G.R. No. 196199/G.R. No. 196252, December 7, 2021,

♦ Decision,

Hernando, [J]

♦ Separate Concurring Opinion,

Caguioa, [J]

♦ Concurring and Dissenting Opinion,

Lazaro-Javier, [J]

[ G.R. No. 196199. December 07, 2021 ]

MANILA INTERNATIONAL PORTS TERMINAL, INC.,

PETITIONER, VS. PHILIPPINE PORTS AUTHORITY, RESPONDENT.

[G.R. No. 196252]

PHILIPPINE PORTS AUTHORITY, PETITIONER, VS. MANILA INTERNATIONAL PORTS TERMINAL, INC., RESPONDENT.

D E C I S I O N

CONCURRING AND DISSENTING OPINION

LAZARO-JAVIER,

J.:

I respectfully disagree with the

ponencia

of my learned senior colleague Justice Ramon Paul L. Hernando insofar as it

declared Executive Order No. 30, series of 1986 (EO 30)

unconstitutional

and the

Philippine Ports Authority's

(PPA)

take-over

s of the operations of the Manila International Ports Terminal, Inc. (MIPTI) at the North Harbor as

illegal,

and

awarded nominal

and

exemplary damages, attorney's fees,

and

costs of suit with legal interest

to MIPTI at PPA's expense.

But

I agree

with the

ponencia

as it

ordered MIPTI to return

the

excess amount of rentals

it had received from PPA

with legal interest

to the national government, and

denied MIPTI's claim

for

unrealized profits.

Section 2 of Presidential Decree No. 634 (PD 634)

granted MIPTI a franchise

"to construct, operate, and maintain modern container terminals, bonded warehouses, storage depots, cold and refrigerated storage, cargoes and transit sheds, conveyor piers, docks, landing and berthing facilities, access roads, bridges, seawalls, bulkheads and fillings in the area of the North Harbor, Manila Bay."

Section 2 of PD 634 was subsequently amended by Presidential Decree No. 1284 (PD 1284)

to include the exclusive provision of other services within its franchise.

PD 1284 also amended PD 634 by also adding Section 4

which, among others, empowered

(i) the

President

of the Philippines to revoke or suspend MIPTI's

franchise,

and

(ii) the

PPA

conduct periodic inspections

and

audit

of the

operation

and

management

of the port by MIPTI for the

purpose

determining

the latter's compliance with the prescribed standards and guidelines, and if warranted,

recommending

to the President the exercise of the power to

suspend

revoke

MIPTI's franchise:

Section 4. The Philippine Ports Authority shall in addition have the following powers, functions and responsibilities:

(a)

Undertaken

any study or work for the development, construction and supervision of all portworks, facilities and dredging in the International Port Complex and its vicinity;

(b) Fix the schedule of rates of fees for all services rendered therein and promulgate guidelines and standards for the efficient operation and management of the complex by MIPTI; and

(c)

Conduct periodic inspections

and

audit

of the

operation

and

management

of the International Port Complex by MIPTI to

determine the latter's compliance

with the

prescribed standards

, rates fixed,and guidelines promulgated,

and if warranted, recommend

to the President of

suspension

revocation

of MIPTI's franchise.

(Emphases supplied)

MIPTI and PPA entered into a

Memorandum of Agreement

(MOA) to implement, among others, Section 4 of PD 1284 which amended PD 634. In Section 14.01 of the MOA, they agreed as follows:

Section 14.01. Suspension or Revocation of Franchise. — PPA shall

conduct periodic inspection and audit of the operation and management

of the Port Terminal

to determine MIPTI's compliance

with the

prescribed standards

, rates fixed, and

guidelines

promulgated under this Agreement and existing PPA issuances, as well as those which may hereafter be made, adopted, or promulgated; and upon

proper investigation

showing of any violation, if warranted, recommend

the

suspension or revocation of MIPTI's franchise to the President

. In case of

suspension or revocation

of MIPTI's franchise during its effectivity,

PPA shall take over the operations and management

of the Port Terminal as may be necessary.

MIPTI

shall see to it that the operations at the Port Terminal shall

not be affected or disrupted

during the period of suspension or turnover. (Emphases supplied)

President Corazon Aquino

issued EO 30 revoking MIPTI's franchise effective immediately,

that is, on

July 21, 1986

, when

EO 30 was published

in the Official Gazette. It is not disputed that EO 30 was issued pursuant to and by authority of PD 634, as amended by Section 4(c) of PD 1284.

The

events

leading to the

issuance of EO 30

as well as the

aftermath of this issuance

are

not disputed:

Sometime

[in] June 1986

, Vicente T. Suazo, Jr., Manager of the Port of Manila,

sent two (2) letters to MIPTI informing it[,] of alleged violations

in the latter's port activities, and

urging it to take necessary actions

in improving its deteriorating performance and equipment.

