Professional Documents
Culture Documents
Authority to Operate
Albano vs Reyes
F:
compliance with the law. 1. Executive Order No. 30 authorized the PPA
to take over, manage and operate the MICT in accordance with PD 857
(Revised Charter of the PPA). PD 857 expressly empowers the PPA to
provide services within Port Districts "whether on its own, by contract or
otherwise."
Therefore, under EO 30 and PD 857, the PPA may contract with ICTSI
for the mgmt., operation and devt. of the MICT.
2. Even if the MICT be considered a public utility or a public service on
the theory that it is a wharf or a dock as contemplated by the Public
Service Act, its operation would not necessarily call for a legislative
franchise. Legislative franchises are not required before each and
every public utility may operate. The law has granted certain
administrative agencies the power to grant licenses for or to authorize
the operation of certain public utilities.
That the Consti provides that the issuance of a franchise for the
operation of a public utility shall be subject to amendment,
alteration or repeal by Congress does not necessarily imply that
only Congress has the power to grant such authorization. There
are several laws granting specified agencies in the Executive Dept. the
power to issue such authorization for certain classes of public utilities.
[ 1. LTFRB wrt Certificates of Public Convenience authorizing the
operation of public land transportation services provided by motorized
vehicles; 2. ERB wrt operation of electric power utilities and services
except electric coops]
Reading EO 30 and PD 857 together, the PPA has been empowered to
undertake by itself or to authorize the operation and mgmt. of the MICT
by another by contract. The latter power having been delegated to the
PPA, a legislative franchise is no longer necessary. In this case, the
PPA's contracting with ICTSI is wholly within its jurisdiction and powers.
3. The award of the contract to ICTSI is all the authorization that is
necessary. The award made by the PPA and the President enjoys the
presumption of validity and regularity of official action. There is no
evidence to the contrary.
4. Albano has standing to assail the contract. While the expenditure of
public funds may not be involved under the contract, public interest is
definitely involved considering the important role of the MICP in the
economic devt. of the country and the magnitude of the amount
involved. He has sufficient standing since a public right (disclosure
provision) is sought to be enforced.
5. There in no conflict among the 3 branches of govt. The Executive
Dept. has not contravened an act of Congress. There is no usurpation
Ratio:
1.
2.
3.
4.
On June 22, 1958, RA No. 2090 was enacted granting ETCI (formerly
FACI) a franchise to establish radio stations for domestic and
transoceanic telecommunications.
On May 13, 1987, ETCI filed an application with NTC to install,
establish, operate, and maintain a Cellular Mobile Telephone System
and an Alpha Numeric Paging System in Metro Manila and Southern
Luzon, with a prayer for provisional authority to operate Phase A of its
proposal within Metro Manila. Denying PLDTs motion to dismiss on the
following grounds:
ETCI is not capacitated or qualified under its legislative franchise to
operate a system-wide telephone or network of telephone service such
as the one proposed in its application;
ETCI lacks the facilities needed and indispensable to the successful
operation of the proposed cellular mobile telephone system;
PLDT has its pending application with NTC Case No 86-86, to install
and operate a Cellular Mobile Telephone System for domestic and
international service not only in Manila but also in the provinces and
that under the prior operator or protection of investment doctrine,
PLDT has the priority preference in the operation of such service; and
The provisional authority, if granted, will result in needless,
uneconomical, and harmful duplication, among others.
NTC denied PLDTs motion for reconsideration and maintained its ruling that
liberally construed, applicants franchise carries with it the privilege to operate
and maintain a cellular mobile telephone service. Subsequently, PLDT alleged
essentially that the interconnection ordered was in violation of due process and
that the grant of provisional authority as jurisdictionally and procedurally infirm.
Issue:
No.
The decisive considerations are public need, public interest, and the
common good. Those were the overriding factors which motivated NTC
in granting provisional authority to ETCI. Article II, Section 24 of the
1987 Constitution, recognizes the vital role of communication and
information in nation building.
o
It is likewise a State policy to provide the environment for the
emergence of communications structures suitable to the
balanced flow of information into, out of, and across the
country (Article XVI, Section 10).
o
A modern and dependable communications network rendering
efficient and reasonably priced services is also indispensable
for accelerated economic recovery and development. To
these public and national interests, public utility companies
must bow and yield.
o
Despite the fact that there is a virtual monopoly of the
telephone system in the country at present. Service is sadly
inadequate.
o
There is a unanimous cry to hasten the development of a
modern, efficient, satisfactory and continuous
telecommunications service not only in Metro Manila but
throughout the archipelago
Issue:
Whether or not the TRB may be empowered to grant authority to operate the
toll facility/system.
