open to private

litigants. In short, by taking the initiative in an action againstthe private parties, the state surrenders its privileged position

and comes down to the level of the defendant. The latterautomatically acquires, within certain limits, the right to set

up whatever claims and other defenses he might haveagainst the state . . . (Sinco, Philippine Political Law, Tenth

E., pp. 36-37, citing U.S. vs. Ringgold, 8 Pet. 150, 8 L.ed.

899)'" It can hardly be doubted that in exercising the right of

eminent domain, the State exercises itsjus imperii, as

distinguished from its proprietary rights orjus gestionis.Yet, even in that area, it has been held that where privateproperty has been taken in expropriation without just

compensation being paid, the defense of immunity from suitcannot be set up by the State against an action for payment

by the owner.

24. REMEDIAL LAW; ACTIONS; MODES OF

DISCOVERY; PRODUCTION OR INSPECTION OFDOCUMENT; DISCLOSURE OF RELEVANT

DOCUMENTS, MANDATORY; CASE AT BAR. TheCourt finally finds that, contrary to the petitioner's theory,

there is good cause for the production and inspection of thedocuments subject of the motion dated August 3, 1989.

Some of the documents are, according to the verification of

the amended complaint, the basis of several of the material

allegations of said complaint. Others, admittedly, are to be

used in evidence by the plaintiff. It is matters such as these


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into which inquiry is precisely allowed by the rules ofdiscovery, to the end that the parties may adequately prepare

for pre-trial and trial. The only other documents sought to be

produced are needed in relation to the allegations of the

counterclaim. Their relevance is indisputable; theirdisclosure may not be opposed.

25. ID.; ID.; ID.; PROCEDURE. Due no doubt to thedeplorable unfamiliarity respecting the nature, purposes and

operation of the modes of discovery earlier mentioned, there

also appears to be a widely entertained idea that application

of said modes is a complicated matter, unduly expensive anddilatory. Nothing could be farther from the truth. For

example, as will already have been noted from the precedingdiscussion, all that is entailed to activate or put in motion the

process of discovery by interrogatories to parties under Rule25 of the Rules of Court, is simply the delivery directly to a

party of a letter setting forth a list of questions with therequest that they be answered individually. That is all. The

service of such a communication on the party has the effect

of imposing on him the obligation of answering the

questions "separately and fully in writing under oath," andserving "a copy of the answers on the party submitting the

interrogatories within fifteen (15) days after service of theinterrogatories . . ." The sanctions for refusing to make

discovery have already been mentioned. So, too, discoveryunder Rule 26 is begun by nothing more complex than the

service on a party of a letter or other written communicationcontaining a request that specific facts therein set forth

and/or particular documents copies of which are thereto

appended, be admitted in writing. That is all. Again, the

receipt of such a communication by the party has the effect

of imposing on him the obligation of serving the party

requesting admission with "a sworn statement either denyingspecifically the matters of which an admission is requested

or setting forth in detail the reasons why he cannot truthfully

either admit or deny those matters," failing in which "(e)ach

of the matters of which admission is requested shall bedeemed admitted." The taking of depositions in accordance

with Rule 24 (either on oral examination or by writteninterrogatories) while somewhat less simple, is nonetheless

by no means as complicated as seems to be the lamentablyextensive notion.

D E C I S I O N

NARVASA,Jp:

Private respondents Bienvenido R. Tantoco, Jr. and

Dominador R. Santiago together with Ferdinand E.Marcos, Imelda R. Marcos, Bienvenido R. Tantoco, Sr.,

Gliceria R. Tantoco, and Maria Lourdes Tantoco-Pinedaare defendants in Civil Case No. 0008 of the Sandiganbayan.

The case was commenced on July 21, 1987 by thePresidential Commission on Good Government (PCGG) in

behalf of the Republic of the Philippines. The complaintwhich initiated the action was denominated one "for

reconveyance, reversion, accounting, restitution anddamages," and was avowedly filed pursuant to Executive

Order No. 14 of President Corazon C. Aquino.


