MUNICIPALITY OF SAN FERNANDO, LA UNION, PETITIONER, VS. HON. JUDGE ROMEO N. FIRME, JUANA RIMANDO-BANIÑA, LAUREANO BANIÑA, JR., SOR MARIETA BANIÑA, MONTANO BANIÑA, ORJA BANIÑA AN…

Municipality of San Fernando versus Firme

The Case

This is a petition for certiorari, with a prayer for a writ of preliminary mandatory injunction, brought by the Municipality of San Fernando, La Union against Judge Romeo Firme of the Court of First Instance of La Union, Bauang branch, and against the heirs of the late Laureano Baniña Sr. The municipality asks the Supreme Court to nullify or modify the proceedings and orders of the trial judge in a civil case for damages arising from a three-vehicle collision, and ultimately to reverse the decision holding the municipality solidarily liable with its dump truck driver. The case matters because it is the classic teaching vehicle on the distinction between suability and liability, and on when a municipal corporation may be held answerable for a tort committed by its employee in the discharge of governmental functions.

Procedural History

The private respondents, heirs of the deceased Laureano Baniña Sr., first sued the Estate of Macario Nieveras and its driver Bernardo Balagot for damages before the Court of First Instance of La Union, San Fernando branch. Those defendants then filed a third party complaint against the municipality and the driver of its dump truck. The case was later transferred to the Bauang branch presided over by Judge Firme. By order dated May 7, 1975, the heirs amended their complaint and impleaded the municipality and its regular employee Alfredo Bislig as defendants for the first time.

The municipality answered, raising lack of cause of action, non-suability of the State, prescription, and the negligence of the jeepney owner and driver as the proximate cause of the collision. The trial judge then issued a series of orders: dismissing the cross-claim against Balagot; admitting the amended answer and setting hearing on the affirmative defenses only with respect to the supposed lack of jurisdiction; deferring resolution of the grounds for dismissal until trial; denying reconsideration of that deferral; reiterating the denial; declaring the case submitted for decision; and denying the motion to recall prosecution witnesses for cross-examination. On October 10, 1979, the trial court rendered judgment for the plaintiffs, ordering the municipality and Bislig to pay jointly and severally funeral expenses, lost expected earnings, moral damages, and attorney's fees, while dismissing the complaint against the Estate of Nieveras and Balagot. Reconsideration was denied, and the municipality came to the Supreme Court on certiorari.

Facts

At about seven o'clock in the morning of December 16, 1965, a collision occurred involving three vehicles: a passenger jeepney driven by Bernardo Balagot and owned by the Estate of Macario Nieveras, a gravel and sand truck driven by Jose Manandeg and owned by Tanquilino Velasquez, and a dump truck owned by the Municipality of San Fernando, La Union and driven by Alfredo Bislig. Several jeepney passengers, including Laureano Baniña Sr., died from their injuries, and four others suffered varying degrees of physical injuries.

The heirs sued the jeepney owner and driver, who in turn brought in the municipality and its driver. When the municipality was impleaded, it raised non-suability of the State as an affirmative defense, among others. The trial judge deferred resolution of that defense until trial, but never resolved it; he proceeded to trial and rendered judgment against the municipality and Bislig.

At trial, the dump truck driver maintained that he was on his way to the Naguilian river to get a load of sand and gravel for the repair of San Fernando's municipal streets. No evidence to the contrary was presented.

Issues

• Whether or not the respondent judge committed grave abuse of discretion amounting to lack or excess of jurisdiction when he deferred and failed to resolve the defense of non-suability of the State until trial.
• Whether or not the municipality may be held liable for the quasi-delict committed by its regular employee, the dump truck driver.

Applicable Provisions

Article XVI, Section 3 of the Constitution provides:

The State may not be sued without its consent.

This is the source of the doctrine of non-suability, which the municipality invoked as an affirmative defense and which the trial judge left unresolved.

Section 3(m) of Rule 131 of the Revised Rules of Court provides:

The presumption is that official duty has been regularly performed.

This presumption supplied the finding that the dump truck driver was performing duties pertaining to his office when the collision occurred.

Ruling

On the first issue, the Court held that the respondent judge did not commit grave abuse of discretion when he deferred the resolution of the defense of non-suability. The Court characterized the failure as an exercise of judgment, however arbitrary, and not the grave abuse that certiorari corrects.

On the second issue, however, the Court held that the judge acted in excess of his jurisdiction when he held the municipality liable for the quasi-delict of its regular employee. The Court drew the now-canonical distinction between suability and liability:

Suability depends on the consent of the state to be sued, liability on the applicable law and the established facts. The circumstance that a state is suable does not necessarily mean that it is liable; on the other hand, it can never be held liable if it does not first consent to be sued. Liability is not conceded by the mere fact that the state has allowed itself to be sued. When the state does waive its sovereign immunity, it is only giving the plaintiff the chance to prove, if it can, that the defendant is liable.

The Court explained that municipal corporations are agencies of the State when engaged in governmental functions and should enjoy sovereign immunity, yet they are subject to suit even in the performance of such functions because their charters grant them the competence to sue and be sued. Suability, however, is not liability. The test of liability is whether the driver, acting on behalf of the municipality, was performing governmental or proprietary functions. Quoting the Indiana case of City of Kokomo versus Loy, the Court described the dual capacity of municipal corporations: in one they exercise rights springing from sovereignty, and their acts are political and governmental; in the other they exercise a private, proprietary or corporate right arising from their existence as legal persons.

Applying the test, the Court found that the driver was on his way to the Naguilian river to get sand and gravel for the repair of municipal streets. Absent contrary evidence, the regularity of official duty was presumed. The Court reiterated its ruling in Palafox versus Province of Ilocos Norte that the construction or maintenance of roads is a governmental activity. Hence, the municipality could not be held liable for the torts committed by its regular employee then engaged in the discharge of governmental functions, and the death of the passenger, tragic as it was, imposed no duty on the municipality to pay monetary compensation.

Doctrine

First, the State may not be sued without its consent, and consent may be express or implied. Municipal corporations are suable because their charters grant them the competence to sue and be sued, but suability does not equal liability. Second, a municipality is generally not liable for torts committed in the discharge of governmental functions and may be held answerable only if it was acting in a proprietary capacity. Third, the construction or maintenance of roads is a governmental activity, so a municipality is not liable for the negligence of its dump truck driver hauling sand and gravel for street repair. Fourth, official duty is presumed regularly performed under Section 3(m) of Rule 131, and that presumption may establish the governmental character of the employee's act.

Disposition

The petition was granted, and the decision of the trial court was modified by absolving the Municipality of San Fernando, La Union of any liability in favor of the private respondents.

Remember This

Memorize the line: suability depends on consent, liability on the applicable law and the established facts; a suable municipality is not necessarily a liable one. Examiners use this case to test the governmental versus proprietary function test, the non-suability of the State under Article XVI, Section 3 of the Constitution, and the rule that road construction and maintenance is a governmental activity.