Montoya v. Ignacio, G.R. No.

L-5868, December 29, 1953: property covered by the franchise, or if the sale or lease is detrimental
BAUTISTA, J.: to public interest.

FACTS: Such being the reason and philosophy behind this requirement, it
follows that if the property covered by the franchise is transferred,
or leased to another without obtaining the requisite approval, the
1. TomasitaArca boarded the jeepney driven by Leonardo de
transfer is not binding against the Public Service Commission
Guzman at Tanza, Cavite. She paid the usual fare for the
and in contemplation of law the grantee continues to be
trip. While the jeepney was on its way to its destination, and
responsible under the franchise in relation to the Commission
at a point between Tanza and Cavite City, somewhere in
and to the public. Since the lease of the jeepney in question was
barrio Ligton, municipality of Rosario, it collided with a bus of
made without such approval, the only conclusion that can be drawn is
the Luzon Bus Line causing as a result the death of
that Marcelino Ignacio still continues to be its operator in contemplation
Tomasita.
of law, and as such is responsible for the consequences incident to its
2. Because of the jeepney's failure to transport Tomasita safely
operation, one of them being the collision under consideration.
to her destination and her resultant death, her widower and
children instituted the present action praying that the
defendants, owners of the jeepney, be ordered to pay them BASIS:
an indemnity in the amount of P31,000.
3. Defendants, set up as a special defense that the collision
It may be argued that section 16, paragraph (h) provides in its last part
between the jeepney and the bus was investigated by the
that "nothing herein contained shall be construed to prevent the sale,
Office of the Provincial Fiscal of Cavite and the result of the
alienation, or lease by any public utility of any of its property in the
investigation was that the one at fault was the driver of the
ordinary course of business", which gives the impression that the
bus.
approval of the Public Service Commission is but a mere formality
4. Defendants claim that inasmuch as the present case
which does not affect the effectivity of the transfer or lease of the
involves the same issues as those in the case filed
property belonging to a public utility. But such provision only means
against the driver of the bus, the same should be held in
that even if the approval has not been obtained the transfer or lease is
abeyance until after the final termination of the criminal
valid and binding between parties although not effective against the
case.
public and the Public Service Commission. The approval is only
5. Defendant Cayetano Tahimik further claims that he is not
necessary to protect public interest.
and has never been the owner of the jeepney and cannot
therefore be held responsible for the damages cause by it.
Wherefore, the decision appealed from is reversed. Judgment is
hereby rendered ordering the defendant Marcelino Ignacio to pay the
lower court: rendered decision dismissing the case holding that
plaintiffs the sum of P31,000 as damages, with costs.
defendants are not liable because it was not proven that the collision
which resulted in the death of TomasitaArca was due to the negligence
of the driver of the jeepney whose ownership is attributed to
defendants. From this decision plaintiffs have appealed.

Court of Appeals: affirmed the decision appealed from:

Grounds:Marcelino Ignacio was not the one operating the jeepney but
one LeoncioTahimik who had leased the jeepney by virtue of a
document duly executed by the parties.

Petitioner’s claim:

(NOTE: Important contention) It is claimed that while Marcelino

Ignacio, owner of the jeepney, has leased the same to one
LeoncioTahimik on June 8, 1948, and that at the time of collision it was
the latter who was actually operating it, the contract of lease was null
and void because it was not approved by the Public Service
Commission as required by section 16, paragraph h, of the Public
Service Law.

Other contention: that the lower court erred in ruling that to maintain an
action for damages caused by the breach of a carrier's obligation to
carry a passenger safely to his destination it is necessary to prove that
the damages were caused by the negligence of the driver of said
carrier in order that liability may attach which.

ISSUE:

There is merit in this contention.