18 July 1986

, Primitivo S. Solis, Jr.,

PPA's General Manager, served a letter to MIPTI notifying it about the strike being staged

by various trucking and brokerage firms at North Harbor

caused by its alleged poor performance and illegal practices

. Solis required

MIPTI to answer not later than 9:00 A.M. the next day

the following

illegal acts

allegedly committed

by it

, to wit:

(a) unpaid claims

for short delivery,

cargo losses

and damages;

(b) dilapidated and short supply of equipments

[sic];

with port users and approval of PPA;

(d) refunds from advance deposits were not returned

nor honored; and

(e) cargoes were not released

unless incentives were given to the arrastre personnel. In said letter, Solis likewise

informed MIPTI of its violations

under the provisions of their MOA.

19 July 1986

, in compliance with the PPA directive, Gregorio Oca – then

MIPTI's President – submitted a reply denying all the allegations

imputed against MIPTI and

enumerating the acts showing its faithful compliance

with its obligations under the franchise and the MOA.

On same date, then President Corazon C. Aquino issued Executive Order (EO) No. 30 revoking MIPTI's franchise due to substantial violations

of the MOA, which resulted in (sic) the

deterioration of port services, and authorizing PPA to undertake, on its own, the cargo-handling operation at North Harbor

. Consequently,

PPA sent a letter

to MIPTI

informing

it of its

plan to take over its business and properties.

20 July 1986

, PPA

issued a permit

to Metrostar Port and Allied Services, Inc.

(Metrostar)

, a private domestic corporation engaged in the business of providing cargo-handling services and operation of port complex in the country,

to render cargo-handling and other port-related services

at North Harbor for a period of one (1) year.

21 July 1986, PPA actually took over MIPTI's operations

at the MIPTC

and seized its equipment

. PPA

thereafter placed Metrostar in control of the port operations

at North Harbor

and in possession of the seized properties

. MIPTI subsequently made an

inventory of all the seized properties

in the presence of representatives from PPA, Metrostar[,] and PCGG.

14 August 1986, PPA sent a letter

to MIPTI's President

informing him that it was exercising its right to purchase the seized properties at book value

pursuant to

AO No. 10-81

. However,

MIPTI refused the offer

on the ground that the price was iniquitous. Thereafter, a

guarantee fund deposit

was established in MIPTI's favor to secure the

rental payments for the use of the seized properties.

(Emphases supplied)

In the proceedings below, PPA

admitted

that it

recommended

the

revocation

of MIPTI's franchise but

justified

its

recommendation

by saying that "it only protected the interest of the public as being the State's agent in regulating port-related services at the port areas."

The Ponencia

The

ponencia

disposed of this case as follows:

WHEREFORE

, the September 22, 2010 Decision of the Court of Appeals in CA-G.R. CV No. 80775 is

AFFIRMED

with

MODIFICATION

DECLARING

Executive Order No. 30, issued on July 19, 1986,

UNCONSTITUTIONAL

;

DECLARING

the takeover by defendant Philippine Ports Authority of the properties of the Manila International Port Terminal, Inc.

ILLEGAL

;

ORDERING

defendant Philippine Ports Authority and its incumbent general manager;

a. To pay Manila International Port Terminal, Inc. nominal damages of P1,000,000.00; and

b. To pay Manila International Port Terminal, Inc. exemplary damages of P200,000.00 and attorney's fees of P500,000.00 plus costs of suit; and

ORDERING

Manila International Port Terminal, Inc. to return the amount of P15,646,933.27, representing the excess rentals, to Philippine Ports Authority.

The amounts due shall be subject to a legal interest of six percent (6%)

per annum

from finality of this Decision until fully paid.

SO ORDERED.

In so decreeing, the

ponencia

relied upon the following rationale:

One.

EO 30 is

unconstitutional

because it

revoked MIPTI's franchise without due process of law.

The

ponencia

says: "One day, was business as usual for MIPTI. The following day, it was informed of its violations. The next day, if no longer has a business."

The swiftness by which the revocation

was decided

and thereafter

imposed

and

enforced

proves the

violation of MIPTI's right to due process

–

The swift turn of events

from the time MIPTI was notified to answer

the charges against it at

5:00 pm of 18 July 1986 up to the time EO No. 30 was issued revoking the franchise on 19 July 1986

only showed a predetermined plan of driving the company out of business without affording it reasonable opportunity to present its defense.

