G.R. No. 203610 – 797 Phil. 33 – 805 SCRA 524 – Political Law – Constitutional Law – State Immunity from Suit; Exceptions; Contract Agreements
In 1978, the government bought a 9,800 square meter lot from Gonzalo Roque, Jr. and several others. The lot was supposed to be used as the site for the national government center. Their sale agreement was reduced to a deed of absolute sale. The purchase price agreed upon was lower than the market price then. After the sale, Roque et al were allowed to stay in the property. No construction was immediately started.
A decade passed and still no project was commenced. Worse, informal settlers began encroaching into the property. Roque et al. then wrote the government several times and invoked that during the contract negotiations, though not written in the contract, they have the right to repurchase if no development was made. The government did not respond to their letters.
In 2003, the government directed Roque et al. to vacate the property as the site will be used for a housing project. In 2005, Roque et al. sued the government for the annulment of the deed of sale. They also invoked their right to repurchase the property.
The government invoked that they are immune from suit.
ISSUE: Whether or not the government may not be sued in this instance.
HELD: No. As a rule, the State and its instrumentalities are immune from suit. The exceptions are:
- When the state makes a waiver of its immunity; and
- When the State enters into a contract which creates mutual or reciprocal rights and obligations.
Here, the government entered into a deed of sale with Roque et al. to construct the NGC Project on the lot sold. To facilitate the sale, the Republic created a negotiating team to discuss the terms of the sale with Roque et al. who agreed to the negotiated sale on these alleged conditions: (a) that they will have the right to repurchase the properties if the NGC Project does not push through; and (b) that the NGC Project will increase the market value of their remaining properties.
However, although the government may be sued in this case, the deed of sale cannot be annulled on the ground that they failed to prove that there was fraud. Anent their alleged right to repurchase which was not written in the contract, a) Roque et al failed to properly allege their claim regarding their right to repurchase and b) they failed to present sufficient proof of their alleged right to repurchase.