The law really requires the approval of the Public Service Commission
in order that a franchise, or any privilege pertaining thereto, may be
sold or leased without infringing the certificate issued to the grantee.
The reason is obvious. Since a franchise is personal in nature any
transfer or lease thereof should be notified to the Public Service
Commission so that the latter may take proper safeguards to protect
the interest of the public. In fact, the law requires that, before the
approval is granted, there should be a public hearing, with notice to all
interested parties, in order that the Commission may determine if there
are good and reasonable grounds justifying the transfer or lease of the
Y Transit Co., Inc. v. NLRC, 229 SCRA 508: ROMERO, J.: I The public respondent NLRC committed palpable legal error and
grave abuse of discretion amounting to lack of jurisdiction when it
held that there was no valid transfer of ownership in favor of the
FACTS:
petitioner, completely disregarding the preponderance of evidence
and existing jurisprudence which support the validity of the transfer
1. Yujuico Transit Co., Inc., mortgaged ten (10) of its buses to of ownership to the petitioner.3
the Development Bank of the Philippines (DBP) to secure a
loan in the amount of P2,795,129.36.
ISSUE: Did public respondent commit grave abuse of discretion in
2. Thereafter, the Board of Directors of Yujuico Transit Co.,
reinstating the levy on the buses which have been allegedly
Inc. passed a resolution authorizing its President, Jesus
transferred to a third party, herein petitioner "Y" Transit Co., Inc.?
Yujuicoto enter into a dacionenpago arrangement with the
DBP, whereby Jesus Yujuico would transfer to the DBP the
Saint Martin Technical Institute in consideration of the full We rule in the negative.
settlement of the obligations of three companies, one of
which was Yujuico Transit Co, Inc.
The following facts have been established before the NLRC: that the
3. Accordingly, on or about October 24, 1978, the transfer of
transfer of ownership from Yujuico Transit Co., Inc. to Jesus Yujuico,
the property was made and DBP released the mortgages
and from Jesus Yujuico to "Y" Transit Co., Inc. lacked the prior
constituted on the buses of Yujuico Transit Co., Inc.
approval of the BOT as required by Section 20 of the Public Service
Consequently, the company transferred the ownership of its
Act;4 that the buses were transferred to "Y" Transit Co., Inc. during the
mortgaged properties, including the buses, to Jesus Yujuico.
pendency of the action; and that until the time of the execution, the
buses were still registered in the name of Yujuico Transit Co., Inc.
Meanwhile, sometime in June and July 1979, the Yujuico Transit
Employees Union (Associated labor Union) filed two (2) consolidated
There being no prior BOT approval in the transfer of property from
complaints against Yujuico Transit Co., Inc. for Unfair Labor Practice
Yujuico Transit Co., Inc. to Jesus Yujuico, it only follows that as far as
and violations of Presidential Decrees Nos. 525, 1123, 1614 and 851
the BOT and third parties are concerned, Yujuico Transit Co., Inc. still
(non-payment of living allowances).
owned the properties. and Yujuico, and later, "Y" Transit Co., Inc. only
held the same as agents of the former.
4. Jesus Yujuico sold the subject buses to herein petitioner "Y"
Transit Co., Inc. for P3,485,400.00.
Conversely, where the registered owner is liable for obligations to third
parties and vehicles registered under his name are levied upon to
LA: dismissed the complaint for unfair labor practice but holding satisfy his obligations, the transferee of such vehicles cannot prevent
Yujuico Transit Co., Inc.liable under the aforementioned Presidential the levy by asserting his ownership because as far as the law is
Decrees in the amount of P142,790.49. concerned, the one in whose name the vehicle is registered remains to
be the owner and the transferee merely holds the vehicles for the
registered owner. Thus, "Y" Transit Co., Inc. cannot now argue that the
On February 9, 1982, a writ of execution for the said amount was
buses could not be levied upon to satisfy the money judgment in favor
issued by the Labor Arbiter. On June 14, 1982, an alias writ of
of herein respondents. However, this does not deprive the transferee of
execution was issued and levy was made upon the ten (10) buses.
the right to recover from the registered owner any damages which may
Thereafter, "Y" Transit Co., Inc. filed Affidavits of Third Party Claim.
have been incurred by the former since the . . . transfer or lease is valid
and binding between the parties. . . . 7 Thus, had there been any real
5. Private respondents herein opposed the Third party contract between "Y" Transit Co., Inc. and Yujuico Transit Co., Inc. of
claim on the ground that the transactions leading to the "Y" Transit Co., Inc. and Jesus Yujuico regarding the sale or transfer of
transfer of the buses to "Y" Transit Co., Inc. were void the buses, the former may avail of its remedies to recover damages.
because they lacked the approval of the BOT as required
by the Public Service Act. They also argued that the buses
.
were still registered in the name of Yujuico Transit Co. which
was, therefore, still the lawful owner thereof.
WHEREFORE, in view of the foregoing, this petition is hereby
DISMISSED.
LA: found that "Y" Transit Co., Inc. had valid title to the buses and that
the BOT, by its subsequent acts had approved the transfer. The
decision stated further, thus:

The fact that the registration certificates of most of the vehicles in

question are still in the name of Yujuico Transit Co., Inc. at the time
of the levy on execution does not militate against the claimant.

Accordingly, the Third-Party Claim was granted and the release of all
the buses levied for execution was ordered.

APPEAL: NLRC reversed the labor arbiter's decision on the

ground that the transfer of the buses lacked the BOT approval. It
ordered the reinstatement of the levy and the auction of
properties.

