G.R. No. L-27549 September 30, 1969.
HON. JUAN PONCE ENRILE, as Commissioner of Customs; JUANITO A. AGBAYANI, as Collector of Customs of the Port of Cebu; and JOSE SYBICO, as Customs Arrastre Supervisor of the Port of Cebu, petitioners, vs. HON. COURT OF APPEALS, HON. JOSE MENDOZA, as presiding judge of Branch VI of the Court of First Instance of Cebu, and CEBU PORT TERMINAL INC., respondents.

FACTS

On October 19, 1966, the Commissioner of Customs, acting under Section 1213 of the Tariff and Customs Code, entered into a Management Contract with Cebu Port Terminal, Inc. (CPTI), designating CPTI as the sole manager of the arrastre service at the port of Cebu for five years. The Bureau of Customs later called CPTI’s attention to numerous violations of the contract, including failure to provide necessary pier facilities and non-submission of required monthly reports, and demanded compliance. On February 10, 1967, the Commissioner of Customs formally notified CPTI that the Bureau was taking over the arrastre operations pursuant to paragraph 32 of the contract, which allowed for revocation and take-over upon violation if not corrected within one week after notice. Customs Administrative Order No. 1-67 was issued directing the take-over. CPTI filed a complaint in the Court of First Instance of Cebu (Civil Case No. 9846) against the petitioners, alleging the termination was without due process and unlawful, and sought preliminary and final injunction, damages, and attorney’s fees. The trial court issued a writ of preliminary injunction. Petitioners moved to dismiss, arguing lack of jurisdiction (claiming it pertained to the Court of Tax Appeals), that the injunction could not be enforced outside the court’s territorial jurisdiction, that the suit was against the State, and that the complaint stated no cause of action. The trial court maintained the injunction. Petitioners then filed a petition for prohibition and certiorari with the Court of Appeals, which initially issued a restraining order but later dismissed the petition and dissolved its injunction. The case was elevated to the Supreme Court on certiorari.

ISSUE

1. Whether the Court of First Instance had jurisdiction over the subject matter of the case, or whether exclusive appellate jurisdiction belonged to the Court of Tax Appeals under Section 7 of Republic Act 1125.
2. Whether the writ of preliminary injunction issued by the trial court was proper.

RULING

1. The Court of First Instance had jurisdiction. The Supreme Court held that the case did not fall under the exclusive appellate jurisdiction of the Court of Tax Appeals. The controversy arose from an alleged violation of a management contract for arrastre services, not from matters involving customs duties, fees, seizures, fines, or forfeitures under the Customs Law. Applying the rule of ejusdem generis, the “other matters” under the Court of Tax Appeals’ jurisdiction must be of the same kind as those specifically enumerated, which the contract dispute was not.
2. The issuance of the writ of preliminary injunction by the trial court was improper and constituted grave abuse of discretion. The Supreme Court found that the take-over by the Commissioner was justified under paragraph 32 of the contract due to CPTI’s violations and failure to rectify them. More importantly, the Court emphasized the paramount public interest in the efficient operation of arrastre services at the port of Cebu and the government’s revenue share from such services. This public interest was in serious jeopardy due to CPTI’s inefficiency. Pending a satisfactory showing by CPTI to the contrary, enjoining the government’s take-over was improvident.
The Supreme Court reversed the decision of the Court of Appeals, set aside the writ of preliminary injunction issued by the trial court, and remanded the case for continuation of proceedings. Costs were imposed on CPTI.