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Bacoco Vs Nacoco

The National Coconut Corporation paid stenographers for transcript services but the Auditor General disallowed the payment, arguing that as a government entity NCC was exempt. The Court ruled that: (1) Government has constituent functions that bind society and ministrant functions for public welfare; (2) Though NCC promotes economic welfare, it was incorporated separately from government and subject to corporation law; (3) The term "Government" in the Administrative Code refers only to sovereignty functions, not government-owned corporations. Therefore, NCC was not a government entity exempt from fees and the stenographers did not need to reimburse.

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121 views1 page

Bacoco Vs Nacoco

The National Coconut Corporation paid stenographers for transcript services but the Auditor General disallowed the payment, arguing that as a government entity NCC was exempt. The Court ruled that: (1) Government has constituent functions that bind society and ministrant functions for public welfare; (2) Though NCC promotes economic welfare, it was incorporated separately from government and subject to corporation law; (3) The term "Government" in the Administrative Code refers only to sovereignty functions, not government-owned corporations. Therefore, NCC was not a government entity exempt from fees and the stenographers did not need to reimburse.

Uploaded by

Lu Cas
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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BACANI V NACOCO G.R. No.

L-6957, November 29, 1956


100 PHIL 468 - 1956

FACTS:
Herein petitioners are stenographers in Branch VI of the CIF Manila. In a pending civil case where
the public respondents are involved, they requested for the services of the stenographers and
thereby paid them for the said transcript at the rate of P1 per page, amounting to P714 in total.

However, upon inspecting the books of the corporation, the Auditor General disallowed the
payment of such fees and sought for the recovery of the amounts paid.

Consequently, the AG required the petitioners to reimburse the amounts invoking that the
National Coconut Corporation is a government entity within the purview of section 2 of the
Revised Administrative Code of 1917 which states that: “‘The Government of the Philippine
Islands’ is a term which refers to the corporate governmental entity through which the functions
of government are exercised throughout the Philippine Islands, including, save as the contrary
appears from the context, the various arms through which political authority is made effective in
said Islands, whether pertaining to the central Government or to the provincial or municipal
branches or other form of local government.”, hence, exempted from the payment of the fees in
question.

ISSUE:
Whether the NCC is a government entity and is exempted from the payments in question?

Held: NO

RULING:
The Court held No. Discussing, there are two-fold functions of the government namely:
constituent and ministrant. The constituent function refers to the bonds of society and are
compulsory in nature, while ministrant is more on public welfare like public works, education,
charity, health and safety. From such, we may infer that there are functions which our government
is required to exercise to promote its objectives as expressed in our Constitution and which are
exercised by it as an attribute of sovereignty, and those which it may exercise to promote merely
the welfare, progress and prosperity of the people.

The NCC has that function because the corporation promotes certain aspects of the economic life
of the people. In short, NCC belongs to what we call the government-owned and controlled
corporation which is governed by Corporation Law.

Albeit the NCC performs governmental functions for the people’s welfare, however, it was given
a corporate power separate and distinct from our government, for it was made subject to the
provisions of our Corporation Law in so far as its corporate existence and the powers that it may
exercise are concerned.

To recapitulate, we may mention that the term “Government of the Republic of the Philippines”
used in section 2 of the Revised Administrative Code refers only to that government entity
through which the functions of the government are exercised as an attribute of sovereignty, and
in this are included those arms through which political authority is made effective whether they
be provincial, municipal or other form of local government.

Therefore, NCC is not a government entity and is not exempted from the payment of fees in
question; petitioners are not subject to reimbursement.

Petition GRANTED.

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