HON. SALVADOR M. MISON, COMMISSIONER OF CUSTOMS, AND CARLOS L. RAZO, COLLECTOR OF CUSTOMS OF THE SUBPORT OF CLARK, PETITIONERS, VS. HON. ELI G. C. NATIVIDAD, PRESIDING JUDGE OF …

This is a petition for certiorari and prohibition filed on
6 April 1988 to annul, for having been issued without jurisdiction or with
grave abuse of discretion, the 26 February 1988 Resolution of respondent Judge
— denying petitioners’ motion to dismiss Civil Case No. 8109 pending before
Branch 48 of the Regional Trial Court (RTC) of Pampanga and granting private
respondent’s motion therein for the issuance of a writ of preliminary
injunction — and to enjoin respondent Judge from proceeding further in said
case. It resurrects a long-settled
issue of the jurisdiction of the Regional Trial Court over actions involving
articles subject to seizure proceedings under the Tariff and Customs Code.

In the Resolution of 18 April 1988, this Court required the
respondents to comment on the petition and issued a Temporary Restraining Order restraining the respondent Judge
from further proceeding with the aforementioned Civil Case No. 8109 or from
enforcing and/or carrying out his Resolution of 26 February 1988.^[1]

Private respondent subsequently filed his Comment^[2] to
the petition, to which petitioners
filed a Reply.^[3]
Private respondent then filed a Rejoinder^[4]
to the latter.

This Court gave due course to the petition and required the
parties to submit their respective Memoranda.^[5] Both
manifested that they have sufficiently expounded on the relevant issues in
their previous pleadings and moved, in effect, that they be allowed to dispense
with the submission of their respective Memoranda, which this Court noted and
granted.

The factual antecedents
disclosed in the petition are as follows:

In a sworn letter^[6] dated
7 February 1988 and addressed to the Commissioner of Customs, one Butch
Martinez informed the former of the existence
of both “assembled and disassembled” knocked-down vehicles, particularly Toyota Lite Aces, at the
compound of CVC Trading, which is owned by a certain Mr. Castro and located at
St. Jude Avenue, St. Jude Village, San Fernando, Pampanga. Martinez requested for an immediate
investigation thereon and prosecution for the violation of customs laws.

On the basis thereof, Gen. Benjamin C. Cruz, Acting Director of
the National Customs Police, formed a team composed of National Customs Police
(NCP) and Customs Intelligence and Investigation Division (CIID) members,
issuing to the same a Mission Order^[7] on 11
February 1988. The team proceeded to
San Fernando, Pampanga on the same day, giving due notice of their presence to
the PC Region III Command and the PC-INP Station at San Fernando, Pampanga.

Upon arrival at the place pinpointed by Mr. Martinez at around
11:00 p.m., the team found a fenced area containing twenty (20) units of fully
and partly assembled Toyota Lite Ace vans. It immediately took possession and control of the motor vehicles by
cordoning off the enclosure. Thereafter, at about 11:30 p.m., two (2) members of the team were
designated to secure a warrant of seizure and detention from the Collector of
Customs of the Subport of Clark,^[8]
herein petitioner Carlos L. Razo. The
latter instituted seizure proceedings against the abovementioned vehicles
(Seizure Identification No. CAB-01-88), entitled “Republic of the
Philippines versus Twenty (20) units Toyota Lite-Ace, CVC Trading St. Jude
Ave., Dolores Homesite, San Fernando, Pampanga, OWNER/CLAIMANT”, for the
violation of “Section 2530 (f) and (1)-1 & 5” of the Tariff and
Customs Code, in relation to Central Bank regulations. Accordingly, at about 8:00 a.m. on 12 February 1988, he issued a Warrant of Seizure and Detention.^[9]

Since receipt of the warrant was refused by the owner/claimant or
any of his representatives, the same was served by substituted service through
the posting of a copy thereof on one of the subject motor vehicles found near
the gate of the stockyard. An inventory
of the vehicles was conducted and a copy thereof was attached to the return of
the warrant made to the issuing authority.

