Professional Documents
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PLDT filed a Motion to Set Aside the Order alleging that the interconnection was
violated due process and that the order granting PA to ETCI was jurisdictionally and
procedurally infirmed. NTC denied reconsideration and set the date for hearing for
continuation of the main proceedings.
The Supreme Court issued a Temporary Restraining Order enjoining NTC to cease and
desist from all or any of its on-going proceedings and ETCI from continuing with any of
its projects as granted in the issued PA by the NTC. The motion filed by ETCI to lift the
TRO was denied.
ISSUES:
1. Whether the provisional authority was properly granted.
Held: The provisional authority granted by the NTC (which is the regulatory agency of
the National Government over all telecommunications entities) has a definite expiry
period of 18 months unless sooner renewed; may be revoked, amended or revised by
the NTC; covers one of four phases; limited to Metro Manila only; and does not
authorize the installation and operation of an alphanumeric paging system. It was
further issued after due hearing, with PLDT attending and granted after a prima facie
showing that ETCI had the necessary legal, financial and technical capabilities; and that
public interest, convenience and necessity so demanded. Provisional authority would
be meaningless if the grantee were not allowed to operate, as its lifetime is limited and
may be revoked by the NTC at any time in accordance with law.
2. Whether ETCIs franchise includes operation of cellular mobile telephone system
(CMTS)
HELD: The NTC construed the technical term radiotelephony liberally as to include
the operation of a cellular mobile telephone system. The construction given by an
administrative agency possessed of the necessary special knowledge, expertise and
experience and deserves great weight and respect. It can only be set aside by judicial
intervention on proof of gross abuse of discretion, fraud or error of law.
3. Whether PLDT can refuse interconnection with ETCI.
HELD: The NTC merely exercised its delegated authority to regulate the use of
telecommunication networks when it decreed interconnection. PLDT cannot refuse
interconnection as such is mandated under RA 6949 or the Municipal Telephone Act of
1989. What interconnection seeks to accomplish is to enable the system to reach out to
the greatest number of people possible in line with governmental policies. With the
broader reach, public interest and convenience will be better served. Public need,
public interest, and the common good are the decisive, if not the ultimate,
considerations. To these public and national interests, public utility companies must
yield.
The NTC order does not deprive PLDT due process as it allows the parties themselves
to discuss and agree upon the specific terms and conditions of the interconnection
agreement instead of the NTC itself laying down the standards of interconnection which
it can very well impose.
Bell
Telecommunications
(BellTel)
filed
before
the
National
authority to sign, validate and promulgate any and all orders, resolutions and decisions
of the NTC and only his vote counts. BellTel filed two motions to resolve the application
and the issuance of the PA but the NTC did not act on it. In that relation, the petitioners
filed an Opposition. Commissioner Kintanar issued an Order setting said motions for
hearing but did not resolve said motions. However, no hearing was conducted and it
was rescheduled.
BellTel filed a motion to promulgate, after previously filing two urgent ex-parte motion to
resolve application, which was not acted upon by the NTC. On 4 July 1995, the NTC
denied the motion in an order signed solely by Commissioner Kintanar. On 17 July
1995, BellTel filed a petition for certiorari, mandamus and prohibition against NTC
before the Supreme Court. The Court referred the case to the Court of Appeals
pursuant to Paragraph 1, Section 9 of BP 129. The Court of Appeals granted BellTels
position. Hence, the petitions for review by the opposing telecommunication companies
and Commissioner Kintanar.
ISSUE: Whether the vote of the Chairman of the Commission is sufficient to legally
render an NTC order, resolution or decision.
quasi-judicial functions. However, this does not militate against the collegial nature of
the NTC because the Rules of Procedure and Practice applied by the NTC in its
proceedings states that in cases heard by the Board En Banc, the resolution or order
should be reached with the concurrence of at least two regular members after
deliberation and consultation. NTC Circulars 1-1-93, 3-1-93 and the Order of Kintanar,
declaring the NTC as a single entity or non-collegial entity, are contrary to law and thus
are null and void.
companies complaint without prejudice to the referral of their grievances with the NTC.
Hence, the petition for review with the Supreme Court.
ISSUE: Whether a party should have exhausted administrative remedies before it filed
the case in court.
HELD: No, the parties need not exhaust administrative remedies.
A party need not exhaust administrative remedies before going to Court, when
questioning the validity or constitutionality of a rule or regulation issued by an
administrative agency. The principle only applies when the act of the agency was
performed pursuant to its quasi-judicial function, and not when the assailed and
pertained to its rule-making or quasi-legislative power. The quasi-legislative function or
rule-making power of an administrative agency is different from its quasi-judicial or
administrative ad judicatory power. The first is the product of a delegated legislative
power to create new and additional legal provisions that have the effect of law. It must
be in accordance with the Constitution and other requirements by the law. The second
involves the power to hear and determine questions of fact to which the legislative
policy is to apply and to decide in accordance with the standards lay down by the law
itself in enforcing and administering the same law.
