The central issue in this litigation concerns the validity of the Romulo-Snyder Agreement (1950)  whereby the Philippine Government undertook to return  to the United States Government in ten  annual installments, a total of about 35-million dollars advanced by the United States to, but unexpended by, the National Defense Forces of the Philippines.

In October 1954, the Usaffe Veterans Associations Inc., hereafter called Usaffe Veterans, for itself and for  many other Filipino veterans of  World War II, ex-members of the United States Armed Forces in the Far  East (USAFFE) prayed  in  its complaint before the Manila court of first instance that said Agreement be  annulled, that payments thereunder be declared illegal and that defendants as officers of the Philippine Republic  be restrained from disbursing any  funds in the National Treasury in pursuance of said Agreement.   Said Usaffe Veterans further asked that the moneys available, instead of being remitted to the United States, should be turned over to the Finance Service  of the Armed Forces of the Philippines for the payment of all pending claims of the veterans represented by plaintiff.

The complaint rested on plaintiff's  three propositions: first, that J;he funds to be "returned" under the Agreement were  funds appropriated by the American  Congress for the Philippine Army, actually delivered to the Philippine Government and actually owned by the said Government; second, that U. S. Secretary Snyder of the Treasury, had no authority to retake such funds from the  P, I, Government; and third, that Philippine Foreign Secretary Carlos P. Romulo  had  no authority to  return or promise  to  return the aforesaid sums of money through the so-called Romulo-Snyder  Agreement.

The defendants moved to dismiss, alleging Governmental immunity from  suit.   But the court required an answer, and then heard the  case on the merits.  Thereafter,  it dismissed the complaint, upheld the validity of the Agreement and dissolved the preliminary injunction it had previously issued.   The plaintiff appealed.

On July 26,1941, foreseeing the War in the Pacific,  President  Franklin  D. Roosevelt, called into  the  service  of the Armed  Forces of the United States, for the duration of  the  emergency, all  the organized  military  forces  of the Philippine Commonwealth.   His order was published here  by Proclamation No. 740  of President Quezon  on August 10,  1941.  In  October 1941, by two special orders, General Douglas MacArthur, Commanding  General of the United  States Army  Forces  in  the Far East (known  as USAFFE)  placed  under his  command  all  the Philippine Army units including the Philippine Constabulary,  about 100,000 officers and soldiers.

For the expenses incident to such incorporation, mobilization and  activities,  the Congress of the United States provided in its Appropriation Act of December  17, 1941 (Public Law No. 353, 77th Congress) as follows:

"For all expenses necessary for the mobilization, operation  and maintenance of  the Army  of the Philippines, including expenses connected with calling into  the service of the armed forces of the United States the organized military forces of the Government of the Commonwealth of the Philippines,  * * *  but shall be expended and  accounted for  in the manner prescribed by the President of the United States,  $269,000.00; to remain available  until June 30, 1943, which shall  be available for payment to the Government of the Commonwealth of the Philippines upon its written request,  either in advance of or in reimbursement for all or any part of the estimated or actual costs, as authorized by  the  Commanding General, United States Army Forces in the Far  East, of necessary expenses  for the purposes aforesaid, *  *  *." (Italics Ours.)

In  subsequent Acts,  the U.  S.  Congress  appropriated moneys in language identical to the above: $28,313,000.00 for the fiscal year ending June 30,  1943; and $100,000,000 each year, for the fiscal years ending June 30, 1944, June 30, 1945, and  June 30, 1946^[1]   The last pertinent appropriation was Public Law No. 301 (79th Congress)  known as the  Rescission Act.  It simply  set  aside 200 million dollars  for the  Army  of the Philippines for the fiscal year ending June 30, 1946.

Now,  pursuant to  the power reserved to  him under Public Law 353 above-quoted,  President Roosevelt issued on  January 3,  1942,  his  Executive  Order No. 9011 prescribing partly as follows:

"2. (a) Necessary expenditures from  funds in  the  Philippine Treasury for the purposes authorized by the  Act of December 17, 1941, will be made by disbursing  officers of  the  Army of  the Philippines on the  approval of authority of the Commanding General, United States Army Forces in the Far East, and such purposes as he may deem proper, and his  determination thereon shall be final and conclusive upon the accounting officers of the Philippine Government, and such expenditures will be accounted for in accordance with procedures established by Philippine Commonwealth Laws and regulations."   (Italics Ours.)

Out of the total  amounts  thus  appropriated by  the United  States Congress as above itemized, P570,863,000.00 was transferred directly to The Philippine Armed  Forces by  means of  vouchers  which stated "Advance of Funds under Public Law 353-77th Congress and Executive Order No. 9011".  This amount was used (mostly) to discharge in the Philippine Islands the monetary obligations assumed by the  U. S. Government as a  result of the induction of the Philippine  Armed Forces into the U. S.  Army, and of its operations beginning in 1941. Part of these obligations consisted in the claims of Filipino  USAFFE soldiers for arrears  in  pay and  in the charges  for  supplies used  by them and the  guerrillas.

