Manila Electric Company v. Public Service Commission
REITERATIONFacts
The Antecedents: The Manila Electric Company (Meralco) proposed to enforce a regulation stating that a customer disconnected for non-payment of bills would not be reconnected unless arrears were paid and a deposit for future accounts, equivalent to two months' approximate consumption and bearing 6% annual interest, was made. This deposit would be refunded after one year of prompt payment. Procedural History: The Public Service Commission, through a letter dated July 24, 1934, directed Meralco to desist from enforcing this regulation, citing Section 16 (c) of Act 3108, which prohibits unjust, unreasonable, or discriminatory practices. The Commission also required Meralco to secure authority from it before enforcing such a regulation and to pay registration fees. The Petition: Meralco filed a petition for certiorari with the Supreme Court, seeking to nullify the order of the Public Service Commission. Meralco argued that the Commission erred in presuming its regulation to be unjust and unreasonable and in requiring prior approval and payment of fees for a regulation not expressly mandated by law to be submitted for approval.
Issue(s)
Whether there is a presumption that measures adopted by public service companies are unjust, unreasonable, and arbitrary. Whether the Public Service Commission is authorized to require the petitioner to submit the regulation for approval before enforcement and to pay registration fees.
Ruling
The Supreme Court declared the order of the Public Service Commission null and void and without effect. The Court held that public service companies are not required to prove the reasonableness of their regulations unless objected to, and that they are not obligated to submit regulations for prior approval if the law does not expressly require it.
Ratio Decidendi
On Issue 1: The Court held that there is no presumption that measures or rules adopted by public service companies are unjust, unreasonable, and arbitrary. Instead, Section 334, No. 31 of the Code of Civil Procedure establishes a disputable presumption that the law has been obeyed. Consequently, it is presumed that the Manila Electric Company has complied with the prohibition in Section 16 (c) of Act No. 3108, and that its adopted regulation is just and reasonable. The burden of proof, therefore, rests upon the party alleging that the measure is unjust, unreasonable, or arbitrary, and the Public Service Commission violated procedural law by requiring Meralco to prove the reasonableness of its regulation. On Issue 2: The Court ruled that while Section 13 of Act No. 3108 grants the Public Service Commission general supervision and regulation of public utilities, and Section 24 (h) allows it to investigate complaints and charge expenses, the Act does not require a public utility to submit regulations of the nature in question for prior approval. The Court noted that when the Legislature intended prior approval, it expressly stated so, as in Section 16 (h) regarding the sale or lease of property. Following the rule of statutory construction that what is not expressly or impliedly prohibited may be done, Meralco was not obliged to submit its regulation for approval, nor was the Public Service Commission authorized to require it. However, the Court acknowledged that public service companies are bound to give notice of measures affecting the public to the Commission to enable it to perform its duty of supervision and regulation.
Main Doctrine
The Court held that public service companies are not required to prove that their adopted measures or regulations are just and reasonable unless they are objected to as such, and that they are not obliged to submit such measures for prior approval by the Public Service Commission if the law does not expressly require it. The presumption of law is that compliance therewith has been obeyed, meaning that the regulations adopted by public service companies are presumed to be just and reasonable, placing the burden of proof on the party alleging otherwise.