G.R. No. L-29304 September 30, 1970
CARABAO, INC., plaintiff-appellant, vs. AGRICULTURAL PRODUCTIVITY COMMISSION, FRANCISCO P. SAGUITGUIT and/or FAUSTINO SYCHANGCO, defendants-appellees.

FACTS

Plaintiff Carabao, Inc. filed a complaint in the Court of First Instance of Rizal to recover P238,500.00 as the unpaid price for 300 fire extinguishers sold and delivered to defendant Agricultural Productivity Commission. The plaintiff alleged it had presented a claim for payment to the Auditor General on June 14, 1967, and pursuant to Act No. 3083, it acquired the right to file the court action because the Auditor General failed to decide the claim within two months (by August 13, 1967). The defendants moved to dismiss the case on the ground of lack of jurisdiction, arguing that under the Philippine Constitution and Commonwealth Act No. 327, the exclusive original jurisdiction over money claims against the Government is vested in the Auditor General, with appellate jurisdiction in the Supreme Court. The lower court sustained the dismissal. It was later revealed that the Auditor General had rendered a decision on October 6, 1967, denying the plaintiff’s claim on grounds that the purchase order was null and void for lack of a proper obligating instrument and due to the exorbitant price. The lower court maintained its dismissal order.

ISSUE

Whether the Court of First Instance had jurisdiction over the plaintiff’s money claim against the government, given the provisions of Act No. 3083 and Commonwealth Act No. 327 in relation to the Philippine Constitution.

RULING

The order of dismissal is affirmed. The governing law for settling money claims against the Philippine Government is Commonwealth Act No. 327, enacted pursuant to Article XI, Section 3 of the Philippine Constitution. This Act vests exclusive original jurisdiction in the Auditor General and provides for an appeal to the Supreme Court for private claimants. The provisions of Act No. 3083, which allowed a direct court action if the Auditor General failed to decide within two months, are incompatible with and have been abrogated by the later Commonwealth Act No. 327 under the principle that later repugnant statutes abrogate earlier ones. Consequently, inaction by the Auditor General for the statutory period no longer entitles a claimant to file a direct suit in court; the remedy is to institute mandamus proceedings to compel a decision. The courts of first instance no longer have original jurisdiction over such claims. The conditions in Commonwealth Act No. 327 must be strictly observed, and Act No. 3083 now stands merely as the general law waiving state immunity from suit, subject to its limitations.