6. "Y" Transit Co., Inc. thereafter filed this special civil action
for certiorari under Rule 65 of the Rules of Court praying for
the issuance of a Restraining Order and/or a Writ of
Preliminary Injunction and for the annulment of the NLRC
decision as it was issued with grave abuse of discretion
amounting to lack of jurisdiction.
7. In this petition, "Y" Transit Co., Inc. raised the following
issue, to writ:
Republic v. International Communications Corporation, G.R. No.
141667, July 17, 2006- GARCIA, J.:
FACTS:
1. On April 4, 1995, respondent ICC, holder of a legislative
franchise under Republic Act (RA) No. 7633 to operate
domestic telecommunications, filed with the NTC an
application for a Certificate of Public Convenience and
Necessity to install, operate, and maintain an international
telecommunications leased circuit service between the
Philippines and other countries, and to charge rates therefor,
with provisional authority for the purpose.
2. the NTC approved the application for a provisional authority
subject, among others, to the condition:
3. That applicant [ICC] shall pay a permit fee in the amount of
P1,190,750.00, in accordance with section 40(g) of the
Public Service Act,4 as amended;
4. ICC filed a motion for partial reconsideration of the Order
insofar as the same required the payment of a permit fee.
5. In a subsequent Order dated June 25, 1997, the NTC denied
the motion.
6. ICC went to the CA on a petition for certiorari with prayer for
a temporary restraining order and/or writ of preliminary
injunction, questioning the NTC's imposition against it of a
permit fee of P1,190,750.50 as a condition for the grant of
the provisional authority applied for.
7. CA: ruled in favor of the NTC, Then, ICC moved for a
reconsideration. This time, the CA, in its Amended
Decision dated September 30, 1999, reversed itself, to
wit:
8. NTC filed a motion for reconsideration,
9. its motion was denied by the CA
Hence, NTC's present recourse claiming that the CA erred in ruling
that:
1. NTC has arrogated upon itself the power to tax an entity;
2. Section 40(g) of the Public Service Act has been amended by
Section 5(g) of R.A. 7925;6
3. The imposition of permit fees is no longer authorized by R.A.
7925; and
4. The imposed permit fee in the amount of P1,190,750.50 for
respondent's provisional authority is exorbitant.
PROCEDURAL MATTER
respondent ICC, argued that: the present petition should be dismissed
outright for having been filed out of time. It is respondent's posture that
petitioner's motion for reconsideration filed with the CA vis-a-vis the
latter's Amended Decision is a pro forma motion and, therefore, did not
toll the running of the reglementary period to come to this Court via this
petition for review.
Under Section 2 of Rule 45 of the Rules of Court, a recourse to this
Court by way of a petition for review must be filed within fifteen (15)
days from notice of the judgment or final order or resolution appealed
from, or of the denial of the petitioner's motion for new trial or
reconsideration filed in due time after notice of the judgment. While a
motion for reconsideration ordinarily tolls the period for appeal, one
that fails to point out the findings or conclusions which were
supposedly contrary to law or the evidence does not have such an
effect on the reglementary period as it is merely a pro forma motion.7
Under established jurisprudence, the mere fact that a motion for
reconsideration reiterates issues already passed upon by the court
does not, by itself, make it a pro forma motion. Among the ends to
which a motion for reconsideration is addressed is precisely to
convince the court that its ruling is erroneous and improper, contrary to
the law or evidence; and in so doing, the movant has to dwell of
necessity on issues already passed upon. If a motion for
reconsideration may not discuss those issues, the consequence would
be that after a decision is rendered, the losing party would be confined
to filing only motions for reopening and new trial.9
Where there is no apparent intent to employ dilatory tactics, courts
should be slow in declaring outright a motion for reconsideration as pro
forma. The doctrine relating to pro forma motions has a direct bearing
upon the movant's valuable right to appeal.
SC: Hence, if petitioner's motion for reconsideration was indeed pro
forma, it would still be in the interest of justice to review the Amended
Decision a quo on the merits, rather than to abort the appeal due to a
technicality, especially where, as here, the industry involved
(telecommunications) is vested with public interest. All the more so
given that the instant petition raises some arguments that are well-
worth resolving for future reference.
SUBSTANTIVE MERITS OF THE PETITION.
A. In its Amended Decision, the CA ruled that petitioner NTC
had arrogated upon itself the power to tax an entity, which it
is not authorized to do. Petitioner disagreed, contending the
fee in question is not in the nature of a tax, but is merely a
regulatory measure.
Section 40(g) of the Public Service Act provides:
Sec. 40. The Commission is authorized and ordered to charge and
collect from any public service or applicant, as the case may be,
the following fees as reimbursement of its expenses in the
authorization, supervision and/or regulation of the public
services:
xxx xxx xxx
g) For each permit, authorizing the increase in equipment, the
installation of new units or authorizing the increase of capacity, or
the extension of means or general extensions in the services,
twenty centavos for each one hundred pesos or fraction of the
additional capital necessary to carry out the permit. (Emphasis
supplied)
Clearly, Section 40(g) of the Public Service Act is not a tax measure
but a simple regulatory provision for the collection of fees imposed
pursuant to the exercise of the State’s police power. A tax is imposed
