G.R. No. 133763




EN BANC G.R. No. 133763 November 13, 2002 THE UNITED HARBOR PILOTS’ ASSOCIATION OF THE PHILIPPINES, INC., petitioner, vs. ASSOCIATION OF INTERNATIONAL SHIPPING LINES, INC., in its own behalf and in representation of its members and PHILIPPINE PORTS AUTHORITY, respondents. D E C I S I O N SANDOVAL-GUTIERREZ, J.: As the maritime horizons of the world expanded with each new discovery and conquest, it became apparent that the safety of a vessel while operating in strange harbors would be enhanced if, in addition to the regular ocean pilot, an individual learned in the tides, currents and depths of the particular harbor were engaged to assist the master in moving his vessel through such waters. Thus, there arose the practice of pilotage service.¹ Concomitantly, guilds or associations of harbor pilots were established for the purpose of securing the best compensation for their members. The practice continues to this day. In an ardent desire to secure for its members the payment of nighttime and overtime pay, petitioner United Harbor Pilots’ Association of the Philippines, Inc. (UHPAP) filed the present petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure against respondents Association of International Shipping Lines, Inc. (AISL) and Philippine Ports Authority (PPA). UHPAP assails the (a) Decision² dated January 26, 1998 of the Regional Trial Court, Branch 36, Manila granting AISL’s petition for declaratory relief; and (b) Order³ dated May 26, 1998 denying its (UHPAP’s) motion for reconsideration of the Decision. The facts are undisputed. Petitioner UHPAP is the umbrella organization of various groups rendering pilotage service in the different ports of the Philippines. It services foreign and domestic shipping companies, including the members of private respondent AISL. On March 1, 1985, public respondent PPA issued PPA Administrative Order (AO) No. 03-85 substantially adopting the provisions of Customs Administrative Order (CAO) No. 15-65⁴ on the payment of additional charges for pilotage service rendered "between 1800H to 1600H," or on "Sundays or Holidays," practically referring to "nighttime and overtime pay." Quoted hereunder is Section 16 of PPA AO No. 03-85: "Section 16. Payment of Pilotage Service Fees – Any vessel which employs a Harbor Pilot shall pay the pilotage fees prescribed in this Order and shall comply with the following conditions: x x x x x x x x x "c) When pilotage service is rendered at any port between 1800H to 1600H, Sundays or Holidays, an additional charge of one hundred (100%) percentum over the regular pilotage fees shall be paid by vessels engaged in foreign trade, and fifty (50%) percentum by coastwise vessels. This additional charge or premium fee for nighttime pilotage service shall likewise be paid when the pilotage service is commenced before and terminated after sunrise. "Provided, however, that no premium fee shall be considered for service rendered after 1800H if it shall be proven that the service can be undertaken before such hours after the one (1) hour grace period, as provided in paragraph (d) of this section, has expired."⁵ (emphasis supplied) On February 3, 1986, in response to the clamor of harbor pilots for the rationalization of pilotage fees, then President Ferdinand E. Marcos issued Executive Order No. 1088 providing for uniform and modified rates for pilotage services rendered in all Philippine ports. It fixes the rate of pilotage fees on the basis of the "vessel’s tonnage" and provides that the "rate for docking and undocking anchorage, conduction and shifting and other related special services is equal to 100%," thus: "SECTION 1. The following shall be the rate of pilotage fees or charges based on tonnage for services rendered to both foreign and coastwise vessels; For Foreign Vessels Rate in US $ or its Peso Equivalent Less than 500GT $ 30.00 500GT to 2,500GT 43.33 2,500GT to 5,000GT 71.33 5,000GT to 10,000GT 133.67 10,000GT to 15,000GT 181.67 15,000GT to 20,000GT 247.00 20,000GT to 30,000GT 300.00 30,000GT to 40,000GT 416.67 40,000GT to 60,000GT 483.33 60,000GT to 80,000GT 550.00 80,000GT to 100,000GT 616.67 100,000GT to 120,000GT 666.67 120,000GT to 130,000GT 716.67 130,000GT to 140,000GT 766.67 "Over 140,000 