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PHILIPPINE SUPREME COURT DECISIONS

SECOND DIVISION

[G.R. No. 109090. August 7, 1996.]

BRILLO HANDICRAFTS, INC., Petitioner, v. COURT OF APPEALS, and DAILY OVERLAND EXPRESS, INC., Respondents.

Brotamonte Law Office for Petitioner.

Hermel R. Mapantal for Private Respondent.


SYLLABUS


1. CIVIL LAW; CONTRACTS; EQUITABLE PRINCIPLE OF ESTOPPEL; APPLICABLE IN CASE AT BAR. — The applicable rate should be the one agreed upon and the same should have the force of law between the parties. In fact, petitioner can no longer impugn its liability because it had already partially paid the amount. The case filed by private respondent was for the unpaid balance. It should likewise be noted that petitioner was a regular customer of private respondent and it did not assail the rate then being charged on its shipments. Petitioner had apparently acquiesced thereto, tacitly accepting whatever was private respondent’s rate. It can not now belatedly challenge the amount being collected therefrom as an afterthought. We agree with the findings of the Court of Appeals that estoppel has set in, thus: "Appellant has engaged the trucking services of plaintiff years before this litigation. Plaintiff has been charging freight rates to which defendant never objected. It would have been easy for appellant to manifest its objection to plaintiff’s billing from the start of their business relations, but it did not. Appellant was silent for so long a time until this suit was filed against it. It was too late, estoppel had already set in." Consistently with the rationale of the decision of respondent Court of Appeals is a well-entrenched rule that "laches in a general sense, means the failure or neglect for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier. It is negligence or omission to assert a right within a reasonable time, warranting the presumption that the party entitled to assert it either has abandoned or declined to assert. Petitioner having paid a part of the assailed rate of freightage to private respondent may not be heard to dispute the remaining balance of the same. Un ne doit prise advantage de son tort demesne — one ought not to take advantage of his own wrong."


D E C I S I O N


TORRES, JR., J.:


This petition for review filed by petitioner Brillo Handicrafts, Inc. assails the decision of the Court of Appeals dated January 22, 1993, the dispositive portion of which reads as follows:jgc:chanrobles.com.ph

"WHEREFORE, with the modification (a) reducing to only P 2,500.00 the reimbursement to plaintiff of the commissioner’s fees; and (b) deleting the amount of P10,000.00 as attorney’s fees, the challenged decision is hereby AFFIRMED in all other respects.

SO ORDERED." 1

The records reveal that Daily Overland Express, Inc. (Daily, for brevity) was engaged in the forwarding business, charging freight for the conveyance of goods from Legazpi City to Manila and vice-versa. Brillo Handicrafts, Inc. (Brillo, for brevity) was one of its regular customers. As of June 15, 1990, Brillo had an outstanding balance for freight services in the amount of P153,204.10 and this account refers to the shipping charges covering the period of February 1, 1990 to April 30, 1990. Demands for payment were made but Brillo was able to pay only the amount of P20,000.00 in October 1990. Hence, in December 1990, Daily filed a complaint for the balance of P130,204.10, plus reimbursement of 15% attorney’s fees, P10,000.00 litigation expenses, and costs of suit.

In its answer, Brillo alleged that the balance sought to be collected was exorbitant and overstated. It also alleged that it never refused to pay but it merely suspended its payments when plaintiff Daily failed to render proper accounting in accordance with the prescribed rate of freightage at the rate of P2.20 per ton for every kilometer.

During the pre-trial conference, it was agreed that the only issue for resolution was merely accounting and therefore, the matter was referred to a commissioner who was a certified public accountant.

The commissioner’s report was composed of two sets. The first computation was based on the rate of the plaintiff’s and defendant’s liability would be P109,741.66 because of additional deductions on freight discount credited to the latter. The other set was based on defendant’s insisted rate of P2.20 per ton per kilometer, resulting to a total liability of only P3,658.76. Both parties approved the commissioner’s report. The only thing to be resolved by the trial court was to determine which of the computations was applicable in the case at bar.

During the pendency of the case, an inquiry was made from the Regional Manager of the Land Transportation Franchising and Regulatory Board about the rate of P2.20 per ton per kilometer being insisted by the defendant Brillo Handicrafts. It appeared that it was in Philippine Federation of Petroleum Haulers Association (Case No. 84-6382) that the Board of Transportation issued the fixed rate. This rate, however, as adverted to by Daily did not apply to them because they were not parties to the case. Moreover, the price was for hauling of petroleum products only. Defendant Brillo on the other hand, maintained that the plaintiff was covered by the aforesaid ruling because it was not given any authority to charge a special rate.

Forthwith, the case was submitted for decision without any presentation of testimonial evidence since the issue was only the applicable rate. Thus, on August 29, 1991, the Regional Trial Court of Legazpi City ruled that:jgc:chanrobles.com.ph

"This court is inclined to believe plaintiff’s claim that they are not covered by said decision. First, because Case No. 84-6382 (Philippine Federation of Petroleum Haulers Association), cannot be made to apply to plaintiff herein because plaintiff is not a party to said case. Second, plaintiff is not a petroleum hauler. This court is aware that the government is fixing a special low rate for petroleum haulers because the government controls the price of petroleum. To lower the cost of petroleum, it was necessary to control its hauling freight because hauling is one of the big factors to be considered in lowering petroleum price. Third, the aforesaid decision expressly states that it is applicable for a period of one year only from the date of issuance. The decision was issued on March 2, 1985, or six years ago. At that time, prices of commodities and transportation fees were comparatively low as compared to now.

