G.R. No. 191846 - Guingona, Jr. vs. Commission on Elections

Four cases of rotary drill parts were shipped from abroad aboard S.S. "Leoville" in November 1962, consigned to Mobil Philippines Exploration, Inc. in Manila.
The shipment arrived at the Port of Manila on April 10, 1963, and was discharged to the custody of the Customs Arrastre Service, a unit under the Bureau of Customs handling arrastre operations.
Only three out of the four cases were delivered to the consignee's broker by the Customs Arrastre Service. The fourth case was undelivered.

On April 4, 1964, Mobil Philippines Exploration, Inc. filed suit in the Court of First Instance of Manila against the Customs Arrastre Service and the Bureau of Customs for recovery of the value of the undelivered case amounting to P18,493.37 plus damages.
On April 20, 1964, the defendants filed a motion to dismiss, claiming that the entities were not persons under the law and therefore not suable.
The trial court dismissed the complaint on April 25, 1964, holding that neither the Customs Arrastre Service nor the Bureau of Customs were suable entities.
Mobil Philippines Exploration, Inc. appealed to the Supreme Court contesting the issue of the defendants’ suability.

The Rules of Court (Section 1, Rule 3) provide that only natural persons, juridical persons, or entities authorized by law may be parties in civil actions.
The Bureau of Customs is a bureau under the Department of Finance; the Customs Arrastre Service is a unit within the Bureau of Customs. Neither has juridical personality.
Plaintiff argued that since the Bureau of Customs operates arrastre services, which are proprietary functions, it should be suable as an entity authorized by law in relation to that function.
Relevant statutory provision: Section 1213 of Republic Act No. 1937 (Tariff and Customs Code) grants the Bureau of Customs supervision, control, and operation of arrastre services, and allows contracting with private parties for arrastre service after public bidding.
Previous related ruling: Associated Workers Union v. Bureau of Customs, where the Court noted that arrastre services are proprietary or non-governmental functions but did not decide on the suability of the Bureau of Customs.
The Bureau of Customs’ arrastre function is argued to be an incident to its governmental function of assessing and collecting customs duties.

Whether the Bureau of Customs and its unit, the Customs Arrastre Service, possessing no juridical personality, are suable entities under the law in relation to their operation of arrastre services.
Whether performing proprietary functions, such as arrastre services, removes sovereign immunity and allows a government bureau to be sued without express statutory consent.