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After having been served with summons, Tantoco, Jr. andSantiago, instead of filing their answer, jointly filed a

"MOTION TO STRIKE OUT SOME PORTIONS OF THE

COMPLAINT AND FOR BILL OF PARTICULARS OF

OTHER PORTIONS" dated Nov. 3, 1987.1The PCGGfiled an opposition thereto,2and the movants, a reply to the

opposition.3By order dated January 29, 1988, theSandiganbayan, in order to expedite proceedings and

accommodate the defendants, gave the PCGG forty-five (45)days to expand its complaint to make more specific certain

allegations.4

Tantoco and Santiago then presented a "motion for leave to

file interrogatories under Rule 25 of the Rules of Court"dated February 1, 1988, and "Interrogatories under Rule 25."

5Basically, they sought an answer to the question: "Whowere the Commissioners of the PCGG (aside from its

Chairman, Hon. Ramon Diaz, who verified the complaint)who approved or authorized the inclusion of Messrs.

Bienvenido R. Tantoco, Jr. and Dominador R. Santiago as

defendants in the . . . case?"6The PCGG responded by

filing a motion dated February 9, 1988 to strike out saidmotion and interrogatories as being impertinent, "queer,"

"weird," or "procedurally bizarre as the purpose thereoflacks merit as it is improper, impertinent and irrelevant

under any guise."7

On March 18, 1988, in compliance with the Order of

January 29, 1988, the PCGG filed an Expanded Complaint.8As regards this expanded complaint, Tantoco and Santiago

reiterated their motion for bill of particulars, through aManifestation dated April 11, 1988.9

Afterwards, by Resolution dated July 4, 1988,10theSandiganbayan denied the motion to strike out, for bill of

particulars, and for leave to file interrogatories, holding

them to be without legal and factual basis. Also denied was

the PCGG's motion to strike out impertinent pleading datedFebruary 9, 1988. The Sandiganbayan declared inter alia the

complaint to be "sufficiently definite and clear enough,"there are adequate allegations . . . which clearly portray the

supposed involvement and/or alleged participation ofdefendants-movants in the transactions described in detail in

said Complaint," and "the other matters sought forparticularization are evidentiary in nature which should be

ventilated in the pre-trial or trial proper . . . ." It also opined

that "(s)ervice of interrogatories before joinder of issue and

without leave of court is premature . . . (absent) any special

or extraordinary circumstances . . . which would justify . . .(the same)." llcd

Tantoco and Santiago then filed an Answer with

Compulsory Counterclaim under date of July 18, 1988.11In

response, the PCGG presented a "Reply to Answer with

Motion to Dismiss Compulsory Counterclaim."12

The case was set for pre-trial on July 31, 1989.13On July

25, 1989, the PCGG submitted its PRE-TRIAL BRIEF.14The pre-trial was however reset to September 11, 1989, and

all other parties were required to submit pre-trial briefs on or

before that date.15

On July 27, 1989 Tantoco and Santiago filed with theSandiganbayan a pleading denominated "Interrogatories to

Plaintiff,"16and on August 2, 1989, an "Amended
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Interrogatories to Plaintiff"17as well as a Motion forProduction and Inspection of Documents. 18

The amended interrogatories chiefly sought factual detailsrelative to specific averments of PCGG's amended

complaint, through such questions, for instance, as

"1. In connection with the allegations . . . in

paragraph 1 . . ., what specific property orproperties does the plaintiff claim it has the

right to recover from defendants Tantoco, Jr.and Santiago for being 'ill-gotten'?"

"3. In connection with the allegations . . . inparagraph 10 (a) . . ., what specific act or acts

. . . were committed by defendants Tantoco,Jr. and Santiago in 'concert with' defendant

Ferdinand Marcos and in furtherance orpursuit, of the alleged systematic plan of said

defendant Marcos to accumulate ill-gottenwealth?"

"5. In connection with . . . paragraph 13 . . .,what specific act or acts of the defendants

Tantoco, Jr. and Santiago . . . were committedby said defendants as part, or in furtherance,

of the alleged plan to conceal assets ofdefendants Ferdinand and Imelda Marcos?"

