Friday, December 09, 2011

Restrictive Theory of State Immunity from Suit

A State may be said to have descended to the level of an individual and can thus be seemed to have tacitly given its consent to be sued only when its enters into business contracts. However, the restrictive application of State immunity is proper only when the proceedings arise out of commercial transactions of the foreign sovereign, its commercial activities or its economic affairs. It does not apply where the contract relates to the exercise of its sovereign functions. (United States v. Ruiz, G.R. No. L-35645, May 22, 1985)

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