Ruling:
1997
FACTS
Presidential Decree No. 243, issued on July 12, 1973, created a "body
corporate and politic" to be known as the Philippine Veterans
Investment Development Corporation (PHIVIDEC) vested with authority
to engage in "commercial, industrial, mining, agricultural and other
enterprises" among other powers and "to allow the full and continued
employment of the productive capabilities of and investment of the
veterans and retirees of the Armed Forces of the Philippines."
9. At the end of the fifth year, or at the end of the 10th year, should this Agreement be thus renewed,
PIA has the option to take over the operation of the electric service and acquire by purchase
CEPALCO's assets within PIE-MO. This option shall be communicated to CEPALCO in writing at least
24 months before the date of acquisition of assets and takeover of operation by PIA. Should PIA
exercise its option to purchase the assets of CEPALCO in PIE-MO, PIA shall respect the right of
ownership of and maintenance by CEPALCO of those assets inside PIE-MO not covered by such
purchase. . . .
ISSUE
Whether or not the NPC may supply power directly to PIA in the PIE-MO area
where CEPALCO has a directly franchise.
RULING
Petitioner PIA asserts that it may receive power directly from the NPC
because it is a public utility. It avers that P.D. No. 538, as amended,
empowers PIA "as and to be a public utility to operate and serve the
power needs within PIE-MO, i.e., a specific area constituting a small
portion of petitioner's franchise coverage," without, however, specifying
the particular provision which so empower PIA.
a. To operate, administer and manage the PHIVIDEC Industrial Areas and other areas which shall
hereafter be proclaimed, designated and specified in subsequent Presidential Proclamation; to
construct acquire, own, lease, operate and maintain infrastructure facilities, factory buildings,
warehouses, dams, reservoirs, water distribution, electric light and power systems,
telecommunications and transportation networks, or such other facilities and services necessary or
useful in the conduct of industry and commerce or in the attainment of the purposes and objectives of
this Decree; (Emphasis supplied.)
Accordingly, in pursuit of its powers "to grant such franchise for and to
operate and maintain within the Areas electric light, heat or power
systems," etc. under Sec. 4 (i) of P.D. No. 538 and its rule-making
power under Sec. 4 (1) of the same law, on July 20, 1979, the PIA
Board of Directors promulgated the "Rules and Regulations To
Implement the Intent and Provisions of Presidential Decree No. 538." 48
Rule XI thereof on "Utilities and Services" provides as follows:
Sec. 1. Utilities It is the responsibility of the Authority to provide all required utilities and services
inside the Estate:
xxx xxx xxx
a) Contracts for the purchase of public utilities
and/or services shall be subject to the prior
approval of the Authority; Provided, however,
CEPALCO shares the view of the Court of Appeals that the Energy
Regulatory Board (ERB) is the proper administrative body for such
hearings. However, a recent legislative development has overtaken
said view.
It should be noted that the Rules and Regulations took effect thirty (30)
days after its publication in the Official Gazette on September 24, 1979
or more than three (3) months after the July 6, 1979 contract between
PIA and CEPALCO was entered into. As such, the Rules and
Regulations itself allowed the continuance of the supply of electric
power to PIE-MO by CEPALCO.
That the contract of July 6, 1979 was not renewed by the parties after
the expiration of the five-year period stipulated therein did not change
the fact that within that five-year period, in violation of both the contract
and its Rules and Regulations, PIA applied with the NPC for direct
power connection. The matter was aggravated by NPC's favorable
action on the application, totally unmindful of the extent of its powers
under the law which, in National Power Corporation v. Court of Appeals,
49
the Court delimits as follows:
. . . . It is immaterial whether the direct connection is merely an improvement or an increase in
existing voltage, as alleged by petitioner, or a totally new and separate electric service as claimed by
private respondent. The law on the matter is clear. PD 40 promulgated on 7 November 1972
expressly provides that the generation of electric power shall be undertaken solely by the NPC.
