G.R. No. 51214 January 26, 1989
EDGARDO DORUELO and ANTHONY ESTENZO, petitioners, vs. MINISTRY OF NATIONAL DEFENSE, PHILIPPINE COAST GUARD, and MARIA EFIGENIA SHIPPING CORP., respondents.

FACTS

The case arose from a maritime collision on September 21, 1977, between the tanker LSCO Petroparcel, commanded by Captain Edgardo Doruelo, and the fishing boat MB Maria Efigenia XV, resulting in the sinking of the latter. The Philippine Coast Guard (PCG) Board of Marine Inquiry conducted proceedings on the marine protests filed by both vessel masters. The PCG found LSCO Petroparcel to be the overtaking vessel and thus, under the International Rules of the Road, had the duty to keep out of the way of the overtaken fishing boats. The PCG rejected Captain Doruelo’s claim that he altered course to give way and that the fishing boat subsequently followed and hit his vessel, finding this version physically improbable given the vessels’ relative speeds and distances.
Consequently, the PCG suspended Captain Doruelo and Chief Mate Anthony Estenzo from their marine professions for two years. The petitioners appealed to the Ministry of National Defense (MND). The MND affirmed the PCG’s finding of liability but, citing “verified information” that Captain Doruelo was involved in another sea collision indicating a propensity for recklessness, increased his suspension to three years. The petitioners then elevated the case to the Supreme Court via certiorari.

ISSUE

The primary issues were: (1) whether the factual findings of the PCG, affirmed by the MND, were supported by substantial evidence and thus binding on judicial review; and (2) whether the MND acted correctly in increasing the penalty based on an alleged subsequent collision not presented as evidence in the case.

RULING

The Supreme Court dismissed the petition but modified the penalty. On the first issue, the Court upheld the factual findings of the PCG. It reiterated the doctrine that factual determinations of administrative agencies, when based on substantial evidence, are accorded great weight and finality. Substantial evidence is defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. The Court found that the PCG’s decision was thorough and judicious, and its conclusion—that the petitioners’ vessel, as the overtaking vessel, failed in its duty to keep clear—was supported by the preponderance of evidence. The petitioners’ mere disagreement with the appreciation of evidence did not constitute a ground for reversal.
On the second issue, the Court ruled that the MND committed an error in increasing the penalty. The Court emphasized a cardinal rule in administrative adjudication: a decision must be based on evidence presented at the hearing or contained in the record and disclosed to the parties affected. The MND’s reliance on “verified information” about another collision was improper, as this was not part of the evidence in the case record. If Captain Doruelo was liable for another incident, his liability should be determined in separate, proper proceedings. Therefore, the Court reinstated the original two-year suspension penalty imposed by the PCG.