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PNOC SHIPPING v. CA

FACTS:

The case involves a collision between two vessels, the M/V Maria Efigenia XV owned by the Maria Efigenia Fishing Corporation and the Petroparcel owned by the Luzon Stevedoring Corporation (LSC). Philippine Coast Guard Commandant Simeon N. Alejandro found the Petroparcel at fault for the collision. Private respondent, the Maria Efigenia Fishing Corporation, filed a lawsuit against LSC and the captain of the Petroparcel seeking compensation for the damages caused by the collision. During the pendency of the case, the PNOC Shipping and Transport Corporation sought to be substituted in place of LSC as it had acquired ownership of the Petroparcel. Private respondent later sought the amendment of its complaint to include the recovery of the lost value of the hull of the M/V Maria Efigenia XV and other damages. The lower court granted the amendment and issued a pre-trial order containing stipulations of facts. After trial, the lower court rendered its decision on November 18, 1989.

The private respondent presented evidence through its general manager and sole witness, Edilberto del Rosario. He testified that the fishing boat, M/V Maria Efigenia XV, was owned by the private respondent and was carrying 1,060 tubs of assorted fish at the time it sank. The witness also stated that the boat had two cummins engines, radar, pathometer, and compass, which were all lost. The private respondent incurred expenses for legal representation at the Board of Marine Inquiry and for commencing the suit for damages.

The lower court considered several pieces of documentary evidence presented by the private respondent to support their claim for actual damages amounting to P6,438,048. These include a certificate of ownership, a marine protest document, quotations for the construction of a trawler, invoice for marine engines, quotations for radar and sounder units, and quotations for ropes and other equipment. The lower court held that the prevailing replacement value of the fishing boat and its equipment would increase at 30% every year from the date of the quotations.

On the other hand, the petitioner only presented one witness, Lorenzo Lazaro, who testified that the price quotations submitted by the private respondent were excessive. However, Lazaro failed to present quotations from his suppliers to support his claim, stating that it was a "secret scheme." The lower court concluded that the petitioner did not provide sufficient evidence to rebut the private respondent's claim.

The petitioner filed a motion for reconsideration, arguing that the damages awarded were excessive, among other contentions.

The petitioner filed a motion for reconsideration of the lower court's decision, arguing that the lower court erred in holding them liable for damages and that the lower court did not acquire jurisdiction over the case due to the insufficient payment of the docket fee. The petitioner also contended that the lower court erred in awarding an amount greater than what was prayed for in the complaint, and in failing to resolve the issues raised in its memorandum. The petitioner subsequently filed a supplemental motion for reconsideration to further discuss the issue of jurisdiction despite the plaintiff's failure to pay the prescribed docket fee.

Unsatisfied with the lower court's decision, the petitioner brought the case to the Court of Appeals. However, the Court of Appeals affirmed the decision in its entirety on October 14, 1992. The Court of Appeals ruled that there was no need to qualify Del Rosario, the owner of the lost vessel, as an expert witness because he possessed sufficient knowledge of the equipment and cargoes on the vessel. The Court of Appeals also upheld the admissibility of the documentary evidence presented by the respondent, stating that the trial court has the discretion to admit such evidence. The appellate court found that the documentary evidence was never rebutted satisfactorily by the petitioner's own witness, Lorenzo Lazaro, who heavily relied on the same evidence. The Court of Appeals concluded that the awarded amount of damages was duly established based on the uncontroverted documentary evidence and was within the relief sought in the second amended complaint. The Court of Appeals also addressed the issue of jurisdiction, referring to the ruling in Sun Insurance Ltd. v. Asuncion and holding that the additional docket fee could be paid later on.

ISSUES:

  1. Whether or not the award of actual damages amounting to P6,438,048.00 to the private respondent was proper.

  2. Whether or not the lower court acquired jurisdiction despite the alleged non-payment of the proper docket fee.

RULING:

  1. First Issue: Award of Actual Damages

    • The Supreme Court held that the award of P6,438,048.00 was without adequate evidentiary basis because the price quotations presented by the private respondent were regarded as hearsay evidence. The Court emphasized that documentary evidence must be supported by the testimony of the authors of the documents, which was not done in this case. As a result, the private respondent was instead awarded nominal damages amounting to P2,000,000.00.

  2. Second Issue: Jurisdiction and Docket Fee

    • The Supreme Court found that the lower court acquired proper jurisdiction when the private respondent paid the docket fee corresponding to its claim in the original complaint. The unpaid docket fee for the increased claim in the amended complaint should be considered a lien on the judgment. The petitioner did not timely question the lower court's jurisdiction, only raising it after receiving an adverse decision. Thus, the jurisdictional issue did not invalidate the proceedings.

PRINCIPLES:

  1. Actual Damages

    • To recover actual damages, the amount of loss must be proven with a reasonable degree of certainty, based on competent and concrete evidence.

  2. Hearsay Evidence

    • Hearsay evidence, whether objected to or not, has no probative value and cannot be used as a basis for awarding damages.

  3. Nominal Damages

    • In the absence of competent proof on actual damages, nominal damages can be awarded to recognize a technical injury.

  4. Jurisdiction and Docket Fee

    • Payment of the docket fee for the initial claim establishes jurisdiction. Any additional fee due to amendments can be enforced as a lien on the judgment. A challenge to jurisdiction based on non-payment of additional docket fees should be timely raised, or the right to raise such a challenge is waived.

  5. Admissibility vs. Probative Weight

    • Admissibility pertains to whether evidence can be considered at all, while probative value pertains to the weight given to evidence. Evidence may be admitted but given no weight if it lacks probative value.