Transpo Batch2

8/13/2019 Transpo Batch2

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TRANSPORTATION | B2015CASE DIGESTS

NEBBIA v. NEW YORKMarch 5, 1934

Roberts, J.Ron

SUMMARY: Nebbia is assailing the New Y!" law whi#hestablishe$ a %il" Cnt!l Ba!$ that #an &i' the (ini()(an$ (a'i()( !etail *!i#e & (il"+ ,e base$ his a!g)(entn the e-)al *!te#tin an$ $)e *!#ess #la)se+ ,e sa.sthat nl. *)bli# )tilities #an be !eg)late$ an$ the (il"in$)st!. is nt a *)bli# )tilit.+ The #)!t ag!ee$ that the(il" in$)st!. is nt a *)bli# )tilit. b)t s)staine$ the/ali$it. & the !eg)latin n the! g!)n$s+

DOCTRINE:o B)sinesses a&&e#te$ with a *)bli# inte!est that a

b)siness s a&&e#te$ is ne in whi#h *!*e!t. is$e/te$ t an ente!*!ise & a s!t whi#h the *)bli#itsel& (ight a**!*!iatel. )n$e!ta"e ! ne whsewne! !elies n a *)bli# g!ant ! &!an#hise &! the !ightt #n$)#t the b)siness ! in whi#h he is b)n$ tse!/e all wh a**l. in sh!t s)#h as is #((nl.#alle$ a *)bli# )tilit. ! a b)siness in its nat)!e a(n*l.+

o The (il" in$)st!. it is sai$ *ssesses nne & these#ha!a#te!isti#s an$ the!e&!e nt being a&&e#te$ witha *)bli# inte!est its #ha!ges (a. nt be #nt!lle$ b.the state+

The #)!t a$(its that the $ai!. in$)st!. is nt in thea##e*te$ sense & the *h!ase a *)bli# )tilit. &! the&llwing !easns

o The!e is n s)ggestin & an. (n*l. !(n*listi# *!a#ti#e+

o Thse engage$ in the b)siness a!e in n wa.$e*en$ent )*n *)bli# g!ants ! &!an#hises &! the*!i/ilege & #n$)#ting thei! a#ti/ities+

FACTS:

1+ The 3egislat)!e & New Y!" establishe$ b. Cha*te! 154& the 3aws & 166 a %il" Cnt!l Ba!$ with *we!a(ng the! things t 7&i' (ini()( an$ (a'i()( + + +!etail *!i#es t be #ha!ge$ b. + + + st!es t #ns)(e!s&! #ns)(*tin && the *!e(ises whe!e sl$+7

2+ The Ba!$ &i'e$ nine #ents as the (ini()( *!i#e t be#ha!ge$ b. a st!e &! a -)a!t & (il"+6+ Nebbia the *!*!iet! & a g!#e!. st!e in R#heste!

sl$ tw -)a!ts an$ a &i/e #ent la& & b!ea$ &! eighteen#ents 89+5 #ents *e! -)a!t: an$ was #n/i#te$ &!/ilating the Ba!$;s !$e!+

hethe! the =e$e!al Cnstit)tin *!hibits a state&!( s &i'ing the selling *!i#e & (il"+RULING: N+ The stat)te $i$ nt /ilate the E-)alP!te#tin Cla)se an$ D)e P!#ess Cla)se when it &i'e$ the(ini()( an$ (a'i()( selling *!i#e & (il"+ The state is?)sti&ie$ in !eg)lating the *!i#e & (il"+

RATIO:On the *)bli# )tilit. a!g)(ent in !elatin t $)e *!#essa!g)(ent Nebbia a!g)es that the *)bli# #nt!l & !ates ! *!i#es is

*e! se )n!easnable an$ )n#nstit)tinal sa/e asa**lie$ t b)sinesses a&&e#te$ with a *)bli# inte!esto That a b)siness s a&&e#te$ is ne in whi#h *!*e!t.

is $e/te$ t an ente!*!ise & a s!t whi#h the *)bli#itsel& (ight a**!*!iatel. )n$e!ta"e ! ne whsewne! !elies n a *)bli# g!ant ! &!an#hise &! the!ight t #n$)#t the b)siness ! in whi#h he is b)n$t se!/e all wh a**l. in sh!t s)#h as is #((nl.#alle$ a *)bli# )tilit. ! a b)siness in its nat)!e a(n*l.+


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o The (il" in$)st!. it is sai$ *ssesses nne & these#ha!a#te!isti#s an$ the!e&!e nt being a&&e#te$with a *)bli# inte!est its #ha!ges (a. nt be#nt!lle$ b. the state+

The #)!t a$(its that the $ai!. in$)st!. is nt in the

a##e*te$ sense & the *h!ase a *)bli# )tilit. &! the&llwing !easnso The!e is n s)ggestin & an. (n*l. !

