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SMITH, BELL & CO. Vs NATIVIDAD (Malcolm, J.) 40 Phil 136, 144-145 (1919)

1) Smith, Bell & Co. is a British-owned Philippine corporation that owns a cargo vessel called the Bato. They applied to register the Bato for domestic trade but were denied because as a foreign-owned corporation they did not meet the domestic ownership requirements under Act 2671. 2) Smith, Bell & Co. argued that denying them registration deprived them of their property rights without due process. However, the court ruled that Act 2671 was a valid exercise of police powers and did not violate due process. 3) The court affirmed that denying registration to foreign-owned companies was within the legislature's power to regulate domestic shipping, which is vital to Philippine commerce and security.

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98 views

SMITH, BELL & CO. Vs NATIVIDAD (Malcolm, J.) 40 Phil 136, 144-145 (1919)

1) Smith, Bell & Co. is a British-owned Philippine corporation that owns a cargo vessel called the Bato. They applied to register the Bato for domestic trade but were denied because as a foreign-owned corporation they did not meet the domestic ownership requirements under Act 2671. 2) Smith, Bell & Co. argued that denying them registration deprived them of their property rights without due process. However, the court ruled that Act 2671 was a valid exercise of police powers and did not violate due process. 3) The court affirmed that denying registration to foreign-owned companies was within the legislature's power to regulate domestic shipping, which is vital to Philippine commerce and security.

Uploaded by

Margeon Caminade
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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SMITH, BELL & CO. vs NATIVIDAD (Malcolm, J.)40 Phil 136, 144-145 (1919) Facts:-Smith, Bell & Co.

is a corporation organized and existing under the laws of the Philippine Islands;majority of the stockholders are British; owner of a motor vessel known as the Batobrought toCebu for the purpose of transporting Smith, Bell & Co.s merchandise between ports in theislands.-application for registration was made at Cebu at the Collector of Customs---denied. Becausethey were not citizens of the US/Phils.-Act 2671, Sec. 1172. Certificate ofPhilippine Register.upon registration of a vessel of domesticownership, and of more than 15 tons gross, a certificate of Philippine register shall be issued forit. If the vessel is of domestic ownership and of 15 tons gross or less, the taking of the certificateof Philippine register shall be optional with the owner.-domestic ownership, as used in this section, means ownership vested in the (a) citizens ornative inhabitants of the Phil Islands; (b) citizens of the US residing in the Phil. Islands; (c) anycorporation or company composed wholly of citizen of Phils./US or both-plaintiffs contention: Act No. 2671 deprives the corp. of its property without due process of lawbecause by the passage of the law, the company was automatically deprived of every beneficialattribute of ownership of the Bato and that they are left with a naked title they could not use.Issue: WON Smith, Bell & Co. were denied of the due process of law by the Phil. Legislature in itsenactment of Act 2761. Ruling: No. (judgment affirmedplaintiff cant be granted registry.)RD: Act No. 2761, in denying to corporations such as Smith, Bell & Co. Ltd., the right to registervessels in the Phils. Coastwide trade, falls within the authorized exceptions. Specifically withinthe purview of the police power. Literally and absolutely, steamship lines are the arteries of thecommerce in the Phils. If one be severed, the lifeblood of the nation is lost. If these areprotected, security of the country and general welfare is sustained

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