At about 11:00 a.m. on 12 February 1988, when the team was about
to haul the motor vehicles away, two (2) Regional Trial Court sheriffs arrived
with a temporary restraining order issued on that date by the respondent Judge,
as Executive Judge of the Regional Trial Court of San Fernando, Pampanga; the
order was issued in connection
with Civil Case No. 8109, entitled “Sonny Carlos, plaintiff, versus Bureau
of Customs and/or Customs Police, defendant,” for Damages with Prayer for
Preliminary Injunction and Restraining Order. The plaintiff in the said case is the private respondent in this
petition. The order restrained the
Bureau of Customs and/or Customs Police from seizing or confiscating the
vehicles until further ordered, and directed the defendants to attend the
raffle of the case on 26 February 1988 at 9:00 o’clock in the morning and show
cause why a writ of preliminary injunction should not be issued against
them. It further required plaintiff to
submit within twenty four (24) hours from that date the list of vehicles in
question and “not to dispose any (sic) of them pending further order of
the court.”^[10]

In his Complaint^[11] in
the above-entitled case, private respondent alleges that he is the owner of
several vehicles which are legally registered in his name and that he has paid
all the taxes and “corresponding licenses” therefor; he further avers
that elements of the defendant Bureau of Customs and/or Customs Police have
surrounded his residence threatening to take possession of the vehicles. He finally prays that the latter be enjoined
from doing so and that they be ordered to pay damages in the sum of P50,000.00.

By virtue of the restraining order, the physical transfer of the
vehicles was deferred; however, elements of the National Customs Police and the
PC Regional Command remained deployed in the area to assert possession and
control over the seized motor vehicles by the Bureau of Customs.

On 16 February 1988, lawyers of the Bureau of Customs filed a
Motion to Dismiss^[12]
Civil Case No. 8109 alleging
therein (a) the lack of jurisdiction of the Regional Trial Court over the
subject vehicles in view of the exclusive jurisdiction of the Collector of
Customs over seizure and forfeiture cases, and (b) the failure of the plaintiff
to exhaust administrative remedies.

On 17 February 1988, the private respondent filed an
Opposition/Comment on the Motion to Dismiss^[13]
alleging, among others, that the Warrant of Seizure and Detention did not
comply with the requirements for a valid search warrant under the Constitution,
and that taxes for the vehicles have been paid to the Bureau of Internal
Revenue (BIR).

The Motion to Dismiss was heard on 19 February 1988 by the
respondent Judge, to whose branch the case, was raffled off. After said hearing, the private respondent’s
motion and application for preliminary injunction were deemed submitted for
resolution.

On 22 February 1988, private respondent filed an Amended
Complaint^[14]
changing his name from “Sonny Carlos” to “CESAR SONNY
CARLOS” and naming as defendants, in place of the “BUREAU OF CUSTOMS
AND/OR CUSTOMS POLICE”, “ATTY. CARLOS L. RAZO, in his capacity as
Collector of Customs; LOUIE ROMERO, BILLY BIBIT, their authorized deputies and
JOHN DOES.” In this Amended Complaint, private respondent assails the
subject warrant for being patently “illegal and fatally defective”
and void of any virtue; reiterates his willingness to post a bond “in an
amount the Court may fix conditioned upon the damages that the defendants may
suffer as a consequence of the issuance of the injunction;” and asks for
P500,000.00 as actual damages, P100,000.00 as exemplary and corrective damages,
P50,000.00 as moral damages and P50,000.00 as attorney’s fees.

In the meantime, the hearing of Seizure Identification No. CAB-01-88
was set for 18 and 19 February 1988, per Notice of Hearing dated 15 February
1988 and issued by petitioner Collector of Customs. Since the owner/claimant CVC Trading refused to accept a copy of
the said notice, a follow-up notice of hearing was transmitted to it thru a
telegram; the latter replied also by telegram,^[15]
declaring that:

“We are the legal possesors/owners (sic) of the vehicles in
our compound there can be no forfeiture since a case has been lodged before the
civil courts hearing on Feb 19, 1988 the courts have assumed jurisdiction to
your exclusion

Moreover elementary due process requires service of documents
complaint. There can be no service of
summon’s (sic) or notice of hearing thru telegrams.”

At the hearing on 18 February 1988, Attys. Napoleon Gatmaitan and
Conrado Unlayao, CIID, Bureau of Customs, appeared for the Government. No appearance was entered for the
owner/claimant. Thus, the Government
was allowed to present evidence ex-parte.

On 26 February 1988, petitioner Collector of Customs rendered a
Decision^[16]
in the said seizure proceedings, the dispositive portion of which reads:

“WHEREOF, by authority of law vested in the undersigned, it is
hereby ordered that the Twenty (20) Units Toyota Lite Ace covered by this
seizure case be, as they are
hereby, declared forfeited in favor of the Government to be disposed of in the
manner provided for by law.

