Facts:
1. Spain paid
$400,000 into the treasury of the Philippine Islands for the relief of those damaged by an earthquake.
2. Upon the petition of Monte de Piedad, an institution
under the control of the church, the Philippine Government directed its
treasurer to give $80,000 of the relief fund in Four (4)4 installments. As a result, various petitions were filed, including
the heirs of those entitled to the allotments. All
prayed for the State to bring suit against Monte de Piedad, and for it to pay with
interest.
3. The Defendant appealed since all its funds have been
exhausted already on various jewelry loans.
Issue: Whether the government is the proper
authority to the cause of action
YES.
The Philippine government, as a trustee towards the funds
could maintain the action since there has been no change of sovereignty. The
state, as a sovereign, is the parens
patriae of the people. These principles are based upon public policy. The Philippine
Government is not a mere nominal party because it was exercising its sovereign
functions or powers and was merely seeking to carry out a trust developed upon
it when the Philippine Islands was ceded to the United States. Finally, if said loan was for ecclesiastical
pious work, then Spain would not exercise its civil capacities.
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