Title
Buenaflor vs. Camarines Sur Industry Corp.
Case
G.R. No. L-14991-94
Decision Date
May 30, 1960
Buenaflor contested Camarines Corporation's expired corporate status, securing rights to operate a 5-ton ice plant after Supreme Court ruled in his favor, prioritizing first applicant and public interest.
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Case Digest (G.R. No. L-14991-94)

Facts:

1. Initial Applications and Hearings:
Jaime T. Buenaflor filed two applications with the Public Service Commission on June 25, 1957: one to install and operate a 5-ton ice plant in Sabang, Calabanga, Camarines Sur (P.S. Case 107548), and another to establish a cold storage and refrigeration service with a capacity of 6,000 cubic feet (P.S. Case 107549). The Commission scheduled a hearing for October 9, 1957, requiring Buenaflor to publish the applications in two newspapers and serve copies to Inigo Daza and Camarines Sur Industry Corporation (Camarines Corporation), which operated ice plants in neighboring municipalities.

2. Camarines Corporation's Response:
Upon receiving Buenaflor's applications, Camarines Corporation filed its own applications on October 1, 1957, seeking authority to construct a 5-ton ice plant and a cold storage system in Sabang (P.S. Cases 109874 and 109875). It also opposed Buenaflor's applications, claiming to be the pioneer distributor of ice in the locality.

3. Corporate Status of Camarines Corporation:
During the hearing on October 9, 1957, Buenaflor's attorneys moved to dismiss Camarines Corporation's applications, arguing that its corporate life had expired in November 1953, rendering it incapable of applying for or receiving a certificate of public convenience. In response, Camarines Corporation's corporators executed new articles of incorporation on October 30, 1957, forming a new corporation (Camarines Sur Industry Corporation) and transferring the assets and certificates of the old corporation to the new entity.

4. Commission's Decision:
The Public Service Commission, in its decision dated December 12, 1958, granted Camarines Corporation the authority to operate a 5-ton ice plant in Sabang, citing its status as a pioneer operator in the area. However, it awarded Buenaflor the certificate for a cold storage service and a smaller 1-ton ice plant. Buenaflor appealed the denial of his application for the 5-ton ice plant.

Issue:

  1. Whether the Public Service Commission erred in granting Camarines Corporation the authority to operate a 5-ton ice plant in Sabang, despite its corporate life having expired in 1953.
  2. Whether Buenaflor, as the first applicant, should have been granted the authority to operate the 5-ton ice plant.
  3. Whether the new Camarines Corporation could validly claim the rights and privileges of the old corporation, which had ceased to exist.

Ruling:

The Supreme Court reversed the decision of the Public Service Commission, ruling in favor of Jaime T. Buenaflor. The Court held that:

  1. The old Camarines Corporation had no juridical personality after November 1953 and could not lawfully continue its business operations, including selling ice.
  2. The new Camarines Corporation, formed in October 1957, could not be considered a continuation of the old corporation and had not filed its own application for a certificate of public convenience in Sabang.
  3. Buenaflor, as the first applicant and a qualified operator, should have been granted the authority to operate the 5-ton ice plant.

The Court approved Buenaflor's application for a 5-ton ice plant, revoking the Commission's award to Camarines Corporation.

Ratio:

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