(Emphases supplied)

Two

.MIPTI's

property right

was

violated without due process of law

because

PPA

had

recommended

the revocation of MIPTI's franchise

without complying

with

Section 4(c)

of PD 1284

and

Section 14.01

of the MOA between PPA and MIPTI. This was because PPA had made the recommendation

without any factual basis at all

and therefore

arbitrarily

and

whimsically

.Thus:

Here, it is

undisputed that PPA did not conduct any investigation

. While

PPA

insists that its

decision to recommend was justified

for it was

under the impression that MIPTI indeed committed the violations

, such

violations remain to be mere allegations

, the

veracity

of which could have been ascertained had PPA simply conducted the

required investigation

(Emphases supplied)

Three

. The operative fact doctrine

cannot

justify, reverse,

set aside

the

unconstitutionality

of EO 30 and the

violations

of MIPTI's right to due process.

Four

. MIPTI is entitled to

nominal

damages with

legal interest

from PPA because its

rights

under

Section 4(c)

of PD 1284 and Section 14.01 of the MOA were violated by PPA.

Five

. MIPTI is entitled to

exemplary

damages from PPA because of the

arbitrary

and

hasty manner

by which PPA rendered and presented its

recommendation

. Thus:

PPA's arbitrary, hasty, and oppressive actions justify the award of exemplary damages. PPA

acted with undue haste and without conducting any investigation; it did not even attempt to establish with certainty any violation

on the part of MIPTI;

neither did it grant MIPTI any opportunity to counter the charges

against it. All these were

manifestations of bad faith

thereby warranting the award of exemplary damages.

(Emphases supplied)

Further, since "MIPTI was

compelled

to litigate with third persons or to

incur expenses to protect its rights,"

it is entitled to attorney's fees and the costs of suit.

The

ponencia

claimed again that –

x x x

there was sufficient showing of bad faith

on the part of PPA. We thus sustain the RTC's award of exemplary damages and attorney's fees in the amounts of P200,000.00 and P500,000.00, respectively, as affirmed by the CA.

(Emphasis supplied)

The

ponencia

, however,

did not spell out

if there were

any other factual bases

for this claim of

"sufficient showing of bad faith"

other than

the aforementioned basis for the award of exemplary damages.

My Dissent

As I have stated at the beginning,

I disagree

with the declaration of unconstitutionality and illegality and the award of nominal, exemplary, and other types of damages to MIPTI.

However,

I extol

, and no doubt, agree to high heavens with the

ponencia

for

ordering MIPTI to refund

to the national government the

excess rental payments plus legal interest

and the following

rationale

on why MIPTI is

not entitled

to unrealized profits as an item of damages, to wit:

Here, the trial court ordered PPA to pay MIPTI unrealized profits after it determined that the latter was unable to operate and earn income from its operations due to the unlawful takeover. This was affirmed by the CA.

However, the RTC and the CA seem to have overlooked the fact that the takeover was ordered by President Aquino; it was not undertaken by PPA on its own authority. Given that the validity of EO 30 is presumed, PPA cannot be faulted for merely enforcing it. Thus, it cannot be held liable for the profits MIPTI failed to obtain by reason of the said enforcement.

(Emphases added)

Let me expound on the

reasons

for my

disagreement.

First.

EO 30 and PPA did not violate MIPTI's

procedural

due process right.

The

revocation of a franchise

demands the

observance

due process

of law.

Gamboa v. Teves

affirms this legal doctrine: "A

franchise

is a

property right

and

cannot be revoked

forfeited without due process of law.

"It is

important to stress

that the

procedural

due process requirement as outlined in

Section 4(c)

and

Section 14.01

pertain

to the

revocation

MIPTI's franchise.

Stated differently, Section 4(c) and Section 14.01

outlines

the

contents or requirements of procedural

due process – what must be done to accord procedural due process to MIPTI – before its franchise is

revoked.

It is

not clear

though if the President

could

exercise the power to suspend or revoke

independently

of Section 4(c) of PD 1284 and Section 14.01 of the MOA, that is,

without

PPA's investigation and/or recommendation

, provided of course there is

another means

by which

due process of law was observed

. However, we do

not

have to resolve this

ambiguity

now because it is

not

an issue in this case.

Therefore, Section 4(c) and Section 14.01 provide

foundation

, because perhaps

procedural

due process may be

founded

some other means

, for concluding whether the

revocation

of MIPTI's franchise was attended by

procedural

due process or was not.

For clarity, PPA also owes a

legal duty of procedural

due process to MIPTI before it could

recommend

(to

stress, merely

recommend) the

revocation

of MIPTI's franchise. The

recommendation

to revoke would be

infirm

if Section 4(c) and Section 14.01 are

not complied with

– though the

compliance requirement

should

not

be as

stringent

as when the

power to revoke

is exercised. The reasons for these observations are –

(i) A

recommendation

to revoke, apart from the revocation itself, has a

life of its own

. A

recommendation is actionable

if it is the

proximate cause

both injury and damage

to MIPTI.

