G.R. No.

L-23052
January 29, 1968
Facts:
In January 1958, at about 8pm, Teotico was about to board a jeepney in P. Burgos, Manila
when he fell into an uncovered manhole, resulting injuries upon him . Thereafter he sued for
damages under Art.2189 of the Civil Code the City of Manila, the mayor, the city engineer,
the city health officer, the city treasurer, and the chief of police. The CFI Manila ruled against
Teotico. Upon appeal, the CA reversed the CFI ruling and held that the City of Manila should
pay damages to Teotico.
The City of Manila assailed the decision of the CA on the ground that the charter of Manila
states that it shall not be liable for damages caused by the negligence of the city officers in
enforcing the charter; that the charter is a special law and shall prevail over the Civil Code
which is a general law; and that the accident happened in national highway.
Issue:
Whether the City of Manila have control or supervision over P. Burgos Ave making it
responsible for the damages suffered by Teotico.
Held:
Yes. It is true that in case of conflict, a special law prevails over a general law; that the
charter of Manila is a special law and that the Civil Code is a general law. However, looking
at the particular provisions of each law concerned, the provision of the Manila Charter
exempting it from liability caused by the negligence of its officers is a general law in the
sense that it exempts the city from negligence of its officers in general. There is no
particular exemption but merely a general exemption. On the other hand, Article 2189 of the
Civil Code provides a particular prescription to the effect that it makes provinces, cities, and
municipalities liable for the damages caused to a certain person by reason of the
defective condition of roads, streets, bridges, public buildings, and other-public works under
their control or supervision.
The allegation that the incident happened in a national highway was only raised for the first
time in the Citys motion for reconsideration in the Court of Appeals, hence it cannot be
given due weight. At any rate, even though it is a national highway, the law contemplates
that regardless if whether or not the road is national, provincial, city, or municipal, so long as
it is under the Citys control and supervision, it shall be responsible for damages by reason

of the defective conditions thereof. In the case at bar, the City admitted they have control
and supervision over the road where Teotico fell when the City alleged that it has been
doing constant and regular inspection of the citys roads, P. Burgos included.

Municipality of San Fernando v. Judge Firme (1991)

G.R. No. L-52179

FACTS:
On 16-Dec 1965 at 7am, a three-vehicle collision occurred involving a dump truck of the Municipality of
San Fernando La Union, a gravel and sand truck, and a passenger jeepney. At the time of the accident,
the dump truck of the municipality driven by its regular employee, A. Bislig, was on its way to Naguilian
River to get a load of sand and gravel for the repair of the municipalitys streets. Laureano Baina Sr, a
passenger of the jeepney, died as a result of the injuries he sustained in the collision. Banias relatives
instituted a complaint for damages against the driver and owner of the passenger jeepney and the dump
truck. In their answer, the municipality raised four (4) grounds for dismissal: lack of cause of action, the
non-suability of the State w/o its consent, prescription and negligence of the jeepney driver. Judge Firme
set a hearing on the sole ground of lack of jurisdiction but deferred resolution on the other grounds until
trial. The municipality filed a motion for reconsideration against the order of the judge but denied. Soon
after, the case was deemed submitted due to both parties failure to file their respective memoranda. The
case was dismissed against the Jeepney owner and its driver but the court held the Municipality and its
driver liable for actual damages, moral damages and Atty.s fees.

ISSUES:
(1) WON the municipality can be sued.
(2) If in the affirmative, WON it can be held liable for torts committed by its regular employee who was
then engaged in the discharge of governmental powers.

HELD:
(1) Yes. Municipality can sue and be sued.
Generally, the State may not be sued without its consent (Art. XVI Sec. 3). When the state does waive its
sovereign immunity, whether express or implied, it is only giving the plaintiff the chance to prove that the
defendant is liable. Express consent may be embodied in a general law or a special law. Consent is
implied when the government enters into business contracts, thereby descending to the level of the other
contracting party, and also when the State files a complaint, thus opening itself to a counterclaim.
Municipal corporations are suable because their charters grant them the competence to sue and be sued
(express consent).

