COMMISSIONER OF CUSTOMS, PETITIONER, VS. LT. COL. LEOPOLDO RELUNIA, RESPONDENT.

Commissioner of Customs versus Relunia

The Case

This is the case of the Commissioner of Customs versus Lieutenant Colonel Leopoldo Relunia, decided by the Supreme Court in May 1959. The Commissioner of Customs appeals from a decision of the Court of Tax Appeals, which had declared illegal the forfeiture of an electric range seized from a Philippine Navy vessel and ordered its release upon payment of the corresponding customs duties, taxes, or charges. The case matters because it settles a question every customs lawyer must know: whether a government vessel that is not engaged in foreign trade, and in particular a vessel of the Philippine Navy, is nevertheless required by law to carry and present a cargo manifest upon arriving from a foreign port. The answer determines whether unmanifested goods found on such a vessel may be forfeited under the customs law.

Procedural History

The Collector of Customs of Manila declared the articles forfeited for violations of the Customs Law in a decision rendered in March 1955. The owner of the electric range, Lieutenant Colonel Leopoldo Relunia, appealed to the Commissioner of Customs, who affirmed the Collector's decision in its entirety. Relunia then elevated the matter to the Court of Tax Appeals, which reversed the forfeiture, holding that the vessel was not required to present a manifest and ordering the release of the electric range upon payment of the corresponding customs duties, taxes, or charges, without pronouncement as to costs. The Commissioner of Customs then appealed that decision to the Supreme Court, which resolved the appeal on the merits.

Facts

On December 10, 1953, the RPS Misamis Oriental, a unit of the Philippine Navy, was dispatched to Japan to transport contingents of the Fourteenth Battalion Combat Team bound for Pusan, Korea, and to carry Christmas gifts for our soldiers there. It was thereafter used for transportation in connection with the needs of our soldiers, making trips between Korea and Japan, so that it did not return to the Philippines until September 2, 1954. While in Japan, it loaded 180 cases containing various articles subject to customs duties, classified into three groups: those supposed to be for the Philippine Army Post Exchange, those pertaining to the Philippine Navy Officers Base Commissary in Cavite, and those belonging to individuals, consisting of nine Philippine Army and Navy officers and crew and two private persons.

All these articles were declared forfeited by the Collector of Customs of Manila for violations of the Customs Law. One of the cases contained a General Electric electric range with four burners, consigned to Relunia, and it was forfeited under Section 1363, paragraph g, of the Administrative Code as unmanifested cargo. On appeal, the Commissioner of Customs affirmed the Collector's decision in its entirety.

The customs authorities learned of the goods only through confidential information about commercial goods on board the vessel, and after a Port Patrol policeman intercepted a truckload of cases leaving the customs zone from the navy boat. When the merchandise was examined at the customhouse, it was found to be covered by no cargo manifest, bills of lading, consular invoices, or Central Bank licenses and release certificates. The navy authorities maintained that Philippine Navy vessels were war vessels exempt from the manifest requirement, and the Court of Tax Appeals agreed with them.

Issues

• Whether or not the RPS Misamis Oriental, a vessel of the Philippine Navy not engaged in foreign trade, was required by the customs law to make and submit a manifest of its cargo to the customs authorities upon its arrival in the Philippines.
• Whether or not the electric range consigned to Relunia was unmanifested merchandise within the meaning of Section 1363, paragraph g, of the Administrative Code, and therefore subject to forfeiture.

Applicable Provisions

Section 1363, paragraph g, of the Administrative Code, the forfeiture provision invoked, provides:

Sec. 1363. Property subject to forfeiture under customs laws. — Vessels, cargo, merchandise, and other objects and things shall, under the conditions hereinbelow specified, be subject to forfeiture: (g) Unmanifested merchandise found on any vessel, a manifest therefor being required.

This is the provision under which the electric range was forfeited, and its operation depends entirely on whether a manifest was required of the vessel.

Section 1221 of the Administrative Code, on the duty of vessels to make entry, provides in its second paragraph:

The master of any war vessel or vessel employed by any foreign government shall not be required to report and enter on arrival in the Philippines, unless engaged in the transportation of merchandise in the way of trade.

The navy authorities relied on this exemption for war vessels, and the case turns on whether it reaches a vessel of our own Navy.

Section 1228 of the Administrative Code, on the manifest required of a vessel from a foreign port, provides:

Every vessel from a foreign port or place must have on board complete written or typewritten manifests of all her cargo.

