G.R. No. 100481 - Philippine Interisland Shipping Association of the Philippines vs. Court of Appeals

Case Summary (G.R. No. 100481)

Petitioners

• Philippine Interisland Shipping Association, Conference of Interisland Ship-owners and Operators, United Petroleum Tanker Operators Association, Lighterage Association of the Philippines, Pilotage Integrated Services Corporation (intervenors in one case)
• Hon. Pete Nicomedes Prado, Hon. Jesus B. Garcia, Jr., Commodore Rogelio A. Dayan, Simeon T. Silva, Jr. – variously in capacities as Secretary of Transportation and Communications, PPA Chairman/General Manager/South Harbor Manager

Respondents

• Court of Appeals – rendered decisions upholding trial courts or dismissing appeals for lack of jurisdiction
• Hon. Napoleon R. Flojo – Presiding Judge, Branch 2, RTC-Manila
• UHPAP and MPA – moved for injunctions and contempt citations to enforce pilotage-rate orders

Key Dates

• February 3, 1986 – Issuance of Executive Order No. 1088 by President Marcos (uniform, increased pilotage rates)
• November 16, 1986 – UHPAP announces implementation of E.O. 1088; PPA issues Memorandum Circular No. 43-86 (lower rates)
• January 7, 1987 – UHPAP files injunction in RTC-Manila (Civil Case No. 87-38913)
• February 26, 1988 – PPA issues Administrative Order No. 02-88 (“open pilotage” policy)
• September 8, 1989 – RTC-Manila issues preliminary injunction against A.O. 02-88; October 26, 1989 – judgment voiding A.O. 02-88
• October 4, 1991 – Court of Appeals affirms trial court in G.R. SP No. 19570 and CA G.R. SP No. 18072
• July 31, 1992 – PPA issues Administrative Order No. 05-92 (pilot‐assignment control)
• November 1992 – trial court issues restraining orders; petitions for contempt follow
• January 22, 1997 – Supreme Court decision under the 1987 Constitution

Applicable Law

• 1987 Philippine Constitution – governing executive and legislative powers
• Presidential Decree No. 857 – grants PPA authority to regulate pilotage services and fix rates (“impose, fix, prescribe, increase or decrease such rates…”)
• Executive Order No. 1088 – legislative issuance by President Marcos prescribing uniform pilotage charges
• Administrative Orders of PPA (Nos. 43-86, 02-88, 05-92) – attempts to modify or abandon rates fixed by E.O. 1088

Factual Background

Harbor pilots guide vessels through port approaches and maneuvers, relying on specialized local knowledge. Under P.D. 857, the PPA oversees pilotage and may fix service fees. In response to pilot associations’ demands, President Marcos issued E.O. 1088 (Feb. 3, 1986) prescribing uniform, higher pilotage rates. The PPA declined enforcement, first issuing lower rates (Memorandum Circular No. 43-86) and later adopting an open‐pilotage policy (A.O. 02-88) that left fee‐setting to contracting parties.

Procedural History: G.R. Nos. 103716–17

UHPAP sought a writ of preliminary mandatory injunction and temporary restraining order to compel PPA compliance with E.O. 1088 and to block disciplinary sanctions. The RTC-Manila enjoined the PPA from penalizing pilots charging E.O. 1088 rates. The PPA’s motion to dismiss (as moot after A.O. 02-88) was denied; its appeal to the Court of Appeals was consolidated with intervenors’ appeal. In October 1991 the appellate court affirmed the trial court, holding E.O. 1088 valid and not superseded by A.O. 02-88. The PPA then sought Supreme Court review.

Procedural History: G.R. No. 100481

UHPAP and MPA filed a certiorari petition in RTC-Manila, Branch 2, challenging A.O. 02-88 as ultra vires and contrary to E.O. 1088 and P.D. 857. The court nullified A.O. 02-88 and made permanent its preliminary injunction. The PPA and intervenors appealed to the Court of Appeals, which dismissed for lack of jurisdiction (issues purely legal). Both government and intervenors then sought review by the Supreme Court. The government’s petition was dismissed for failure to show reversible error, rendering the policy abandoned and A.O. 02-88 moot.

Procedural History: G.R. No. 107720

After the PPA abandoned A.O. 02-88, it issued A.O. 05-92 (pilot scheduling by PPA). UHPAP and MPA perceived this as a reincarnation of the open‐pilotage system and filed contempt motions in Branch 2, RTC-Manila, which issued restraining orders. The PPA contested jurisdiction. The trial court set contempt hearings, and the PPA elevated the question to the Supreme Court.

Issues Presented

Whether E.O. 1088 is a valid exercise of legislative power and binding on the PPA.
Whether the Court of Appeals erred in dismissing the appeal of intervenors from the trial court’s decision voiding A.O. 02-88.
Whether the RTC-Manila, Branch 2, had jurisdiction to entertain contempt motions arising from A.O. 05-92.

Analysis

• Legislative versus Administrative Power: Fixing rates is inherently legislative. Under Amendment 6 of the 1973 Constitution and P.D. 857, the President and Congress may prescribe rates; the PPA’s rate‐making power is delegated and cannot be used