under the taxing power of government principally for the purpose of
raising revenues. The law in question, however, merely authorizes and
requires the collection of fees for the reimbursement of the
Commission's expenses in the authorization, supervision and/or
regulation of public services. There can be no doubt then that petitioner
NTC is authorized to collect such fees. However, the amount thereof
must be reasonably related to the cost of such supervision and/or
regulation.10
B. Petitioner NTC also assails the CA's ruling that Section 40(g)
of the Public Service Act had been amended by Section 5(g)
of R.A. No. 7925, which reads:
Sec. 5. Responsibilities of the National Telecommunications
Commission. - The National Telecommunications Commission
(Commission) shall be the principal administrator of this Act and as
such shall take the necessary measures to implement the policies
and objectives set forth in this Act. Accordingly, in addition to its
existing functions, the Commission shall be responsible for the
following:
xxx xxx xxx
 g) In the exercise of its regulatory powers, continue to impose Independent of the above, there is one basic consideration for the
such fees and charges as may be necessary to cover dismissal of this petition, about which petitioner NTC did not bother to
reasonable costs and expenses for the regulation and comment at all. We refer to the fact that, as respondent ICC aptly
supervision of the operations of telecommunications entities. observed, the principal ground given by the CA in striking down the
(Emphasis supplied) imposition of the P1,190,750.50 fee is that respondent ICC is entitled
to the benefits of the so-called "parity clause" embodied in Section 23
of R.A. No. 7925, to wit:
The CA ratiocinated that while Section 40(g) of the Public Service Act
(CA 146, as amended), supra, allowed NTC to impose fees as
reimbursement of its expenses related to, among other things, the Section 23. Equality of Treatment in the Telecommunications
"authorization" of public services, Section 5(g), above, of R.A. No. Industry. - Any advantage, favor, privilege, exemption, or immunity
7921 no longer speaks of "authorization" but only of "regulation" and granted under existing franchises, or may hereafter be granted,
"supervision." To the CA, the omission by Section 5(g) of R.A. No. shall ipso facto become part of previously granted
7921 of the word "authorization" found in Section 40(g) of the Public telecommunications franchises and shall be accorded immediately
Service Act, as amended, meant that the fees which NTC may impose and unconditionally to the grantees of such franchises xxx.
are only for reimbursement of its expenses for regulation and
supervision but no longer for authorization purposes.
In this connection, it is significant to note that the subsequent
congressional franchise granted to the Domestic Satellite Corporation
SC: NTC is correct in saying that there is no showing of legislative under Presidential Decree No. 947, states:
intent to repeal, even impliedly, Section 40(g), supra, of the Public
Service Act, as amended. An implied repeal is predicated on a
Section 6. In consideration of the franchise and rights hereby
substantial conflict between the new and prior laws. In the absence of
granted, the grantee shall pay to the Republic of the Philippines
an express repeal, a subsequent law cannot be construed as repealing
during the life of this franchise a tax of one-half percent of gross
a prior one unless an irreconcilable inconsistency and repugnancy
earnings derived by the grantee from its operation under this
exist in the terms of the new and old laws.11 The two laws must be
franchise and which originate from the Philippines. Such tax shall
absolutely incompatible such that they cannot be made to stand
be due and payable annually within ten days after the audit and
together.12
approval of the accounts by the Commission on Audit as
prescribed in Section 11 hereof and shall be in lieu of all taxes,
Here, there does not even appear to be a conflict between Section assessments, charges, fees, or levies of any kind, nature, or
40(g) of the Public Service Act, as amended, and Section 5(g) of description levied, established or collected by any municipal,
R.A. 7925. In fact, the latter provision directs petitioner NTC to provincial, or national authority x xx (Emphasis supplied)
"continue to impose such fees and charges as may be necessary
to cover reasonable costs and expenses for the regulation and
The CA was correct in ruling that the above-quoted provision is, by law,
supervision of telecommunications entities." The absence alone
considered as ipso facto part of ICC's franchise due to the "parity
of the word "authorization" in Section 5(g) of R.A. No. 7921 cannot
clause" embodied in Section 23 of R.A. No. 7925. Accordingly,
be construed to mean that petitioner NTC had thus been deprived
respondent ICC cannot be made subject to the payment of the subject
of the power to collect such fees. As pointed out by the petitioner,
fees because its payment of the franchise tax is "in lieu" of all other
the words "authorization, supervision and/or regulation" used in
taxes and fees.
Section 40(g) of the Public Service Act are not distinct and completely
separable concepts which may be taken singly or piecemeal. Taken in
their entirety, they are the quintessence of the Commission's regulatory WHEREFORE, the petition is hereby DENIED and the assailed
functions, and must go hand-in-hand with one another. In petitioner's Amended Decision and Resolution of the CA are AFFIRMED.
own words, "[t]he Commission authorizes, supervises and regulates
telecommunications entities and these functions... cannot be
considered singly without destroying the whole concept of the
Commission's regulatory functions."15 Hence, petitioner NTC is correct
in asserting that the passage of R.A. 7925 did not bring with it the
abolition of permit fees.