(n*listi# *!a#ti#e+o Thse engage$ in the b)siness a!e in n wa.

$e*en$ent )*n *)bli# g!ants ! &!an#hises &! the*!i/ilege & #n$)#ting thei! a#ti/ities+

B)t the #)!t still )*hel$ the !eg)latin base$ n the!g!)n$s an$ #(*a!e$ it t the %)nn #ase+

In the %)nn #ase %)nn an$ S#tt hel$ n &!an#hise &!(the state+ The. wne$ the *!*e!t. )*n whi#h thei!ele/at! was sit)ate$ an$ #n$)#te$ thei! b)siness as*!i/ate #iti@ens+ N $)bt the. &elt at libe!t. t $eal withwh( the. *lease$ an$ n s)#h te!(s as the. (ight$ee( ?)st t the(sel/es+ Thei! ente!*!ise #)l$ nt&ai!l. be #alle$ a (n*l. alth)gh it was !e&e!!e$ tin the $e#isin as a 7/i!t)al (n*l.+7 B)t still the. #anbe !eg)late$ be#a)se the. a!e a&&e#te$ with *)bli#inte!est+

It is #lea! that the!e is n #lse$ #lass ! #ateg!. &b)sinesses a&&e#te$ with a *)bli# inte!est an$ the&)n#tin & #)!ts in the a**li#atin & the =i&th an$=)!teenth A(en$(ents is t $ete!(ine in ea#h #ase

whethe! #i!#)(stan#es /in$i#ate the #hallenge$!eg)latin as a !easnable e'e!tin & g/e!n(entala)th!it. ! #n$e(n it as a!bit!a!. ! $is#!i(inat!.+

The!e #an be n $)bt that )*n *!*e! ##asin an$ b.a**!*!iate (eas)!es the state (a. !eg)late a b)sinessin an. & its as*e#ts in#l)$ing the *!i#es t be #ha!ge$&! the *!$)#ts ! #(($ities it sells+

On the e-)al *!te#tin #la)se a!g)(ent Nebbia a!g)es that the !$e! & the %il" Cnt!l Ba!$

$enies hi( the e-)al *!te#tin & the laws+ It is shwn

that the !$e! !e-)i!es hi( i& he *)!#hases his s)**l.&!( a $eale! t *a. eight #ents *e! -)a!t an$ &i/e#ents *e! *int an$ t !esell at nt less than nine an$ si'whe!eas the sa(e $eale! (a. b). his s)**l. &!( a&a!(e! at lwe! *!i#es an$ $eli/e! (il" t #ns)(e!s at

ten #ents the -)a!t an$ si' #ents the *int+ 8The law allw$ist!ib)t!s t sell the (il" 10 #ents *e! -)a!t while!etaile!s a!e nl. allwe$ t sell the (il" #ents *e!-)a!t:

The #)!t thin"s that the #ntentin that the$is#!i(inatin $e*!i/es the a**ellant & e-)al *!te#tinis nt well &)n$e$+o The a**ellant *)!#hase$ his s)**l. & (il" &!( a

&a!(e! as $ $ist!ib)t!s ! #)l$ ha/e *!#)!e$ it&!( a &a!(e! i& he s $esi!e$+

o The!e is the!e&!e n shwing that the !$e! *la#e$hi( at a $isa$/antage ! in &a#t a&&e#te$ hi(

a$/e!sel. an$ this alne is &atal t the #lai( &$enial & e-)al *!te#tin+

o B)t i& it we!e shwn that the a**ellant is #(*elle$t b). &!( a $ist!ib)t! the $i&&e!en#e in the !etail*!i#e he is !e-)i!e$ t #ha!ge his #)st(e!s &!(that *!es#!ibe$ &! sales b. $ist!ib)t!s is not on itsface arbitrary or unreasonable, for there are obviousdistinctions between the two sorts of merchantswhich may well justify a difference of treatment, ifthe leislature !ossesses the !ower to control the!rices to be chared for fluid mil".

On the $)e *!#ess #la)se a!g)(ent As #an be seen &!( /a!i)s state legislatins the (il"

in$)st!. has been *!g!essi/el. s)b?e#te$ t a la!ge!(eas)!e & #nt!l+

The (il" in$)st!. in New Y!" has been the s)b?e#t &lngstan$ing an$ $!asti# !eg)latin in the *)bli#inte!est+ The legislati/e in/estigatin & 162 was*e!s)asi/e & the &a#t that &! this an$ the! !easns)n!est!i#te$ #(*etitin agg!a/ate$ e'isting e/ils an$


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the n!(al law & s)**l. an$ $e(an$ was ins)&&i#ient t#!!e#t (ala$?)st(ents $et!i(ental t the #(()nit.+

The in-)i!. $is#lse$ $est!)#ti/e an$ $e(!ali@ing#(*etiti/e #n$itins an$ )n&ai! t!a$e *!a#ti#es whi#h!es)lte$ in !etail *!i#e#)tting an$ !e$)#e$ the in#(e &

the &a!(e! belw the #st & *!$)#tin+ That b$. belie/e$ #n$itins #)l$ be i(*!/e$ b.