"7. In connection with . . . paragraph 15 (c) . .. is it plaintiff's position or theory of the case

that Tourist Duty Free Shops, Inc., includingall the assets of said corporation, are

beneficially owned by either or both

defendants Ferdinand and Imelda Marcos andthat the defendants Tantoco, Jr. and Santiago,

as well as, the other stockholders of record of

the same corporation are mere 'dummies' of

said defendants Ferdinand and/or Imelda R.Marcos?"

On the other hand, the motion for production and inspectionof documents prayed for examination and copying of

1) the "official records and other evidence" onthe basis of which the verification of the

Amended Complaint asserted that theallegations thereof are "true and correct; llcd

"2) the documents listed in PCGG's Pre-TrialBrief as those "intended to be presented and

xx marked as exhibits for the plaintiff;" and

3) "the minutes of the meeting of the PCGG

which chronicles the discussion (if any) andthe decision (of the Chairman and members)

to file the complaint" in the case at bar.

By Resolutions dated August 21, 1989 and August 25, 1989,the Sandiganbayan admitted the Amended Interrogatoriesand granted the motion for production and inspection of

documents (production being scheduled on September 14and 15, 1989), respectively.

On September 1, 1989, the PCGG filed a Motion for

Reconsideration of the Resolution of August 25, 1989

(allowing production and inspection of documents). It

argued that


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1) since the documents subject thereof would be marked asexhibits during the pre-trial on September 11, 1989 anyway,

the order for "their production and inspection on September

14 and 15, are purposeless and unnecessary;"

2) movants already know of the existence and contents of

the document which "are clearly described . . . (in) plaintiff'sPre-Trial Brief;"

3) the documents are "privileged in character" since they are

intended to be used against the PCGG and/or itsCommissioners in violation of Section 4, Executive Order

No. 1, viz.:

"(a) No civil action shall lie against the

Commission or any member thereof foranything done or omitted in the

discharge of the task contemplated bythis Order.

(b) No member or staff of the Commissionshall be required to testify or produce

evidence in any judicial, legislative, oradministrative proceeding concerning

matters within its official cognizance."

It also filed on September 4, 1989 an opposition to the

Amended Interrogatories,19which the Sandiganbayantreated as a motion for reconsideration of the Resolution of

August 21, 1989 (admitting the Amended Interrogatories).The opposition alleged that

1) the interrogatories "are not specific and do not name the

person to whom they are propounded . . .," or "who in the

PCGG, in particular, . . . (should) answer theinterrogatories;" LibLex

2) the interrogatories delve into "factual matters which hadalready been decreed . . . as part of the proof of the

Complaint upon trial . . .;"

3) the interrogatories "are frivolous" since they inquire about

"matters of fact . . . which defendants . . . sought to . . .(extract) through their aborted Motion for Bill of

Particulars;"

4) the interrogatories "are really in the nature of a

deposition, which is prematurely filed and irregularlyutilized . . . (since) the order of trial calls for plaintiff to first

present its evidence."

Tantoco and Santiago filed a reply and opposition on

September 18, 1989.

After hearing, the Sandiganbayan promulgated two (2)

Resolutions on September 29, 1989, the first, denyingreconsideration (of the Resolution allowing production of

documents), and the second, reiterating by implication the

permission to serve the amended interrogatories on theplaintiff (PCGG).20

Hence, this petition forcertiorari.

The PCGG contends that said orders, both dated September29, 1989, should be nullified because rendered with grave

abuse of discretion amounting to excess of jurisdiction.More particularly, it claims


25/60

a) as regards the order allowing the amended interrogatoriesto the plaintiff PCGG:

1) that said interrogatories are not specific anddo not name the particular individuals

to whom they are propounded, being

addressed only to the PCGG;

2) that the interrogatories deal with factualmatters which the Sandiganbayan (in

denying the movants' motion for bill ofparticulars) had already declared to be

part of the PCGG's proof upon trial;and

3) that the interrogatories would make PCGGCommissioners and officers witnesses,

in contravention of Executive OrderNo. 14 and related issuances;

and

b) as regards the order granting the motion for production of

documents:

1) that movants had not shown any good

cause therefor;

2) that some documents sought to be produced

and inspected had already beenpresented in Court and marked

preliminarily as PCGG's exhibits, andthe movants had viewed, scrutinized

and even offered objections thereto andmade comments thereon; and

3) that the other documents sought to be

produced are either

(a) privileged in character or

confidential in nature and their

use is proscribed by the

immunity provisions ofExecutive Order No. 1, or

(b) non-existent, or mere products of

the movants' suspicion and fear.