However, while petitioner had made some valid points of argument, its
position must, of necessity, crumble on the fourth issue raised in its
petition. Petitioner itself admits that the fees imposed are precisely
regulatory and supervision fees, and not taxes. This necessarily
implies, however, that such fees must be commensurate to the costs
and expenses involved in discharging its supervisory and regulatory
functions.

In the words of Section 40(g) of the Public Service Act itself, the fees
and charges which petitioner NTC is authorized to collect from any
public service or applicant are limited to the "reimbursement of its
expenses in the authorization, supervision and/or regulation of public
services."

It is difficult to comprehend how the cost of licensing, regulating,

and surveillance could amount to P1,190,750.50. The CA was
correct in finding the amount imposed as permit fee exorbitant
and in complete disregard of the basic limitation that the fee
should be at least approximately commensurate to the expense.

Petitioner itself admits that it had imposed the maximum amount

possible under the Public Service Act, as amended. That is hardly
taking into consideration the actual costs of fulfilling its regulatory and
supervisory functions.
G.R. No. L-59234 September 30, 1982
TAXICAB OPERATORS OF METRO MANILA, INC., FELICISIMO
CABIGAO and ACE TRANSPORTATION
CORPORATION, petitioners,
vs.
THE BOARD OF TRANSPORTATION and THE DIRECTOR OF THE
BUREAU OF LAND TRANSPORTATION, respondents.
FACTS:
Petitioner Taxicab Operators of Metro Manila, Inc. (TOMMI) is a
domestic corporation composed of taxicab operators, who are grantees
of Certificates of Public Convenience to operate taxicabs within the
City of Manila and to any other place in Luzon accessible to vehicular
traffic. Petitioners Ace Transportation Corporation and Felicisimo
Cabigao are two of the members of TOMMI, each being an operator
and grantee of such certificate of public convenience.
On October 10, 1977, respondent Board of Transportation (BOT)
issued Memorandum Circular No. 77-42. Pursuant to the above BOT
circular, respondent Director of the Bureau of Land Transportation
(BLT) issued Implementing Circular No. 52, dated August 15, 1980,
instructing the Regional Director, the MV Registrars and other
personnel of BLT, all within the National Capitol Region, to implement
said Circular, and formulating a schedule of phase-out of vehicles to be
allowed and accepted for registration as public conveyances. To quote
said Circular:
Pursuant to BOT Memo-Circular No. 77-42, taxi
units with year models over six (6) years old are
now banned from operating as public utilities in
Metro Manila. As such the units involved should be
considered as automatically dropped as public
utilities and, therefore, do not require any further
dropping order from the BOT.
Henceforth, taxi units within the National Capitol Region having year
models over 6 years old shall be refused registration. In accordance
therewith, cabs of model 1971 were phase-out in registration year
1978; those of model 1972, in 1979; those of model 1973, in 1980; and
those of model 1974, in 1981.
On January 27, 1981, petitioners filed a Petition with the BOT,
docketed as Case No. 80-7553, seeking to nullify MC No. 77-42 or to
stop its implementation; to allow the registration and operation in 1981
and subsequent years of taxicabs of model 1974, as well as those of
earlier models which were phased-out, provided that, at the time of
registration, they are roadworthy and fit for operation.
Issues:
A. Did BOT and BLT promulgate the questioned
memorandum circulars in accord with the manner
required by Presidential Decree No. 101, thereby
safeguarding the petitioners' constitutional right to
procedural due process?
B. Granting, arguendo, that respondents did
comply with the procedural requirements imposed
by Presidential Decree No. 101, would the
implementation and enforcement of the assailed
memorandum circulars violate the petitioners'
constitutional rights to.
(1) Equal
protection
of the
law;
(2)
Substanti
ve due
process;
and
(3)
Protection
against
arbitrary
and
unreason
able
classificat
ion and
standard?
Ruling:
On Procedural and Substantive Due Process:
In support of their submission that they were denied procedural due
process, petitioners contend that they were not caged upon to submit
their position papers, nor were they ever summoned to attend any
conference prior to the issuance of the questioned BOT Circular.
Presidential Decree No. 101 grants to the Board of Transportation the
power
4. To fix just and reasonable standards,
classification, regulations, practices,
measurements, or service to be furnished,
imposed, observed, and followed by operators of
public utility motor vehicles.
Section 2 of said Decree provides procedural guidelines for said
agency to follow in the exercise of its powers:
Sec. 2. Exercise of powers. — In the exercise of
the powers granted in the preceding section, the
Board shag proceed promptly along the method of
legislative inquiry.
Apart from its own investigation and studies, the
Board, in its discretion, may require the
cooperation and assistance of the Bureau of
Transportation, the Philippine Constabulary,
particularly the Highway Patrol Group, the support
agencies within the Department of Public Works,
Transportation and Communications, or any other
government office or agency that may be able to
furnish useful information or data in the formulation
of the Board of any policy, plan or program in the
implementation of this Decree.
The Board may also can conferences, require the
submission of position papers or other documents,
information, or data by operators or other persons
that may be affected by the implementation of this
Decree, or employ any other suitable means of
inquiry.
It is clear from the provision aforequoted, however, that the leeway
accorded the Board gives it a wide range of choice in gathering
necessary information or data in the formulation of any policy, plan or
program. It is not mandatory that it should first call a conference or
require the submission of position papers or other documents from
operators or persons who may be affected, this being only one of the
options open to the Board, which is given wide discretionary authority.
Petitioners cannot justifiably claim, therefore, that they were deprived
of procedural due process. Neither can they state with certainty that
public respondents had not availed of other sources of inquiry prior to
issuing the challenged Circulars. operators of public conveyances are
not the only primary sources of the data and information that may be
desired by the BOT.
Dispensing with a public hearing prior to the issuance of the Circulars circumstance would be accorded the same treatment both in privilege
is neither violative of procedural due process. As held in Central Bank conferred and the liabilities imposed. 9 The challenged Circulars satisfy
vs. Hon. Cloribel and Banco Filipino, 44 SCRA 307 (1972): the foregoing criteria.

