DEPARTMENT OF TRANSPORTATION (DOTR), MARITIME INDUSTRY AUTHORITY

(MARINA), AND PHILIPPINE COAST GUARD (PCG) vs. PHILIPPINE PETROLEUM SEA
TRANSPORT ASSOCIATION, HERMA SHIPPING TRANSPORT CORPORATION, ISLAS
TANKERS SEATRANSPORT CORPORATION, MIS MARITIME CORPORATION,
PETROLIFT, INC., GOLDEN ALBATROSS SHIPPING CORPORATION, VIA MARINE
CORPORATION, AND CARGOMARINE CORPORATION

G.R. No. 230107, July 24, 2018

FACTS:

Recognizing the gravity and extent of the Guimaras oil spill, the lack of proper
response strategy, the absence of the necessary equipment for containing, cleaning
up, and removing spilled oil, and the difficulty in pinning the liability on oil
companies, Congress was prompted to pass law implementing the International
Convention on Civil Liability for Oil Pollution Damage (1969 Civil Liability Convention)
and the International Convention on the Establishment of an International Fund for
Compensation for Oil Pollution Damage (1992 Fund Convention). The 1969 Civil
Liability Convention was later amended by the 1992 Protocol (1992 Civil Liability
Convention).

On June 2, 2007, RA 9483, entitled "An Act Providing For The Implementation
of the Provisions of the 1992 International Convention on Civil Liability for Oil
Pollution Damage and the 1992 International Convention on the Establishment of an
International Fund for Compensation for Oil Pollution Damage, Providing Penalties
for Violations thereof, and for Other Purposes" or simply the "Oil Pollution
Compensation Act of 2007," was signed into law. The provision relevant to this case,
Section 22 of RA 9483, provides for the establishment of an "Oil Pollution
Management Fund" (OPMF).

Nine years later, or on April 12, 2016, the IRR of RA 9483 was promulgated,
with Section 1, Rule thereof implementing the questioned Section 22 of RA 9483.

A month after the promulgation of the IRR, they filed a Petition for
Declaratory Relief (with Prayer for the Issuance of a Temporary Restraining Order
and/or a Writ of Preliminary Injunction) under Rule 63, contesting Section 22 (a) of
RA 9483, as well as Section 1, Rule of its IRR. The petition was raffled off and heard
by the Regional Trial Court, Branch 216, Quezon City (RTC). There, they argued that
the obligation to contribute to the OPMF solely imposed upon the owners and
operators of oil/petroleum tankers and barges violates their right to equal protection
of the law; that the ten-centavo (10c) impost is confiscatory and, thus, violates their
right to due process; Section 22 (a) is a prohibited rider; and, finally, the provision
provides an undue delegation of legislative power.

On February 22, 2017, the RTC rendered the questioned Decision granting
the petition for declaratory relief and ruling in favor of respondents.

Petitioners went directly to the SC via the present petition for review on
certiorari assailing the February 22, 2017 Decision of the RTC. Petitioners argue that
the RTC erred in declaring Section 22(a) of RA 9483 and its implementing rule
unconstitutional, given that respondents' petition for declaratory relief questioned
the wisdom behind them and was, thus, beyond the lower court's jurisdiction.
Petitioners further add that the classification in Section 22 of RA 9483 and its IRR is
reasonable and just, and does not violate the equal protection clause. Likewise,
petitioners maintain that public interest in protecting the marine wealth of the
country warrants the imposition of the 10-centavo impost. Finally, the petitioners
insist that the creation of the OPMF is relevant to the subject matter of RA 9483.

ISSUES:

W/N Section 22(a)of RA 9483 creating the Oil Pollution Management Fund is a
proscribed rider.

W/N the classification in Section 22 of RA 9483 and its IRR violates the equal
protection clausewhen it singled out "owners and operators of oil or petroleum
tankers and barges.

