G.R. No. L-13910 - Manila Yellow Taxi-Cab, Inc. vs. Castelo

On March 7, 1957, Edmundo L. Castelo filed an application with the Public Service Commission (PSC) seeking a certificate of public convenience to operate ten (10) taxicab units in the City of Cabanatuan and its surrounding areas in Luzon.
The Manila Yellow Taxi-Cab, Inc., already a grantee to operate ten (10) taxicab units in the same territory, opposed Castelo’s application, arguing that:

Its current service was more than adequate for the riding public.
Approval of the new application would result in ruinous competition.
Being an old operator, it deserved preferential rights over any new entrant seeking to expand service.

Documentary evidence consisting of Exhibits 1, 2, and 3, which indicated that the oppositor’s taxicab operation, although authorized for 10 units, often operated at a loss.
Key testimony included:

Ladignon’s account of multiple transport modes in Cabanatuan (calesas, jitneys, and buses) and the frequent observation of empty taxicabs.
Cross-examination revelations regarding relationships among witnesses and the actual operational status of the taxicab units, with Romeo A. Punzal admitting that only 7 of the 10 units were in active service due to repairs and other operational issues.

Presented both testimonial and documentary evidence.
Documentary evidence included resolutions from the Cabanatuan Jaycees and the Cabanatuan City Council endorsing additional taxi services for public convenience.
Testimonies emphasized:

The large population and significant student enrollment in local colleges, with students mostly attending night classes and relying on affordable transportation.
The inadequacy of the oppositor’s service, compounded by the use of outdated vehicles (e.g., Studebaker 1952 models) and vehicles with physical defects (such as holes in the floors causing dust entry).
Testimonies from government officials and business representatives (e.g., Enrique Ortiz and Francisco San Vicente) confirming that the existing taxi service did not meet the public’s needs, especially in off-peak hours and for travel to barrios and remote areas.
Evidence that during peak periods and adverse conditions (such as rains), existing services by calesas, jitneys, and the oppositor’s aging cabs were insufficient, leading to inconveniences for commuters.

There was merit in Castelo’s claim that additional taxicab facilities were needed in Cabanatuan.
The service rendered by the oppositor was inadequate to serve the public’s continuous and growing travel needs.
The peculiarity of the local transportation context (a mix of calesas, jitneys, and public buses) did not substitute for the more comprehensive service provided by taxicabs.

Whether the Public Service Commission made a proper finding of public necessity for additional taxicab services in the City of Cabanatuan based on the evidence presented.

Examination of whether the existing ten (10) units operated by the oppositor truly satisfied the transportation needs of the riding public.
Consideration of whether additional taxis were warranted given the population density, commercial establishments, educational institutions, and unique transportation challenges in the city.

Whether the oppositor’s contention that its status as an “old operator” entitled it to preferential treatment should preclude the issuance of a certificate to a new applicant.

Evaluation of the legal principle of preferential rights for established operators.
Assessment of whether the oppositor had made a proactive offer to meet the increased demand or simply relied on its historical precedence in the market.

Whether the evidentiary basis and factual findings of the PSC should be upheld by the Court as a matter of judicial restraint in administrative fact-finding.