Source: https://supreme.justia.com/cases/federal/us/227/270/
Timestamp: 2019-04-22 08:28:14+00:00

Document:
The government of Porto Rico cannot be sued without its consent.
The government of Porto Rico, as established by the Organic Act, with some possible exceptions, comes within the general rule exempting a government sovereign in its attributes.
That government of Porto Rico, as established by the Organic Act of April 12, 1900, is a strong likeness of that established for Hawaii which has immunity from suit. Kawananakoa v. Polyblank, 205 U. S. 349.
The provision in § 7 of the Organic Act of Porto Rico that the people of Porto Rico shall have power to sue and be sued is not to be construed as destroying the grant of sovereignty given by the act itself.
Like words may have one significance in one context and a different signification in another.
In construing an organic act of a territory, this Court will consider that Congress intended to create a government conforming to the American system of divided powers -- legislative, executive and judicial -- and did not intend to give to any one branch of that government power by which the government itself so created could be destroyed.
The words "to sue and be sued" as used in § 7 of the Organic Act of Porto Rico, when construed in connection with the grant of governmental powers therein contained, amount only to a recognition of a liability to be sued in case of consent duly given.
The facts, which involve the construction of § 7 of the Organic Act of Porto Rico and whether the government of that Island can be sued without its consent, are stated in the opinion.
"The appeal was taken by the People of Porto Rico, the only ground alleged in support thereof in this Supreme Court being that, inasmuch as the People of Porto Rico cannot be sued without its consent, and it appears that such consent had not been given in the present case, the district court acted without jurisdiction, wherefore the judgment rendered by it was null and void."
The court did not overlook the importance of the question, as is shown by its careful and perspicuous opinion. A member of the court fully stated his reasons for dissenting. On this appeal, taken by the People of Porto Rico, the case having been tried without a jury, the question for decision is narrower than would seem to be the case, regarding alone the general terms in which the question is mentioned in the passage previously quoted from the opinion of the court below.
"It may be justly asserted that Porto Rico is a completely organized territory, although not a territory incorporated into the United States, and that there is no reason why Porto Rico should not be held to be such a territory."
Besides, in Gromer v. Standard Dredging Co., 224 U. S. 362, in considering the subject and giving due weight to "the precaution against abuse" of the People of Porto Rican legislative power, and after calling attention to the reservation made by Congress of the right to repeal any Porto Rican act of legislation, it was nevertheless declared (p. 224 U. S. 370): "The purpose of the act is to give local self-government conferring an autonomy similar to that of the states." There being, then, no doubt that immunity from suit without it consent is necessarily inferable from a mere consideration of the nature of the Porto Rican government, the issue is whether there is any ground which removes Porto Rico from the general rule. That such an exception is the result of the concluding portion of § 7 of the organic act was the sole basis upon which the court below rested its conclusion, and the correctness of that view is the only issue we are called upon to decide.
"shall constitute a body politic under the name of the People of Porto Rico, with governmental powers as hereinafter conferred, and with power to sue and be sued as such."
Unquestionably the provision, disconnected from its context, would sustain the conclusion that there exists a general liability to be sued without reference to consent. Indeed, the words "to sue and be sued" are but a crystallized form of expression resorted to for the purpose of aptly stating the right to sue and the liability to be sued, which springs from a grant of corporate existence, private or public. But this does not solve the question here arising, which is the meaning of the words in the act under consideration, for it may be that like words may have one significance in one context and a different signification in another. And this is made clear by bearing in mind that, as usually applied, the words "to sue and be sued" but express implications as to the existence of powers flowing from the matter to which they relate, while here, if the words have the meaning insisted on, they serve, if not to destroy, at least to seriously modify or greatly restrict, the grant of powers conferred by the organic act. The destructive potency of the words if given the meaning insisted upon is self-evident, since the claim here is that they denature the government created by the organic act by depriving it of an immunity which has been frequently decided by this Court would otherwise necessarily arise from the scope of the powers conferred. As, however, a full appreciation of the operation of the words, if they are interpreted as insisted upon, affords the truest means of ascertaining their real signification, we do not rest content with that which is self-evident, but pursue the subject further.
"The presence of the words 'with power to sue and be sued' in our organic act cannot be ascribed to an oversight of Congress, but, on the contrary, it may be presumed that Congress employed them having in mind the obligations contracted in the Treaty of Paris, and with the desire of giving to the persons included in its stipulations ready access to courts of justice against any invasion of their rights by governmental action. And, indeed, there should be no fear of entrusting to the courts the protection, not only of the persons mentioned in the treaty, but of any other persons, without excluding the people of Porto Rico. This has been demonstrated sufficiently by an experience of more than ten years."
in adopting it was to follow the plan applied from the beginning to the organized territories by creating a government conforming to the American system, with defined and divided powers -- legislative, executive, and judicial, -- in further view of the fact that the exercise of the judicial power here claimed would be destructive of that system, we are of opinion that it cannot be supposed that Congress intended by the clause in question to destroy the government which it was its purpose to create. In a sense, the words "to sue and be sued," applied, as they normally have been, in grants of private or public charters, are redundant, since they but express the existence of powers which would naturally be implied. It may be true also to say that, if they be likewise confined in the case before us, they will also be in a sense redundant. Despite this, we think they should be construed with reference to the powers conferred by the provisions to which they relate, and therefore cannot be treated as destructive of the authority otherwise conferred by the act. Thus interpreting the clause, it is but an expression of the power to sue arising from the terms of the organic fact, and a recognition of a liability to be sued consistently with the nature and character of the government -- that is, only in case of consent duly given. The words, "shall have the government powers hereinafter conferred and with the power to sue," etc., exclude the possibility in reason of holding that the right to sue and be sued which was given, "and with," that is, because of or along with the powers conferred, was intended to or does distort of limit the powers of government which the act conferred.

References: v. 
 § 7
 § 7
 § 7
 v. 
 § 7