Since the issuance by the NTC of the two circulars was pursuant to its rule-making
power, the petitioners were justified in invoking the judicial power of the RTC to assail
the constitutionality and validity of said circulars.
Due to that event, Globe professed its intention to discontinue the use of the earth
station with Philcomsat. It contented a part in their agreement that neither party shall be
held liable or deemed to be in default for any failure to perform its obligation under this
Agreement if such failure results directly or indirectly from force majeure or fortuitous
event. Force majeure according to their contact include circumstances beyond the
control of the party involved including, but not limited to, any law, order, regulation,
direction or request of the Government of the Philippines, strikes or other labor
difficulties, insurrection riots, national emergencies, war, acts of public enemies, fire,
floods, typhoons or other catastrophes or acts of God. However, there is also a
stipulation in that same agreement regarding the payment after discontinuance of
service, which binds Globe to pay rentals for a particular period. Despite of several
demands to pay were sent to Globe by Philcomsat, the former did not pay any.
Philcomsat then filed a complaint praying for the payment of all money claims against
Globe. Globe in return insist on its defense of force majeure in non-payment of the
rentals.
The RTC ruled in favor of Philcomsat but the amount it prayed for was not granted
precisely and it affirmed the defense of Globe regarding the issue of force majeure.
Both parties appealed to the CA. Since affirmed the decision of the RTC but ordered
Globe to pay rentals from the actual time of use until the time the US military vacated
the bases in the month of December 1992. Both parties appealed the case to the
Supreme Court.
ISSUES:
constitutes force majeure which would exempt Globe from complying with its obligation
to pay rentals; 2) whether Globe is liable to pay rentals under the Agreement for the
month of December 1992; and 3) whether Philcomsat is entitled to attorneys fees and
exemplary damages.
HELD: As to the first issue, the SC ruled in favor of Globe as the termination of the RPUS Military Bases Agreement is a force majeure. Contrary to the position of Philcomsat
that such event is not unforeseeable, but were possibilities known to it and Globe at the
time they entered into the Agreement, such events cannot exempt Globe from
performing its obligation of paying rentals for the entire five-year term thereof, the court
held that Article 1174, which exempts an obligor from liability on account of fortuitous
events or force majeure, refers not only to events that are unforeseeable, but also to
those which are foreseeable, but inevitable. The events which the parties included in
the enumeration of what force majeure is as to their contract does not have the effect of
expanding the force majeure enumerated in the Civil Code. Furthermore, under Article
1306 of the Civil Code, parties to a contract may establish such stipulations, clauses,
terms and conditions as they may deem fit, as long as the same do not run counter to
the law, morals, good customs, public order or public policy.
Regarding the second issue, Globe should not be made to pay the rentals for
December of 1992. The aforementioned events made impossible the continuation of the
Agreement until the end of its five-year term without fault on the part of either party. The
Court of Appeals was thus correct in ruling that the happening of such fortuitous events
rendered Globe exempt from payment of rentals for the remainder of the term of the
Agreement. Moreover, it would be unjust to require Globe to continue paying rentals
even though Philcomsat cannot be compelled to perform its corresponding obligation
under the Agreement.
Finally, in resolving the third issue, the court affirmed the findings of the CA in not
awarding Philcomsat attorneys fees and exemplary damages. Exemplary damages
may be awarded in cases involving contracts or quasi-contracts, if the erring party acted
in a wanton, fraudulent, reckless, oppressive or malevolent manner. In the present case,
it was not shown that Globe acted wantonly or oppressively in not heeding Philcomsats
demands for payment of rentals. It was established during the trial of the case before
the trial court that Globe had valid grounds for refusing to comply with its contractual
obligations after 1992.
P0.167 per kwh and the refund of such amount to MERALCOs customers beginning
February 1994 and until its billing cycle beginning February 1998. The regulation of
rates to be charged by public utilities is founded upon the police powers of the State
and statutes prescribing rules for the control and regulation of public utilities are a valid
exercise thereof.
ISSUE: Whether or not the State exercises its Police Power in regulating rates for
public use.
HELD: In regulating rates charged by public utilities, the State protects the public
against arbitrary and excessive rates while maintaining the efficiency and quality of
services rendered. However, the power to regulate rates does not give the State the
right to prescribe rates, which are so low as to deprive the public utility of a reasonable
return on investment. Thus, the rates prescribed by the State must be one that yields a
fair return on the public utility upon the value of the property performing the service and
one that is reasonable to the public for the services rendered. The fixing of just and
reasonable rates involves a balancing of the investor and the consumer interests. It is a
settled rule that the goal of rate-making is to arrive at a just and reasonable rate for both
the public utility and the public, which avails of the formers products and services.
However, what is a just and reasonable rate cannot be fixed by any immutable method
or formula. Hence, it has been held that no public utility has a vested right to any
particular method of valuation.
