[With Resolution of June 23, 1965]

Direct appeal from a judgment on
the merits of the Court of First Instance of Cotabato,
in its Civil Case No. 1694, dismissing the amended and supplementary complaints
for replevin and for over P600,000 in
damages.

The parties in this case are both
producers and exporters of logs and hold separate but adjacent forest
concessions which are located in the municipalities of Parang, Pigcawayan, and Nuling province of Cotabato. Parcel No. II of the
plaintiff-appellant’s ordinary timber license No. 325-59 adjoins that of
defendant-appellee’s ordinary timber license No.
201-57, their common boundary line running from south to north, along which are
points and corners corresponding to the technical description in each license
which have, as their common reference survey, the forest zone corner indicated
in the control map of the Bureau of Forestry known as Land Classification Map
No. 1809. No visible boundary, however, exist on the
ground.

On the first cause of action,
which refers to a logging operation by the defendant-appellee in 1958 somewhere along the aforesaid border, both
the litigating companies claim that the logging took place within its respective
licensed area.

On 11
February 1959, the Cotabato Timberland Company, Inc., brought the matter to the
attention of the district forestry office and requested for a verification. Upon
receipt of the said complaint, the assistant district forester, Ebad Ulangkaya, personally
inspected the area, and found the Plaridel Lumber
Company, Inc., logging thereon; but Nothing definite
was established. To whom the logging pertained remained
undecided.

After several months’ delay,
characterized by many communications to forestry officials, including the
director, urging prompt action, intra-office correspondence on the complaint,
particularly on the designation of the forestry personnel to undertake an
investigation, and when chosen, the postponements at the behest of the
defendant-appellee, forester Isabelo Tobias, at last authorized and made a survey of the
common boundary of the concession and inventoried the stumps found in the course
thereof.

After establishing on the ground
a one-meter wide cut of the underbrush of what Tobias believed to be the
boundary line, he identified, counted, and measured the stumps (561 in number,
fully located in his sketch) and computed the volume of logs that were taken,
based on a standard table for the species of trees cut.

On the second cause of action,
the plaintiff-appellant prays for damages in the total amount of P57,381.60,
representing the commercial value of 756.17 cubic meters of logs (stated in the
amended complaint) and 496.43 cubic meters (stated in the supplementary
complaint), or for their delivery. These logs were allegedly taken by the
defendant-appellee in a second encroachment within the
aforesaid Parcel No. II, from November, 1959 to February,
1960.

About one-third
of the western portion of this Parcel No. II is occupied by many Edcor settlers. To reach one of its timber concessions, the
Plaridel Lumber Company started in November, 1959 the
construction of a road, at the request of the settlers, and then continued it in
an easterly direction beyond the settlement and traversing entirely the said
Parcel No. II, without, however, notifying the licensee, the Cotabato Timberland Company.

The Plaridel Lumber Company had requested for the road
right-of-way from the District Forester, Samuel Fortich, on 23 May
1959 and
on 21 December
1959. It
knew that the road had to pass through a licensed area. The said official
authorized, on 15 January
1960, the
road construction, including the hauling of logs already cut, but limiting the
cutting of more trees along the surveyed road right-of-way. Then, over the
protests of the appellant-licensee, and without the hearing which it had
requested, the Director of Forestry, on 17 February
1960,
granted the right-of-way permit tinder the condition that the grantee shall turn
over all trees cut along the approved right-of-way to the Cotabato Timberland Company, unless it is not ready to
receive them.

The defendant-appellee admits having hauled and removed 600,000 board feet
of timber from along the road.

The answer filed by the Plaridel Lumber Co., Inc. denied the alleged invasion of the
lumber concession of the plaintiff, Cotabato
Timberland Co., Inc., and pleaded that the trees cut along the common boundary
claimed by the latter were within the forest concession of defendant; and that
the cutting of logs in 1950-1960, alleged in the complaint’s second cause of
action, was done by defendant with proper authorization from the corresponding
administrative authorities. Defendant Plaridel further
counter-claimed for damages and attorneys’ fees.