*!e/enting $est!)#ti/e *!i#e#)tting b. st!es whi#h $)et the &l$ & s)!*l)s (il" we!e able t b). at ()#hlwe! *!i#es than the la!ge! $ist!ib)t!s an$ t sellwith)t in#)!!ing the $eli/e!. #sts & the latte!+

The gene!al !)le is that the )se & *!*e!t. an$ the(a"ing & #nt!a#ts shall be &!ee & g/e!n(entalinte!&e!en#e+ B)t neithe! *!*e!t. !ights n! #nt!a#t!ights a!e absl)te &! g/e!n(ent #annt e'ist i& the#iti@en (a. at will )se his *!*e!t. t the $et!i(ent &his &ellws ! e'e!#ise his &!ee$( & #nt!a#t t w!"

the( ha!(+ S &a! as the !e-)i!e(ent & $)e *!#ess is #n#e!ne$

an$ in the absen#e & the! #nstit)tinal !est!i#tin astate is &!ee t a$*t whate/e! e#n(i# *li#. (a.!easnabl. be $ee(e$ t *!(te *)bli# wel&a!e an$ ten&!#e that *li#. b. legislatin a$a*te$ t its *)!*se+

DISPOSITIVE:)$g(ent is a&&i!(e$+


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5/11


NAIA IPT III *!?e#t t Pai!#a!g Cns!ti)( whi#hlate! !gani@e$ int PIATCO 8Phili**ine Inte!natinalAi! Te!(inals C+ In#+:

5+ The G/e!n(ent th!)gh the DOTC Se#!eta!.8A!t)! En!ile: an$ PIATCO th!)gh its P!esi$ent

8,en!. G: signe$ the Cn#essin Ag!ee(ent &!the BOT A!!ange(ent & the NAIA III 81FCn#essin Ag!ee(ent:+

9+ The 1F Ag!ee(ent was s)*e!se$e$ b. theA(en$e$ an$ Restate$ Cn#essin Ag!ee(ent8ARCA: #ntaining !e/isins an$ ($i&i#atins+ Alsa se!ies & s)**le(ental ag!ee(ents 8Th!ees)**le(ents: was ente!e$ int b. the g/e!n(entan$ PIATCO+

F+ Se/e!al *etitins we!e &ile$ be&!e the SC t $e#la!ethe PIATCO #nt!a#ts 81F Cn#essin Ag!ee(entARCA an$ the S)**le(ents: n)ll an$ /i$+ The SC

!)le$ in &a/! & thse wh &ile$ the sai$ *etitinsan$ ann)lle$ the PIATCO #nt!a#ts+4+ In the *!esent #ase PIATCO an$ the! !es*n$ent

Cng!ess(en an$ !es*n$entinte!/en!s see" the!e/e!sal & the SC $e#isin n)lli&.ing the PIATCO#nt!a#ts+ In the alte!nati/e PIATCO *!a.s that theC)!t sh)l$ nt st!i"e $wn the enti!e 1FCn#essin Ag!ee(ent the ARCA an$ itss)**le(ents be#a)se & the se*a!abilit. #la)se+PIATCO als *!a.s that the #ases at ba! be !e&e!!e$t a!bit!atin *)!s)ant t the *!/isins & ARCA+

ISSUES RULING:%R+-&R/0

1+ Des the S)*!e(e C)!t ha/e ?)!is$i#tin t hea!an$ $e#i$e the *!esent #ase n its (e!its YES

2+ D the *etitine!s 8thse wh &ile$ the *etitin tn)lli&. the PIATCO #nt!a#ts: ha/e legal stan$ing YES

6+ Di$ the *etitine!s &ail t i(*lea$ an in$is*ensable*a!t. NO

2/6-

1+ Di$ PIATCO *ass the stan$a!$s the PBAC sh)l$a**l. t $ete!(ine the &inan#ial #a*abilit. & a bi$$e!8&! *!e-)ali&i#atin *)!*ses: NO

2+ >e!e the!e s)bstantial a(en$(ents t the 1FCn#essin ag!ee(ent 8I& the!e we!e the a(en$e$

#nt!a#t ()st be $e#la!e$ n)ll an$ /i$: YES6+ Di$ the PIATCO Cnt!a#ts #ntain $i!e#t g/e!n(entg)a!antee *!/isins 8whi#h a!e #nt!a!. t BOTlaw: YES