Pevious notice and hearing as elements of due Evident then is the conclusion that the questioned Circulars do not
process, are constitutionally required for the suffer from any constitutional infirmity. To declare a law
protection of life or vested property rights, as well unconstitutional, the infringement of constitutional right must be clear,
as of liberty, when its limitation or loss takes place categorical and undeniable. 10
in consequence of a judicial or quasi-judicial
proceeding, generally dependent upon a past act
WHEREFORE, the Writs prayed for are denied and this Petition is
or event which has to be established or
hereby dismissed
ascertained. It is not essential to the validity of
general rules or regulations promulgated to govern
future conduct of a class or persons or enterprises,
unless the law provides otherwise. (Emphasis
supplied)

On Protection against Arbitrary and Unreasonable Classification and

Standard:

Petitioners further take the position that fixing the ceiling at six (6)
years is arbitrary and oppressive because the roadworthiness of
taxicabs depends upon their kind of maintenance and the use to which
they are subjected, and, therefore, their actual physical condition
should be taken into consideration at the time of registration

A reasonable standard must be adopted to apply to an vehicles

affected uniformly, fairly, and justly. The span of six years supplies that
reasonable standard. The product of experience shows that by that
time taxis have fully depreciated, their cost recovered, and a fair return
on investment obtained. They are also generally dilapidated and no
longer fit for safe and comfortable service to the public specially
considering that they are in continuous operation practically 24 hours
everyday in three shifts of eight hours per shift. With that standard of
reasonableness and absence of arbitrariness, the requirement of due
process has been met.

On Equal Protection of the Law:

Petitioners alleged that the Circular in question violates their right to

equal protection of the law because the same is being enforced in
Metro Manila only and is directed solely towards the taxi industry. At
the outset it should be pointed out that implementation outside Metro
Manila is also envisioned in Memorandum Circular No. 77-42. To
repeat the pertinent portion:

For an orderly implementation of this Memorandum Circular, the rules

herein shall immediately be effective in Metro Manila. Its
implementation outside Metro Manila shall be carried out only after the
project has been implemented in Metro Manila and only after the date
has been determined by the Board

The Board's reason for enforcing the Circular initially in Metro Manila is
that taxicabs in this city, compared to those of other places, are
subjected to heavier traffic pressure and more constant use. This is of
common knowledge. Considering that traffic conditions are not the
same in every city, a substantial distinction exists so that infringement
of the equal protection clause can hardly be successfully claimed.