After requisite trial, the Court
of First Instance found the complaint unsupported by evidence, and consonantly
dismissed the original action as well as the counterclaim; whereupon, plaintiff
Cotabato Timberland Company appealed directly to this
Court in view of the amount involved.

Our review of the evidence on
record compels us to agree with the trial court that the resurvey of the common
boundary by Forester Isabelo Tobias, Jr., was not
accurate, and in fact it was disapproved by the Bureau of Forestry authorities
(Exhibits “10” and “10-A”). The result is that the inventory of stumps and
computation of logs taken therefrom, coetaneously made by the aforesaid forester, does not
furnish adequate support for the damages claimed by plaintiff-appellant
company.

We can not close our eyes to the
fact that the boundary resurvey by Forester Tobias, upon which appellant rests
its case, started at the junction of the Big Patot
Creek and Small Patot Creek as Corner No. 6 of the
appellee’s timber license No. 201-57; but Corner No. 6
is identical to Corner No. 43 of Land Classification Map No. 1809 (Exhibit
“D-3-a”), which is a Pls concrete monument. From this
indefinite junction of creeks, he proceeded to Corner No. 7, which, according to
him, was indicated by a “mayapis” tree, but which, on
the map, is, and should be, a Pls monument. Along the
zigzagging line from Corner No. 42 to 18 of the said control map, which
correspond with, or are identical to, specified points in the timber license,
are 25 other Pls monuments, and, therefore, known
points on the ground, yet Tobias failed to hit any one of
them.

It would seem unnecessary to
stress that the duty of Tobias, in making his resurvey, was to follow as closely
as possible the footsteps of the original surveyor who located and placed the
Pls monuments in the corners of the original line. It
is an established rule that in regard to boundaries “monuments control courses
and distances as well as the calculated area” (Gov’t.
of P. I. vs. Abad, 47 Phil. 573; Higuera vs. U.S., 18 Law Ed. (US) 469; Cornelison vs. Hammond, 224, N.C. 757, 32 S.E. 2d, 326), and
in the course of his resurvey Tobias relied almost exclusively on courses and
distances.

The appellant claims that the
computations of Tobias should prevail over the monuments because the latter
could be moved. But there is no evidence that the location of the PLs monuments indicated in the control map has been changed.
And as the interference with, or removal of land survey monuments is made a
criminal act, and penalized by statute (Adm. Code, Act 2711, sec. 2753), such
removal or alteration is not to be assumed without adequate evidentiary support,
which, in the present case, does not exist.

It may be added that if
plaintiff-appellant believed that the Tobias resurvey of the common boundary of
its timber concession and that of the defendant-appellee was erroneously or improperly refused confirmation
by the officials of the Bureau of Forestry, it could have had their action
reviewed and corrected by the Department Secretary. As it failed to take steps
to do so, the rejection of the Tobias report is final against appellant Cotabato Timberland Co., Inc., and its case can not be built
thereon.

The plaintiff-appellant, Cotabato Timberland Company, Inc., stands on a more solid
ground in its second cause of action. It is not seriously controverted that, as previously narrated, the defendant,
Plaridel Lumber Co., Inc., entered and started
building a road across Parcel II of plaintiff’s concession on November 1959,
continued it entirely across the said parcel, and subsequently cut, hauled, and
removed around 600,000 board feet of timber along the road, besides using it for
hauling its own forest products. All of this was done without
previous notice” to the licensee of the area, plaintiff-appellant Cotabato Timberland Company.

That this intrusion by the appellee, Plaridel Lumber Company,
was illegal is self-evident. Plaridel sought to excuse
its depredations, relying on the authorization it secured from District Forester
Samuel Fortich on 15 January
1960 to
build the road, and an alleged request of the settlers, through the Edcor area on the western side of appellant’s Parcel II. The
Court of First Instance upheld this defense and exonerated defendant-appellee from liability. Plainly this was error. The request
of the Edcor settlers and administrators did not
constitute valid authority for Plaridel upon the
territory of another licensee without its previous knowledge and consent; nor
was this invasion validated by the District Forester’s permit, since the latter
was secured only on January, 1960, months after the defendant’s illegal
entry.

