Title
La Filipina Uy Gongco Corporation and Philippine Foremost Milling Corporation vs. Harbour Centre Port Terminal, Inc.
Case
G.R. No. 229490
Decision Date
Mar 1, 2023
La Filipina sued Harbour Centre for breaching a 2004 MOA by failing dredging obligations, raising fees, and denying priority berthing. Courts ruled in La Filipina's favor, awarding damages and enforcing contract terms.

Case Digest (A.M. No. CTA-01-1)
Expanded Legal Reasoning Model

Facts:

  • Parties and Background
    • La Filipina Uy Gongco Corporation and Philippine Foremost Milling Corporation (collectively “La Filipina et al.”) are agricultural importers and millers.
    • Harbour Centre Port Terminal, Inc. (“Harbour Centre”) operates the Manila Harbour Centre; its affiliates R-II Builders, Inc. and Landtrade Properties and Marketing Corporation developed the terminal.
  • Contractual Arrangements
    • In 1997–1999, La Filipina et al. purchased land at Manila Harbour Centre after Harbour Centre and affiliates promised:
      • Priority berthing for foreign bulk carriers and coastwise vessels;
      • Deep-water berthing (–11.5 m MLLW) and regular maintenance dredging;
      • Free use of apron space, rail lines, parking for discharging towers, underground conveyors.
    • In November 2004, the parties executed a Memorandum of Agreement (MOA) specifying: port and handling charge formulas, berthing protocols (advance notices, priority rules), and dredging obligations with liquidated damages.
  • Dispute and Trial Proceedings
    • In 2008, Harbour Centre demanded back rent, over-assessed handling charges, and removal of La Filipina et al.’s structures; La Filipina et al. disputed these demands.
    • On September 8, 2008, La Filipina et al. sued for breach of the MOA, specific performance (dredging, priority berthing), damages, and secured a temporary restraining order.
    • On October 11, 2011, the RTC ordered Harbour Centre to: dredge to –11.5 m within 15 days; honor berthing rights; compute charges per MOA; and to pay:
      • Liquidated damages (US$2,000/day from December 6 2004);
      • Actual damages (Php 7.3 million);
      • Exemplary damages (Php 10 million);
      • Attorney’s fees (Php 10 million);
      • Credit/refund of excess handling charges;
      • Permanent injunction.
  • Appeals and Execution
    • Both sides appealed to the Court of Appeals (CA). The RTC granted execution pending appeal, authorizing La Filipina et al. to hire a dredging contractor at Harbour Centre’s expense after court-ordered surveys.
    • La Filipina et al. completed dredging in October 2014 at Php 462 million. They moved in the CA for writs of attachment and reimbursement; the CA deferred.
    • In June 2016, the CA Eleventh Division affirmed the RTC decision with two modifications:
      • Liquidated damages computed up to October 24 2014;
      • Attorney’s fees reduced to Php 5 million.
    • The CA denied the attachment motion.
    • In October 2018, the CA Special 16th Division held the RTC had lost jurisdiction over La Filipina et al.’s Motion for Payment (reimbursement), labeled prior CA guidance obiter dictum, and found forum shopping.
  • Supreme Court Consolidation
    • La Filipina et al. filed Petitions for Review in G.R. Nos. 229490 (attachment) and 245515 (reimbursement); Harbour Centre filed in G.R. No. 230159 (jurisdiction, contract validity).
    • The Supreme Court consolidated the three cases on August 28, 2019.

Issues:

  • Jurisdiction
    • Did the RTC, as a special commercial court, have jurisdiction over the maritime contract dispute?
    • Did the RTC retain jurisdiction to hear La Filipina et al.’s Motion for Payment (reimbursement)?
  • Contract Validity and Interpretation
    • Is the MOA void as ultra vires (executed without corporate authority)?
    • Does the MOA lack cause or consideration?
    • Should the MOA be reformed for mistake, fraud, inequitable conduct or accident?
    • Was Harbour Centre’s unilateral increase in port and handling charges proper?
    • Must La Filipina et al. pay rent for space occupied by their cargo unloading equipment?
  • Breach and Damages
    • Did Harbour Centre breach La Filipina et al.’s priority berthing rights?
    • Are La Filipina et al. entitled to actual damages?
    • Are La Filipina et al. entitled to liquidated damages?
  • Ancillary Remedies and Conduct
    • Are La Filipina et al. entitled to a writ of attachment?
    • Did La Filipina et al. commit forum shopping?

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)

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