Manila v. Public Service Commission
REITERATIONFacts
The Antecedents: The Manila Electric Company (Meralco) applied to the Public Service Commission (PSC) for authority to abandon its trolley bus and street car services and substitute them with an auto bus service. The PSC granted a temporary permit, which was later extended. Meralco then applied for permanent authority, asserting the proposed service was a public convenience. Procedural History: The City of Manila opposed Meralco's application, arguing that the substitution violated Meralco's franchise, which required the city's consent. The PSC dismissed the city's opposition and granted Meralco permanent authority. The City of Manila appealed this decision. The Petition: The core of the dispute was whether the power to authorize such abandonment and substitution resided with the City of Manila or the Public Service Commission, given Meralco's franchise granted by the Philippine Commission and later amended.
Issue(s)
Whether the Public Service Commission (PSC) has the jurisdiction to authorize the Manila Electric Company to abandon street car lines and substitute them with auto buses without the consent of the City of Manila. Whether the general provisions of the Public Service Law (Act No. 3108) repealed the specific provisions in the Manila Electric Company franchise regarding municipal approval for route changes.
Ruling
The Supreme Court ruled that the City of Manila, not the Public Service Commission, possesses the power to authorize the Manila Electric Company to abandon its trolley bus and street car services and substitute them with an auto bus service. The decision of the Public Service Commissioner was vacated and set aside, subject to Meralco securing municipal approval within three months.
Ratio Decidendi
On Issue 1: The Court held that the power to authorize the abandonment of a trolley bus or street car service and the substitution thereof with an auto bus service is confided to the City of Manila. The franchise is a contract between the state (via its agent, the City) and the grantee, which must be respected. The City is given wide authority by its charter to regulate the use of city streets, and a key consideration for the franchise was the repair and maintenance of those streets by Meralco. The Court noted that the Commission's general power of supervision and regulation does not inherently include the specific prerogative to allow a utility to abandon its franchise obligations or change its routes when such powers are explicitly reserved to another body by a special law. On Issue 2: Applying the rule of statutory construction from Manila Railroad Co. v. Rafferty, the Court emphasized that special laws or charters are not repealed by general laws by mere implication. Repeal by implication is not favored, and the repugnance between two statutes must be very clear. Although the Public Service Law (Act No. 3108) is later and grants broad oversight, it does not explicitly mention the power to permit street railways to abandon franchises. Historically, even after the creation of the Public Utility Commission (the predecessor of the PSC) in 1913, Meralco continued to seek city ordinances for route changes, showing that the parties themselves interpreted the law as requiring municipal consent. Therefore, the general law did not abrogate the specific franchise provisions.
Main Doctrine
The Public Service Commission does not possess the power to authorize a public utility to abandon its existing service and substitute a new one if such action contravenes the specific provisions of its franchise, especially when the franchise requires municipal consent for such changes. Legislative intent to repeal or supersede specific franchise provisions by a general law must be manifest.