GR 116356; (June, 1998) (Digest)
G.R. No. 116356 June 29, 1998
EASTERN SHIPPING LINES, INC., petitioner, vs. COURT OF APPEALS and DAVAO PILOTS ASSOCIATION, respondents.
FACTS
Petitioner Eastern Shipping Lines, Inc. was sued by private respondent Davao Pilots Association for unpaid pilotage services rendered between January 14, 1987, and July 22, 1989, amounting to P703,290.18. The petitioner refused to pay the fees computed under Executive Order No. 1088, which prescribes uniform and modified rates for pilotage services, insisting instead on paying the lower rates set by Philippine Ports Authority (PPA) memorandum circulars. The petitioner assailed the constitutionality of EO 1088, arguing that its interpretation and application were left to a private person (the private respondent) and that it constituted an undue delegation of powers. The petitioner also contended that the power to prescribe pilotage fees was vested by law in the PPA under its charter, PD 857. The trial court ruled in favor of the private respondent, finding the petitioner’s evidence of unpaid fees unchallenged and the petitioner’s arguments unsupported by proof. The Court of Appeals affirmed the trial court’s decision.
ISSUE
Whether Executive Order No. 1088 is unconstitutional.
RULING
No, Executive Order No. 1088 is valid and constitutional. The Supreme Court adhered to its en banc ruling in Philippine Interisland Shipping Association of the Philippines vs. Court of Appeals, which upheld the constitutionality of EO 1088. The Court reiterated that EO 1088 is a valid statute with a legislative purpose to rationalize pilotage service charges through uniform and adjusted rates. The power to fix rates for services like pilotage is legislative in character. EO 1088 does not withdraw the PPA’s power to impose, prescribe, increase, or decrease rates; however, the PPA may not decrease them below the rates mandated by EO 1088. Any PPA circular inconsistent with EO 1088 is void and ineffective, as administrative acts must not be contrary to law. The petitioner has no legal basis to refuse payment of pilotage fees computed under EO 1088. The petition was denied, and the Decision of the Court of Appeals was affirmed.