EPG CONSTRUCTION VS VIGILAR March 16, 2001 FACTS: (1983) The herein petitioners-contractors, under contracts with DPWH,

constructed 145 housing units but coverage of construction and funding under the said contracts was only for 2/3 of each housing unit. Through the verbal request and assurance of then DPWH Undersecretary Canlas, they undertook additional constructions for the completion of the project, but said additional constructions were not issued payment by DPWH. With a favorable recommendation from the DPWH Asst. Secretary for Legal Affairs, the petitioners sent a demend letter to the DPWH Secretary. The DPWH Auditor did not object to the payment subject to whatever action COA may adopt. (1992) Through the request of then DPWH Secretary De Jesus, the DBM released the amount for payment but (1996) respondent DPWH Secreatry Vigilar denied the money claims prompting petitioners to file a petition for mandamus before the RTC which said trial court denied. Hence, this petition. Among others, respondent-secretary argues that the state may not be sued invoking the constitutional doctrine of Non-suability of the State also known as the Royal Prerogative of Dishonesty. ISSUE: Whether or not the Principle of State Immunity is applicable in the case at bar. HELD: The principle of state immunity finds no application in this case. Under the circumstances, respondent may not validly invoke the Royal Prerogative of Dishonesty and hide under the states cloak of invincibility against suit. Considering that this principle yields to certain settled exceptions. The rule is not absolute for it does not say that the state may not be sued under any circumstance. The doctrine of governmental immunity from suit cannot serve as an instrument for perpetrating an injustice on a citizen. It is just as important that there be fidelity to legal norms on the part of officialdom if the rule of law is to be maintained. The ends of justice would be subverted if we were to uphold, in this instance, the states immunity from suit. This court - as the staunch guardian of the citizens rights and welfare- cannot sanction an injustice so patent on its face, and allow itself to be an instrument of perpetration thereof. Justice and equity sternly demand that the states cloak of invincibility against suit be shred in this particular instance and that petitionerscontractors be duly compensated , on the basis of quantum meruit, for construction done on the public works housing project Petition GRANTED.