GR L 19432; (June, 1965) (Digest)
G.R. No. L-19432 June 23, 1965
COTABATO TIMBERLAND COMPANY, INC., plaintiff-appellant, vs. PLARIDEL LUMBER COMPANY, INC., defendant-appellee.
FACTS
The case involves a motion for reconsideration filed by appellee Plaridel Lumber Co. Inc. regarding a decision dated February 26, 1965. In the main decision, damages were awarded to appellant Cotabato Timberland Co., Inc. for 551,663.84 board feet of logs that appellee Plaridel failed to turn over. The right of way permit issued to Plaridel by forestry authorities required the turnover of logs cut to Cotabato, subject only to Cotabato being ready to receive them. Plaridel now argues that the damages awarded are excessive because the cost of producing the logs should be deducted from the export price used to compute damages; otherwise, appellant Cotabato would be unjustly enriched.
ISSUE
Whether the cost of production of the logs should be deducted from the export price in computing the compensatory damages awarded to appellant Cotabato Timberland for the logs appellee Plaridel failed to deliver.
RULING
No, the cost of production should not be deducted. The motion for reconsideration is denied.
The Court held the motion to be without merit for four reasons:
1. The right of way permit issued to Plaridel mandated the turnover of logs to Cotabato, with the sole condition being Cotabato’s readiness to receive them. The permit contained no provision for deducting production costs.
2. Section 1837 of the Revised Administrative Code expressly provides that when forest products unlawfully gathered from a licensee’s area are seized and delivered to the proper licensee, they are to be delivered “free from any claim on the part of the offended persons.” This legal provision frees the offended licensee (Cotabato) from any claim, which includes claims for production costs.
3. There was no evidence presented regarding the cost of production of the logs. The logs were a byproduct of Plaridel’s road-building activities.
4. Deducting production costs would result in unjust enrichment for Plaridel, not Cotabato. It would allow Plaridel to build its road to the double prejudice of Cotabato: first, by invading its licensed area, and second, by having Cotabato effectively bear the expenses of that production.