(ii) A

recommendation

to revoke is

not

the

proximate cause

of the loss of MIPTI's operation of the port at North Harbor. Since the private interests at stake in a

recommendation

to revoke is

not itself

directly

the franchise, the

procedural

requirements should

not be as strict

as when a franchise is being revoked.

Section 4(c) of PD 1284

empowers the

President to suspend

revoke

MIPTI's franchise. The

PPA

, on the other hand, may

recommend

the exercise of the President's power to suspend or revoke. PPA's

recommendation

is based upon its

investigation

of MIPTI's operation and management.

Here, the President issued EO 30

revoking

MIPTI's franchise

expressly

on the

basis

of –

(i) a

"review of MIPTI's compliance

to its contract [showing] that it had

committed substantial violations

thereof" and "its services [having] consequently

deteriorated

;" and

(ii) Section 4(c) of PD 1284 and Section 14.01 of the MOA,

specifically

, the authority of PPA to

recommend

the suspension or revocation of MIPTI's franchise upon an investigation or showing of MIPTI's violation thereof.

The pertinent provisions of EO 30 state:

WHEREAS, the Manila International Port Complex (MIPC) at North, Harbor, Manila was constructed and developed pursuant to P.D. No. 1284 promulgated on 16 January 1978, and in response to the increasing need of international container trade;

x x x x

WHEREAS, in implementation of its franchise, MIPTI entered into a

Memorandum of Agreement

with the Philippine Ports Authority (PPA) on 01 April 1980, which

spelled out the terms and conditions under which MIPTI shall render efficient services

and

violations of which will warrant the suspension or revocation of its franchise;

WHEREAS, under

Section 4(c) of P.D. No. 1284

and

Section 14.01 of the aforesaid agreement, PPA can

, upon

investigation

showing of violation

thereof by MIPTI,

recommend

the suspension or revocation of its franchise to the President;

WHEREAS,

review of MIPTI'S compliance to its contract shows that it has committed substantial violations

thereof and

its services have consequently deteriorated

to the prejudice of the international shipping, other port users and the general public;

x x x x

WHEREAS, PPA can undertake on its own, the management, and operations of the MIPC and the cargo handling services thereat pursuant to Section 6a(v) (x) of P.D. No. 857 promulgated on 23 December 1975;

WHEREFORE

, I, CORAZON C. AQUINO, President of the Republic of the Philippines,

by virtue of the powers

vested in me by the

Constitution

and the

law

, do hereby

order the immediate recall of the franchise

granted to the Manila International Port Terminals, Inc. (MIPTI) and

authorize the Philippine Ports Authority

(PPA)

to take over, manage and operate the Manila International Port Complex at North Harbor

, Manila and

undertake the provision of cargo handling and port related services thereat

, in accordance with P.D. No. 857 and other applicable laws and regulations.

DONE in the City of Manila, this 19th day of July, in the year of Our Lord, Nineteen Hundred and Eighty-Six.

(Emphases supplied)

The issuance of EO 30 was

actually preceded

by PPA's

recommendation

to the President to

revoke

MIPTI's franchise.

In turn

, PPA's

recommendation

was

actually supported

by PPA's

investigation

that the Court of Appeals found to

have been done

–

Sometime

[in] June 1986,

Vicente T. Suazo, Jr., Manager of the Port of Manila, sent two

(2) letters to MIPTI informing it of alleged violations

in the latter's port activities, and

urging it to take necessary actions

in improving its deteriorating performance and equipment.

18 July 1986

, Primitivo S. Solis, Jr.,

PPA's General Manager, served a letter to MIPTI notifying it about the strike being staged

by various trucking and brokerage firms at North Harbor

caused by its alleged poor performance and illegal practices

. Solis required

MIPTI to answer not later than 9:00 A.M. the next day

the following

illegal acts

allegedly committed by it, to wit:

(a) unpaid claims

for short delivery,

cargo losses

and damages,

(b) dilapidated and short supply of equipments

(sic);

with port users and approval of PPA;

(d) refunds from advance deposits were not returned

nor honored; and

(e) cargoes were not released

unless incentives were given to the arrastre personnel. In said letter, Solis likewise

informed MIPTI of its violations

under the provisions of their MOA

19 July 1986

, in compliance with the PPA directive, Gregorio Oca – then

MIPTI's President – submitted a reply denying all the allegations

imputed against MIPTI and

enumerating the acts showing its faithful compliance

with its obligations under the franchise and the MOA.