This Court issued a temporary restraining order on October27, 1989, directing the Sandiganbayan to desist from

enforcing its questioned resolutions of September 29, 1989in Civil Case No. 0008.21

After the issues were delineated and argued at no littlelength by the parties, the Solicitor General withdrew "as

counsel for plaintiff . . . with the reservation, however,conformably with Presidential Decree No. 478, the

provisions of Executive Order No. 292, as well a thedecisional law of 'Orbos v. Civil Service Commission, et al.,'

(G.R. No. 92561, September 12, 1990)22to submit hiscomment/observation on incidents/matters pending with this

. . Court if called for by circumstances in the interest of the

Government or if he is so required by the Court."23This,

the Court allowed by Resolution dated January 21, 1991.24
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Subsequently, PCGG Commissioner Maximo A. Macerenadvised the Court that the cases from which the Solicitor

General had withdrawn would henceforth be under his

(Maceren's) charge "and/or any of the following private

attorneys: Eliseo B. Alampay, Jr., Mario E. Ongkiko, MarioJalandoni and such other attorneys as it may later authorize."

25

The facts not being in dispute, and it appearing that the

parties have fully ventilated their respective positions, the

Court now proceeds to decide the case. prLL

Involved in the present proceedings are two of the modes ofdiscovery provided in the Rules of Court: interrogatories to

parties,26and production and inspection of document and

things.27Now, it appears to the Court that among far toomany lawyers (and not a few judges), there is, if not a

regrettable unfamiliarity and even outright ignorance about

the nature, purposes and operation of the modes ofdiscovery, at least a strong yet unreasoned and unreasonable

disinclination to resort to themwhich is a great pity forthe intelligent and adequate use of the deposition-discovery

mechanism, coupled with pre-trial procedure, could, as theexperience of other jurisdictions convincingly demonstrates,

effectively shorten the period of litigation and speed upadjudication.28Hence, a few words about these remedies is

not at all inappropriate.

The resolution of controversies is, as everyone knows, the

raison d'etre of courts. This essential function isaccomplished by first, the ascertainment of all the material

and relevant facts from the pleadings and from the evidence

adduced by the parties, andsecond, after that determination

of the facts has been completed, by the application of thelaw thereto to the end that the controversy may be settled

authoritatively, definitely and finally.

It is for this reason that a substantial part of the adjective law

in this jurisdiction is occupied with assuring that all the facts

are indeed presented to the Court; for obviously, to theextent that adjudication is made on the basis of incompletefacts, to that extent there is faultiness in the approximation

of objective justice. It is thus the obligation of lawyers no

less than of judges to see that this objective is attained; that

is to say, that there be no suppression, obscuration,misrepresentation or distortion of the facts; and that no party

be unaware of any fact material and relevant to the action, orsurprised by any factual detail suddenly brought to his

attention during the trial.29

Seventy-one years ago, inAlonso v. Villamor,30this Court

described the nature and object of litigation and in theprocess laid down the standards by which judicial contests

are to be conducted in this jurisdiction. It said:

"A litigation is not a game of technicalities in

which one, more deeply schooled and skilled

in the subtle art of movement and position,entraps and destroys the other. It is, rather acontest in which each contending party fully

and fairly lays before the court the facts inissue and then brushing aside as wholly trivial

and indecisive all imperfections of form andtechnicalities of procedure, asks that justice

be done on the merits. Lawsuits, unlike duels,

are not to be won by a rapier's thrust.
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