MAN SHUNG LOONG CO., ET AL., PETITIONERS, VS. MELECIO FABROS, COLLECTOR OF CUSTOMS OF THE PORT OF JOLO, ET AL., RESPONDENTS.

The
petitioners herein instituted these mandamus proceedings against the
collector of customs of the port of Jolo and the Insular Collector of
Customs, to compel, the former to issue in their favor new warrants for
various sums of money representing payments made by them in excess of
import duties, with legal interest thereon, and the latter to abstain
from executing any act tending to prevent the former from issuing and
delivering the aforementioned new warrants to the herein petitioners.

In view of the failure of the counsel for both parties to agree on the
material facts involved in the case, it was necessary to commission the
clerk of the Court of First Instance of Sulu to receive all the
evidence presented therein. Counsel for the petitioners later filed an
amended petition wherein his allegations were made to conform with the
facts established according to him, which petition, as amended, was
admitted at the instance of said attorney.

The facts which, in our opinion, have been established, may be summarized as follows:

In the years 1930 and 1931, the herein petitioners who were then
merchants, imported sugar from Singapore, Strait Settlements, through
the Jolo customhouse. They then applied for immediate delivery to them
of said sugar by depositing an amount estimated as sufficient to cover
the import duties thereon. The collector of customs of Jolo granted
their request. Inasmuch as the duties chargeable thereon could not then
and there be determined due to a recent amendment of the law applicable
thereto, which required that computation of the duties in question
should be based upon the degree of polarization of the sugar, and
inasmuch as such computation could not be made without first sending a
sample thereof to the Bureau of Science in Manila where polarization
had to be determined by means of a polariscope, the aforesaid collector
of customs, through the cashier of his office, made a tentative
liquidation of said duties, after which the herein petitioners
deposited the estimated amount and the sugar was delivered to them.
After the required test had been made by the Bureau of Science, the
collector of customs of Jolo made a final liquidation of the duties
payable by the herein petitioners and found that their deposit was not
sufficient to cover the same. Consequently, said petitioners remained
indebted to the Government in the sum of P8,656.20 in the form of
unpaid duties. The aforementioned respondent demanded payment of the
sum owing by the petitioners herein but they refused alleging that the
first liquidation was final and conclusive, and that, inasmuch as more
than one year had already elapsed from the date thereof, they were no
longer under obligation to pay, and whatever action the Government
might have had against them had already prescribed in accordance with
section 1287 of the Administrative Code.

Between the months
of January and July, 1932, the petitioners herein again imported
merchandise from foreign countries and upon their arrival at Jolo, the
said petitioners applied for immediate delivery thereof under a
tentative liquidation. The collector of customs refused to grant their
petition unless payment was first made of the import duties, owed by
them to the Government. In view of this attitude, the petitioners
herein instituted mandamus proceedings in the Court of First Instance
of Sulu against the collector of customs of Jolo, obviously for the
purpose of compelling said official to make immediate delivery of the
merchandise in question under a tentative liquidation. The case,
however, was dismissed in view of an agreement entered into between the
parties to the effect that the petitioners herein would make a deposit
of 30 per cent in excess of the estimated duties on the merchandise in
question. The petitioners thus made the deposit agreed upon and the
merchandise was delivered to them under a tentative liquidation.
Sometime later, a final liquidation of the aforesaid duties was made
which showed that the petitioners’ deposits exceeded the amount of the
duty they owed, whereupon the collector of customs of Jolo issued the
warrants for the excess, which were duly countersigned by the
provincial auditor for delivery to the herein petitioners. Before
delivery thereof was effected, the collector of customs of Jolo sought
authorization from the Insular Collector of Customs to withhold and
apply the amount of said warrants to the payment of the petitioners’
debt. Inasmuch as he was granted such authority, said respondent
cancelled the warrants in question and applied the amount thereof to
the petitioners’ account with tile Government, Counsel for the said
petitioners then addressed a communication to the Insular Auditor
requesting him to order the delivery of the warrants in question to his
clients. The Insular Auditor, however, sustained the action taken by
the respondents and ruled that the Government was justified under the
law to effect said compensation.