It is true that, over protests of
appellant, the Director of Forestry, on 17 February
1960,
granted Plaridel a right-of-way permit, subject to the
condition that the grantee would turn over all trees cut along the right-of-way,
to the Cotabato Timberland Company, unless the latter
was not ready to receive them. But this grant of right-of-way obtained when the
road was nearly completed, like that of District Forester Fortich, could in no way cure the prior unauthorized entry,
roadbuilding, and removal of logs inside Cotabato’s timber concession. Nothing in the permit
indicates that it was intended to have such retroactive
effect.

The law is clear that—

“Where a license is issued for
the taking of forest products and a person other than the license unlawfully
enters or operates without license in the territory covered thereby and cuts,
gathers or removes any forest products contrary to the terms of said license, or
attempts to remove any products so cut or gathered, the same may he seized and
delivered to the proper licensee, upon the payment of the regular charges
thereon, free from any claim on the part of the offended person. * * *” (Sec.
1837, Rev. Adm. Code)

Considering the quoted legal
provision and the condition imposed by the Director of Forestry that logs cut
along the right-of-way authorized .should be turned over to the rightful
concessionaire, Cotabato Timberland Company, the
liability of the appellee for the value of an said
logo, which it did not so
turn over, is beyond question.

Referring to the logs that were
taken inside the Edcor settlement, which is also
inside the concession in question, the appellee claims
that the appellant has no right to them because the farm lot owners have been
issued homestead titles; and under the appellant’s license, it is not allowed to
gather forest products on private lands without express authority. This argument
is untenable because the condition in the appellee’s
road right-of-way permit from the Bureau of Forestry obligates the appellee to turn over the logs to the appellant, and the
permit did not exempt the logs that were taken inside the Edcor settlement. Note that the appellant’s license preceded
the appellee’s permit.

The court a quo found that the
plaintiff-appellant was not entitled to the trees cut along the approved road
because it was not ready to receive them for lack of a road of its own. We
disagree. Lack of a road does not necessarily connote unpreparedness to receive the logs; and, even assuming that
the appellant was unprepared, the appellee certainly
contributed thereto by cutting and hauling logs within a licensed area without
previously notifying the license of its operation and without having offered to
deliver or turn over the logs. The lack of a road does not exclude other
possibilities or remedies that the appellant, Cotabato
Timberland Company, could have taken in order to receive, remove, or dispose of
the logs.

That the plaintiff-appellant
herein was justified in seeking judicial relief without further ado is
emphasized by the circumstances of the case. The defendant-appellee, when told to stop by forestry officials in the
field, refused to obey; it continued its road construction and hauling of logs
although it did not have the proper permit to construct, nor the proper license to gather forest products in the area.
Neither the Director of Forestry nor the Department Head could have given relief
to the appellant because the Director authorized, on 22 January 1960 (the
Present case was filed on 9 February 1960), the release of the 600,000 board
feet of timber to the appellee on a measly bond of
P7,200.00 to answer for damages to the licensee. And upon the
release of the logs, the appellee no time in exporting
them to Japan, ‘hereby
terminating these officials’ administrative control over the disputed lots and
rendering futile further administrative processes, including an
appeal.

“The failure of a litigant to
exhaust his administrative remedies does not bar an action for damages where the
circumstances of the case are such that he is excused from exhausting such
remedies, as where the exhaustion of administrative remedies would be completely
futile and meaningless.” (73 CJS 359)

Of the 600,000 board feet
released to the appellee, Plaridel Lumber Company, the plaintiff-appellant admitted
receipt of 169.68 cubic meters (Exhibit “O”; Tsn. p.
355) and 38.66 cubic meters (Tsn., p. 665), or a total
of 208.34 cubic meters, which is equivalent to 88.3336.16 board feet of timber.
What has not been turned over, therefor, amounts to
551,663.84 board feet, which commands an export value in the sum of P61,399.66,
at the price of P120.00 per thousand board feet (Exhibit
“O”).