gross tonnage $0.05 or its peso equivalent every excess tonnage. Rate for docking and undocking anchorage, conduction and shifting and other related special services is equal to 100%. Pilotage services shall be compulsory in government and private wharves or piers, For Coastwise Vessels: Regular 100 and under 500 gross tons P 41.70 500 and under 600 gross tons 55.60 600 and under 1,000 gross tons 69.60 1,000 and under 3,000 gross tons 139.20 3,000 and under 5,000 gross tons 300.00 5,000 and over gross tons "SEC. 2. With respect to foreign vessels, payment of pilotage services shall be made in dollars or in pesos at the prevailing exchange rate."⁶ In addition, E.O. No. 1088 contains a repealing clause stating that all orders, letters of instruction, rules, regulations and issuances inconsistent with it are repealed or amended accordingly.⁷ Pursuant to E.O. No. 1088, PPA issued several resolutions disallowing overtime premium but authorizing reasonable night premium pay and differential, viz.: a. PPA Resolution No. 1486⁸ dated May 22, 1995, disallowing the overtime premium or charge collected by Harbor Pilots under Section 16 (c) of PPA Administrative Order No. 03-85, for services rendered during holidays; b. PPA Resolution No. 1541⁹ dated November 13, 1995, affirming Resolution No. 1486 and directing the PPA management to adopt a policy of no overtime pay for pilotage services on holidays and to recommend a reasonable night premium pay or night differential pay for the conduct of basic pilotage services; c. PPA Resolution No. 1554¹⁰ dated December 19, 1995 (1) recalling PPA Resolution No. 1541 insofar as it recommended the grant of reasonable night premium pay or night differential pay; (2) reaffirming PPA Resolution No. 1486; and (3) deferring for further legal review by the Office of the Government Corporate Counsel the passage of the proposed PPA AO No. 19-95. PPA Administrative Order No. 19-95 was supposed to provide the amendments to Section 16 (c) of PPA Administrative Order No. 03-85, by disallowing overtime pay for holiday’s work and authorizing the collection of nighttime premium pay for pilotage services rendered from 1800H to 1600H. On the basis of PPA Resolution No. 1486, AISL refused to pay UHPAP’s claims for nighttime and overtime pay. This constrained the latter to declare May 19, 1996 as the cut-off date for shipowners and agents to pay the said claims, otherwise, its harbor pilots would not render pilotage services and would work only from sunrise to sundown.¹¹ To resolve the conflict, AISL filed with the Regional Trial Court (RTC), Branch 36, Manila a petition for declaratory relief seeking the declaration of its rights and obligations under E.O. No. 1088 in relation to PPA AO No. 03-85. The issues presented therein are (a) whether E.O. No. 1088 authorizes the payment of nighttime and overtime pay; and (b) whether the rate of pilotage fees enumerated in E.O. No. 1088 is for "every pilotage maneuver" or for the "entire package of pilotage services." On January 26, 1998, the RTC rendered a Decision¹² in favor of AISL, the dispositive portion of which reads: "WHEREFORE, judgment is hereby rendered granting the petition herein and it is hereby declared that (1) respondent PPA is bereft of authority to impose and respondent UHPAP is not authorized to collect any overtime or night shift differential for pilotage services rendered; and (2) the rates of fees for pilotage services rendered refer to the totality of pilotage services rendered and respondent UHPAP cannot legally charge separate fees for each pilotage service rendered. All billings inconsistent with this decision are declared null and void and petitioners are not liable therefor. "SO ORDERED." In so holding, the RTC ratiocinated that in view of the repealing clause in E.O. No. 1088, it is axiomatic that all prior issuances inconsistent with it are deemed repealed. Consequently, the provisions of Section 16 of PPA AO No. 03-85 on nighttime and overtime pay are "effectively stricken-off the books." On the second issue, the RTC held that since the rate of pilotage fees enumerated in E.O. No. 1088 is based on the "vessel’s tonnage," it means that such rate refers to the "entire package of pilotage services." To rule