Facts:

The case involves the American Insurance Company as the plaintiff-appellant and the Republic of the Philippines along with the Bureau of Customs as the defendants-appellees. The events leading to this case began in 1964 when certain cargoes consigned to the San Miguel Corporation were allegedly lost while under the custody of the Bureau of Customs, which was acting as the arrastre operator. The American Insurance Company, having insured the cargoes, sought to recover the value of these lost goods. The case was filed in the Court of First Instance of Manila under Civil Case No. 60551. The lower court dismissed the action, leading to the appeal by the American Insurance Company. The dismissal was based on a long-standing legal principle that the Bureau of Customs, in its capacity as an arrastre operator, was performing a governmental function related to the assessment and collection of taxes and revenues. C...

Facts:

1. Parties Involved:

   • Plaintiff-Appellant: American Insurance Company.
   • Defendants-Appellees: Republic of the Philippines and Bureau of Customs.

2. Nature of the Case:

   • The American Insurance Company filed an action to recover the value of certain cargoes consigned to the insured San Miguel Corporation.
   • The cargoes were allegedly lost in 1964 while in the possession of the Bureau of Customs, which was acting as the "arrastre" operator.

3. Legal Proceedings:

   • The Court of First Instance of Manila dismissed the case (Civil Case No. 60551).
   • The American Insurance Company appealed the dismissal.

4. Key Legal Context:

   • The case involves the doctrine of state immunity from suit.
   • The Bureau of Customs, as an arrastre operator, was performing a governmental function.

Issue:

1. Whether the Bureau of Customs, acting as an arrastre operator, is performing a governmental function.
2. Whether the Republic of the Philippines and the Bureau of Customs can be sued without the State's consent.
3. Whether the plaintiff's remedy lies in filing a claim with the Auditor General under Commonwealth AO No. 327.

Ruling:

The Supreme Court affirmed the order of dismissal issued by the Court of First Instance of Manila. The Court held that:

1. The Bureau of Customs, in performing arrastre services, is engaged in a governmental function.
2. The Republic of the Philippines and the Bureau of Customs cannot be sued without the State's consent due to the doctrine of state immunity from suit.
3. The proper remedy for the plaintiff is to file a claim with the Auditor General under Commonwealth AO No. 327.

Ratio:

• (Unlock)