G.R. No. L-1822; November 28, 1949
MARVEL BUILDING CORPORATION, plaintiff-appellant, vs. PHILIPPINE WAR DAMAGE COMMISSION, defendant-appellee.

FACTS

Marvel Building Corporation filed a complaint to collect unpaid rent from the Philippine War Damage Commission for the month of July 1947, pursuant to a lease contract over floors of the L.R. Aguinaldo Building. The Commission, after occupying the premises and paying rent to prior owners, vacated without paying the July rent. The Commission moved to dismiss the complaint, arguing it was an agency of the United States Government and thus the suit was effectively against the U.S. Government, over which the court had no jurisdiction without its consent. The Court of First Instance of Manila granted the motion to dismiss.

ISSUE

Whether the trial court has jurisdiction over a suit for unpaid rent against the Philippine War Damage Commission, an agency of the United States Government.

RULING

No. The order of dismissal is affirmed. The Philippine War Damage Commission is an instrumentality of the United States Government, created by U.S. law, funded by the U.S. Treasury, and reporting to the U.S. President and Congress. While a suit to recover possession of property held by such an agent may proceed, a suit like this one—which seeks a money judgment—would result in a direct financial liability against the U.S. Government itself. Since the U.S. Government has not consented to be sued, the court lacks jurisdiction. The Commission has no independent funds to satisfy a judgment; any payment would ultimately come from U.S. Government appropriations.

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