As enunciated in the preambular clauses of the challenged BOT

Circular, the overriding consideration is the safety and comfort of the
riding public from the dangers posed by old and dilapidated taxis. The
State, in the exercise, of its police power, can prescribe regulations to
promote the health, morals, peace, good order, safety and general
welfare of the people. It can prohibit all things hurtful to comfort, safety
and welfare of society. 5 It may also regulate property rights. 6 In the
language of Chief Justice Enrique M. Fernando "the necessities
imposed by public welfare may justify the exercise of governmental
authority to regulate even if thereby certain groups may plausibly
assert that their interests are disregarded".

8
What is required under the equal protection clause is the uniform
operation by legal means so that all persons under Identical or similar
G.R. No. 47065 June 26, 1940
PANGASINAN TRANSPORTATION CO., INC., petitioner,
vs.
THE PUBLIC SERVICE COMMISSION, respondent.
Facts:
The petitioner has been engaged for the past twenty years in the
business of transporting passengers in the Province of Pangasinan
and Tarlac and, to a certain extent, in the Province of Nueva Ecija and
Zambales, by means of motor vehicles commonly known as TPU
buses, in accordance with the terms and conditions of the certificates
of public convenience issued in its favor by the former Public Utility
Commission. , the petitioner filed with the Public Service Commission
an application for authorization to operate ten additional new Brockway
trucks (case No. 56641), on the ground that they were needed to
comply with the terms and conditions of its existing certificates and as
a result of the application of the Eight Hour Labor Law. The PSC
granted the application but added several conditions for
PANTRANCO’s compliance. One is that the service can be acquired
by government upon payment of the cost price less depreciation, and
that the certificate shall be valid only for a definite period of time.
Not being agreeable to the two new conditions thus incorporated in its
existing certificates, the petitioner filed a motion for reconsideration
which was denied by the Public Service Commission. Stated in the
language of the petitioner, it is contended:
1. That the legislative powers granted to the Public Service
Commission by section 1 of Commonwealth Act No. 454,
without limitation, guide or rule except the unfettered
discretion and judgment of the Commission, constitute a
complete and total abdication by the Legislature of its
functions in the premises, and for that reason, the Act, in so
far as those powers are concerned, is unconstitutional and
void.
2. That even if it be assumed that section 1 of
Commonwealth Act No. 454, is valid delegation of legislative
powers, the Public Service Commission has exceeded its
authority because: (a) The Act applies only to future
certificates and not to valid and subsisting certificates issued
prior to June 8, 1939, when said Act took effect, and (b) the
Act, as applied by the Commission, violates constitutional
guarantees.
Section 15 of Commonwealth Act No. 146, as amended by section 1 of
Commonwealth Act No. 454, invoked by the respondent Public Service
Commission in the decision complained of in the present proceedings,
reads as follows:
With the exception to those enumerated in the preceding
section, no public service shall operate in the Philippines
without possessing a valid and subsisting certificate from the
Public Service Commission, known as "certificate of public
convenience," or "certificate of convenience and public
necessity," as the case may be, to the effect that the
operation of said service and the authorization to do
business will promote the public interests in a proper and
suitable manner.
The Commission may prescribed as a condition for the
issuance of the certificate provided in the preceding
paragraph that the service can be acquired by the
Commonwealth of the Philippines or by any instrumentality
thereof upon payment of the cost price of its useful
equipment, less reasonable depreciation; and likewise, that
the certificate shall 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 force and to those which
may hereafter be issued, to permits to modify itineraries and
time schedules of public services and to authorization to
renew and increase equipment and properties.
Issue:
Whether or not PSC can impose said conditions. If so, wouldn’t
this power of the PSC constitute undue delegation of powers?
Ruling:
Section 8 of Article XIII of the Constitution provides, among other
things, that no franchise, certificate, or any other form of authorization
for the operation of a public utility shall be "for a longer period than fifty
years," and when it was ordained, in section 15 of Commonwealth Act
No. 146, as amended by Commonwealth Act No. 454, that the Public
Service Commission may prescribed as a condition for the issuance of
a certificate that it "shall be valid only for a definite period of time" and,
in section 16 (a) that "no such certificates shall be issued for a period
of more than fifty years," the National Assembly meant to give effect to
the aforesaid constitutional mandate. More than this, it has thereby
also declared its will that the period to be fixed by the Public Service
Commission shall not be longer than fifty years. All that has been
delegated to the Commission, therefore, is the administrative function,
involving the use discretion, to carry out the will of the National
Assembly having in view, in addition, the promotion of "public interests
in a proper and suitable manner." The fact that the National Assembly