otherwise, according to the RTC, is to frustrate the uniformity envisioned by the rationalization scheme. Unsatisfied, UHPAP filed a motion for reconsideration but was denied. Hence, the present recourse. UHPAP presents the following issues for our determination: "I WHETHER EXECUTIVE ORDER NO. 1088 REPEALED THE PROVISIONS OF CUSTOMS ADMINISTRATIVE ORDER NO. 15-65 AND PHILIPPINE PORTS AUTHORITY ADMINISTRATIVE ORDER NO. 03-85, AS AMENDED, ON PAYMENT OF ADDITIONAL PAY FOR HOLIDAYS WORK AND PREMIUM PAY FOR NIGHTTIME SERVICE. II WHETHER THE RATES, AS FIXED IN THE SCHEDULE OF FEES BASED ON TONNAGE IN EXECUTIVE ORDER NO. 1088, ARE TO BE IMPOSED ON EVERY PILOTAGE MOVEMENT. III WHETHER EXECUTIVE ORDER NO. 1088 DEPRIVED THE PHILIPPINE PORTS AUTHORITY, OF ITS RIGHT, DUTY AND OBLIGATION TO PROMULGATE NEW RULES AND RATES FOR PAYMENT OF FEES, INCLUDING ADDITIONAL PAY FOR HOLIDAYS AND PREMIUM PAY FOR NIGHTTIME SERVICES."¹³ UHPAP contends that E.O. No. 1088 does not repeal the provisions of PPA AO No. 03-85 on nighttime and overtime pay. It also asserts that the rate of pilotage fees fixed by E.O. No. 1088, though based on tonnage, is to be imposed on "every pilotage maneuver" and not on the "entire package of pilotage services." A contrary argument would place the harbor pilots on a worse position than prior to the enactment of E.O. No. 1088. And lastly, UHPAP claims that E.O. No. 1088 does not deprive the PPA of its right to impose new rates, such as nighttime and overtime pay. Citing Philippine Interisland Shipping Association of the Philippines vs. Court of Appeals,¹⁴ it maintains that PPA may increase the rates but it may not decrease them below those mandated by E.O. No. 1088. In its comment,¹⁵ AISL argues that there exists an actual inconsistency between the two orders, thus, E.O. No. 1088 should be construed as an implied repeal of PPA AO No. 03-85 provisions on nighttime and overtime pay. Likewise, the rate of pilotage fees under E.O. No. 1088 applies to the "entire package of pilotage services" for three reasons: (1) under Section 1 of E.O. No. 1088, the rate of pilotage fees is based on the "vessel’s tonnage;" (2) the use of the words "and" and "is" in the provision – "rate for docking and undocking anchorage, conduction, and shifting, and other related special services is equal to 100%" – means that all the enumerated pilotage services may not, absent any contract increasing it, exceed 100% of the rate schedule; and (3) since the object of the law is to standardize the pilotage services in all Philippine ports, it follows that the intent of E.O. No. 1088 is to treat the package of pilotage services as a whole. PPA, through the Solicitor General, filed its comment¹⁶ also contending that there is an irreconcilable conflict between E.O. No. 1088 and the provisions of PPA AO No. 03-85 on nighttime and overtime pay, resulting in an implied repeal. But unlike AISL, PPA is of the position that (1) the rate of pilotage fees under E.O. No. 1088 refers to each pilotage service of "docking," "undocking anchorage," "conduction," "shifting," and "other related special services;" and (2) E.O. No. 1088 does not divest PPA of its authority to impose, prescribe, increase or decrease rates, charges or fees for pilotage services. We shall resolve the issues in seriatim. I Section 3 of E.O. No. 1088 is a general repealing clause, the effect of which falls under the category of an implied repeal as it does not identify the orders, rules or regulations it intends to abrogate. A repeal by implication is frowned upon in this jurisdiction. It is not favored, unless it is manifest that the legislative authority so intended¹⁷ or unless it is convincingly and unambiguously demonstrated that the subject laws or orders are clearly repugnant and patently inconsistent that they cannot co-exist. This is because the legislative authority is presumed to know the existing law so that if repeal is intended, the proper step is to express it.