The original unauthorized
intrusion of appellee Plaridel Lumber Company into the land covered by the license
of appellant was aggravated by Plaridel’s subsequent
defiance of the forestry officers that vainly sought to stop it from
constructing its road and bar it from committing further acts on dispossession
(L-1) pending approval of its right-of-way application; and the record reveals a
deplorable tendency on the part of said defendant-appellee to further its economic interest in utter disregard
of the rights of other licensees. This rebellious disregard of administrative
authority and reckless pretermission of appellant’s rights are incompatible with
a healthy respect for the rule of law. If Plaridel
believed that the acts of the forestry officials were unjust or illegal, it
should have availed of the corresponding administrative and judicial remedies,
instead of taking the law in its hands and recording to forcible defiance of the
orders received. In our opinion, to discourage repetition of such brave conduct,
an award is required of exemplary damages, under section 5, chapter 3, Book IV,
of our new Civil Code, in the amount of P10,000.00 over and above the value of
the logs to be paid by said defendant-appellee to
plaintiff-appellant.

And because appellant was forced
by appellee’s conduct to institute court proceedings
to protect itself, in view of Plaridel Lumber
Company’s open defiance of its rights and of the orders of administrative
officials, the defendant company should be sentenced further to pay attorney’s
fees to the plaintiff-appellant in the sum of P5,000.00
(Article 2208, pars. 1, 2 and 11, Civil Code).

WHEREFORE, the decision appealed from is
reversed, and the appellee Plaridel Lumber Company, Inc., is sentenced to pay to the
appellant Cotabato Lumber Company, Inc., the sum of
P61,399.66 as compensatory damages, plus P10,000.00 exemplary damages, and, in
addition, P5,000.00 for attorney’s fees. Costs in both
instances against appellee Plaridel Lumber Company, Inc.

Bengzon, C. J., Bautista Angelo, Concepcion, Barrera, Paredes,
Dizon, Regala, Makalintal, Bengzon,
J.P. and Zaldivar, JJ.,
concur.

R E S O L U T I O
N

June
23, 1965

REYES, J. B. L.,
J.:

Appellee Plaridel Lumber Co., Inc. has moved to reconsider our
decision of February 26, 1965, on the ground that the damages awarded to
appellant Cotabato Timberland Co., Inc., are excessive
in that the cost of production of the 551,663.84 board feet that appellee failed to turn over to appellant should be deducted
from the export price. Otherwise, it is claimed, appellant would be unjustly
enriched.

The motion is without merit, for
the following reasons:

1. The right of way permit issued
to Plaridel by the forestry authorities provides for
the turn over of the logs cut to Cotabato Timberland
Co., Inc., subject to only one condition: that it is ready to receive them. Said
permit does not provide for the deduction of the cost of
production.

2. The law expressly frees the
offended licensee from any claim (which should include the cost of production)
when forest products which have been unlawfully gathered from his licensed area
are seized and delivered to him.

“Where a license is issued for
the taking of forest products and a person other than the licensee unlawfully
enters or operates without license in the territory covered thereby and cuts,
gathers, or removes any forest products contrary to the terms of said license,
or attempts to remove any products so cut or gathered, the same may be seized
and delivered to the proper licensee, upon the payment of the regular charges
thereon, free from any claim on the part of the offended person. * * * (Sec. 1837, Rev. Adm. Code). (Italics supplied: quoted
on p. 8, main decision)

3. There is no evidence on either
the cost of the road construction or the cost of production of the logs. In
fact, the log-production was but a consequence of Plaridel’s road-building.

4. It would be Plaridel, not Cotabato, that would be
unjustly enriched if cost of production, if any, is deducted from the
compensatory damages because Plaridel would have built
its road to the double prejudice of Cotabato: (a) the
invasion of its licensed area; (b) with Cotabato
bearing the expenses.

WHEREFORE, the motion to reconsider is
denied.

Bengzon, C.J., Concepcion, Paredes, Dizon, Regala, Makalintal, Bengzon,
J.P. and Zaldivar, JJ., concur.