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Facts:
In his application for a permit, Cayetano Orlanes alleges that:
a. he is the holder of a certificate of public convenience (PC) issued by the Public Service Commission (PSC) in case No. 7306, to operate an autobus
line
i. from Taal to Lucena, passing through Batangas, Bolbok and Bantilan (in the Province of Batangas), and Candelaria and Sariaya (in the Province of
Tayabas), without any fixed schedule
ii. however, he could not accept passengers from intermediate points in which Batangas Transportation Co. (Batranco) has authority to operate by
virtue of a prior license
b. he then has applied for a fixed schedule for those lines in which his license is limited and requests that he be converted into a regular operator
on a fixed schedule, thereby submitting a proposed schedule to PSC
Batranco appeared and filed an application for a permit, praying that the petition of Orlanes be denied, alleging that:
a. it is operating a regular service of auto trucks between Batangas and some parts in Tayabas
b. since 1918, it has been operating a regular service between Taal and Rosario, and in 1920, its service was extended to the municipality of San
Juan de Bolbok, with a certificate of PC issued
c. in 1925, Orlanes obtained from PSC a certificate of PC, as aforementioned
d. Orlanes inaugurated operations in March of 1926, but maintained it on the part between Taal and Bantilan for only about three months, when
he abandoned it in June; he did not renew it until five days before the hearing of case No. 10301
e. said case 10301 was filed by Batranco praying that:
i. its number of trip hours within the areas (conflicting routes) over which Orlanes likewise prays to be a regular operator be increased, and/or
ii. all irregular operators be prohibited from operating their respective licenses, unless they should observe an interval of two hours before, or one
hour after, the regular hours of Batranco
f. from June, 1926, Orlanes and Batranco were jointly operating a regular service between Bantilan and Lucena, with trips every half an hour
g. Orlanes not having asked for a regular service between Bantilan and Taal, Batranco remedied this under authority and increased its trips
between Bantilan and Tayabas to make due and timely connections in Bantilan to all other points in the Province of Batangas
h. the service maintained by Batranco is sufficient to satisfy the convenience of the public
i. the PC does not require the granting of the permit for the service which Orlanes applied for, since to do so would result in ruinous competition
and grave prejudice of the company without any benefit to the public
PSC granted the petition of Orlanes, as prayed for. Batranco filed a motion for rehearing, which was denied. It then appealed to the SC.
Issue:
Whether a certificate of PC to operate a public utility be issued to an applicant (Orlanes) thereof in a field where a person is already granted a license
(Batranco)?
Held:
The decision of the PSC is revoked and set aside, the case being remanded for further proceedings. So long as an operator under a prior license
complies with the terms and conditions of his license and reasonable rules and regulation for its operation and meets the reasonable demands of the
public, it is the duty of PSC to protect rather than to destroy his investment by the granting of a subsequent license to another for the same thing
over the same route of travel. The granting of such a license does not serve its convenience or promote the interests of the public.
The questions presented involve a legal construction of the powers and duties of the PSC, and the purpose and intent for which it was created, and
the legal rights and privileges of a public utility operating under a prior license.
1. An autobus line is a public utility, a common carrier, and an important factor in the business conditions of the Islands, which is daily branching
out and growing very fast.
It must apply for and obtain a license or permit from the PSC, and comply with defined terms and conditions before such a business can be operated.
When license is granted, the operator must conform to, and comply with, all reasonable rules and regulations of the PSC.
2. The object and purpose of PSC, among others, is to look out for, and protect, the interests of the public, and, in the instant case, to provide it
with safe and suitable means of travel over the highways in question, in like manner that a railroad would be operated under like terms and
conditions. For many and different reasons, it has never been the policy of a PSC to grant a license for the operation of a new line of railroad which
parallels and covers the same field and territory of another old established line, for the simple reason that it would result in ruinous competition, and
would not be of any benefit or convenience to the public.
The PSC has ample power and authority to make any and all reasonable rules and regulations for the operation of any public utility and to enforce
compliance therewith, failure of which permits the PSC to revoke the license. It also has ample power to specify and define what a reasonable
compensation is for the services rendered to the public.
The fact that PSC has previously granted a license to any person to operate a bus line over a given highway and thereafter refuses to grant a similar
license to another over the same highway, does not in the least create a monopoly in the person of the licensee, for the reason that the PSC has, at
all times, the powers enumerated previously.
FACTS:
Private respondent GrandAir applied for a Certificate of Public Convenience and Necessity with the Civil Aeronautics Board (CAB). This application
was opposed by petitioner PAL which is a holder of a legislative franchise to operate air transport services alleging that that the CAB had no
jurisdiction to hear the petitioner’s application until GrandAir has first obtained a franchise to operate from Congress.