HELD:
NO. As argued by respondents, the thrust of the 1992 Civil Liability and the
1992 Fund Conventions is to impose upon covered ship owners strict liability for
pollution damage arising from oil spills and to provide compensation for the victims
thereof. On the other hand, the questioned OPMF governs the immediate
containment, removal, and clean -up operations in oil pollution cases and provides
for the conduct of research, enforcement, and monitoring activities of relevant
agencies. On the basis thereof, it would appear that the Conventions and the OPMF
cover two different subject mattersthat is, providing compensation versus pollution
containment and clean-up-as asserted by respondents. Thus, prima facie, one would
easily agree with respondents' contention. Such simplistic, if not myopic, view is not
the proper measure to determine whether a provision of law should be declared as
unconstitutional.
 It would undoubtedly be improper for this Court to make a superficial reading
of the texts of the conventions in order to determine whether the inclusion of
Section 22 in RA 9483, which was enacted to implement these Conventions, is infirm
more in-depth analysis of the conventions is necessary.
A review of the Conventions reveals that they do not only cover damage
claims by affected individuals but also all amounts encompassed by the term
"pollution damage" which is defined therein as:
 (a) loss or damage caused outside the ship by contamination
resulting from the escape or discharge of oil from the ship,
wherever such escape or discharge may occur, provided that
compensation for impairment of the environment other than
loss of profit from such impairment shall be limited to costs of
reasonable measures of reinstatement actually undertaken
or to be undertaken;
 (b) thecosts of preventive measures and further loss or
damage caused by preventive measures.
The Conventions, therefore, also cover damage to property, containment,
clean-up, and rehabilitation. Thus, the policy underpinning the establishment
of the OPMF in Section 22(a) of RA 9483 and its IRR is wholly consistent with
the objectives of the conventions.
Indeed, by employing preventive and/or immediate containment
measures or response techniques, the State is but affording protection to
persons or all stakeholders who stand to suffer from oil pollution incidents-
the main thrust of the conventions that is now effectively translated and
implemented in Section 22 (a) of RA 9483 and its IRR. In other words, by
creating the OPMF, Congress sought to ensure that our enforcement
agencies are capable of protecting our marine wealth and preventing harm
from being caused to the people and their livelihood by reason of these
unfortunate events.

NO. For one, bear in mind that the purpose of the subject legislation is
the implementation of the 1992 Civil Liability Convention and the 1992 Fund
Convention. Both Conventions only expressly cover "sea-going vessel and
seaborne craft of any type whatsoever constructed or adapted for the
carriage of oil in bulk as cargo x xx." This alone already forecloses any
argument against the validity of the alleged classification since the
implementation by RA 9483 of the subject Conventions necessarily carries
with it the adoption of the coverage and limitations employed in said texts.
Furthermore, We cannot subscribe to respondents' proposition that since
all vessels plying Philippine waters are susceptible to accidents which may
cause oil spills, all should be made to contribute to the OPMF. While all
vessels, channels, and storage facilities that carry or store oil are capable of
causing oil pollution, this does not make them "similarly situated" within the
context of the equal protection clause.
Aside from the difference in the purposes behind their existence and
navigation, it is internationally well-recognized that oil tankers pose a greater
risk to the environment and to people. As matter of fact, these types of
vessels have long been considered as separate class and are being given a
different treatment by various organizations.
As regards respondents' contention that since RA 9483 came about
because of the spate of oil spillage at the time of its enactment, this violates
the requirement that the classification must not be limited to existing
conditions only, the argument does not hold water. A statute or provision
thereof is said to be limited to existing conditions only if it cannot be applied
to future conditions as well. Here, We cannot, by any stretch of imagination,
agree with respondents' proposition. Suffice it to state that enacting a piece
of legislation as a response to a problem, incident, or occurrence does not
make it "limited to existing conditions only." Assessing whether a statute or
provision meets said requirement necessitates a review of the provision or
statute itself and not the cause or trigger for its enactment. To require
otherwise would be to improperly tie the hands of our legislature in enacting
laws designed to address the various matters, incidents, and occurrences that
may arise in a highly-dynamic and unpredictable society.

METRO MANILA TRANSIT CORPORATION vs. REYNALDO CUEVAS

 G.R. No. 167797, June 15, 2015

 FACTS:

Metro Manila Transit Corporation (MMTC) and Mina’s Transit Corporation

(Mina’s Transit) entered into an agreement to sell dated August 31, 1990, whereby
the latter bought several bus units from the former at a stipulated price. They agreed
that MMTC would retain the ownership of the buses until certain conditions were
met, but in the meantime Mina’s Transit could operate the buses within Metro
Manila.

On October 14, 1994, one of the buses subject of the agreement to sell hit
and damaged a Honda Motorcycle owned by Reynaldo and driven by Junnel.
Reynaldo and Junnel sued MMTC and Mina’s Transit for damages in the Regional
Trial Court (RTC).

