G.R. No. 160123 - Centro Project Manpower Services Corp. vs. Naluis

Manila Electric Company (MERALCO) is the petitioner, a public utility engaged in the sale and distribution of electricity.
Spouses Edito and Felicidad Chua, along with respondent Josefina Paqueo, are the beneficiaries of the electric service and the respondents in the case.
The case originated with a Regional Trial Court (RTC) decision ordering MERALCO to restore the Chuas’ electricity and pay moral and attorney’s fees damages; the Court of Appeals (CA) affirmed the RTC decision with modifications (notably reducing moral damages from ₱300,000.00 to ₱100,000.00).
MERALCO filed a petition for review on certiorari challenging the CA’s decision.

MERALCO provided electric service to the Chuas’ residence using a meter (initially Meter No. 33SPN46170) installed on a concrete post outside their perimeter fence.
The meter recorded consistent monthly consumption ranging between 231 and 269 kilowatt hours from June 11, 1996 to September 11, 1996, with corresponding bills averaging between ₱747.84 and ₱887.27.

In October 1996, the Chuas received an unusually high bill amounting to ₱4,906.87 for the period September 11 to October 11, 1996, indicating consumption of 1,297 kilowatt hours—a surge over 553% compared to prior months.
Alarmed by the significant increase, the Chuas’ daughter, Florence Chua, went to MERALCO’s office to question the bill, and she paid the bill under protest to avoid service interruption.
On October 31, 1996, a MERALCO representative, Francisco Jose Albano, inspected the meter; his Meter/Socket Inspection Report noted that the old meter’s terminal seal was missing, the cover seal was broken, and the sealing wire was cut.
Subsequent to the inspection, MERALCO replaced the old meter (Meter No. 33SPN46170) with a new one (Meter No. 33RZN80082); billing based on the new meter’s reading showed consumption returning to average levels (between 227 and 254 kilowatt hours) with corresponding monthly charges between ₱700.00 and ₱800.00.

On January 3, 1997, MERALCO issued a demand letter citing the discovered defects and imposing a demand for payment of₱183,983.66 (comprising rate charge and energy tax) along with the possibility of surcharges for violation of Republic Act (RA) 7832.
After the Chuas refused to pay the demanded amount, on January 24, 1997, MERALCO removed the replaced meter and disconnected the Chuas’ electric service.
A subsequent letter dated February 5, 1997, reduced the differential billing amount to ₱71,737.49, but this revision was later disregarded by MERALCO in its submissions.

A preliminary mandatory injunction compelling MERALCO to restore their electric service;
An award for moral, exemplary damages; and
Attorney’s fees and litigation expenses.

The lower courts ruled in favor of the Chuas ordering restoration and awarding moral damages (modified by the CA).

Whether MERALCO had the legal authority to immediately disconnect the Chuas’ electric service under RA 7832 given the alleged meter tampering.

Whether the discovery of the tampered meter (evidenced by a missing terminal seal, broken cover seal, and cutting of the sealing wire) provided sufficient prima facie evidence for disconnection.
Whether the meter inspection complied with the statutory requirement of being witnessed by an officer of the law or a duly authorized representative of the Energy Regulatory Board (ERB).

Whether the differential billing imposed by MERALCO is legally enforceable on the Chuas.

Whether there is sufficient evidence to prove that the Chuas had tampered with their meter.
Whether the unusually high September 1996 billing can be attributed to consumer tampering or to other factors, including possible negligence on part of MERALCO.

Whether the Chuas are entitled to moral damages for the wrongful disconnection of their electric service.

Whether the disconnection, as executed by MERALCO, amounted to a deprivation of an essential service without due process.
Whether any evidence of evident bad faith or grave abuse of authority exists in MERALCO’s actions that would justify the award of moral damages.

Whether MERALCO’s overall conduct, including the handling of billing inconsistencies and meter inspection, constitutes inexcusable negligence that would bar its claim for differential billing.