Let copies of this Decision be furnished all parties and office
(sic) concerned, with a copy
thereof posted in the Bulletin Board of
this Customhouse, for their information
guidance and appropriate action.”

On the same date, the respondent Judge issued a Resolution^[17] in Civil Case No. 8109 denying the
motion to dismiss and granting the
application for a writ of preliminary injunction. The pertinent
portions thereof read:

“I. Resolution on the Motion to Dismiss with Prayer to Lift Restraining Order

x x x

A reading of the complaint will show that it was alleged that the
plaintiff is the owner of the
subject vehicles. He is in actual and physical possession of
the same. Plaintiff enjoys the presumption of ownership, to (sic) which he has to protect.

x x x

It is to be noted that the subject matter of the complaint is the legal ownership of the vehicles and damages being asked
by plaintiff, thus, this Court
can assume jurisdiction over the case. The mere allegation of the defendants
that the subject vehicles were smuggled
based on ‘reliable information’ will not
divest this Court of jurisdiction.

x x x

In this particular case, there is no showing that plaintiff is an importer who imported dutiable goods, in
entering the port of Clark Air Base; imported thru that port. The goods are in private (sic) place owned by plaintiff, and
not in the possession of the collector of customs.

x x x

The numerous Supreme Court decisions cited by movant in his motion
to dismiss have very remote pertinence at the case at bar. In the cited cases, dutiable imported goods
or articles were seized while on vessels and/or customs zone (sic), and the alleged
owners filed cases of replevin or recovery of personal properties.

II. Resolution in the Issuance of Writ
of Preliminary Injunction

x x x

Having substantiated the said allegations, in
his complaint with Annexes and considering the oral arguments of the parties,
it is hereby ordered and directed that after the plaintiff filed (sic) the bond
in the amount of P100,000.00 as fixed by this Court, all the defendants and any
other persons acting under their command, or for (sic) in their behalf, to
(sic) desist and refrain from guarding the area of the plaintiff and from
seizing or confiscating the vehicles involved in this case pending termination of this litigation and/or unless a
contrary order is issued by this
Court. Thus, the defendants is (sic)
hereby inhibited for the meantime to guard the area or commit trespass of
plaintiffs’ premises in any manner restrain (sic) the movement of herein
plaintiff and his representatives or employees, considering that there is
standing (sic) of this Court that pending the termination of this case, the
said vehicles should not be disposed of.”

Hence, this petition which We find to be meritorious. It should be granted.

The court a quo has
no jurisdiction over the res subject
of the warrant of seizure and detention. The respondent Judge, therefore, acted arbitrarily and despotically in
issuing the temporary restraining order, granting the writ of preliminary
injunction and denying the motion to dismiss,
thereby removing the res from the control of the Collector of
Customs and depriving him of his exclusive original jurisdiction over the
controversy. Respondent Judge exercised
a power he never had and encroached upon the exclusive original jurisdiction of
the Collector of Customs. By express
provision of law, amply supported by well-settled jurisprudence, the Collector
of Customs has exclusive jurisdiction over seizure and forfeiture proceedings
and regular courts cannot interfere with his exercise thereof or stifle or put
it to naught.

In the 1966 case of Pacis
vs. Averia,^[18] this
Court, speaking through Mr. Justice J.P.
Bengzon, held that:

“The Tariff and Customs Code, in Section 2530 thereof, lists
the kinds of property subject to forfeiture. At the same time, in Part
2 of Title VI thereof, it provides for the procedure in seizure and forfeiture
cases and vests in the Collector of Customs the authority to hear and decide
said cases. [Section 2312, R.A. 1937]
The Collector’s decision is appealable to the Commissioner of Customs [Section
2313, R.A. 1937] whose decision is in
turn appealable to the Court of Tax Appeals. [Section 2402, R.A. 1937; Sections 7 and 11, R.A. 1125]. An aggrieved party may appeal from a
judgment of the Court of Tax Appeals directly to this Court [Section 18, R.A.
1125; Rule 44, Rules of Court]. On the
other hand, Section 44(c) of the Judiciary Act of 1948 [As amended by R.A.
3828] lodges in the Court of First Instance original jurisdiction in all cases
in which the value of the property in controversy amounts to more than ten
thousand pesos. This original
jurisdiction of the Court of First Instance, when exercised in an action for
recovery of personal property which is a subject of a forfeiture proceeding in
the Bureau of Customs, tends to encroach upon, and to render futile, the
jurisdiction of the Collector of Customs in seizure and forfeiture
proceedings. This is precisely what
took place in this case. The seizure
and forfeiture proceedings against the M/B ‘Bukang Liwayway’ before the
Collector of Customs of Manila, was stifled by the issuance of a writ of
replevin by the Court of First Instance of Cavite.