ISSUE:
WON the CAB had the jurisdiction to hear the application because GrandAir did not possess a legislative franchise.
WON Congress, in enacting Republic Act 776, has delegated the authority to authorize the operation of domestic air transport services to the
respondent Board, such that Congressional mandate for the approval of such authority is no longer necessary.
RULING:
Yes. The Civil Aeronautics Board has the authority to issue a Certificate of Public Convenience and Necessity, or Temporary Operating Permit to a
domestic air transport operator, who, though not possessing a legislative franchise, meets all the other requirements prescribed by the law.
There is nothing in the law nor in the Constitution, which indicates that a legislative franchise is an indispensable requirement for an entity to
operate as a domestic air transport operator. Although Section 11 of Article XII recognizes Congress’ control over any franchise, certificate or
authority to operate a public utility, it does not mean Congress has exclusive authority to issue the same. Franchises issued by Congress are not
required before each and every public utility may operate. In many instances, Congress has seen it fit to delegate this function to government
agencies, specialized particularly in their respective areas of public service.
Congress, gave CAB the power to issue permits for the operation of domestic transport services. It has delegated to the said body the authority to
determine the capability and competence of a prospective domestic air transport operator to engage in such venture.
TOMAS VS MALORCA
Facts:
Tomas Litimco filed a petition before the Public Service Commission (PSC) praying for authority to operate a TPU service on the line Manila-Malolos
via Sta. Isabel with the use of 10 units. Several operators filed written oppositions. \
Before PSC could render its decision, La Mallorca, another operator, moved to reopen the case stating that if the petition to operate the line
proposed be granted it would work to its prejudice and so it requested a reopening in order that it may file its opposition. The motion was granted.
However, instead of presenting evidence in support of its opposition, La Mallorca moved for postponement, only to announce days later that instead
of merely objecting to the petition, it decided to file an application under a separate number (Case No. 63120) requesting for authority to operate
the same line applied for by petitioner by rerouting 4 of its 10 round trip units of the line Malolos-Manila via Guiguinto.
The PSC rendered decision denying petitioner’s application but granting that of respondent on the ground that the latter has a better right to render
the service applied for.
1. his application was filed much ahead than that of respondent and as such it is entitled to preference
2. in awarding the line to respondent it in effect gave recognition to the unfair attitude of respondent
3. to grant the service in favor of respondent will work to the prejudice of the riding public for it would be allowing respondent to abandon a portion
of its service on its original line Manila-Malolos via Guiguinto, a service which was previously found to promote the need and convenience of the
people in said territory.
1. application for rerouting will not involve any increase of trips or units nor will involve the purchase of new trucks, while that of petitioner would
call for the use of 10 new trucks, which means a further depletion of the already depleted dollar reserve of our government
2. application for re-routing will not involve the acquisition of an operating right over the national highway from Malolos railroad crossing up to
Guiguinto, while, on the other hand, petitioner’s application will involve the acquisition of a new operating right
Issue:
Held:
Litimco. Since it is admitted that he is financially competent and able to operate the line proposed and is also an operator of a bus line from Manila
to Malolos via Bulacan, we see no plausible reason why he should not be given preference to operate the service applied for considering that he is
the first one to apply for such line.
This is in accord with the policy to stave off any act of discrimination or partiality against any application for operation of a new line. While there may
be cases where an applicant, even if ahead in time, was not given the service, it is because it was proven that he was financially incompetent, or
otherwise disqualified, to render the service, If an applicant is qualified financially, and is able to undertake the service, he should be given the
preference as a matter of fairness and justice.
Priority in the filing of the application for a certificate of public convenience is, other conditions being equal, an important factor in determining the
right of the public service companies.
The argument that the application of petitioner for the operation of the new line calls for the purchase of 10 new trucks is of no consequence, if the
operation will redound to the benefit of the riding public. The operation of a new line as a general proposition always involves a new investment
which may happen even with old operators. In the course of operation, and with the passing of time, new equipment and facilities may be found
necessary to maintain an efficient service, which additional expenditure cannot certainly be considered as a cause for disruption of the service. This
is a matter of finance which concerns exclusively the one who desires to operate the new line.
At any rate, the new line merely covers 7 kilometers of new territory which traverses three sparsely populated barrios, and considering that
respondent did not deem it necessary to cover said territory except after the passing of many years, and only thought of giving the service when
petitioner filed his application, fairness requires that preference be given to petitioner.