G.R. No. 101345 December 1, 1992
NONITO J. BERNARDO, petitioner, vs. CALTEX (PHILIPPINES), INC., respondent.

FACTS

Petitioner Nonito J. Bernardo, an operator/dealer, operates two Caltex gasoline stations. On December 3, 1990, he placed an order for 10,000 liters of diesel fuel with Caltex’s Pandacan Terminal and made full payment. On December 4, 1990, he placed another order for 10,000 liters of premium gasoline and made full payment on December 5, 1990. Bernardo sent his tanker to take delivery on December 5, 1990, but delivery failed allegedly due to a malfunction of Caltex’s computer system. On that same day, the Energy Regulatory Board announced a price increase for petroleum products effective at 6:00 P.M. Caltex, citing its Purchase and Sale Agreement which stated prices were those in effect on the date of delivery, refused to deliver the products unless Bernardo paid the price difference. Bernardo filed a complaint in the Regional Trial Court (RTC) of Quezon City seeking delivery and damages. Caltex moved to dismiss, arguing improper venue and lack of cause of action, and later asserted that jurisdiction belonged to the Energy Regulatory Board (ERB) under rules governing disputes between oil companies and dealers. The RTC initially denied the motion to dismiss and issued a preliminary mandatory injunction, but after Caltex’s petition to the Court of Appeals, the injunction was set aside. Subsequently, the RTC, upon Caltex’s motion, dismissed Bernardo’s suit for lack of jurisdiction, citing the ERB’s regulatory powers. Bernardo appealed directly to the Supreme Court.

ISSUE

Whether the Regional Trial Court or the Energy Regulatory Board has original jurisdiction over the dispute between Bernardo and Caltex regarding the applicable price for the pre-paid petroleum products.

RULING

The Supreme Court ruled that the Regional Trial Court has jurisdiction. The controversy is not about the validity or propriety of the ERB’s price-fixing power, nor is it an unsettled pricing dispute requiring the ERB’s expertise. The core issue is a civil law question: determining which set of prices (pre-increase or post-increase) applies to the perfected contracts of sale between the parties, based on the provisions of the Civil Code. The Court found the situation analogous to Mobil Oil Philippines, Inc. v. Court of Appeals, where a prepaid order created a perfected contract of sale at the price prevailing at the time of payment. Since the dispute involves the interpretation and enforcement of contractual obligations, it is beyond the cognizance of the ERB and properly within the jurisdiction of the regular courts. The Order of the RTC dismissing the case was annulled and set aside, and the RTC was directed to resume proceedings.