The Court reads this provision as comprehensive and all inclusive, subject only to the exception of foreign war vessels and vessels employed by a foreign government.

Section 1234 of the Administrative Code, on the entry of transport or supply ships of the United States Army or Navy, provides in part:

The master or other officer in charge of a transport or supply ship of the United States Army or Navy, arriving from a foreign port at any port in the Philippines, shall, for the purpose of making entry of his vessel, present a manifest in duplicate, containing the following information, duly certified by him to the boarding officer or collector of customs.

The Court uses this provision to confirm that even government transport and supply ships arriving from abroad must present a manifest.

Ruling

On the first issue, the Court held that the RPS Misamis Oriental was required to present a manifest upon its arrival in Manila on September 2, 1954. The Court rejected the reasoning of the Court of Tax Appeals, which had relied on the title of Article VI of the Customs Law, "Entrance of vessels in foreign trade," to confine the manifest requirement to vessels engaged in foreign trade. The Court held that resort to the title of a statute as an aid in interpretation is an unsafe criterion and is not entitled to much weight; the title may be consulted only where there is doubt as to the meaning of the law, not otherwise. The Court stressed that Section 1228 requires every vessel from a foreign port or place to have on board complete manifests of all her cargo, and that this provision is quite comprehensive, if not all inclusive, excepting only the war vessels or vessels employed by a foreign government mentioned in the second paragraph of Section 1221, presumably out of international practice. All other vessels coming from foreign ports, whether or not engaged in foreign trade, must carry a manifest for presentation to the customs authorities. The Court explained the reason for the requirement in the words it quoted with favor from the brief for the Commissioner of Customs:

As the name of the document suggests, a manifest is obviously meant to place beyond doubt the nature of the load or of the cargo that a vessel carries. The manifest is therefore intended to be an indication, if not an open declaration, that the vessel is not engaged in smuggling or in surreptitious practices and activities.

The Court added that were the requirement confined to vessels in foreign trade, private vessels, yachts, pleasure boats, cruisers, and ships chartered for a special mission could bring in dutiable or prohibited goods with impunity, a result the customs laws could not have intended. On Section 1234, the Court agreed that it should have been amended to name our own Navy, but found no necessity for amendment where its application to our navy ships is so clear and manifest, since the reasons for requiring a manifest from transport and supply ships of the United States Army and Navy apply with more reason to our navy ships, and because we have complete control over them.

On the second issue, the Court held that no manifest required by law was in fact submitted to the customs authorities upon the vessel's arrival. It agreed with the Collector and the Commissioner of Customs, against the finding of the Court of Tax Appeals, that the claimed presentation through one Casimiro de la Ysla was not established. The Court found it unlikely that a manifest was prepared on board in Japan or delivered to customs, given the settled belief of the navy authorities that Philippine Navy vessels were exempt, as reflected in the letter of Commodore Francisco requesting clarification. It noted that the customs authorities learned of the goods only through confidential information and the interception of a truckload leaving the customs zone, and that the merchandise was covered by no cargo manifest, bills of lading, consular invoices, or Central Bank licenses and release certificates. Hence the electric range was unmanifested merchandise subject to forfeiture.

Doctrine

Every vessel arriving from a foreign port or place, whether or not engaged in foreign trade, must have on board a complete manifest of all its cargo and present it to the customs authorities; the only exception is the war vessel or vessel employed by a foreign government described in the second paragraph of Section 1221, and that exception does not cover vessels of our own Navy. Unmanifested merchandise found on any vessel required to have a manifest is subject to forfeiture under Section 1363, paragraph g, of the Administrative Code. The title of a statute is an unsafe criterion in interpretation and is not entitled to much weight; it may be resorted to only where there is doubt as to the meaning of the law or the intention of the legislature, not otherwise. The manifest requirement serves to place beyond doubt the nature of the cargo a vessel carries and to declare that the vessel is not engaged in smuggling or surreptitious practices, and government vessels are not beyond the pale of the customs laws.

Disposition

The Commissioner of Customs won: the Supreme Court reversed the decision of the Court of Tax Appeals, sustained the forfeiture of the electric range as unmanifested merchandise, and thereby denied its release to Relunia.

Remember This

Memorize the line that a manifest is required of every vessel from a foreign port, whether or not engaged in foreign trade, and that only foreign war vessels are excepted, so our own navy ships are not exempt. Examiners use this case to test the forfeiture of unmanifested merchandise under Section 1363, paragraph g, and the rule that a statute's title is a weak aid in interpretation.