Of the millions so transferred,  there remained unexpended and uncommitted in the possession  of the Philippine Armed Forces  as  of December  01, 1949,  about 35 million dollars.   As at that time, the Philippine Government badly needed funds for its activities, President Quirino, through Governor Miguel  Cuaderno  of the Central Bank proposed to the corresponding  officials of the U. S. Government the retention of the  35-million dollars as a loan, and for its repayment in ten  annual installments. After protracted negotiations the deal was concluded, and the Romulo-Snyder Agreement was signed in Washington on November 6,  1950, by the then Philippine Secretary of Foreign Affairs,  Carlos P. Romulo, and the then American Secretary of the Treasury, John W. Snyder. Principal stipulation therein was this paragraph:

"3. The Government of the Republic of  the Philippines  further agrees to pay the dollar amount payable hereunder to the Secretary of the  Treasury of the United States in ten  annual installments, the first nine payments to be in  the amount  of P3,500,000.00 and the  final residual  payment' to be in the  amount determined by deducting the  total  of the previous  principal payments from the total  amount of dollars to be paid to the Secretary of the Treasury of the United States, the latter amount to be determined as provided in Article II hereof.  *   *  *."

It should be  added that the  agreement, made  on the basis of the parties'  belief that 35-million was the  outstanding balance, provided in its  article II for an audit by appropriate officers to compute  the exact amount  due.

In compliance with the Agreement,  this Government has appropriated by law and paid to the United States up to and including 1954, yearly installments totalling P33,187,663.24.
There is no reason to doubt that subsequent budgets failed to  make  the  corresponding  appropriations  for other installments.

In this appeal, the  Usaffe Veterans reiterated with extended arguments, their  basic propositions.  They insist: first, the money  delivered by  the U. S.  to the  Armed Forces of  the Philippine Island  were straight payments for  military  services; ownership thereof  vested  in the Philippine  Government upon  delivery, and consequently, there was nothing to return, nothing to consider as a loan; and  second, the Romulo-Snyder Agreement was void because there was no loan to be repaid and because it was not  binding  on the Philippine  Government for lack of authority of the officers who concluded the same.

With regard to the first point, it must be remembered that the first Congressional Act  of December  17,  1941 (Public Law  No. 353) appropriating $269-million-expressly said the amount "shall be available for payment to the Government of the Commonwealth of the Philippines upon its written request, either in advance of or in reimbursement for all or any part of the estimated or actual costs" of operation, mobilization and maintenance  of the Philippine Army.  Note carefully, the money is to be handed to the Philippine Government either  in advance of expenditures or in reimbursement thereof.  AH the vouchers signed upon receipt of  the money state clearly,  "Advance of funds under  Public Law 353-7th Congress and Executive Order No.  9011".

In any system of accounting, advances of funds  for expenditures  contemplate disbursements to be reported,  and credited if approved,  against such advances, the unexpended  sums to be returned later.  In fact, the Congressional law  itself required accounting "in the manner prescribed  by  the President of the U.S." and said President in his Executive  Order No. 9011, outlined the procedure whereby advanced funds shall  be accounted for.  Furthermore, it requires as a  condition sine qua non  that all expenditures  shall first be approved by the  Commanding-General, United States Army Forces in the Far East.

Now, these ideas of "funds  advanced" to meet  such expenditures  of the Philippine Army as may be  approved by the USAFFE Commanding-General, in connection with the requirement of accounting therefor evidently contradict appellant's thesis that the moneys represented straight payments to the Philippine Government for its armed services, and  passed into the absolute control of such Government.

In fact,  the respective army officers  of  both nations,^[2] who are presumed to know their business, have consistently regarded the money as funds advanced, to be subsequently accounted for which  means  submission of expenditures, and if approved, return  of unexpended balance.

Now then, it is undeniable that upon a  final rendition of accounts by the Philippine  Government, a superabit resulted of at least 35 million dollars in favor of the U.S. Instead of returning such amount in  one lump sum, our Executive Department arranged for its  repayment in ten annual installments. Prima facie such arrangement should raise  no valid  objection, given the obligation to return which we know exists.

Yet plaintiff attempts  to block such repayment because many alleged  claims of veterans  have not been processed and paid,  December 31,  1949, having been fixed as the deadline  for the presentation and/or payment  of  such claims.  Plaintiff obviously calculates that  if  the return is prevented and the money kept here,  it  might  manage to persuade the powers-that-be to extend the  deadline anew. Hence the two-pronged attack: (a)  no obligation to repay; (b) the officers who promised to  repay  had no authority to bind this Government.

The first ground  has proved untenable.