!. "#$%&' D()* &+) S&a&), #n $)* ( na(na-)$)rg)n/, +av) &+) r#g+& &( &)$%(rar#-/ &a0)(v)r &+) (%)ra(n ( an/ 12*#n)** a)&)34#&+ %21-# #n&)r)*&5 6 YES

5+ Sh)l$ the *e!atin b. PIATCO & NAIA III be!eg)late$ YES

RATIO:

%R+-&R/01+ PIATCO a!g)es that the #ase at ba! !aises &a#t)al-)estins an$ ()st be t!ie$ be&!e the t!ial #)!t+The S)*!e(e C)!t was nt *e!s)a$e$+ The #ases atba! !e-)i!e the inte!*!etatin an$ a**li#atin & theCnstit)tin the BOT 3aw its IRR an$ the! legal*!in#i*les n the basis & clearly undis!uted facts+Sin#e the *e!ati/e &a#ts we!e settle$ al!ea$. the!eis n nee$ &! t!ial t.*e $ete!(inatin & thei! &alsit.! t!)th+ =)!the!(!e as this #ase #n#e!ns *)bli#inte!est the SC (a. ta"e *!i(a!. ?)!is$i#tin /e! it+The C)!t is tas"e$ t settle #nt!/e!s. with a high

*)bli# inte!est #(*nent in a single *!#ee$ing an$a/i$ &)t)!e litigatin+

2+ PIATCO a!g)es that the *etitine!s ha/e n legalstan$ing be#a)se the. a!e nt *a!ties t the#nt!a#t+ Als the. &aile$ t shw an. legall.$e(an$able !ight t ?)sti&. thei! stan$ing+ TheS)*!e(e C)!t $isag!ees with PIATCO+ The*etitine!s a!e e(*l.ees & se!/i#e *!/i$e!s*e!ating at e'isting inte!natinal ai!*!ts an$e(*l.ees & %IAA while *etitine!sinte!/en!s a!ese!/i#e *!/i$e!s with e'isting #nt!a#ts with %IAA


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wh will s)stain $i!e#t in?)!. )*n thei(*le(entatin & PIATCO Cnt!a#ts+ 8Nte J*n the#((en#e(ent & *e!atins at NAIA IPT III NAIA Ian$ II will #ease t be )se$ as inte!natinal*assenge! te!(inals+: The *etitine!s w)l$ be

$e*!i/e$ & thei! s)!#es & li/elih$ while theinte!/en!s w)l$ lse legiti(ate b)sinessin/est(ents+ The SC als libe!all. g!ante$ legalstan$ing t the (e(be!s & ,R &! th!ee !easns Ka: at sta"e is the BOT #nt!a#t & the *!e(ie!inte!natinal ai!*!t b: the h)ge a()nt &in/est(ent t #(*lete the *!?e#t whi#h is 16billin #: inte!*!etatin & the Cnstit)tin BOT 3awan$ its IRR+

6+ PIATCO a!g)es that *etitine!s sh)l$ ha/ei(*lea$e$ the Re*)bli# & the Phili**ines+ It allege$that *etitine!s s)e$ DOTC %IAA an$ the DP>, as

i(*le(ent!s & the PIATCO #nt!a#ts an$ nt as!e*!esentati/es & the G/e!n(ent+ The SC sai$ thatPIATCOs allegatins we!e ina##)!ate+ DOTC an$%IAA we!e i(*lea$e$ as *a!ties t the PIATCO#nt!a#ts an$ nt (e!el. as thei! i(*le(ent!s+DOTC an$ %IAA we!e i(*lea$e$ &! ha/ing e'e#)te$the #nt!a#ts+ Als the SC sai$ that it was t late&! PIATCO t b!ing this iss)e+ It sh)l$ ha/e !aise$the iss)e ea!lie! as a g!)n$ t $is(iss+

2/6-1+ PBAC Stan$a!$ a: *!& & the abilit. & the *!?e#t

*!*nent an$H ! #ns!ti)( t *!/i$e a (ini()(a()nt & e-)it. t the *!?e#t 8the (ini()(a()nt & e-)it. t whi#h the *!*nents &inan#ial#a*abilit. will be base$ shall be 60L & the *!?e#t#st: AND b: lette! testi(nial &!( ban"s attestingthat the *!?e#t *!*nent an$H ! #ns!ti)( a!eban"ing with the( in g$ &inan#ial stan$ing an$ha/e a$e-)ate !es)!#es+ At the ti(e & *!e-)ali&i#atin PIATCOs (a'i()( &)n$s a/ailable &!in/est(ent a()nt t nl. 9+04L 8554 64