However Section 3 of the same decree also provides that the distribution of electric power shall be
undertaken by cooperatives, private utilities (such as the CEPALCO), local governments and other
entities duly authorized, subject to state regulation. ( Emphasis supplied.)
The same case ruled that "(i)t is only after a hearing (or an opportunity
for such a hearing) where it is established that the affected private
franchise holder is incapable or unwilling to match the reliability and
rates of NPC that a direct connection with NPC may be granted." As
earlier stated, the Court arrived at the same ruling in the later cases of
G.R. Nos. 72085, 84695 and 87697.
The ERB, which used to be the Board of Energy, by virtue of EO 172, whre the
ERB is basically a price or rate-fixing agency. Apparently recognizing this basic
function, Republic Act No. 7638 (An Act Creating the Department of Energy,
Rationalizing the Organization and Functions of Government Agencies Related to
Energy, and for Other Purposes) was promulgated. The determination of which
of two public utilities has the right to supply electric power to an area which is
within the coverage of both is certainly not a rate-fixing function which should
remain with the ERB. It deals with the regulation of the distribution of energy
resources which, under Executive Order No. 172, was expressly a function of
ERB. However, with the enactment of Republic Act No. 7638, the Department of
Energy took over such function. Hence, it is this Department which shall then
determine whether CEPALCO or PIA should supply power to PIE-MO.
Clearly, petitioner NPC's assertion that its "authority to entertain and hear direct
connection applications is a necessary incident of its express authority to sell
electric power in bulk" is now baseless. Even without the new legislation affecting
its power to conduct hearings, it is certainly irregular, if not downright anomalous
for the NPC itself to determine whether it should supply power directly to the PIA
or the industries within the PIE-MO. It simply cannot arrogate unto itself the
authority to exercise non-rate fixing powers which now devolves upon the
Department of Energy and to hear and eventually grant itself the right to supply
power in bulk.
Issue: whether or not the private respondent was validly awarded the questioned
Certificate of Public Convenience to operate an ice plant in Davao City.
Held:
Divinagracia v. CBS
2009
Doctrine: Although there is no doubt that the President may exercise the
authority granted to him under Section 5 of R.A. No. 7477 (charter of PBS) which
provides that the President of the Philippines may temporarily take over and
operate the stations of the grantee, temporarily suspend the operation of any
stations in the interest of public safety, security and public welfare, or authorize
the temporary use and operation thereof by any agency of the Government, such
authority can be exercised only under limited and rather drastic circumstances.
They still do not vest in the NTC the broad authority to cancel licenses and
permits.
Facts:
Issue: Whether or not the NTC has the power to cancel the CPCs it has issued
to legislative franchisees
Held/Ratio:
No, the NTC does not have the power to cancel CPCs.
546 which established the NTC, the administrative agency which has
regulatory jurisdiction over broadcast stations.
When Congress grants a legislative franchise, it is the legal obligation
of the NTC to facilitate the operation by the franchisee of its broadcast
station and since public administration of the airwaves is a highly
technical function, the Congress has delegated to the NTC the task of
administration.
The licensing power of the NTC arises from the necessary delegation
by Congress of legislative power geared towards the orderly exercise
by franchisees of the rights granted them by Congress.
But even as the NTC is vested with the power to issue CPCs to
broadcast stations, it is not expressly vested with the power to cancel
such CPCs, or otherwise prevent broadcast stations with duly issued
franchises and CPCs from operating radio and television stations.
There is no such expression in the law, and by presuming such right the
Court will be acting contrary to the stated State interest as expressed in
respondents legislative franchises.
Although there is no doubt that the President may exercise the authority
granted to him under Section 5 of R.A. No. 7477 (charter of PBS) which
provides that the President of the Philippines may temporarily take over
and operate the stations of the grantee, temporarily suspend the
operation of any stations in the interest of public safety, security and
public welfare, or authorize the temporary use and operation thereof by
any agency of the Government, such authority can be exercised only
under limited and rather drastic circumstances.
They still do not vest in the NTC the broad authority to cancel licenses
and permits.
service and the authorization to do business will promote the public interests in a
proper and suitable manner.