Accordingly, with respect to a determination of the proper method to be used in the
valuation of property and equipment used by a public utility for rate-making purposes,
the administrative agency is not bound to apply any one particular formula or method
simply because the same method has been previously used and applied.
In fact,
nowhere in the previous decisions cited by MERALCO, which applied the trending
method, did the Court rule that the same should be the only method to be applied in all
instances. Thus, the burden is upon the oppositor, MERALCO, to prove that the rates
fixed by the ERB are unreasonable or otherwise confiscatory as to merit the reversal of
the ERB. In the instant cases, MERALCO was unable to discharge this burden.
Wherefore, in view of the foregoing, the instant petitions are GRANTED and the
decision of the Court of Appeals in C.A. G.R. SP No. 46888 is REVERSED.
Respondent MERALCO is authorized to adopt a rate adjustment in the amount of
P0.017 per kilowatt-hour, effective with respect to MERALCOs billing cycles beginning
February 1994. Further, in accordance with the decision of the ERB dated February 16,
1998, the excess average amount of P0.167 per kilowatt-hour starting with the
applicants billing cycles beginning February 1998 is ordered to be refunded to
MERALCOs customers or correspondingly credited in their favor for future
consumption.
January 7, 1999, Bayantel wrote the office of the City Assessor seeking the exclusion of
its real properties in the city from the roll of taxable real properties. With its request
having been denied, Bayantel interposed an appeal with the Local Board of
Assessment Appeals (LBAA). And, evidently on its firm belief of its exempt status,
Bayantel did not pay the real property taxes assessed against it by the Quezon City
government.
On account thereof, the Quezon City Treasurer sent out notices of delinquency for the
total amount of P43,878,208.18, followed by the issuance of several warrants of levy
against Bayantels properties preparatory to their sale at a public auction set on July 30,
2002.
Threatened with the imminent loss of its properties, Bayantel immediately withdrew its
appeal with the LBAA and instead filed with the RTC of Quezon City a petition for
prohibition with an urgent application for a temporary restraining order (TRO) and/or writ
of preliminary injunction
ISSUE: Whether or not Bayantels real properties in Quezon City are, under its
franchise, exempt from real property tax.
HELD: The power to tax is primarily vested in the Congress; however, in our
jurisdiction, it may be exercised by local legislative bodies, no longer merely be virtue of
a valid delegation as before, but pursuant to direct authority conferred by Section 5,
Article X of the Constitution. Under the latter, the exercise of the power may be subject
to such guidelines and limitations as the Congress may provide which, however, must
be consistent with the basic policy of local autonomy.
In net effect, the controversy presently before the Court involves, at bottom, a clash
between the inherent taxing power of the legislature, which necessarily includes the
power to exempt, and the local governments delegated power to tax under the aegis of
the 1987 Constitution.
Now to go back to the Quezon City Revenue Code which imposed real estate taxes on
all real properties within the citys territory and removed exemptions theretofore
"previously granted to, or presently enjoyed by all persons, whether natural or
juridical..," there can really be no dispute that the power of the Quezon City
Government to tax is limited by Section 232 of the LGC which expressly provides that
"a province or city or municipality within the Metropolitan Manila Area may levy an
annual ad valorem tax on real property such as land, building, machinery, and other
improvement not hereinafter specifically exempted." Under this law, the Legislature
highlighted its power to thereafter exempt certain realties from the taxing power of local
government units. An interpretation denying Congress such power to exempt would
reduce the phrase "not hereinafter specifically exempted" as a pure jargon, without
meaning whatsoever. Needless to state, such absurd situation is unacceptable.
As we see it, then, the issue in this case no longer dwells on whether Congress has the
power to exempt Bayantels properties from realty taxes by its enactment of Rep. Act
No. 7633 which amended Bayantels original franchise. The more decisive question
turns on whether Congress actually did exempt Bayantels properties at all by virtue of
Section 11 of Rep. Act No. 7633.
Admittedly, Rep. Act No. 7633 was enacted subsequent to the LGC. Perfectly aware
that the LGC has already withdrawn Bayantels former exemption from realty taxes,
Congress opted to pass Rep. Act No. 7633 using, under Section 11 thereof, exactly the
same defining phrase "exclusive of this franchise" which was the basis for Bayantel s
exemption from realty taxes prior to the LGC. In plain language, Section 11 of Rep. Act
No. 7633 states that "the grantee, its successors or assigns shall be liable to pay the
same taxes on their real estate, buildings and personal property, exclusive of this
franchise, as other persons or corporations are now or hereafter may be required by
law to pay." The Court views this subsequent piece of legislation as an express and real
intention on the part of Congress to once again remove from the LGCs delegated taxing
power, all of the franchisees (Bayantels) properties that are actually, directly and
exclusively used in the pursuit of its franchise.
We, therefore agree with the trial court finding that while the rights of the appellants
to safe and healthy environment enshrined under Sec.15 and 16 of 1987