¹⁸ There is nothing in E.O. No. 1088 that reveals any intention on the part of Former President Marcos to amend or supersede the provisions of PPA AO No. 03-85 on nighttime and overtime pay. While it provides a general repealing clause, the same is made dependent upon its actual inconsistency with other previous orders, rules, regulations or other issuances. Unfortunately for AISL, we find no inconsistency between E.O. No. 1088 and the provisions of PPA AO No. 03-85. At this juncture, it bears pointing out that these two orders dwell on entirely different subject matters. E.O. No. 1088 provides for uniform and modified rates for pilotage services rendered to foreign and coastwise vessels in all Philippine ports, public or private. The purpose is to rationalize and standardize the pilotage service charges nationwide. Upon the other hand, the subject matter of the controverted provisions of PPA AO No. 03-85 is the payment of the additional charges of nighttime and overtime pay. Plainly, E.O. No. 1088 involves the basic compensation for pilotage service while PPA AO No. 03-85 provides for the additional charges where pilotage service is rendered under certain circumstances. Just as the various wage orders do not repeal the provisions of the Labor Code on nighttime and overtime pay, the same principle holds true with respect to E.O. No. 1088 and PPA AO 03-85. Moreover, this Court adheres to the rule that every statute must be so construed and harmonized with other statutes as to form a uniform system of jurisprudence.¹⁹ E.O. No. 1088 and PPA AO No. 03-85 should thus be read together and harmonized to give effect to both. II We now come to the issue of whether the rate of pilotage fees fixed by E.O. No. 1088 is to be imposed for "every pilotage maneuver" or for the "entire package of pilotage services." While E.O. No. 1088 prescribes the rates of pilotage fees on the basis of the "vessel’s tonnage," however, this does not necessarily mean that the said rate shall apply to the totality of pilotage services. If it were so, the benefit intended by E.O. No. 1088 to harbor pilots would be rendered useless and ineffectual. It would create an unjust if not an absurd situation of reducing the take home pay of the harbor pilots to a single fee, regardless of the number of services they rendered from the time a vessel arrives up to its departure. It must be remembered that pilotage services cover a variety of maneuvers such as "docking," "undocking anchorage," "conduction," "shifting" and other "related special services." To say that the rate prescribed by E.O. No. 1088 refers to the totality of all these maneuvers is to defeat the benefit intended by the law for harbor pilots. It should be stressed that E.O. No. 1088 was enacted in response to the clamor of harbor pilots for the increase and rationalization of pilotage service charges through the imposition of uniform and adjusted rates. Hence, in keeping with the benefit intended by E.O. No. 1088, the schedule of fees fixed therein based on tonnage should be interpreted as applicable to "each pilotage maneuver" and not to the "totality of the pilotage services." The use of the word "and" between the words "docking" and "undocking" in paragraph 2 of Section 1 of E.O. No. 1088 should not override the above-mentioned purpose of said law. It is a basic precept of statutory construction that statutes should be construed not so much according to the letter that killeth but in line with the purpose for which they have been enacted. Statutes are to be given such construction as will advance the object, suppress the mischief, and secure the benefits intended.²⁰ Furthermore, as can be gleaned from the drafts submitted by the PPA on the guidelines pertaining to the uniform pilotage services to be rendered in all pilotage districts,²¹ the PPA is of the interpretation that the rate of pilotage fees fixed by E.O. No. 1088 is to be separately imposed on every pilotage manuever done by the harbor pilots. This interpretation is likewise made clear in PPA Memorandum Circular No. 42-98, dated October 8, 1998, which clarifies pilotage charges for docking and undocking, as follows– "To prevent disruption in pilotage service and considering the pendency of the final and executory decision of the Supreme Court on the pilotage rates issue, it is hereby clarified that pilotage fees for docking and undocking of vessels shall be paid as two (2) separate services x x x." The PPA is the proper government agency tasked with the duty of implementing E.O. No. 