Should Section 44(c) of the Judiciary Act of 1948 give way to the
provisions of the Tariff and Customs Code, or vice versa? In Our opinion,
in this particular case, the Court of First Instance should yield to the jurisdiction of the Collector of
Customs. The jurisdiction of the
Collector of Customs is provided for in Republic Act 1937 which took effect on
July 1, 1957, much later than the Judiciary Act of 1948. It is axiomatic that a later law prevails
over a prior statute [Herman v. Radio Corporation of the Philippines, 50 Phil.
490; Pampanga Sugar Mills v. Trinidad, 279 U.S. 211, 73 L. ed. 665]. Moreover, on grounds of public policy, it is
more reasonable to conclude that the legislators intended to divest the Court
of First Instance of the prerogative to replevin a property which is a subject of a seizure and forfeiture
proceedings for violation of the Tariff and ‘Customs Code. Otherwise, actions for forfeiture of
property for violation of Customs laws could
easily be undermined by the simple device of replevin.

Furthermore, Section 2303 of the Tariff and Customs Code requires
the Collector of Customs to give to the owner of the property sought to be
forfeited written notice of the seizure and to give him the opportunity to be
heard in his defense. This provision
clearly indicates the intention of the law to confine in the Bureau of Customs
the determination of all questions affecting the disposal of property proceeded
against in a seizure and forfeiture case. The judicial recourse of the property owner is not in the Court of First
Instance but in the Court of Tax Appeals, and only after exhausting administrative remedies in the Bureau of
Customs.”

In De Joya vs.
Lantin,^[19]
this Court, speaking again through Mr.
Justice J.P. Bengzon, declared:

“The goods in question are imported articles entered at the
Port of Cebu. Should they be found to
have been released irregularly from Customs custody in Cebu City, they are
subject to seizure and forfeiture, the proceedings for which comes within the
jurisdiction of the Bureau of Customs pursuant to Republic Act 1937.

Said proceedings should be followed; the owner of the goods may set
up defenses therein (Pacis vs. Averia,
L-22526, Nov. 29, 1966). From the
decision of the Commissioner of Customs appeal lies to the Court of Tax
Appeals, as provided in Sec. 2402 of Republic Act 1937 and Sec. 11 of Republic
Act 1125. To permit recourse to the
Court of First Instance in cases of seizure of imported goods would in effect
render ineffective the power of the Customs authorities under the Tariff Code
and deprive the Court of Tax Appeals of one of its exclusive appellate jurisdiction. As this Court has ruled in Pacis vs. Averia, supra, Republic Acts
1937 and 1125 vest jurisdiction over seizure and forfeiture proceedings
exclusively upon the Bureau of Customs and the Court of Tax Appeals. Such law being special in nature, while the
Judiciary Act defining the jurisdiction of Courts of First Instance is a
general legislation, not to mention that the former are later enactments, the
Court of First Instance should yield to the jurisdiction of the Customs
authorities.”

This rule was subsequently reiterated in Romualdez vs. Arca,^[20]
De Joya vs. David,^[21]
Diosamito vs. Balanque,^[22] Lopez vs. Commissioner of Customs,^[23]
Ponce Enrile vs. Vinuya,^[24]
Collector of Customs vs. Torres,^[25]
Pacis vs. Geronimo^[26] and De la Fuente vs. De
Veyra.^[27]

The language of the foregoing rule is simple, clear and leaves no doubt as to the Regional
Trial Court’s lack of jurisdiction
over the res which has already been made the
subject of seizure and forfeiture proceedings. Frankly, this Court is unable
to understand why the respondent Judge misread the same; perhaps, he simply
chose to ignore it. At any rate, such behavior is highly
condemnable.