The Commission may prescribe as a condition for the issuance of the certificate
provided in the preceding paragraph that the service can be acquired by the
Republic of the Philippines or any instrumentality thereof upon payment of the
cost price of its useful equipment, less reasonable depreciation; and likewise,
that the certificate shall be valid only for a definite period of time; and that the
violation of any of these conditions shall produce the immediate cancellation of
the certificate without the necessity of any express action on the part of the
Commission.
In estimating the depreciation, the effect of the use of the equipment, its actual
condition, the age of the model, or other circumstances affecting its value in the
market shall be taken into consideration.
The foregoing is likewise applicable to any extension or amendment of
certificates actually in force and to those which may hereafter be issued, to
permit to modify itineraries and time schedules of public services, and to
authorizations to renew and increase equipment and properties.
Difference between CPC and CPCN :
However, certificates represent property rights to the extent that if the rights
which any public utility is exercising pursuant to lawful orders of the PSC has
been invaded by another public utility, in appropriate cases actions may be
maintained by the complainant public utility. Owners of public utilities have the
right to maintain appropriate actions against other public utilities not authorized to
operate in competition with the complainant.
Certificates are considered as property as used in Civil Procedure as they have
material value and are material assets. They are subject to attachment and
seizure by legal process, and may be acquired by purchase.
Determination of WON an issuance of a certificate is for public convenience - (1)
financial responsibility of the applicant, (2) reliability of the applicant, (3) priority of
filing the application for a certificate, and (4) priority of operation
Issue: Whether or not the CAB can issue a Certificate of Public Convenience
and Necessity or TOP even though the prospective operator does not have a
legislative franchise?
Public convenience and necessity exists when the proposed facility will
meet a reasonable want of the public and supply a need which the
existing facilities do not adequately afford.
(a) To adopt, establish, fix, impose, maintain, collect or carry into effect
any individual or joint rates, commutation, mileage or other special rate,
toll, fare, charge, classification or itinerary. The Commission shall
approve only those that are just and reasonable and not any that are
unjustly discriminatory or unduly preferential, only upon reasonable
notice to the public services and other parties concerned, giving them a
reasonable opportunity to be heard and the burden of the proof to show
that the proposed rates or regulations are just and reasonable shall be
upon the public service proposing the same.
The petition before us seeks to annul and set aside an Order 1 issued
by respondent Commissioner Jose Luis Alcuaz of the National
Telecommunications Commission
Herein petitioner is engaged in providing for services involving
telecommunications. Charging rates for certain specified lines that were
reduced by order of herein respondent Jose Alcuaz Commissioner of
the National Telecommunications Commission. The rates were ordered
to be reduced by fifteen percent (15%) due to Executive Order No. 546
which granted the NTC the power to fix rates. Said order was issued
without prior notice and hearing.
Under Section 5 of Republic Act No. 5514, petitioner was exempt from
the jurisdiction of the then Public Service Commission, now respondent
NTC. However, pursuant to Executive Order No. 196 issued on June
17, 1987, petitioner was placed under the jurisdiction, control and
regulation of respondent NTC
Held:
In Vigan Electric Light Co., Inc. vs. Public Service Commission the
Supreme Court said that although the rule-making power and even the
power to fix rates- when such rules and/or rates are meant to apply to
all enterprises of a given kind throughout the Philippines-may partake of
a legislative character.
Respondent Alcuaz no doubt contains all the attributes of a quasijudicial adjudication. Foremost is the fact that said order pertains
exclusively to petitioner and to no other
The respondent admits that the questioned order was issued pursuant
to its quasi-judicial functions. It, however, insists that notice and hearing
are not necessary since the assailed order is merely incidental to the
entire proceedings and, therefore, temporary in nature but the supreme
court said that While respondents may fix a temporary rate pending
final determination of the application of petitioner, such rate-fixing order,
temporary though it may be, is not exempt from the statutory procedural
requirements of notice and hearing
On March 16, 1994, petitioner KMU filed a petition before the LTFRB
opposing the upward adjustment of bus fares, which the LTFRB
dismissed for lack of merit.
ISSUE:
Whether or not the authority given by respondent LTFRB to provincial
bus operators to set a fare range of plus or minus fifteen (15%) percent,
later increased to plus twenty (20%) and minus twenty-five (-25%)
percent, over and above the existing authorized fare without having to
file a petition for the purpose, is unconstitutional, invalid and illegal.