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NAIA I+ The ag!ee(ent $i$ nt #ntain an e-)i/alent*!/isin allwing %IAA t !ese!/e the !ight t!eg)late the a$?)st(ents & these new &ees an$#ha!ges+ I& in$ee$ the!e we!e n #hange in the *we!t !eg)late n the *a!t & %IAA the!e w)l$ ha/e

been n nee$ &! an a(en$(ent+

ubstantial chane #.#. '/ssum!tion by the8overnment of the

liabilities of %/+ in the event of latters default*In #ase & PIATCOs $e&a)lt the g/e!n(ent will

ass)(ePIATCOs Atten$ant 3iabilities as $e&ine$ in the 1FAg!ee(ent+ This bligatin is nt *!esent in the $!a&tCn#essin Ag!ee(ent an$ the sai$ bligatin ges

against theBOT 3aw whi#h was #!a&te$ t *!e/ent g/e!n(ent

&!( in#)!!ing &inan#ial !is"+

As !ega!$s PIATCOs se*a!abilit. #la)se a!g)(ent8that the

whle #nt!a#t sh)l$ nt be n)lli&ie$: the S)*!e(eC)!t sai$

that the #nt!a#ts (a$e a (#"e!. & the bi$$ing*!#ess+

Cnse-)entl. the. sh)l$ be ann)lle$ &! /ilatinglaw an$

*)bli# *li#.+

6+ The s#he(e in the PIATCO #tn!a#ts is a &!( &$i!e#t g/e!n(ent g)a!antee &! it lea/es theg/e!n(ent n *tin b)t t *a. the atten$antliabilities in the e/ent that the Seni! 3en$e!s &PIATCO a!e )nwilling ! )nable t a**int a -)ali&ie$t!ans&e!ee as a !es)lt & PIATCOs $e&a)lt in the*a.(ent & Seni! 3en$e!s+ These liabilities in#l)$ea()nts with)t li(itatin all *!in#i*al inte!estass#iate$ &ees #ha!ges !ei(b)!se(ents an$ the!!elate$ e'*enses+ The #)nte!*a!t *!/isin in the

1F Ag!ee(ent is als ne!)s t the G/e!n(entas thse #ntaine$ in the ARCA+ A##!$ing t the1F Ag!ee(ent in the e/ent the G/e!ne(nt is&!#e$ *!e(at)!el. t ta"e /e! NAIA IPT III as a!es)lt & PIATCOs $e&a)lt in the *a.(ent & tis lan

bligatins it w)l$ be liable t *a. atten$antliabilities+ ,we/e! INDIRECT g/e!n(ent g)a!anteeis allwe$ )n$e! the BOT 3aw+ The i$ea is t &!g/e!n(ent )n$e!ta"ings s)#h as t a)th!i@e the*!?e#t *!*nent t )n$e!ta"e !elate$ /ent)!eswithin the *!?e#t a!ea in !$e! t en#)!age *!i/atese#t! *a!ti#i*atin in the $e/el*(ent *!?e#ts+


8/11


&&ensi/e t the Cnstit)tin+ ,en#ePIATCO *+(2-3n(& 1) ($%)n*a&)3 (r &+) G(v)rn$)n&7*&)$%(rar/ &a0)(v)r ( NAIA IPT III.

PIATCO;s !elian#e n the #ase & (eirs of uuitan v.

ity of Mandaluyonis e!!ne)s+ S)#h #ase in/l/esthe state;s e'e!#ise & its *we! & e(inent $(ainan$ nt & *li#e *we! hen#e ?)st #(*ensatinwas awa!$e$+

5+ The g!ant t PIATCO & the e'#l)si/e !ight t *e!ateNAIA III sh)l$ nt e'e(*t it &!( !eg)latin b. theg/e!n(ent+ This sh)l$ be $ne (. (a"ing s)!ethat PIATCO $es nt /ilate the legal !ights & thi!$*a!ties+

DISPOSITIVE: >,ERE=ORE the (tins &!

!e#nsi$e!atin &ile$ b. the !es*n$ents PIATCO!es*n$ent Cng!ess(en an$ the !es*n$entsininte!/entins a!e DENIED with &inalit.+

KUWAIT AIRWAYS v. PALMay :, #$$9

ina, J&e 0eon

SUMMARY: PA3 was a g/e!n(entwne$ an$ #nt!lle$#!*!atin when it ente!e$ int a C((e!#ial Ag!ee(ent

)wait Ai!wa.s with !es*e#t t %anila)wait !)tes+Instea$ & &&e!ing #(*eting &lights the. ag!ee$ that nl.)wait Ai!wa.s w)l$ &&e! this !)te )sing its wn *laneb)t it will sha!e its !e/en)es with PA3+ Ele/en .ea!s a&te!PA3 was *!i/ati@e$+ Th!ee .ea!s &!( its *!i/ati@atin theg/e!n(ent & the Phili**ines an$ the g/e!n(ent &)wait ente!e$ int a Cn&i$ential %e(!an$)( &Jn$e!stan$ing 8C%J: *!/i$ing a(ng the!s that *!i/atea!!ange(ents with !es*e#t t %anila)wait !)tes will ntbe s)b?e#t t !.alt. *a.(ents an.(!e+ In e&&e#t thisag!ee(ent w)l$ !en$e! the !e/en)e sha!ing s#he(e &

