Tacloban Electric & Ice Plants Co. v. Commissioner Medina
REITERATIONFacts
The Antecedents: The Municipal Board of Tacloban City passed Resolution No. 86 requesting a reduction in electric rates charged by Tacloban Electric Light & Ice Plants Company (the Plant), citing the Plant's tax exemption under Republic Act 2995. Subsequently, an agreement was reached to use the Plant's 1961 financial statements, after an independent audit, as a basis for rate reduction. Later, the Acting Commissioner of Customs requested a rate reduction. The Public Service Commission (PSC) required the Plant to show cause why its rates should not be reduced. Procedural History: The PSC consolidated the case with another concerning the audit report. In a decision dated May 3, 1963, the PSC, through Commissioner Enrique Medina and concurred in by Associate Commissioners Francisco Perfecto and Gregorio Panganiban, ordered the Plant to reduce its rates by 10% effective June 1963. The Plant filed a motion for reconsideration, claiming the new rates were unreasonable, confiscatory, and determined without due process. A supplemental motion was later filed. On February 3, 1965, the motion for reconsideration was denied by a 3-3 vote, with Commissioner Medina, Associate Commissioners Josias Guinto, and Alex de Guzman voting to deny, and Commissioners Francisco Perfecto, Jose A. Fornier (in separate dissenting opinions), and Gregorio Panganiban (concurring with Perfecto) dissenting. The supplemental motion was also denied on March 12, 1965, with only Commissioner Medina signing the order. Subsequent motions by the Plant to set aside the promulgation orders and to break the tie vote were not set for hearing by Commissioner Medina. The Petition: The Plant filed a petition for certiorari, prohibition, and mandamus with preliminary injunction before the Supreme Court, seeking to annul the promulgation orders of February 3 and March 12, 1965, enjoin the enforcement of the May 3, 1963 decision, order the breaking of the tie vote, and suspend the period for appeal from the decision.
Issue(s)
Whether the promulgation of the order denying the motion for reconsideration (February 3, 1965) and the supplemental motion (March 12, 1965) was improper due to the absence of four (4) concurring Commissioners. Whether the enforcement of the decision dated May 3, 1963, ordering a rate reduction, is erroneous.
Ruling
The Supreme Court annulled the orders of February 3, 1965, and March 12, 1965, and remanded the case to the Public Service Commission for further deliberation and, if necessary, for reference to the Secretary of Justice. The Court affirmed the immediate effectivity of the decision dated May 3, 1963, as of June 1963, without prejudice.
Ratio Decidendi
On Issue 1: The Court ruled that the promulgation of the order denying the motion for reconsideration on February 3, 1965, was improper. Section 3, last paragraph, of the Public Service Act, as amended by Republic Act 2677, clearly mandates that the concurrence of at least four commissioners is necessary for the promulgation of a final decision or order resolving a motion for reconsideration. The 3-3 vote resulted in an impasse, and it was incorrect to consider it as an automatic denial. The law provides a specific procedure for tie votes, requiring reference to the Secretary of Justice to designate additional members to sit as Commissioners. Commissioner Medina should not have unilaterally promulgated the order. The denial of the supplemental motion was a mere consequence of the improper denial of the main motion for reconsideration. On Issue 2: The Court held that the enforcement of the decision dated May 3, 1963, ordering the rate reduction, was not erroneous. Section 33, last of the Public Service Act, as amended, explicitly states that all orders of the Commission prescribing rates shall be immediately operative. The Commission has no discretion to suspend the effectivity of such orders; only the Supreme Court can grant a suspension. Therefore, the decision ordering the rate reduction was valid and immediately enforceable as of June 1963, despite the procedural infirmities in the subsequent denial of the motion for reconsideration.
Main Doctrine
The Supreme Court reiterated that orders of the Public Service Commission prescribing rates are immediately operative and cannot be suspended by the Commission itself, with only the Supreme Court possessing the authority to grant such suspension. Additionally, the Court emphasized that the promulgation of a final decision or order resolving a motion for reconsideration necessitates the concurrence of at least four commissioners, as stipulated by Section 3 of the Public Service Act, as amended by Republic Act 2677. In cases of tie votes, the Commission must refer the matter to the Secretary of Justice for appropriate action.