MMTC denied liability claiming that although it retained the ownership of the
bus, the actual operator and employer of the bus driver was Mina’s Transit; and that,
in support of its cross-claim against Mina’s Transit, a provision in the agreement to
sell mandated Mina’s Transport to hold it free from liability arising from the use and
operation of the bus units.

ISSUES:

W/N MMTC is liable considering that it was not the actual operator and employer of
the bus driver.

May MMTC recover from Mina’s Transit (the actual employer of the negligent
driver)?

HELD:

YES. In view of MMTC’s admission in its pleadings that it had remained the
registered owner of the bus at the time of the incident, it could not escape liability
for the personal injuries and property damage suffered by the Cuevases. This is
because of the registered-owner rule, whereby the registered owner of the motor
vehicle involved in a vehicular accident could be held liable for the consequences.
The Court has reiterated the registered-owner rule in other rulings, like in Filcar
Transport Services v. Espinas, to wit:

x x x It is well settled that in case of motor vehicle mishaps, the registered owner of
the motor vehicle is considered as the employer of the tortfeasor-driver, and is made
primarily liable for the tort committed by the latter under Article 2176, in relation
with Article 2180, of the Civil Code.

In Equitable Leasing Corporation v. Suyom, we ruled that in so far as third

persons are concerned, the registered owner of the motor vehicle is the employer of
the negligent driver, and the actual employer is considered merely as an agent of
such owner.

MMTC could not evade liability by passing the buck to Mina’s Transit. The
stipulation in the agreement to sell did not bind third parties like the Cuevases, who
were expected to simply rely on the data contained in the registration certificate of
the erring bus.

YES. Although the registered-owner rule might seem to be unjust towards

MMTC, the law did not leave it without any remedy or recourse. According to Filcar
Transport Services v. Espinas, MMTC could recover from Mina’s Transit, the actual
employer of the negligent driver, under the principle of unjust enrichment, by means
of a cross-claim seeking reimbursement of all the amounts that it could be required
to pay as damages arising from the driver’s negligence. A cross-claim is a claim by
one party against a co-party arising out of the transaction or occurrence that is the
subject matter either of the original action or of a counterclaim therein, and may
include a claim that the party against whom it is asserted is or may be liable to the
cross-claimant for all or part of a claim asserted in the action against the cross-
claimant.
 G.V. FLORIDA TRANSPORT INC. v. TIARA COMMERCIAL CORPORATION
(LAXAMANA)

G.R. No. 201378, October 18, 2017

FACTS:

The bus company Victory Liner, Inc. (VLI) filed an action for damages against GV
Florida and its bus driver Arnold Vizquera (Vizquera) before the RTC.

This action arose out of a vehicle collision between the buses of VLI and GV
Florida along Capirpiwan, Cordon, Isabela on May 1, 2007. VLI claimed that
Vizquera's negligence was the proximate cause of the collision and GV Florida failed
to exercise due diligence in supervising its employee.

GV Florida alleged that the Michelin tires of its bus had factory and mechanical
defects which caused a tire blow-out. This, it claimed, was the proximate cause of
the vehicle collision. GV Florida instituted a third-party complaint against Tiara
Commercial Corporation(TCC). According to GV Florida, it purchased from TCC 50
brand new Michelin tires, 4 of which were installed into the bus that figured in the
collision. It claimed that though Vizquera exerted all efforts humanly possible to
avoid the accident, the bus nevertheless swerved to the oncoming south-bound lane
and into the VLI bus. GV Florida maintains that the "proximate cause of the accident
is the tire blow out which was brought about by factory and mechanical defects in
the Michelin tires which third-party plaintiff GV Florida absolutely and totally had no
control over."

The RTC ordered the service of summons on TCC.

TCC filed a Special Entry of Appearance with an Ex-parte Motion for Extension of
Time to File Responsive Pleading and/or Motion to Dismiss. RTC granted TCC's
prayer for extension of time to file a responsive pleading or a motion to dismiss. TCC
eventually filed a motion to dismiss GV Florida's third-party complaint.

RTC denied TCC’s motion to dismiss. MR also denied. CA reversed RTC decision.

ISSUE:

W/N the court acquired jurisdiction over Tiara Commercial Corporation.

HELD:

Yes.

Service of summons is the main mode through which a court acquires jurisdiction
over the person of the defendant in a civil case. Through it, the defendant is
informed of the action against him or her and he or she is able to adequately
prepare his or her course of action.