PA3 an$ )wait Ai!wa.s in/ali$+ A&te! the signing & theC%J )wait Ai!wa.s nti&ie$ PA3 its intentin t te!(inatethe !e/en)e sha!ing s#he(e )n$e! its C((e!#ialAg!ee(ent *)!s)ant t the C%J+ PA3 !e&)se$ an$ insiste$that )wait Ai!wa.s *a. its bligatins+ )wait Ai!wa.s

!e&)se$ t *a. PA3 *!(*ting PA3 t &ile an a#tin &!#lle#tin+

The SC hel$ that )wait Ai!wa.s is liable t PA3 be#a)sethe ag!ee(ent between the g/e!n(ents 8inten$ing ts)*e!se$e the *!i/ate ag!ee(ent between the tw ai!lines:#annt bin$ PA3 with)t $)e *!#ess+

DOCTRINE:T*i#P!i/ati@atin & StateO*e!ate$ P)bli#Jtilities'not e;!licitly stated*An ag!ee(ent between the Phili**ine g/e!n(ent an$ a

&!eign state a&&e#ting *!*e!t. !ights & a g/e!n(entwne$ an$ #nt!lle$ #!*!atin 8GOCC: is /ali$+ B)t n#ethis GOCC is *!i/ati@e$ it be#(es a *!i/ate #(*an.ha/ing *!i/ate *!*e!t. !ights+ In s)#h #ase theg/e!n(ent #an n lnge! ente! int #nt!a#ts a&&e#tingthei! *!*e!t. !ights with)t $)e *!#ess & law+ I& thePhili**ine g/e!n(ent wants t ente! int inte!natinalag!ee(ents that w)l$ a&&e#t *!i/ate *!*e!t. !ights it(a. $ s nl. )*n bse!/an#e & $)e *!#ess!e-)i!e(ents+

FACTS:

In 141 )wait Ai!wa.s an$ Phili**ine Ai!lines ente!e$ inta C((e!#ial Ag!ee(ent whi#h the !)te )waitBang""%anila an$ /i#e /e!sa+ At that ti(e PA3 $i$ nt ha/e a !)tet )wait b)t )wait Ai!wa.s ha$ a !)te t %anila+ Theag!ee(ent is ente!e$ int s the. #an ?intl. *e!ate the%anila)wait R)te 8an$ /i#e /e!sa: )sing the *lanes an$se!/i#es & )wait Ai!wa.s with !e/en)esha!ing sti*)latininstea$ & the( ha/ing t &&e! #(*eting &lights+ Theag!ee(ent sti*)late$ that nl. 6!$ an$


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between %anila n the ne han$ an$ Bang"" n thethe!+ M%eaning & the la#" & 5th &!ee$( !ights The$e*laning & *assenge!s &!( %anila in Bang"" an$ theba!$ing in Bang"" & *assenge!s b)n$ &! %anila a!e*!hibite$+

The C((e!#ial Ag!ee(ent was s)bse-)entl. a(en$e$ si'ti(es between 141 an$ 1hethe! the C%J between the Phili**ine an$ )waitg/e!n(ents #)l$ ha/e a)t(ati#all. te!(inate$ the 141C((e!#ial Ag!ee(ent

RULING:1+ NO the C%J #)l$ nt ha/e te!(inate$ the C((e!#ialAg!ee(ent

RATIO:1+ The C%J #)l$ nt ha/e te!(inate$ the C((e!#ialAg!ee(ent

At the ti(e & the e'e#)tin & the 141 ag!ee(ents PA3was #nt!lle$ b. the Phili**ine g/e!n(ent with the GSIShl$ing the (a?!it. & sha!es+ ,we/e! in 12 PA3 was*!i/ati@e$+ Th)s at the ti(e & the signing & the C%J in

15 PA3 was a *!i/ate #!*!atin n lnge! #nt!lle$ b.the G/e!n(ent+ ,a$ PA3 !e(aine$ a g/e!n(ent wne$ !#nt!lle$ #!*!atin at the ti(e & signing & the C%J itsstat)s w)l$ ha/e b)n$ PA3 t the #((it(ents (a$e b.the g/e!n(ent+ ,we/e! sin#e PA3 ha$ al!ea$. be#(e a*!i/ate #!*!atin the -)estin & i(*ai!(ent & *!i/ate!ights (a. #(e int #nsi$e!atin+

A!g)(ent & )wait Ai!wa.s The thi!$ >he!eas #la)se &the 141 C((e!#ial Ag!ee(ent state$ NO> it is he!eb.ag!ee$ s)b?e#t t an$ without !rejudice to any e;istin or