The petitioners contend
that inasmuch as the collector of customs of Jolo had already issued
the warrants in question, in refund of their excess deposits, there was
nothing left for said official to do other than perform the ministerial
duty of delivering said warrants to them. In support of their
contention, they invoke the ruling laid down in the case of Compañia
General de Tabacos vs. French and Unson (39 Phil., 34), wherein this court, among other things, said:

“We
conclude, therefore, that no power to adjudicate and offset disputed
unliquidated claims for damages is conferred upon the Insular Auditor
by the cited provisions of the Jones Law or by the general grant of
jurisdiction to examine and audit claims owing to the Government
contained in section 584 of the Administrative Code. * * *.”

The first proposition is based on section 1287 of the Administrative
Code which provides that the liquidation made in connection with the
computation of import duties becomes final and conclusive upon the
parties after the expiration of one year, unless said liquidation was
merely tentative. This contention makes it necessary for us to
determine whether the first liquidation made by the collector of
customs of Jolo relative to the imported sugar was tentative or final.
The collector of customs of Jolo and the cashier, Arturo Fernandez,
categorically stated that it was tentative and that it could not have
been final on the ground that the test to determine the degree of
polarization of the sugar had not yet been made by the Bureau of
Science and, under such circumstances, it was impossible to determine
the correct import duties chargeable to the petitioners herein. Their
statements have been conclusively corroborated by the official
documents presented, and under the circumstances, we are fully
convinced that a strong preponderance of evidence supports the
respondents’ theory that the aforesaid liquidation was merely tentative
and not final. It being established that the liquidation in question
was merely tentative and not final, it becomes obvious that the
petitioners’ contention is untenable, inasmuch as the exception
contained in section 1287 invoked by them, should be applied in this
case.

With regard to the second proposition, it is clear that the principle enunciated in the case of Compañia General de Tabacos vs. French and Unson, supra,
is not applicable to the case under consideration. In the case cited
above, it was held that the Insular Auditor had no power to offset
alleged unliquidated Government claims for damages against a settled
and definite debt owing by the latter. In the case at bar, it is not
attempted to set-off an unliquidated claim for damages but another
claim in the form of import duties resulting from a final and
conclusive second liquidation.

This case presents another
aspect in that according to the provisions of sections 1370, 1371,
1379, 1380, 1383, 1384 and 1385 of the Administrative Code, the
petitioners herein, as importers, who did not agree to the final
liquidation made by the collector of customs of Jolo, were in duty
bound to make payment under protest and, at all events, appeal from the
ruling of the said customs officer to the Insular Collector of Customs
and to the Court of First Instance of Manila, in the manner and within
the period prescribed by the aforementioned sections. The law clearly
prescribes this exclusive remedy and inasmuch as the herein petitioners
failed to take advantage of it, mandamus does not lie in this case, in
the absence of any other legal provision making it a ministerial duty
on the part of any of the respondents herein to deliver the warrants in
question.

There still remains another point worthy of
further consideration. According to the allegations of the amended
petition, which are supported by the evidence and are neither denied
nor refuted in the memorandum filed by the respondents, the excess
deposits amount to P10,939.24, while the Government’s claim which is
intended to be offset thereby only amounts to P8,656.20. If the above
figures are correct, it is clear that there exists a difference of
P2,283.04 which should be distributed among such of the petitioners as
are entitled thereto. But inasmuch as there seems to be no question
regarding this balance and that the respondents are disposed to make
the necessary refund thereof, we are of the opinion that there is no
necessity for making a pronouncement in regard to said balance.

Wherefore, the petition herein is hereby denied, with costs against the petitioners. So ordered.

Street, Malcolm, Villa-Real, Abad Santos, Hull, and Vickers, JJ., concur.