1088. As such, its interpretation of said law carries great weight and consideration. In a catena of cases, we ruled that the construction given to a statute by an administrative agency charged with the interpretation and application of a statute is entitled to great respect and should be accorded great weight by the courts. The exception, which does not obtain in the present case, is when such construction is clearly shown to be in sharp conflict with the governing statute or the Constitution and other laws. The rationale for this rule relates not only to the emergence of the multifarious needs of a modern or modernizing society and the establishment of diverse administrative agencies for addressing and satisfying those needs, it also relates to accumulation of experience and growth of specialized capabilities by the administrative agency charged with implementing a particular statute.²² The charges and fees provided for in E.O. No. 1088 are therefore to be imposed for every pilotage maneuver performed by the harbor pilots, as properly interpreted by the PPA, the agency charged with its implementation. III Finally, on the third issue, we rule that E.O. No. 1088 does not deprive the PPA of its power and authority to promulgate new rules and rates for payment of fees, including additional charges. As we held in Philippine Interisland Shipping Association of the Philippines vs. Court of Appeals:²³ "The power of the PPA to fix pilotage rates and its authority to regulate pilotage still remain notwithstanding the fact that a schedule for pilotage fees has already been prescribed by the questioned executive order (referring to E.O. No. 1088). PPA is at liberty to fix new rates of pilotage subject only to the limitation that such new rates should not go below the rates fixed under E.O. 1088. x x x." (emphasis supplied) Our pronouncement is clearly in consonance with the provisions of Presidential Decree No. 857 which vests upon the PPA the power and authority (1) "to supervise, control, regulate… such services as are necessary in the ports vested in, or belonging to the Authority;"²⁴ (2) "to control, regulate and supervise pilotage and the conduct of pilots in any Port District;"²⁵ and (3) "to impose, fix, prescribe, increase or decrease such rates, charges or fees… for the services rendered by it or by any private organization within a Port District."²⁶ WHEREFORE, the petition is GRANTED. The appealed Decision dated January 26, 1998 of the Regional Trial Court, Branch 36, Manila is REVERSED and SET ASIDE. No costs. SO ORDERED. Davide, Jr., C.J., Bellosillo, Puno, Vitug, Mendoza, Panganiban, Quisumbing, Ynares-Santiago, Carpio, Austria-Martinez, Corona, Carpio-Morales, and Callejo, Sr., JJ., concur. Footnotes ¹ As defined, pilotage service consists of navigating a vessel from a specific point, usually about two (2) miles off shore, to an assigned area at the pier and vice versa. Thus, when a vessel arrives, a harbor pilot takes over the ship from its captain to maneuver it to a berth in the port, and when it departs, the harbor pilot also maneuvers it up to a specific point off shore. The set up is required by the fact that each port has a peculiar topography with which a harbor pilot is presumed to be more familiar than a ship captain. (Philippine Interisland Shipping Association of the Philippines vs. Court of Appeals, 266 SCRA 489, 495 (1997). ² Rollo, pp. 38-42. ³ Id., at 63. ⁴ CAO 15-65, Chapter II, Paragraph VII provides: "When pilotage service is rendered at any port between sunset and sunrise, an additional charges of one hundred percentum (100%) over the regular pilotage fees shall be paid for vessels engaged in foreign trade and fifty (50%) percentum for coastwise vessels. This additional charge or premium fee for night time pilotage service shall likewise be paid when the pilotage service is commenced before and finished after sunset or commenced before and finished after sunrise." (Rollo, p. 15) ⁵ Rollo, p. 15. ⁶ Id., at 74-76. ⁷ Section 3 of E.O. No. 1088. ⁸ Rollo, p. 107. ⁹ Id., at 108. ¹⁰ Id., at 111-112. ¹¹ UHPAP Resolution No. 1-96, id., at 115. ¹² Id., at 38-42. ¹³ Id., at 12. ¹⁴ Supra. ¹⁵ Id., at 283-290. ¹⁶ Id., at 349-371. The Lawphil Project - Arellano Law Foundation