(2) No. The municipality cannot be held liable for the torts committed by its regular employee,
who was then engaged in the discharge of governmental functions.

Municipal corporations exist in a dual capacity: Governmental and Proprietary. In its governmental
function, they exercise the right springing from sovereignty and enjoy the sovereign immunity from suit. In
its proprietary function, it exercises a private, proprietary or corporate right, arising from its existence as
legal persons and not as public agencies. The test of liability of the municipality depends on whether or
not the municipality, was performing governmental or proprietary functions.

It has already been remarked that municipal corporations are suable because their charters grant them
the competence to sue and be sued. Nevertheless, they are generally not liable for torts committed by
them in the discharge of governmental functions and can only be held answerable only if it can be shown
that they were acting in proprietary capacity. In permitting such entities to be sued, the State merely gives
the claimant the right to show that the defendant was not acting in governmental capacity when the injury
was committed or that the case comes under the exceptions recognized by law. Failing this, the claimant
cannot recover.

In the absence of any evidence to the contrary, the regularity of the performance of official duty is
presumed. Hence, We rule that the driver of the dump truck was performing duties or tasks pertaining to
his office.

Decision of the respondent court modified. Petitioner municipality absolved of any liability in favor of
private respondents.

Torio vs. Fontanilla

Posted on October 3, 2012

G.R. No. L-29993; 85 SCRA 399

October 23, 1978
____________________
Facts:
The Municipal Council of Malasiqui, Pangasinan, passed Resolution No. 159 to
manage the 1959 Malasiqui town fiesta celebration The 1959 Malasiqui
Town Fiesta Executive Committee was created, which, in turn, organized a subcommittee on entertainment and stage.
A zarzuela troupe, of which Vicente Fontanilla was a member, arrived for their
performance on January 22. During the zarzuela, the stage collapsed and
Fontanilla was pinned underneath. He was immediately hospitalized, but died
the following day.
Fontanillas heirs filed a complaint to recover damages against the Municipality
of Malasiqui, its Municipal Council and all the Councils individual members.
The municipality invoked inter alia the defense that as a legally and duly

organized public corporation it performs sovereign functions and the holding of a

town fiesta was an exercise of its governmental functions from which no liability
can arise to answer for the negligence of any of its agents.
The councilors maintained that they merely acted as the municipalitys agents
in carrying out the municipal ordinance and as such they are likewise not liable
for damages as the undertaking was not one for profit; furthermore, they had
exercised due care and diligence in implementing the municipal ordinance.
After trial, the RTC dismisses the complaint, concluding that the Executive
Committee had exercised due diligence and care in selecting a competent man
for the construction of the stage, and the collapse was due to forces beyond the
control of the committee. Consequently, the defendants were not liable for the
death of Vicente Fontanilla. Upon appeal, the Court of Appeals reversed the trial
courts decision and ordered all the defendants-appellees to pay jointly and
severally the heirs of Vicente Fontanilla the sums of P12,000.00 by way of moral
and actual damages:P1200.00 its attorneys fees; and the costs.
Issue:
Whether or not the Municipality of Malasiqui may be held liable.
Held:
Yes.
Under Philippine laws, municipalities are political bodies endowed with the
faculties of municipal corporations to be exercised by and through their
respective municipal governments in conformity with law, and in their proper
corporate name, they may inter alia sue and be sued, and contract and be
contracted with.
The powers of a municipality are two-fold in character: public, governmental or
political on the one hand; and corporate, private, or proprietary on the other.
Governmental powers are those exercised by the corporation in administering
the powers of the state and promoting the public welfare. These include the
legislative, judicial public, and political. Municipal powers, on the other hand, are
exercised for the special benefit and advantage of the community. These include
those which are ministerial, private and corporate.
This distinction of powers are necessary in determining the liability of the
municipality for the acts of its agents which result in injury to third persons.
If the injury is caused in the course of the performance of a governmental

function/duty, no recovery can be had from the municipality unless there is an

existing statute on the matter, nor from its officers, so long as they performed
their duties honestly and in good faith or that they did not act wantonly and
maliciously.
With respect to proprietary functions, the settled rule is that a municipal
corporation can be held liable to third persons ex contract or ex delicto. They
may also be subject to suit upon contracts and its tort.

