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Bacani vs. Nacoco Digest

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Bacani v.

NACOCO Digest

G.R. No. L-9657 Nov. 29, 1956


Two-fold Function of the Government

FACTS: 
1.    Bacani and Matoto are court stenographers both assigned in the CFI of Manila. During the
pendency of another civil case (Civil Case No. 2293 entitled 'Francisco Sycip vs. NACOCO'),
Alikpala, counsel for NACOCO(Nat’l Coconut Corporation) , requested the said stenographers
for copies of the transcript of the stenographic notes taken by them during the hearing.
Plaintiffs complied with the request by delivering to Counsel Alikpala the needed transcript
containing 714 pages and thereafter submitted to him their bills for the payment of their
fees.  The NACOCO paid the amount of P564 to Bacani and P150 to Matoto for said transcript at
the rate of P1 per page.

3.      Subsequently, the Auditor General required the plaintiffs to reimburse said amounts by virtue
of a DOJ circular which stated that NACOCO, being a government entity, was exempt from the
payment of the fees in question.

4.      Petitioners countered that NACOCO is not a government entity within the purview of section
16, Rule 130 of the Rules of Court while the defendants set up as a defense that the NACOCO is
a government entity within the purview of section 2 of the Revised Administrative Code of 1917
hence, exempt from paying the stenographers’ fees under Rule 130 of the Rules of Court.

 ISSUE: Whether or not NACOCO is a government entity.

No, it is not.

1.   GOCCs do not acquire that status for the simple reason that they do not come under the
classification of municipal or public corporation. While NACOCO was organized for the purpose
of “adjusting the coconut industry to a position independent of trade preferences in the United
States” and of providing “Facilities for the better curing of copra products and the proper
utilization of coconut by-products”, a function which our government has chosen to exercise to
promote the coconut industry. It was given a corporate power separate and distinct from the
government, as it was made subject to the provisions of the Corporation Law in so far as its
corporate existence and the powers that it may exercise are concerned (sections 2 and 4,
Commonwealth Act No. 518). It may sue and be sued in the same manner as any other private
corporations, and in this sense it is an entity different from our government.

2.     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.
3.      President Wilson enumerates the constituent functions as follows:
(1) The keeping of order and providing for the protection of persons and property from violence
and robbery.
(2) The fixing of the legal relations between man and wife and between parents and children.
(3) The regulation of the holding, transmission, and interchange of property, and the
determination of its liabilities for debt or for crime.
(4) The determination of contract rights between individuals.
(5) The definition and punishment of crime.
(6) The administration of justice in civil cases.
(7) The determination of the political duties, privileges, and relations of citizens.
(8) Dealings of the state with foreign powers: the preservation of the state from external
danger or encroachment and the advancement of its international interests.’
4.   The most important of the ministrant functions are: public works, public education, public
charity, health and safety regulations, and regulations of trade and industry. The principles
deter mining whether or not a government shall exercise certain of these optional functions
are: (1) that a government should do for the public welfare those things which private capital
would not naturally undertake and (2) that a government should do these things which by its
very nature it is better equipped to administer for the public welfare than is any private
individual or group of individuals.

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