The Supreme Court Said that it is clear that with regard to rate-fixing,
respondent has no authority to make such order without first
giving petitioner a hearing, whether the order be temporary or
permanent. In the Case at bar the NTC didnt scheduled hearing nor it
did give any notice to the petitioner
Under Delegation
FACTS :
HELD:
Yes.
Under section 16(c) of the Public Service Act, the Legislature delegated
to the defunct Public Service Commission the power of fixing the rates
of public services. Respondent LTFRB, the existing regulatory body
today, is likewise vested with the same under Executive Order No. 202
dated June 19, 1987. x x x
However, nowhere under the aforesaid provisions of law are the
regulatory bodies, the PSC and LTFRB alike, authorized to delegate
that power to a common carrier, a transport operator, or other public
service.
Provisional Rates
ISSUES
Whether or not Resolution No. 2001-89 is invalid on the ground that:
(a) it was in violation of due process;
(b) the provisional toll rate adjustments are exorbitant, oppressive, onerous and
unconscionable; and,
(c) TRB Executive Director Jaime Dumlao, Jr. alone authorized the provisional
increase.
RULING
(a) No. TRB clearly complied with the publication requirements. Also,
the TRB may grant and issue ex-parte to any petitioner, without need of
notice, publication or hearing, provisional authority to collect, pending
hearing and decision on the merits of the petition, the increase in rates
prayed for or such lesser amount as the TRB may in its discretion
provisionally grant.
(b) No. This is obviously a question of fact requiring knowledge of the
formula used and the factors considered in determining the assailed
rates. Definitely, this task is within the province of the TRB. The SC
takes cognizance of the wealth of jurisprudence on the doctrine of
primary administrative jurisdiction and exhaustion of administrative
remedies. In this era of clogged court dockets, the need for specialized
administrative boards or commissions with the special knowledge,
experience and capability to hear and determine promptly disputes on
technical matters or intricate questions of facts, subject to judicial
review in case of grave abuse of discretion, is indispensable. Between
(c) No. It is not true that it was TRB Executive Director Dumlao, Jr.
alone who issued Resolution No. 2001-89. The Resolution itself
contains the signature of the four TRB Directors. Petitioner Padua
would argue that while these Directors signed the Resolution, none of
them personally attended the hearing. This argument is
misplaced. Under our jurisprudence, an administrative agency may
employ other persons, such as a hearing officer, examiner or
investigator, to receive evidence, conduct hearing and make reports, on
the basis of which the agency shall render its decision. Such a
procedure is a practical necessity. Corollarily, in a catena of cases, the
Supreme Court laid down the cardinal requirements of due process in
administrative proceedings, one of which is that the tribunal or body or
any of its judges must act on its or his own independent consideration
of the law and facts of the controversy, and not simply accept the views
of a subordinate. Thus, it is logical to say that this mandate was
rendered precisely to ensure that in cases where the hearing or
reception of evidence is assigned to a subordinate, the body or agency
shall not merely rely on his recommendation but instead shall
personally weigh and assess the evidence which the said subordinate
has gathered.
Section 34 of RA 9136 (EPIRA), imposes Universal Charge upon endusers of electricity, a charge imposed for the recovery of stranded cost.
ERC issued its Implementing Rules and Regulations defining Universal
Charge refers to the charge, if any, imposed for the recovery of
Stranded Debts, Stranded Contract Costs of NPC and Stranded
Contract Costs of Eligible Contracts of Distribution Utilities and other
purposes pursuant to Section 34 of the EPIRA.
National Power Corporation-Strategic Power Utilities Group (NPCSPUG) filed with Energy Regulatory Commission (ERC) a petition for
the availment from the Universal Charge of its share for Missionary
Electrification.
the sale, alienation, or lease by any public service of any of its property in the
ordinary course of its business.
(h) To sell or register in its books the transfer or sale of shares of its capital stock,
if the result of that sale in itself or in connection with another previous sale, shall
be to vest in the transferee more than forty per centum of the subscribed capital
of said public service. Any transfer made in violation of this provision shall be
void and of no effect and shall not be registered in the books of the public service
corporation. Nothing herein contained shall be construed to prevent the holding
of shares lawfully acquired. (As amended by Com. Act No. 454.)