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future areements That #la)se e/in#esa#"nwle$ge(ent that PA3 ha$ "nwn that its !ights w)l$be li(ite$ b. whate/e! ag!ee(ents the Phili**ine an$)wait g/e!n(ents (a. ente! int late!+

SC >hile a *!ea(ble (ani&ests the !easns &! the *assage& the stat)te an$ ai$s in the inte!*!etatin & an.a(big)ities within the stat)te it is nt an essential *a!t &an a#t an$ it $esnt enla!ge ! #n&e! *we!s+

>hen the 141 C((e!#ial Ag!ee(ent was signe$ PA3 was#nt!lle$ b. the g/e!n(ent+ In this #nte't it is e/i$entthat at the ti(e the whe!eas #a)se was in#l)$e$ thePhili**ine g/e!n(ent #)l$ ente! int ag!ee(ents withthe )wait g/e!n(ent that w)l$ s)*e!se$e theC((e!#ial Ag!ee(ent+ B)t this #hange$ n#e PA3 &ell t*!i/ate wne!shi*+

B. the ti(e wne!shi* & PA3 was t!ans&e!!e$ int *!i/atehan$s the #nt!/e!te$ >he!eas #la)se ha$ ta"en n a$i&&e!ent #(*le'in+ An a#t & the Phili**ine g/e!n(entnegating the #((e!#ial a!!ange(ent between the twai!lines w)l$ in&!inge the /este$ !ights & a *!i/atein$i/i$)al+ The !iginal intentin & the >he!eas #la)sewas t !e&le#t what was then a gi/en &a#t !elati/e t thenatinali@e$ stat)s & PA3+ >ith the #hange & wne!shi* &PA3 the >he!eas #la)se ha$ #ease$ t be !e&le#ti/e &the #)!!ent sit)atin be#a)se it nw stan$s as a see(ingin/itatin t the Phili**ine g/e!n(ent t e!$e *!i/ate

/este$ !ights+ The SC !e&)se$ t gi/e e&&e#t t the>he!eas #la)se in a (anne! that $es nt !e&le#t the!iginal intentin & the #nt!a#ting *a!ties+

In the #ha!te! & PA3 it was sai$ t be s)b?e#t t the laws& the Phili**ines nw e'isting ! he!ea&te! ena#te$+ RA N+FF9 ! the Ci/il Ae!na)ti#s A#t & the Phili**ines g!ants theCi/il Ae!na)ti#s Ba!$ 8CAB: the *we! t !eg)late thee#n(i# as*e#t & ai! t!ans*!tatin+

PA3s a)th!it. t *e!ate ai! se!/i#es $e!i/es &!( itslegislati/e &!an#hise an$ is a##!$ingl. b)n$ b. whate/e!li(itatins that a!e ! (a. be s)bse-)entl. in#!*!ate$ inits &!an#hise+ PA3 is als s)b?e#t t the the! laws & thePhili**ines in#l)$ing R+A+ N+ FF9 whi#h g!ants !eg)lat!.

*we! t the CAB+

Sin#e PA3 was al!ea$. )n$e! *!i/ate wne!shi* at the ti(ethe C%J was ente!e$ int it #annt be *!es)(e$ that all#((it(ents (a$e b. the Phili**ine g/e!n(ent a!e)nilate!all. bin$ing n the #a!!ie!+ >hile that was t!)e *!i!t PA3s *!i/ati@atin when the Phili**ine G/e!n(ent ha$the a)th!it. as wne! whate/e! a)th!it. & the Phili**ineG/e!n(ent t bin$ PA3 nw #an nl. #(e in its #a*a#it.as !eg)lat!+

As with all !eg)lat!. s)b?e#ts & the g/e!n(ent

in&!inge(ent & *!*e!t. !ights #an nl. a/ail with $)e*!#ess & law+ 3egislati/e !eg)latin & *)bli# )tilities ()stnt ha/e the e&&e#t & $e*!i/ing an wne! & his *!*e!t.with)t $)e *!#ess & law+

CAB has the *we! t #(*el PA3 t i((e$iatel. te!(inateits C((e!#ial Ag!ee(ent with )wait Ai!wa.s *)!s)ant tthe C%J+ Cnsi$e!ing that it is the Phili**ine g/e!n(entthat has the sle a)th!it. t #ha!te! ai! *li#. theg/e!n(ent th!)gh the CAB has the a)th!it. t #(*el ai!#a!!ie!s t #(*l. with g/e!n(ent *li#ies e/en at thee'*ense & e#n(i# !ights+

,we/e! this is nt a #ase whe!e CAB ha$ $)l. e'e!#ise$ its!eg)lat!. a)th!it. /e! a l#al ai!line+ >hat ha**ene$instea$ was an &&i#e! & the CAB a#ting in behal& nt & theBa!$ b)t & the Phili**ine g/e!n(ent ha$ #((itte$ t a&!eign natin the i((e$iate ab!gatin & Phili**ineAi!liness #((e!#ial ag!ee(ent with )wait Ai!wa.s+ An$while the abilit. & that (e(be! & the CAB t !e*!esent thePhili**ine g/e!n(ent in signing the C%J is nt -)estine$whethe! s)#h (e(be! #)l$ ha/e b)n$ PA3 in a (anne!


