G.R. No. L-4465 July 12, 1951.
CHINESE FLOUR IMPORTERS ASSOCIATION, MANILA, PHILIPPINES, petitioner-appellee, vs. PRICE STABILIZATION BOARD (PRISCO), respondent-appellants. MANUEL RUSTIA, ERNESTO Y. SIBAL and other members of the Philippine Flour Institute, Inc., intervenors-appellants.

FACTS

The Chinese Flour Importers Association, representing 59 licensed Chinese importers who were old importers of wheat flour in 1946-1948, filed a petition for mandamus in the Court of First Instance of Manila. They sought to compel the Philippine Relief and Trade Rehabilitation Administration (PRATRA, later substituted by the Price Stabilization Corporation or PRISCO) and the Philippine Wheat Flour Board to issue import quota allocations to its members pursuant to Sections 12 and 14 of Republic Act No. 426 (the Import Control Law). The petitioner’s members had applied for quotas but their demands were disregarded. The Philippine Flour Institute, Inc., representing new importers, was allowed to intervene. The trial court ruled in favor of the petitioner-association, ordering PRISCO to grant flour quota allocations to the members based on their 1948 and 1949 allocations under RA 426, and dismissed the intervenors’ complaint. Both respondents and intervenors appealed.
The background involves the International Wheat Agreement, which the Philippines signed, guaranteeing to purchase 196,000 metric tons of wheat annually. The Senate concurred with the understanding that the Philippine government retained its authority to allocate these purchases among private importers. President Quirino issued Executive Order No. 305, authorizing PRATRA to control the importation and distribution of wheat flour under the Agreement. Subsequently, Republic Act No. 426 was approved, providing a quota allocation scheme where 70%, 60%, and 50% of the total import quota for fiscal years 1950-51, 1951-52, and 1952-53, respectively, shall be allocated to old importers (Section 14). Section 15 of RA 426 designated the Import Control Commissioner to allocate import quotas, but contained a proviso: “the Philippine Rehabilitation and Trade Rehabilitation Administration shall have exclusive power and authority to determine and regulate the allocation of wheat flour, among importers.” Appendix “C” of RA 426 listed controlled non-essential imports as “Flour, all kinds, except wheat flour.”

ISSUE

Shall the PRATRA (now PRISCO) make the allocation of import quota on wheat flour in accordance with the provisions of Republic Act No. 426 (particularly Section 14), as claimed by the petitioner, or shall it make such allocation in accordance with Sections 1 and 2 of Executive Order No. 305 in conjunction with Section 15 of Republic Act No. 426 , as claimed by the appellants (respondents and intervenors)?

RULING

The Supreme Court affirmed the decision of the trial court. PRISCO must allocate the wheat flour import quota in accordance with Republic Act No. 426 , specifically Section 14.
The Court held that Section 15 of RA 426, while granting PRATRA (PRISCO) “exclusive power and authority to determine and regulate the allocation of wheat flour,” did not remove wheat flour from the operation of the Act. This grant of authority to PRATRA was merely an exception to the general rule vesting allocation power in the Import Control Commissioner, but it did not exempt wheat flour from the substantive allocation formula prescribed by Section 14. The proviso in Section 15 must be construed together with the rest of the Act, particularly Section 14 which establishes the specific percentages for old and new importers. The exclusion of wheat flour from the list in Appendix “C” only meant it was not classified as a “controlled non-essential import,” but did not imply it was excluded from the Act’s allocation system. Executive Order No. 305, issued to implement the International Wheat Agreement, must yield to the subsequent provisions of RA 426, a legislative act. The Senate’s resolution concurring in the Wheat Agreement expressly preserved the government’s discretion to allocate among private importers, which discretion must be exercised within the framework of RA 426. Therefore, PRISCO’s authority under Section 15 is not absolute or unlimited discretion but must be exercised in conformity with the allocation pattern set by Section 14 of the same Act.