A warrant of seizure and detention having already been issued,
presumably in the regular course of official duty,^[28]
the Regional Trial Court of Pampanga was indisputably precluded
from interfering in the said proceedings. That in his complaint in
Civil Case No. 8109 private respondent alleges
ownership over several vehicles which
are legally registered in his name,
having paid all the taxes and corresponding licenses incident thereto, neither
divests the Collector of Customs of such jurisdiction nor confers upon the said
trial court regular jurisdiction over the case. Ownership of goods or the legality of its acquisition can be raised as defenses in a seizure
proceeding;^[29]
if this were not so, the procedure carefully delineated by law for seizure and
forfeiture cases may easily be thwarted and set to naught^[30]
by scheming parties. Even the
illegality of the warrant of seizure and detention cannot justify
the trial court’s interference with the
Collector’s jurisdiction. In the
first place, there is a distinction between the existence of
the Collector’s power to issue it and the regularity of the proceeding taken under such power. In the second place, even if there be such
an irregularity in the latter, the Regional Trial Court does not have the
competence to review, modify or reverse whatever conclusions may result
therefrom. In Ponce Enrile vs. Vinuya,^[31] this Court had the occasion to state:

“2. Respondents, however, notwithstanding the
compelling force of the above doctrines, would assert that respondent Judge
could entertain the replevin suit as the seizure is illegal, allegedly because
the warrant issued is invalid and the seizing officer likewise was devoid of
authority. This is to lose sight of the
distinction, as earlier made mention of, between the existence of the power and
the regularity of the proceeding taken under it. The governmental agency concerned, the Bureau of Customs, is
vested with exclusive authority. Even
if it be assumed that in the exercise of such exclusive competence a taint of illegality may be correctly
imputed, the most that can be said is that under certain circumstances the
grave abuse of discretion conferred may oust it of such jurisdiction. It does not mean however that
correspondingly a court of first instance is vested with competence when
clearly in the light of the above decisions the law has not seen fit to do
so. The proceeding before the Collector
of Customs is not final. An appeal lies
to the Commissioner of Customs and thereafter to the Court of Tax Appeals. It may even reach this Court through the appropriate
petition for review. The proper
ventilation of the legal issues raised is thus indicated. Certainly a court of first instance is not
therein included. It is devoid of
jurisdiction.”

WHEREFORE, the
Resolution of respondent Judge of 26 February 1988 in Civil Case No.
8109 before Branch 48 of the Regional Trial Court of Pampanga, and all proceedings had therein, are NULLIFIED
and SET ASIDE and the said case is
hereby ordered DISMISSED.

The temporary restraining order issued by this Court on 18 April
1988 is hereby made permanent.

SO ORDERED.

Bidin and Romero, JJ., concur.

Gutierrez, Jr., J., (Chairman), on
official leave.

Melo, J., no part.

^[1]
Rollo, 72.

^[2]
Id., 81-103; 111-125.

^[3]
Id., 188-204.

^[4]
Id., 211-215.

^[5]
Id., 218.

^[6]
Annex “A” of petition; Id., 40.

^[7]
Annex “B” of Petition; Rollo, 41.

^[8]
Annex “C” and “C-1”, Id.; Id., 42-43.

^[9]
Annex “D” of Petition; Rollo, 44.

^[10]
Annex “E”‘ of Petition; Rollo, 45.

^[11]
Annex “F”, Id.; Id., 46.

^[12]
Annex “G”, Id.; Id., 48-52.

^[13]
Annex “I” of Petition; Rollo,
55-58.

^[14]
Annex “J”, Id.; Id.,
59-62.

^[15]
Annex “K” of Petition; Rollo,
63.

^[16]
Annex “L”, Id.; Id.,
64-67.

^[17]
Annex “M” of Petition; Rollo,
68-71.

^[18]
18 SCRA 907, 916-917
[1966].

^[19]
19 SCRA 894, 897 [1967].

^[20]
21 SCRA 856 [1967].

^[21]
21 SCRA 1493 [1967].

^[22]
28 SCRA 836 [1969].

^[23]
37 SCRA 327 [1971].

^[24]
37 SCRA 381 [1971].

^[25]
45 SCRA 272 [1972].

^[26]
56 SCRA 583 [1974].

^[27]
120 SCRA 451 [1983].

^[28]
Section 3 (m), Rule 131, Rules of Court.

^[29]
De la Fuente vs. De Veyra, supra.

^[30]
Pacis vs. Geronimo, supra.

^[31]
Supra., at page 388-389.