may itself exercise the function and authority thus conferred upon the
Public Service Commission does not make the provision in question
constitutionally objectionable.
The petitioner is mistaken in the suggestion that, simply because its
existing certificates had been granted before June 8, 1939, the date
when Commonwealth Act No. 454, amendatory of section 15 of
Commonwealth Act No. 146, was approved, it must be deemed to
have the right of holding them in perpetuity. Section 74 of the
Philippine Bill provided that "no franchise, privilege, or concession shall
be granted to any corporation except under the conditions that it shall
be subject to amendment, alteration, or repeal by the Congress of the
United States." The Jones Law, incorporating a similar mandate,
provided, in section 28, that "no franchise or right shall be granted to
any individual, firm, or corporation except under the conditions that it
shall be subject to amendment, alteration, or repeal by the Congress of
the United States." Lastly, the Constitution of the Philippines provided,
in section 8 of Article XIII, that "no franchise or right shall be granted to
any individual, firm, or corporation, except under the condition that it
shall be subject to amendment, alteration, or repeal by the National
Assembly when the public interest so requires." The National
Assembly, by virtue of the Constitution, logically succeeded to the
Congress of the United States in the power to amend, alter or repeal
any franchise or right granted prior to or after the approval of the
Constitution; and when Commonwealth Acts Nos. 146 and 454 were
enacted, the National Assembly, to the extent therein provided, has
declared its will and purpose to amend or alter existing certificates of
public convenience.
Upon the other hand, statutes enacted for the regulation of public
utilities, being a proper exercise by the state of its police power, are
applicable not only to those public utilities coming into existence after
its passage, but likewise to those already established and in operation.
Nor is there any merit in petitioner's contention, that,
because of the establishment of petitioner's operations prior
to May 1, 1917, they are not subject to the regulations of the
Commission. Statutes for the regulation of public utilities are
a proper exercise by the state of its police power. As soon as
the power is exercised, all phases of operation of established
utilities, become at once subject to the police power thus
called into operation. Procedures' Transportation Co. v.
Railroad Commission, 251 U. S. 228, 40 Sup. Ct. 131, 64
Law. ed. 239, Law v. Railroad Commission, 184 Cal. 737,
195 Pac. 423, 14 A. L. R. 249. The statute is applicable not
only to those public utilities coming into existence after its
passage, but likewise to those already established and in
operation. The 'Auto Stage and Truck Transportation Act'
(Stats. 1917, c. 213) is a statute passed in pursuance of the
police power. The only distinction recognized in the statute
between those established before and those established
 after the passage of the act is in the method of the creation
of their operative rights. A certificate of public convenience
and necessity it required for any new operation, but no such
certificate is required of any transportation company for the
operation which was actually carried on in good faith on May
1, 1917, This distinction in the creation of their operative
rights in no way affects the power of the Commission to
supervise and regulate them. Obviously the power of the
Commission to hear and dispose of complaints is as
effective against companies securing their operative rights
prior to May 1, 1917, as against those subsequently securing
such right under a certificate of public convenience and
necessity. (Motor Transit Co. et al. v. Railroad Commission
of California et al., 209 Pac. 586.)
Whilst the challenged provisions of Commonwealth Act No. 454 are
valid and constitutional, we are, however, of the opinion that the
decision of the Public Service Commission should be reversed and the
case remanded thereto for further proceedings for the reason now to
be stated. The Public Service Commission has power, upon proper
notice and hearing, "to amend, modify or revoke at any time any
certificate issued under the provisions of this Act, whenever the facts
and circumstances on the strength of which said certificate was issued
have been misrepresented or materially changed." (Section 16, par.
[m], Commonwealth Act No. 146.) The petitioner's application here was
for an increase of its equipment to enable it to comply with the
conditions of its certificates of public convenience. On the matter of
limitation to twenty five (25) years of the life of its certificates of public
convenience, there had been neither notice nor opportunity given the
petitioner to be heard or present evidence. The Commission appears
to have taken advantage of the petitioner to augment petitioner's
equipment in imposing the limitation of twenty-five (25) years which
might as well be twenty or fifteen or any number of years. This is, to
say the least, irregular and should not be sanctioned. There are
cardinal primary rights which must be respected even in proceedings of
this character. The first of these rights is the right to a hearing, which
includes the right of the party interested or affected to present his own
case and submit evidence in support thereof.

The decision appealed from is hereby reversed and the case

remanded to the Public Service Commission for further proceedings in
accordance with law and this decision, without any pronouncement
regarding costs. So ordered.