On the same date, then President Corazon C. Aquino issued Executive Order (EO) No. 30 revoking MIPTI's franchise due to substantial violations

of the MOA, which resulted in the

deterioration of port services, and authorizing PPA to undertake, on its own, the cargo-handling operation at North Harbor.

Consequently,

PPA sent a letter

to MIPTI

informing

it of its

plan to take over its business and properties.

(Emphases supplied)

The

procedure followed

PPA

proves that an

investigation

was indeed

conducted

and there was at least a

showing of MIPTI's violations

of its franchise.

Due process of law

is a

flexible concept.

This description pertains as well to

procedural

due process. The

contents

requirements

procedural

due process "[depend] on the circumstances and [vary] with the subject matter and the necessities of the situation."

In his

Concurring Opinion in

Perez v. PT&T,

Justice Arturo D. Brion elucidated on what

procedural

due process entails:

x x x x

In the U.S., the due process clause of the U.S. Constitution provides the guarantee for procedural due process, and

has used a general balancing formula to identify the procedural guarantees appropriate to a particular context.

In Mathews v. Eldridge,

Justice Powell articulated this approach when he said:

In recent years this Court increasingly has had occasion to consider the

extent to which due process requires an evidentiary hearing prior to the deprivation of some type of property interest

even if such hearing is provided thereafter. In only one case,

Goldberg v. Kelly,

has the Court ruled that a hearing closely approximating a judicial trial is necessary. In other cases requiring

some type of pretermination hearing as a matter of constitutional right,

the Court has spoken sparingly about the requisite procedures. [Our] decisions underscore the truism that

"[d]ue process,

unlike some legal rules, is

not a technical conception with a fixed content

, unrelated to time, place and circumstances. [Due process] is flexible and calls for such procedural protections as the particular situation demands." Accordingly, the

resolution

of the

issue whether the administrative procedures

provided here are

constitutionally sufficient

requires

analysis

of the governmental and private interests that are affected. More precisely, our prior decisions indicate that

identification of the specific dictates of due process

generally requires consideration of

three distinct factors: first

, the

private interest that will be affected

by the official action;

second

, the

risk of an erroneous deprivation

of such interest through the

procedures used

, and the

probable value

, if any,

of additional

substitute procedural safeguards;

and

finally

, the

Government's interest

, including the

function involved

and the

fiscal and

administrative burdens

that the

additional

substitute

procedural requirement would entail.

Thus,

the U.S. approach is to calibrate the procedural processes to be observed in administrative cases based on specifically defined parameters.

x x x x

Philippine Due Process Requirement

Article III, Section 1 of the Philippine Constitution contains the constitutional guarantee against denial of due process, and is a direct transplant from an American root — the Bill of Rights of the American Constitution ....

I submit that

in the absence of a clear legislative intent that what is intended is an actual hearing

, the Court

cannot construe

the

statutory procedural due process guaranty

as an

absolute requirement for an actual hearing.

x x x x

b. Philippine Procedural Due Process Developments.

Our Constitution does not expressly define the principles that embody

due process

, as it

is a concept intended to counterbalance

a flexible power of state –

police power.

Early on, jurisprudence has recognized distinctions between procedural due process in judicial proceedings and in administrative proceedings.

In a long line of cases starting with

Banco Español v. Palanca,

the requirements of procedural due process in judicial proceedings have been defined. In these proceedings, the quantum of evidence that the prosecution must meet in criminal cases is proof beyond reasonable doubt, while in civil cases the standard has been described as "preponderance of evidence". The requirements of procedural due process in administrative proceedings have been similarly defined in the early case of Ang

Tibay v. CIR.

The proof required in these proceedings is the lower standard of "substantial evidence."

The

quantum of evidence

required in these proceedings

impacts on their hearing requirements.

While both judicial and administrative proceedings require a hearing and the opportunity to be heard, they differ with respect to the

hearing required before a decision can be made

x x x. Administrative due process, on the other hand, requires that the decision be rendered on the evidence presented at the hearing, or at least contained in the record and disclosed to the parties concerned. Thus,

substantial reasons justify the variance in the hearing requirements

for these proceedings. (Emphases supplied)

Clearly,

there is

one-size fits all concept

procedural

due process. What the

contents or requirements

should be of

procedural

due process are determined by the

nature

of the matter being dealt with and the

varying circumstances

attending such matter. This determination is influenced by several

factors

including –

first,

the

procedure

mentioned in the

governing statute

and/or its

implementing rules;

second,

the

private interest

that will be

affected

by the official action;

third,

the risk of an

erroneous deprivation

of such interest

through

the

procedures used,

and the

probable value,

if any, of

additional

or substitute

procedural safeguards;

and,

fourth,

the

Government's interest,

including the

function involved

and the fiscal and

administrative burdens

that the

additional

or substitute

procedural requirement

would entail.