On  the second, there is no doubt that  President Quirino approved the negotiations.  And he had  power to  contract budgetary  loans  under Republic  Act  No.  213, amending Republic Act No. 16.  The most important argument, however, rests on  the lack  of ratification of the  Agreement by the Senate of the Philippines to  make it binding on this Government.  On this  matter, the defendants explain as follows:

"That the agreement is  not  a 'treaty' as that term is  used in the  Constitution,  is conceded. The agreement was never submitted to the Senate for concurrence (Art. VII, Sec. 10 (7).  However, it must be noted that a treaty is not the  only form that an international agreement  may assume.  For  the  grant  of the  treaty-making power to the  Executive and  the Senate does  not  exhaust the  power of the government over international relations.  Consequently, executive agreements may be entered into with other" states and are  effective even  without  the  concurrence  of the  Senate (Sinco, Philippine Political Law, 10th ed.,  303; Tañada and Fernando,  Constitution  of the  Philippines, 4th ed., Vol. II, 1050).  It is observed in this connection  that  from  the  point  of  view  of international law, there is  no difference  between treaties and executive agreements in  their binding effect upon  states concerned as long as the  negotiating functionaries  have remained within their powers (Hackworth, Digest  of International Law, Vol. 5, 395, citing U.  S.  vs.  Belmont,  301 U. S.  342, State of Russia  vs. National City Bank of New York, 69 F. (2d)  44; United States vs. Pink, 315  U. S.  203;, Altman &  Co., vs. United States, 224 U.  S. 583. See also McDougal and Lans, "Treaties and  Executive  Agreements 54 Yale Law Journal 181,  318,  et seg.;  and  Sinco;  Op. cit. 305) 'The distinction between so-called executive agreements' and 'treaties' is purely  a constitutional one  and has no international legal significance' (Research in International Law, Draft Convention  on the Law of Treaties  (Harvard Law School),  Comment, 29 Am. J. Int.) Law Supp. 653, 897.  See also Hackworth, op/cit. 391).

"There are now various forms  of such pacts  or agreements  entered into by and between  sovereign states which do not necessarily come under  the  strict  sense  of' a  treaty and Which do  not  require ratification or consent of the legislative body  of the State, but nevertheless,  are  considered  valid international  agreements.  In a survey  of the  practice of  States  made  by  Harvard  Research in the Draft  Convention in the  Law  of Treaties (1935, pp. 711-713) it has been shown that there had been more executive  agreements entered  into by States than treaties  (Hudson, International  Legislation,  I, p. ixii-xcvii).

"In the leading case  of Altman vs. U. S., 224, U. S. 583,  it was held  that Jan international  compact negotiated between the  representative of  two  sovereign nations and made in the name  and or behalf of the contracting parties and dealing with important commercial  relations between the two countries, is a treaty both internationally although, as  an executive agreement it  is not technically a  treaty requiring the advice and consent of the  Senate.   (Herbert Briggs, The Law of Nations, 1947 ed., p.  489). "Nature of Executive Agreements"

"Executive  Agreements fall  into  two classes:  (1)  agreements made purely as executive acts  affecting external relations and independent of or without legislative authorization, which may  be termed as presidential agreements, and (2) agreements entered into in pursuance of acts of Congress, which have  been  designated  as Congressional-Executive Agreements  (Sinco, supra, 304; Hackworth, supra, 390; McDougal and  Lans,   supra,  204-205;  Hyke,  International Law, 2nd ed., Vol. II, 1406;  et seq.)

"The Romulo-Snyder Agreement may fall under any of  these two classes, for precisely on September 18, 1946, Congress of the Philippines specifically  authorized  the. President  of  the Philippines  to obtain such loans 

"Even granting, arguendo,  that there was no legislative authorization, it  is hereby  maintained that  the Romulo-Snyder Agreement was  legally and validly entered into  to conform to  the second category, namely, 'agreements entered  into purely as executive acts without legislative authorization/ This  second category usually includes money agreements relating to the settlement of  pecuniary claims of citizens.  It may be  said that this  method of settling such claims has come to be the  usual way of dealing with matters of this kind  (Memorandum of the  Solicitor of the Department of State (Nielson) sent to Senator Lodge by the  Under-Secretary of State (Philip), August 23,1922, MS Dept. of  State, file 711.00/98a)."

Such considerations seem persuasive; indeed, the Agreement was not submitted  to the  U.S. Senate either; but we  do not stop to check the authorities  above listed nor test the  conclusions derived  therefrom in order to render a definite pronouncement, for the reason that our Senate Resolution No. 15^[3] practically admits the validity and binding  force of such Agreement. Furthermore, the acts  of Congress Appropriating funds  for the yearly  installments "necessary to  comply  with such Agreements  constitute  a ratification thereof,  which places the  question of validity out  of the Court's reach, no constitutional principle having been invoked to restrict Congress' plenary power to appropriate funds loan or no loan.

In conclusion, plaintiff,  to say the least,  failed to make a clear case  for the  relief  demanded; its petition was, therefore, properly denied.   Judgment affirmed.

Paras,  C. J.,  Padilla,  Montemayor,  Bautista  Angelo, Labrador, Concepcion, Endencia, and Barrera, JJ., concur.