It is the opinion of this court therefore, that the price to be followed is the price agreed upon by the parties in their contract of carriage, which under the instant case, is P32.00 from Legazpi City to Manila and P41.00 from Manila to Legazpi.

There being no fixed rate imposed on plaintiff, as the P2.20 rate insisted by defendant is not applicable to the parties, for reasons already mentioned above, parties are free to agree on the rate. In fact, defendant is estopped from denying now the rate fixed by plaintiff because they have paid such rate before. What is being collected now is merely the balance. The answer states that the original balance of P155,204.10 as of April 30, 1990, was partially paid by defendant, amounting to P30,000.00 in all, at P10,000.00 each last September 14, 1990, September 27, 1990, and October 12, 1990, respectively. By paying said partial amount, which was computed at the plaintiff’s rate of P32.00, defendant cannot validly deny now that said rate is not applicable to them.

WHEREFORE, premises considered, defendant is ordered to pay plaintiff, the sum of P109,741.66 balance of freight plus interest at 12% per annum beginning August 8, 1990, plus P10,000.00 attorney’s fees, and P5,000.00 reimbursement of commissioner’s fees. Costs of suit against defendant.

SO ORDERED." 2

Brillo Handicrafts, Inc. elevated the case to the Court of Appeals, reiterating the same argument that the freightage fixed by the then Board of Transportation should apply to it. It also asseverated that Daily Overland Express, Inc. was a franchise holder granted a certificate of public convenience. As such, it was covered by Sections 15 and 16 (c) of Commonwealth Act 146, which mandated the Public Service Commission to fix and determine individual or joint rates, tolls, charges, etc., as well as commutations, mileage, and other special rates to be followed by any public service. Consequently, applying the provisions of Commonwealth Act No. 146 and Case No. 84-6382, its liability should be based on the second computation of the commissioner’s report which was only P3,658.75.

The appellate court was not persuaded by Brillo’s submissions and hence, the decision of the court a quo was affirmed with modifications.

Now this petition for review filed by Brillo Handicrafts, Inc., bearing this sole assignment of error:chanrob1es virtual 1aw library

The Honorable Court of Appeals gravely erred/abused its discretion amounting to lack or excess of jurisdiction in upholding the declaration of the trial court as to the purported efficacy of the freightage rate imposed by private respondent despite the fact that it is contrary to the prevailing laws, jurisprudence, public order and public policy and in declaring that principle of estoppel operates against petitioner.

The petition lacks merit.

Petitioner contends that the applicable rate should be P2.20 per ton per kilometer, citing the case of Philippine Federation of Petroleum Haulers Association (Case No. 84-6382) dated March 12, 1985. As stated earlier, this case, however, dealt with the corresponding decrease in the hauling rates of petroleum products. Although the rates provided therein shall also be applicable to all authorized TH trucking services, they were nevertheless, provisional, subject to modification, and shall be valid only for one year from date (March 12, 1985). Admittedly, at the time this case was filed, more than one year had already elapsed. The freight charges demanded to be paid covered the hauling period from February 1, 1990 to April 30, 1990. Thus, the rate imposed in Case No. 84-6382 no longer applied for there was no proof that the same was extended. Considering that its effectivity was for a limited period only and temporary in character, the rate ceased to be applicable thereafter.

The applicable rate should be the one agreed upon and the same should have the force of law between the parties. In fact, petitioner can no longer impugn its liability because it had already partially paid the amount. The case filed by private respondent was for the unpaid balance. It should likewise be noted that petitioner was a regular customer of private respondent and it did not assail the rate then being charged on its shipments. Petitioner had apparently acquiesced thereto, tacitly accepting whatever was private respondent’s rate. It can not now belatedly challenge the amount being collected therefrom as an afterthought. We agree with the findings of the Court of Appeals that estoppel as set in, thus:jgc:chanrobles.com.ph

"Appellant has engaged the trucking services of plaintiff years before this litigation. Plaintiff has been charging freight rates to which defendant never objected. It would have been easy for appellant to manifest its objection to plaintiff’s billing from the start of their business relations, but it did not. Appellant was silent for so long a time until this suit was filed against it. It was too late, estoppel had already set in." 3

Consistently with the rationale of the decision of respondent Court of Appeals is a well-entrenched rule that "laches in a general sense, means the failure or neglect, for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier. It is negligence or omission to assert a right within a reasonable time, warranting the presumption that the party entitled to assert it either has abandoned or declined to assert. 4

Petitioner having paid a part of the assailed rate of freightage to private respondent may not be heard to dispute the remaining balance of the same. Un ne doit prise advantage de son tort demesne — one ought not to take advantage of his own wrong."cralaw virtua1aw library

Considering the foregoing premises and the law applicable thereto, we find no reversible error in the assailed decision of the respondent Court of Appeals.

ACCORDINGLY, the decision appealed from dated January 22, 1993 is hereby AFFIRMED in toto.

SO ORDERED.

Regalado, Romero, Puno and Mendoza, JJ., concur.

Endnotes:



1. Rollo, pp. 75-78. Decision penned by Justice L. Victor and concurred in by Justice G. Paras and Justice F. Martin.

2. Decision, Records, pp. 37-38.

3. Northern Cement Corporation v. IAC, 158 SCRA 415.

4. Marcelino v. Court of Appeals, G.R. No. 94422, June 26, 1992.

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