The

starting point

for determining

procedural

due process requirements for the

revocation of MIPTI's franchise

is the

governing statute

itself. In the case at bar, this would be

Section 4(c)

of PD 1284 and

Section 14.01

of the MOA.

Both Section 4(c) and Section 14.01

do not require

actual face-to-face

viva voce hearing.

— Under

Section 4(c), PPA's recommendation

needs

only

to be preceded and supported by an

investigation

(i.e., inspections and audit) –

Section 4(c)

Conduct periodic inspections and audit

x x x

and if warranted, recommend

x x x.

Under

Section 14.01,

the procedure to be followed is the same,

with the addition

of the

more unilateral

pre-requisite of

showing of any violation-

Section 14.01. Suspension or Revocation of Franchise. - PPA shall

conduct periodic inspection and audit

x x x and upon

proper investigation

showing of any violation, if warranted, recommend

x x x.

As quoted above, PPA

actually conducted an investigation

of MIPTI's performance.

This started in

June 1986

when PPA

sent two letters

to MIPTI "informing it of alleged violations in the latter's port activities, and urging it to take necessary actions in improving its deteriorating performance and equipment." Unfortunately, there is

nothing

by way of reply that came from MIPTI.

The

two (2) letters

were followed on

July 18, 1986

by a

third letter

from PPA "notifying it

about the strike

being staged by various trucking and brokerage firms at North Harbor x x x."

It was

only on the following day that MIPTI answered

PPA's

investigation

as expressed in its

three (3) letters.

On the

same day,

PPA

recommended

the revocation of MIPTI's franchise. After a review of MIPTI's compliance, also on the

same day,

President Corazon Aquino issued EO 30.

There is

nothing hasty

irregular

about this

procedure

in the revocation of MIPTI's franchise. There was a

gap of almost two (2) months

before the revocation was decided and later implemented.

To begin with, the

ponencia

failed to identify the requirements

procedural

due process in this case. The

ponencia

merely assumed

that the President and PPA violated MIPTI's right to procedural due process –

without

mentioning, though, what that right

exactly

consisted of.

In the

absence

here of a

clear finding

on the

specific requirements of procedural

due process, the

ponencia

cannot conclude

that MIPTI's procedural due process right was violated.

For another, the

procedure

used by the President and PPA

actually complied

with Section 4(c) of PD 1284 and Section 14.01 of the MOA. To repeat, PPA conducted an

investigation

and undertook a

showing of MIPTI's violations.

The investigation ran for

almost two months.

The governing rules do not require

certain

periods

within which to conduct and conclude the

investigation.

– They also do

not

specify the

standards of proof

that the

investigation

must achieve –

not

proof

beyond a reasonable doubt

of these violations nor of the results of the investigation,

not even

proof on

clear and convincing evidence or on a balance of probabilities.

All in all, the

investigation

may only yield

substantial evidence

– what a

reasonable mind

would accept as

adequate to support

a conclusion. The

showing of violations

does

not

have to be

overwhelming or preponderant,

but only

reasonable.

In the case at bar, there were

three (3) letters

from PPA, two (2) of which were

not replied to

by MIPTI, while the

third one

referred to a

strike

that was going on and therefore easily verifiable. There being

no evidence

of the

unreasonableness

of PPA's

showing of MIPTI's violations,

it would have to be presumed that the

showing of violations

was what every

reasonable mind

would accept

adequate

to support the President's action to revoke the franchise.

Should the President and PPA have done

more than investigate for almost two (2) months,

that is, over and above what Section 4(c) and Section 14.01 demanded?

MIPTI's

private interests,

the

risk

of erroneous actions as a result of the required procedures, the

added value

of additional procedural mechanisms, the

nature of the functions involved,

and the

added burdens

upon the government – all these

dictate

that

adequate procedural safeguards

were already observed by the President and PPA.

MIPTI's

private interests

arose from a

franchise.

Before accepting the franchise, MIPTI

was already apprised

that it is subject to revocation and suspension upon investigation

showing of violations. Its private interests are thus already

sufficiently protected

by what Section 4(c) and Section 14.01 on their face required.

Added safeguards did

not

guarantee

better fact-finding results.

Here,

almost two (2) months and three (3) letters

were given to MIPTI. On the other hand,

several more procedural barriers

would have

adversely impacted

on the

operations of North Harbor,

an admittedly

vital commercial and security facility,

and would have

generated more economic burdens

on the government as a result of the

impasse

arising from the investigation. We also

ought to consider the revolutionary context

of the times then. In other words, the

nature of the function involved,

the

projected added burdens

to the government's operation of a

national port

of immense commercial importance, and the

historical and political context

of the times all

necessitated a swift and decisive action

from the government.