Pasay city v. CFI of Manila (1984)

Tuesday, October 04, 2011
2:43 AM

= Plaintiffs; = Defendants
Facts: In 1964, V.D. Isip, Sons & Associates represented by Isip entered into a
contract with the City of Pasay represented by then Mayor Pablo Cuneta. The
contract entitled "Contract and Agreement" was for construction of a new Pasay City
Hall at FB Harrison St., Pasay city. Pursuant to the contract, proceeded with the
construction of the new Pasay City Hall building. accomplished various stages of
construction the amount of work equivalent to P1.7million of the total contract price
of P4.9million.
paid only the total amount of P1.1million leaving an amount of P613,000. failed
to remit the amount to so latter filed for specific performance with damages. The
parties arrived at a draft amicable agreement which was submitted to the Municipal
Board of Pasay City for its consideration.
In 1969, Municipal Board enacted Ordinance No. 1012 wc approved the Compromise
Agreement . CFI approved the compromise agreement. CFI issued writ of execution.
An application for and notice of garnishment were effected upon the 's funds with
the Philippine Natl Bank (PNB).
filed motion to quash the writ of execution: a) Sheriff has no power to levy or
garnish on execution the general funds, specially the trust funds of Pasay City.
CFI: denied and ordered enforcement of garnishment.
So this suit.
Issue: WON Pasay city funds deposited with PNB are exempt from execution or
garnishment? NO since ordinance already appropriated the amount.
Held:
a. A compromise agreement not contrary to law, public order, public
policy, morals or good customs is a valid contract wc is the law
between the parties themselves.
A judgment on a compromise is final and executory. HERE, execution has already
been issued. It is obvious that did not only succeed in enforcing the compromise
but wants to rescind the compromise. Parties to compromise may either 1)
enforce the compromise 2 to rescind and insist upon his original demand. HERE we

cant allow to avail of both. It cant ask for rescission of compromise agreement
after it has already enjoyed the first option of enforcing the compromise by asking
for writ of execution resulting in garnishment of funds of deposited w/ PNB wc
eventually was delivered to .
b. Pasay city's funds deposited with PNB not exempt from execution.
GR: All government funds deposited w/ PNB by any agency or instrumentality of the
govt, WON by way of general or special deposit, remain government funds and may
not be subject to garnishment or levy. BUT inasmuch as an ordinance has already
been enacted expressly appropriating amount of P613k of payment to the , funds
may be garnished.
Republic v. Palacio: Judgments against a State in cases where it has consent to be
used, generally operate to merely liquidate and establish 's claim in absence of
express provison; otherwise, they cannot be enforced by processes of the law; and
it is for legislature to provide for the payment in such manner as it sees fit.
CFI correct in refusing 's motion to quash the writ of execution.
c. Submission of performance bond by not a condition precedent to
payment of P613k by .
Parties envisioned a stage by stage construction on part of and payment on the
part of as shown by the contract and agreement. The parties to the compromise
thus contemplated a divisible obligation necessitating a performance bond "in
proportion" to the uncompleted work.
Therefore, submission of the bond was not a condition precedent to the payment of
the P613k to . Nowhere in the Contract nor in the Compromise Agreement could
be found the fact that payment by s of such amount was dependent upon the
submission by of the performance bond. It cannot be argued that reciprocal
obligation was created in the Compromise, for the obligation to pay on the part of
was established several years ago when finished some of the stages of
construction. And this argument is already moot and academic, for the amount
P613k has already been collected through execution and garnishment upon the
funds of Pasay City w/ the PNB.