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that #an be a##!$e$ legal !e#gnitin b. )! #)!ts is-)estinable+

I(agine i& the P!esi$ent & the Phili**ines ! ne & his alte!egs a##e$e$ t the $e(an$s & a &!eign #)nte!*a!t an$

ag!ee$ t sh)t $wn a *a!ti#)la! =ili*in b)siness !ente!*!ise+ G!anting that the!e is basis in Phili**ine law &!the #ls)!e & s)#h b)siness #)l$ the (e!e $e#la!atin &the P!esi$ent ha/e the legal e&&e#t & i((e$iatel. !en$e!ingb)siness *e!atins illegal In /iew & the Bill & Rights this#annt be $ne+

The!e is nthing t *!e/ent the g/e!n(ent &!( )tili@ing allthe *!*e! #hannels )n$e! law t en&!#e s)#h #ls)!e b)t)nless $)e *!#ess is bse!/e$ it $es nt ha/e legal e&&e#tin this ?)!is$i#tin+ E/en g!anting that the ag!ee(entbetween the tw g/e!n(ents #!eates a bin$ing bligatin

)n$e! inte!natinal law it !e(ains in#)(bent &! ea#h#nt!a#ting *a!t. t a$he!e t its wn inte!nal law in the*!#ess & #(*l.ing with its bligatins+

8a3 PAL r)$a#n)3 a g(v)rn$)n&6(4n)3 (r (n&r(--)3(r%(ra(n, #& 4(2-3 +av) 1))n 1(2n3, a* %ar& ( &+))9)2v) 1ran+, &( ($%-/ 4#&+ &+) 3#&a&)* ( &+)Pr)*#3)n&. Y)& P+#-#%%#n) A#r-#n)* +a* 1)($), 1/ &+#*$), a %r#va&) (r%(ra(nK ne that (a. ha/e lab!e$)n$e! the #n$itins & its legislati/e &!an#hise that allwe$it t #n$)#t ai! se!/i#es b)t *!i/ate in #ha!a#te!nnetheless+ T+) Pr)*#3)n& (r +#* a-&)r )g(* 3( n(&

+av) &+) -)ga- a%a#&/ &( 3#&a&) #n*2%)ra1-)($$an3* &( %r#va&) %)r*(n*.

The SC $es nt see wh. the Phili**ine g/e!n(ent #)l$nt ha/e bse!/e$ $)e *!#ess & law sh)l$ it ha/e$esi!e$ t see the C((e!#ial Ag!ee(ent i((e$iatel.te!(inate$+ The CAB with its a(*le !eg)lat!. *we! /e!l#al ai!line!s #)l$ ha/e been #alle$ )*n t e'e!#ise its?)!is$i#tin t (a"e it s+ A !e(e$. e/en e'ists in #i/il lawKthe ?)$i#ial ann)l(ent ! !e&!(atin & #nt!a#tsKwhi#h#)l$ ha/e been a/aile$ & t e&&e#t the i((e$iate

te!(inatin & the C((e!#ial Ag!ee(ent+ N s)#h !e(e$.was atte(*te$ b. the g/e!n(ent+

E/en g!anting that the *li#e *we! & the State as gi/en&lesh in the /a!i)s laws g/e!ning the !eg)latin & the

ai!line in$)st!. in the Phili**ines (a. be e'e!#ise$ ti(*ai! the /este$ !ights & *!i/atel.wne$ ai!lines the$e*!i/atin & *!*e!t. still !e-)i!es $)e *!#ess & law+ In!$e! t /ali$ate *etitine!s *sitin we will ha/e t#n#e$e that the !ight t $)e *!#ess (a. be e'ting)ishe$b. e'e#)ti/e #((an$+ >hile we s.(*athi@e with*etitine! wh !easnabl. #)l$ !el. n the #((it(ent(a$e t it b. the Phili**ine g/e!n(ent we still ha/e t!es*e#t the seg!egate i$entit. & the g/e!n(ent an$ that& a *!i/ate #!*!atin an$ gi/e $)e (eaning t thatseg!egatin /ital as it is t the /e!. ntin & $e(#!a#.+

DISPOSITIVE: Petitin is DENIED)wait Ai!wa.s is liable t PA3 be#a)se the C%J 8inten$ingt s)*e!se$e the 141 #((e!#ial ag!ee(ent *!/i$ing &!!e/en)e sha!ing: #annt bin$ PA3 with)t $)e *!#ess+

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