For the above reasons, with due respect, the

ponencia

went overboard

in declaring EO 30 unconstitutional for violation of MIPTI's procedural due process right and PPA's take-over of MIPTI's operations at North Harbor as

illegal.

The President and PPA

complied to the letter

with the guarantees of Section 4(c) and Section 14.01, and these are

enough

to conclude that

procedural

due process has been observed in both instances. Anything more,

especially since

the

ponencia

itself did not say what

process was due,

would have been

undue process of law.

Second.

The

powers

of public officers are those

expressly granted

and those

necessarily implied

from the express grant. As held in

Villegas v. Subido:

x x x. Nothing is better settled in the law than that a

public official exercises power

not rights. The government itself is merely an agency through which the will of the state is expressed and enforced. Its officers therefore are likewise

agents entrusted with the responsibility of discharging its functions.

As such there is no presumption that they are empowered to act. There must be a

delegation of such authority, either express or implied.

In the absence of a valid grant, they are devoid of power. What they do suffers from a fatal infirmity. x x x (Emphases supplied)

PPA had the

authority to take over the private properties

of MIPTI that were being used for the port operations. This authority is

necessarily implied

from EO 30 and Section 14.01 of the MOA which

mandated

PPA to

take-over

the

operations and management

of the port and MIPTI's

obligation

to see to it that the

take-over run unimpeded.

The port operations

cannot operate during the take-over

without the

concomitant equipment

and the

other apparatus owned by MIPTI

in its performance of the franchise. To require PPA to stockpile its own properties for the purpose of a

take-over

would be an

unreasonable requirement

since its function is

not to operate a port

but to

regulate

port operations

by private contractors. Necessarily,

PPA can only fulfil the

take-over

function

only if

it is also allowed as an

essential incident

of the

express take-over power

that it would be

able to use the private properties of MIPTI

as service provider.

Third.

The

ponencia

assessed

nominal and exemplary damages against PPA as well as attorney's fees, costs of suit and legal interests. I respectfully submit that this assessment has

no factual and legal bases.

There is

no factual basis

since PPA did

not violate MIPTI's procedural

due process right in

recommending

the revocation of MIPTI's franchise. PPA conducted an

investigation and showed MIPTI's violations

of its franchise. This

process is consistent

with Section 4(c) and Section 14.01. Anything more than this would have been

undue and unnecessary.

There is

no legal basis

for awarding MIPTI damages against PPA. The

framework

for determining

whether damages are due

is as follows:

The Court had the occasion to explain the distinction between damages and injury in this wise:

x x x

Injury

is the

illegal invasion of a legal right; damage

is the

loss, hurt[,] or harm which results from the injury;

and

damages

are the

recompense or compensation awarded for the damage suffered.

Thus,

there can be damage without injury

in those instances in which the

loss or harm was not the result of a violation of a legal duty.

In such cases, the

consequences must be borne by the injured person alone,

the

law affords no remedy for damages

resulting from an act which does not amount to a legal injury or wrong. These situations are often called

damnum absque injuria.

In other words, in order that a

plaintiff may maintain an action for the injuries

of which he complains, he

must establish that such injuries resulted from a breach of duty which the defendant owed to the plaintiff

– a

concurrence of injury to the plaintiff

and

legal responsibility by the person causing it.

The underlying basis for the award of tort damages is the premise that the

individual was injured in contemplation of law.

Thus, there

must first be a breach of some duty

and the

imposition of liability for that breach

before damages may be awarded; and the

breach of such duty should be the proximate cause of the injury.

(Emphasis supplied)

Here, the

missing elements

from the

legal basis

to hold PPA liable for damages are –

i. PPA

did not commit injury

to and did

not cause damage

upon MIPTI. PPA conducted an

investigation

and in fact

showed

the commission of

violations

by MIPTI. Hence, PPA did

not

breach any

legal right

of and

legal duty

to MIPTI. While only

technical

injury

and

not actual damage

is required to award nominal damages, nonetheless, no legal right was infringed by PPA.

ii.

Exemplary damages

presuppose a

wrongful act

done with

bad faith.

Since there was

no breach

of legal right and legal duty, exemplary damages

should not have been adjudicated.

Further, Articles 2229

and 2234

of the

Civil Code

authorize the award of exemplary damages

only if

moral, temperate, liquidated, or compensatory damages are

also given.