Rules governing the proper service of summons are not mere matters of
procedure. They go into a defendant's right to due process.

Strict compliance with the rules on service of summons is mandatory. Section

11, Rule 14 of the Rules of Court provides the procedure for the issuance of
summons to a domestic private juridical entity.

While the former rule allowed service on an agent of a corporation, the current
rule has provided for a list of specific persons to whom service of summons must be
made. The purpose of this rule is "to [e]nsure that the summons be served on a
representative so integrated with the corporation that such person will know what
to do with the legal papers served on him."

In this case, the summons was served to Gino-gino, a financial supervisor of TCC.
While she is not one of the officers enumerated in Section 11 of Rule 14, SC finds
that TCC has voluntarily appeared before (and submitted itself to) the RTC:

a. it filed its pre-trial brief without any reservation as to the court's

jurisdiction over it.

b. At no point in its pre-trial brief did TCC raise the issue of the RTC's
jurisdiction over it.

c. it even asked the RTC that it be allowed to reserve the presentation of

additional evidence through documents and witnesses.
GV FLORIDA’s third party complaint has not prescribed.

The Civil Code states that this claim must be made within six months from the
time of the delivery of the thing sold.

This, in turn, requires the presentation of the delivery receipts as well as their
identification and authentication. Under the Rules of Court, a party presenting a
document as evidence must first establish its due execution and authenticity as a
preliminary requirement for its admissibility.

A finding of fact as to the date of delivery can only be made after hearing and
reception of evidence. Thus, the CA erred in ruling that GV Florida's third- party
complaint should be dismissed on the ground of prescription.

EASTERN SHIPPING LINES INC., Petitioner, vs.

BPI/MS INSURANCE CORP. and MITSUI SUM TOMO INSURANCE CO. LTD.,
Respondents.

G.R. No. 193986               January 15, 2014

FACTS:

                Sumitomo Corporation shipped through vessels of Eastern Shipping Lines

various steel sheets in coil in favor of the consignee Calamba Steel. In each of the
three shipments, several coils were observed to be in bad condition as evidenced by
the Turn Over Survey of Bad Order Cargo.  The cargoes were then turned over to
Asian Terminals, Inc. (ATI) for stevedoring, storage and safekeeping pending Calamba
Steel’s withdrawal of the goods. When ATI delivered the cargo to Calamba Steel, the
latter rejected its damaged portion for being unfit for its intended purpose.

                Calamba Steel filed an insurance claim with Mitsui through the latter’s
settling agent, respondent BPI/MS Insurance Corporation (BPI/MS), and the former
was paid the sums of US$7,677.12, US$14,782.05 and US$7,751.15 for the damage
suffered by all three shipments. Correlatively, on August 31, 2004, as insurer and
subrogee of Calamba Steel, Mitsui and BPI/MS filed a Complaint for Damages against
petitioner and ATI.

ISSUE:
                W/N Eastern Shipping was solidarily liable with ATI on account of the
damage incurred by the goods.

HELD:

                YES. The Court held that both Eastern Shipping  and ATI were negligent in
handling and transporting the goods.

                Verily, it is settled in maritime law jurisprudence that cargoes while being
unloaded generally remain under the custody of the carrier. As hereinbefore found
by the RTC and affirmed by the CA based on the evidence presented, the goods
were damaged even before they were turned over to ATI. Such damage was even
compounded by the negligent acts of petitioner and ATI which both mishandled the
goods during the discharging operations. Thus, it bears stressing unto petitioner that
common carriers, from the nature of their business and for reasons of public policy,
are bound to observe extraordinary diligence in the vigilance over the goods
transported by them.

                Subject to certain exceptions enumerated under Article 1734 of the Civil
Code, common carriers are responsible for the loss, destruction, or deterioration of
the goods. The extraordinary responsibility of the common carrier lasts from the
time the goods are unconditionally placed in the possession of, and received by the
carrier for transportation until the same are delivered, actually or constructively, by
the carrier to the consignee, or to the person who has a right to receive them.

                Owing to this high degree of diligence required of them, common carriers,

as a general rule, are presumed to have been at fault or negligent if the goods they
transported deteriorated or got lost or destroyed. That is, unless they prove that
they exercised extraordinary diligence in transporting the goods. In order to avoid
responsibility for any loss or damage, therefore, they have the burden of proving
that they observed such high level of diligence. In this case, petitioner failed to
hurdle such burden.