Title
Alalayan vs. National Power Corp.
Case
G.R. No. L-24396
Decision Date
Jul 29, 1968
Petitioners challenged Section 3 of RA 3043, limiting franchise holders' profits, claiming it violated the one-subject rule, due process, and non-impairment clause. SC upheld the law, ruling it a valid exercise of police power.
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Case Digest (G.R. No. L-24396)

Facts:

  1. Parties Involved:

    • Petitioners: Santiago P. Alalayan and Philippine Power and Development Company (later dismissed from the case).
    • Respondents: National Power Corporation (NPC) and the Administrator of Economic Coordination.
  2. Nature of the Case:

    • A declaratory relief proceeding was initiated by the petitioners to challenge the constitutionality of Section 3 of Republic Act No. 3043, which empowered the NPC to limit the net profits of franchise holders receiving at least 50% of their electric power from NPC to 12% annually of their investments plus two-month operating expenses.
  3. Background of the Dispute:

    • Petitioners were franchise holders of electric plants in Laguna and had existing contracts with NPC for the supply of electric power.
    • On June 17, 1961, Republic Act No. 3043 was enacted, amending the charter of NPC and including the contested provision.
    • NPC announced a rate increase of 17.5%, which petitioners opposed, arguing that the provision was unconstitutional.
  4. Petitioners' Claims:

    • The provision was a "rider" and violated the constitutional requirement that a bill must embrace only one subject, expressed in its title.
    • The provision infringed on their liberty to contract and violated the due process clause.
    • They sought a declaration of unconstitutionality and an injunction to prevent NPC from enforcing the provision.
  5. Lower Court Decision:

    • The lower court sustained the validity of the provision, prompting the petitioners to appeal.

Issue:

  1. Constitutionality of the Provision:
    • Whether Section 3 of Republic Act No. 3043 violated the constitutional requirement that a bill must embrace only one subject, expressed in its title.
    • Whether the provision infringed on the petitioners' liberty to contract and violated the due process clause.
    • Whether the provision impaired the obligation of contracts, violating the constitutional prohibition against laws impairing the obligation of contracts.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)


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