As there is no award of these damages in the

ponencia

's dispositive portion, the

ponencia

cannot give

s MIPTI exemplary damages.

iii. MIPTI is

not entitled

to attorney's fees and legal interest because there are

no factual

and

legal bases

for its complaint for damages. MIPTI was not therefore

compelled

to litigate to protect its rights. It chose to litigate at its

own expense

. Besides, PPA did

not

act in bad faith. Its actions to

recommend

was

within the authority

and process of Section 4(c) and Section 14.0 and to

defend itself

all the way to this Court is

consistent

with the fact that

it did no wrong

and thus was

within its right to defend itself

against baseless claims.

ACCORDINGLY

, I vote to grant Philippine Ports Authority's petition, reverse and set aside the contrary judgments of the Regional Trial Court and the Court of Appeals, dismiss the complaint for damages filed with the trial court,

but order Manila International Ports Terminal, Inc.

to pay the national government P15,646,933.27 with legal interest of six percent (6%)

per annum

from finality of the Decision until fully paid.

Footnotes

RECALLING THE FRANCHISE

GRANTED

TO THE MANILA INTERNATIONAL PORT TERMINALS, INC. (MIPTI) TO OPERATE AND MANAGE THE INTERNATIONAL PORT COMPLEX AT NORTH HARBOR, MANILA. (EXECUTIVE ORDER 30, signed July 19, 1986).

Section 2. Subject to the terms and conditions established in this Decree and in Act Numbered Twenty-one hundred thirty-seven and to the provisions of the Constitution, the Manila International Port-Terminals, Inc., is hereby granted for a period of twenty-five years, renewable for another twenty-five years, the right, privilege and authority to construct, operate and maintain modern container terminals, bonded warehouses, storage depots, cold and refrigerated storage, cargoe and transit sheds, conveyor piers, docks, landing and berthing facilities, access roads, bridges, seawalls, bulkheads and fillings in the area of the North Harbor, Manila Bay, subject to private rights, if any there be, which area is more particularly described as follows. x x x

(PRESIDENTIAL DECREE No. 634, January 7, 1975).

GRANTING AUTHORITY TO THE PHILIPPINE PORTS AUTHORITY TO PLAN, CONSTRUCT, DEVELOP AND MAINTAIN IN ALL PORT TERMINAL FACILITIES IN THE INTERNATIONAL PORT NORTH HARBOR, MANILA BAY, TO SUPERVISE THE OPERATION AND MANAGEMENT OF SUCH FACILITIES, AMENDING FOR THE PURPOSE PRESIDENTIAL DECREE NO. 634, DATED 7 JANUARY 1975, REPEALING PRESIDENTIAL DECREE NO. 802 DATED 18 SEPTEMBER 1975, AND FOR OTHER PURPOSES. (Presidential Decree No. 1284, January 16, 1978).

Section 4 of Presidential Decree No. 1284, January 16, 1978.

The

ponencia

quoted the relevant portions of the Decision of the Court of Appeals.

Ponencia, pp. 31-32.

Ponencia, p. 21.

Id.

at 21.

Id.

at 22.

Id.

at 30.

Id.

at 27.

668 Phil. 1, 84 (2011).

Section 4(c) Conduct periodic inspections and audit of the operation and management of the International Port Complex by MIPTI to determine the latter's compliance with the prescribed standards, rates fixed, and guidelines promulgated, and if warranted, recommend to the President of suspension or revocation of MIPTI's franchise.

Published in the Official Gazette, Vol. 82 No. 29 page 3347 on July 21, 1986.

See National Telecommunications Commission v. Brancomm Cable and Television Network Co., Inc., G.R. No. 204487, December 5, 2019.

Id.

602 Phil. 522, 546-551 (2009). (to follow)

Id.

at (to follow)

141 Phil. 167, 180 (1969). (to follow)

Far Eastern Bank & Trust Co. v. Pacilan Jr., 503 Phil. 334, 346 (2005).

Article 2229. Exemplary or corrective damages are imposed, by way of example or correction for the public good, in addition to the moral, temperate, liquidated or compensatory damages. (AN ACT TO ORDAIN AND INSTITUTE THE CIVIL CODE OF THE PHILIPPINES, REPUBLIC ACT NO. 386, Approved: June 18, 1949).

Article 2234. While the amount of the exemplary damages need not be proved, the plaintiff must show that he is entitled to moral, temperate or compensatory damages before the court may consider the question of whether or not exemplary damages should be awarded. In case liquidated damages have been agreed upon, although no proof of loss is necessary in order that such liquidated damages may be recovered, nevertheless, before the court may consider the question of granting exemplary in addition to the liquidated damages, the plaintiff must show that he would be entitled to moral, temperate or compensatory damages were it not for the stipulation for liquidated damages. (AN ACT TO ORDAIN AND INSTITUTE THE CIVIL CODE OF THE PHILIPPINES, REPUBLIC ACT NO. 386, Approved: June 18, 1949).

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