(i) To sell, alienate or in any manner transfer shares of its capital stock to any
alien if the result of that sale, alienation, or transfer in itself or in connection with
another previous sale shall be the reduction to less than sixty per centum of the
capital stock belonging to Philippine citizens. Such sale, alienation or transfer
shall be void and of no effect and shall be sufficient cause for ordering the
cancellation of the certificate.
MERALCO was
P11,834,570.91.
Consequently, BF Homes and PWCC goes to the RTC stating that what
the respondent has done was oppressive and prayed for exemplary
damages. They have also prayed for the issuance of a writ of
preliminary injunction and restraining order stating that unless
restrained, MERALCO will cut off electric power connections to all of
the water pumps.
Rate Refund
BF Homes v. Meralco
DOCTRINE:
mandated
to
refund
to
BF
the
amount
of
ISSUE:
In determining which body has jurisdiction over a case, the better policy
is to consider not only the status or relationship of the parties but also the
nature of the action that is the subject of their controversy.
FACTS:
WoN jurisdiction over this case lies within the RTC or the Energy Regulatory
Commission.
HELD:
BF and PWCC asked the RTC for the right to refund. They claimed to
have based such right on the SC ruling in Republic v. Manila Electric
Company:
o
Petition is DENIED.
RTC has NO jurisdiction because the power to reside over such case
exclusively belongs to the ERC by virtue of Sec. 43 (u) of the EPIRA.
The powers of the ERC were underlined when the courts traced the
legislative history of the agency in Manila Electric Compoany v. Energy
Regulatory Board
Montoya V. Ignacio
1953
Facts:
Issue: W/N the property in question should be declared exempt from execution
as a family home extrajudicially constituted.
Held:
Family Homes Not Exempt From Execution For Debts Incurred Before
Its Establishment 1. According to Article 243, subdivision 2 of the new
Civil Code: The family home extrajudicially formed shall be exempt from
execution, forced sale or attachment except: (2) For debts incurred
before the declaration was recorded in the Registry of Property.
2. The family home involved in the present case having been judicially
constituted, it comes under Article 243 of the new Civil Code, and, in
accordance with subdivision (2) thereof, is not exempt from execution
for debts incurred before it was recorded in the Registry of Property.
Money Judgment Is Debt
After the dance, the couple boarded the same bus to return to
Manicahan. At around 1 a.m. of 14 August 1955, the bus (1955 TPU1137), and driven by Valeriano Marcos, fell off the road and pinned to
death the said spouses and several other passengers.
Jose Mario Dagamanuel, the only child of the deceased spouses, through his
maternal grandmother as guardian ad-litem, Pascuala Julian de Punzalan,
instituted an action against Zamboanga Transportation Co., Inc. (Zamtanco) and
the Zamboanga Rapids Co., Inc. (Zambraco) for breach of contract of carriage,
alleging that the accident was due to the fault and negligence of the driver in
operating the bus and due to the negligence of the companies in their
supervision of their driver. the trial court rendered judgment sentencing the three,
jointly and severally, to indemnify the private respondents. The CA affirmed the
decision of the court a quo.
ISSUE: Whether or not Zamtranco and Zambraco are jointly and severally liable.
HELD: Yes.
Pantranco vs PSC
F:
Pantranco has been engaged for the past 20 years in the business of
transporting passengers by means of motor vehicles in accordance with
Issue : WON the PSC may prescribe the 2 conditions as a prerequisite to the
issuance of the CPCN.
Held : Yes. CA 146 provides a sufficient standard, which is public interest, by
which the PSC is guided in imposing such conditions.
Indeed this right is so far beyond question that it is settled that the
power of the state to exercise legislative control over public utilities may
be exercised through the board of commissioners. This right of the state
to regulate public utilities is founded upon the police power, and
statutes for the control and regulation of utilities are a legitimate
exercise thereof, for the protection of the public as well as the utilities
themselves.
Such statutes are not unconstitutional, either as impairing the obligation
of contracts, taking property without due process, or denying the equal
protection of the laws, especially inasmuch as the question WON
private property shall be devoted to a public use and the consequent
burdens assumed is ordinarily for the owner to decide; and if he
voluntarily places his property in public service he cannot complain that
it becomes subject to the regulatory powers of the state.
This is more so in the light of authorities which hold that a CPC
constitutes neither a franchise nor a contract, confers no property rights
and is a mere license or privilege.