Eastern Shipping Lines vs.

Court
of Appeals GR No. 116356
June 29, 1998
Facts:
Petitioner Eastern Shipping Lines filed a petition for certiorari under Rule 45
against the Court of Appeals, assailing the latter's decision which affirmed
RTC's decision rendering Eastern Shipping Lines to pay the unpaid fees,
attorney's fees, and costs. With reliance to Executive Order 1088, private
respondent Davao Pilot instituted a complaint in September 25, 1989 against
the petitioner for sum of money ang attorney's fees alleging that Davao Pilot
had rendered pilotage services to Eastern Shipping, but of which, the latter
disputed such claim. Petitioner alleged among others that the said EO is
unconstitutional; that there is a case with identical issue pending before the
Court of Appeals; that it never been remiss in paying pilotage fees to
private respondent; and that the only agency vested by law to prescribe
rates, charges or fees for services rendered by any private organization
within a Port District is within the scope and authority of the Philippine
Ports Authority (PPA) by virtue of PD No. 857. RTC ruled in favor of Davao
Pilot, which was eventually affirmed by CA.

Issue:
Whether or not Executive Order 1088 which sets a higher rate of pilotage
fees is constitutional.

Ruling:
Yes, Executive Order is constitutional. The Supreme Court upholds the
validity of Executive Order No. 1088 iterating the decision in Philippine
Interisland Shipping Association of the Philiplines vs. Court of Appeals,
that EO No. 1088 is a valid statute and that PPA is duty bound to comply
its provisions although, the latter may increase the rates and may not
decrease below those mandated rates under EO No. 1088. Furthermore, the
Court emphasized that the conclusive effect of administrative construction
is not absolute and administrative actions may be disturbed, or set aside by
fhe judicial department if there is an error of law, a grave abuse of power
or lack of jurisdiction or grave abus of discretion clearly conflicting with
either the letter or spirit of the law. Hence, if there is any conflict between
the PPA circular and a law, the latter prevails and by yhis, petition is
denied.