By Rey Panaligan
The Court of Appeals (CA) has allowed the Sugar Regulatory Administration (SRA) to present before the trial court its justification for its order allocating five percent of the country’ sugar production to the United States’ market and 95 percent to the local market for crop-year 2018-2019.
In a decision written by Associate Justice Ramon R. Garcia, the CA reversed the ruling of the Makati City regional trial court (RTC) which allowed two of the country’s top sugar producers to present their evidence assailing the order to the exclusion of the SRA.
Under the law, the SRA is authorized to regulate the supply and stabilize the prices of sugar in the country.
The agency is given the power to classify sugar as “A” for US quota, “B” for domestic market, “C” for reserved, “D” for world market, “E” for world market sugar for food processors, and “F” for world market sugar for ethanol.
On Aug. 28, 2018, petitioner SRA issued Sugar Order No. 17 which allocated five per cent of the sugar production for crop year 2018-2019 for “A” classification and 95 per cent of “B” classification.
The SRA said the order was issued to promote the effective merchandising of sugar and its products in the domestic and US markets.
On Sept. 19, 2018, Central Azucarera de Bais and Central Azucarera de San Antonio, Inc. challenged before the Makati City RTC the order issued by SRA.
The two companies claimed that they stand to suffer direct injury with the implementation of the order since their proprietary rights as producers to gain full price of “D” class sugar would be diminished since “A” class sugar is significantly cheaper.
They also said that there is shortage of sugar in the domestic market and allocating five percent of the production for export to the US will only aggravate the situation and would result in higher prices of sugar for the local consumers.
SRA sought the dismissal of the case. It told the trial court that the two companies have no basis to question the order and that the court has no jurisdiction over questions dealing with the propriety of an executive issuance.
During the pre-trial of the case, SRA’s lawyer, Guillermo Tejada III, appeared before the court but failed to present a written authority from the SRA’s board of directors to represent the sugar agency.
The representative from the Office of the Government Corporate Counsel (OGCC) was neither present during the first call of the case by the court and requested a second call to present and submit SRA’s pre-trial brief which had earlier been sent through the mail.
On April 22, 2019, RTC Judge Augusto Jose Y. Arreza issued an order allowing the two sugar companies to present their evidence starting May 20, 2019 with the failure of the SRA counsel to appear.
In seeking a reconsideration of the trial court’s order, the SRA said the OGCC lawyer was already in the court premises when the case was called by the judge for hearing and was just waiting in line for the elevator.
When the motion for reconsideration was denied, SRA elevated the issue before the CA.
Reversing the trial court’s order, the CA said: “In the case at bench, we find that the merits of the case and the existence of a special compelling circumstance that would warrant a liberal construction of the rules on pre-trial.”
“A perusal of the petition for declaratory relief filed by the private respondents before the court a quo shows that they are seeking to nullify Sugar Order No. 1 Series of 2018-2019, which appears to be an administrative and executive issuance. The issues would then necessarily involve matters of national importance and interest. The interest of justice will be better served by the continuation of the proceedings and final disposition of the case on the merits before the trial court,” the CA stressed.
It pointed out that the SRA exerted efforts to comply with the pre-trial rules and that there was no showing that there were efforts to delay the proceedings.
“Accordingly, the Regional Trial Court of Makati City Branch 133 is ordered to conduct further proceedings and trial on the merits with the participation of petitioner Sugar Regulatory Administration (SRA) and to allow it to controvert herein private respondents’ motion for production and inspection of documents,” the CA ruled.
The decision was concurred in by Associate Justices Victoria Isabel A. Paredes and Tita Marilyn B. Payoyo Villordon.