Phil Inter Island vs. Ca

PHILIPPINE INTERISLAND SHIPPING ASSOCIATION OF PHILIPPINES v.
CA, GR
No. 100481, 1997-01-22
Facts:
Private respondent United Harbor Pilots' Association of the Philippines, Inc. (UHPAP) is
the umbrella organization of various groups rendering pilotage service in different ports
of the Philippines.
On February 3, 1986, shortly before the presidential elections, President Ferdinand E.
Marcos, responding to the clamor of harbor pilots for an increase in pilotage rates,
issued Executive Order No. 1088, PROVIDING FOR UNIFORM AND MODIFIED
RATES FOR PILOTAGE SERVICES RENDERED TO
FOREIGN AND COASTWISE VESSELS IN ALL PRIVATE AND PUBLIC PORTS. The
executive order increased substantially the rates of the existing pilotage fees previously
fixed by the PPA.
However, the PPA refused to enforce the executive order on the ground that it had been
drawn hastily and without prior consultation; that its enforcement would create disorder
in the ports as the operators and owners of the maritime vessels had expressed
opposition to its... implementation; and that the increase in pilotage, as mandated by it,
was exorbitant and detrimental to port operations.
The UHPAP then announced its intention to implement E.O. No. 1088 effective
November 16, 1986.
Consequently, the UHPAP filed on January 7, 1987 a complaint for injunction with the
Regional Trial Court of Manila
On February 26, 1988, while the case was pending, the PPA issued Administrative
Order No. 02-88, entitled IMPLEMENTING GUIDELINES ON OPEN PILOTAGE
SERVICE. The PPA announced in its order that it was leaving to the contracting parties,
i.e., the shipping lines and the pilots, the... fixing of mutually acceptable rates for pilotage
services, thus abandoning the rates fixed by it (PPA) under Memorandum Circular No.
43-86, as well as those provided in E.O. No. 1088.
The PPA then moved to dismiss the case, contending that the issuance of its order had
rendered the case moot and academic and that consequently E.O. No. 1088 had ceased
to be effective.
Meanwhile, in Civil Case 87-38913, the court, without resolving the motion to dismiss
filed by the PPA, rendered a decision[5] holding that A.O. No. 02-88 did not render the
case moot and academic and that the PPA was under obligation to comply with E.O.
No. 1088 because the order had the force of law which the PPA could not repeal.
The then Transportation Minister Hernando Perez and the PPA filed a petition for review.
The petition was filed in this Court which later referred the case to the Court of Appeals
where it was docketed as CA G.R. SP. No. 18072.
In a decision rendered on October 4, 1991, the Twelfth Division[6] of the Court of
Appeals affirmed the decision of the trial court, by dismissing CA G.R. No. 21590 and
denying CA G.R. SP. No. 18072.
Issues:
Issue No. 1
Whether Executive Order No. 1088 is Valid and
Petitioners are Bound to Obey it
Issue No. 2
Whether the Court of Appeals had Jurisdiction over the

Appeal of Intervenors from the Decision of the
Trial Court Invalidating Administrative Order
No. 02-88 of the PPA
Issue no. 3
Whether the Trial Court has Jurisdiction to Hear and

Decide the Contempt Charges... against Petitioners
Ruling:
For issue no. 1
The fixing of rates is essentially a legislative power.

On February 3, 1986, when he issued E.O. No. 1088, President Marcos was authorized
under Amendment No. 6 of the 1973 Constitution to exercise legislative power, just as
he was under the original 1973
Constitution, when he issued P.D. NO. 857 which created the PPA, endowing it with the
power to regulate pilotage service in Philippine ports. Although the power to fix rates for
pilotage had been delegated to the PPA, it became necessary to rationalize the rates of
charges fixed... by it through the imposition of uniform rates.
As the President could delegate the ratemaking power to the PPA, so could he exercise
it in specific instances without thereby withdrawing the power vested by P.D. No.
857, Section 20(a) in the PPA "to impose, fix, prescribe, increase or decrease such
rates, charges or fees... for the services rendered by the Authority or by any private
organization within a Port District."
We conclude that E.O. No. 1088 is a valid statute and that the PPA is duty bound to
comply with its provisions. The PPA may increase the rates but it may not decrease
them below those mandated by E.O. No. 1088.
For issue no. 2... both the government and the intervenors separately brought petitions
for review to this Court. In G.R. No. 100109, the government's petition was dismissed for
lack of showing that the appellate court committed reversible error. The... dismissal of
the government's petition goes far to sustain the dismissal of the intervenors' petition in
G.R. No. 100481 for the review of the same decision of the Court of Appeals. After all,
the intervenors' petition is based on substantially the same grounds as those stated... in
the government's petition. It is now settled that the dismissal of a petition for review on
certiorari is an adjudication on the merits of a controversy.[16] Such dismissal can only
mean that the Supreme Court agrees with the findings and conclusions of... the Court of
Appeals or that the decision sought to be reviewed is correct.
For issue no. 3
The trial court would have jurisdiction only in the event of an attempt to block execution
of its decision and that would be after the remand of the case to the trial... court.[20] Until
then the trial court would have no jurisdiction to deal with alleged contemptuous acts.
The fly in the ointment, however, is that by accepting the dismissal of their petition for
review in G.R. No. 100109, petitioners rendered execution of the decision of the trial
court superfluous. Any attempt by them, therefore, to disobey the court's final injunction
as... embodied in its decision would be properly subject to punishment for contempt.
Petitioners' contention that private respondents' complaint must be the subject of a
separate action would nullify contempt proceedings as means of securing obedience to
the lawful processes of a... court. Petitioners' theory would reward ingenuity and cunning
in devising orders which substantially are the same as the order previously prohibited by
the court.
We hold that the trial court has jurisdiction to hear the motions for contempt filed by
private respondent, subject to any valid defense which petitioners may interpose.
Principles:
The fixing of rates is essentially a legislative power.

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PHILIPPINE INTERISLAND SHIPPING ASSOCIATION OF PHILIPPINES v.

Whether the Court of Appeals had Jurisdiction over the

Whether the Trial Court has Jurisdiction to Hear and

The fixing of rates is essentially a legislative power.

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