Facts:

On February 14, 1936, Walter Bull filed a complaint against Alfredo L. Yatco, the Collector of Internal Revenue, in the Court of First Instance of Manila. Bull sought to compel Yatco to disclose the names of merchants and purchasing firms that had allegedly made sales under false invoices to Simplex Trading Co., Inc., without declaring these sales for tax purposes. He also requested information regarding the amounts of surcharges and compromises paid by these firms to the Bureau of Internal Revenue, as well as a detailed statement of the rewards he was entitled to under the law for providing such information. The complaint asserted that Bull was entitled to a reward and sought an order for Yatco to pay him the corresponding amount, along with the costs of the suit. In response, Yatco, through the Solicitor-General, filed a demurrer, arguing that the Court of First Instance lacked jurisdiction over him as he was acting in his official capacity as a government agent. The demurr...

Facts:

1. Filing of the Complaint: On February 14, 1936, Walter Bull filed a complaint in the Court of First Instance of Manila against Alfredo L. Yatco, the Collector of Internal Revenue. Bull sought the disclosure of names of merchants and firms involved in fraudulent sales to the Simplex Trading Co., Inc., and requested the payment of rewards he claimed to be entitled to under the law.

2. Allegations in the Complaint: Bull alleged that the Bureau of Internal Revenue had discovered sales made under false invoices by certain merchants and firms, which were not declared for taxation purposes. He claimed that these entities had paid surcharges and compromises to the Bureau, and he was entitled to a reward under Section 2735 of the Revised Administrative Code, as amended by Act No. 3734.

3. Defendant's Demurrer: The defendant, through the Solicitor-General, filed a demurrer, arguing that the Court of First Instance of Manila lacked jurisdiction over the case. The demurrer was based on the grounds that the Collector of Internal Revenue was an agent of the government acting in his official capacity, and the suit was effectively against the Commonwealth of the Philippines, which had not consented to be sued.

4. Trial Court's Decision: The trial court sustained the demurrer, ruling that the Commonwealth of the Philippines had not given its consent to be sued, and dismissed the case. Bull appealed this decision.

5. Legal Provisions: Section 2735 of the Revised Administrative Code, as amended, provides for rewards to informers who provide information leading to the discovery of tax violations. The Secretary of Finance issued regulations governing the payment of such rewards, requiring the Collector of Internal Revenue to determine the informer's entitlement to a reward after the final settlement of the case.

6. Plaintiff's Claim: Bull claimed that he had requested the Collector of Internal Revenue to pay him the reward in July 1934, but the request was denied. He did not pursue administrative remedies, such as appealing to the Auditor General, before filing the lawsuit.

Issue:

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Ruling:

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Ratio:

1. Government Immunity from Suit: The government cannot be sued without its consent. The Collector of Internal Revenue, as an agent of the government, is protected by this immunity when acting in his official capacity.

2. Exhaustion of Administrative Remedies: Before filing a lawsuit against the government, a claimant must first exhaust administrative remedies, including presenting the claim to the Auditor General and awaiting a decision. Only after the Auditor General denies the claim can the claimant file a lawsuit in court.

3. Procedure for Claims Against the Government: The procedure for filing claims against the government is outlined in Act No. 3083 and Section 3, Article X of the Constitution. These provisions require that claims be presented to the Auditor General before they can be brought to court.

4. Entitlement to Reward: The entitlement to a reward under Section 2735 of the Revised Administrative Code is subject to the regulations issued by the Secretary of Finance. The plaintiff must comply with these regulations and exhaust administrative remedies before seeking judicial relief.

Concurring Opinion

Justice Laurel concurred in the result but based his reasoning on the administrative nature of the claim. He emphasized that the payment of rewards under Section 2735 is determined in accordance with the rules promulgated by the Collector of Internal Revenue, and the plaintiff must show compliance with these rules to have a valid cause of action. He also noted that the procedure outlined in the Constitution must be followed before a private individual can sue the government.

Conclusion:

The Supreme Court upheld the dismissal of the case, ruling that the plaintiff had failed to exhaust administrative remedies before filing the lawsuit. The Court emphasized the importance of following the proper procedure for claims against the government, including presenting the claim to the Auditor General before seeking judicial relief.