A.C. No. 5161 - Re: Rolando S. Torres

In 1967, Pilipinas Shell Corporation (Shell) subleased a gasoline station in Quezon City to petitioner Teodoro Pulido.
The Bureau of Energy Utilization (BEU) subsequently issued Pulido a certificate authorizing him to operate the station.

In 1976, Pulido authorized private respondent Virgilio Rosal to operate and manage the station in exchange for a monthly fee of P2,000.00.
Later, Pulido sold all his rights in the station together with the associated equipment to Rosal for the sum of P50,000.00.
On the same day as the sale, Pulido executed a special power of attorney authorizing Rosal to administer and operate the station.

Pulido ultimately revoked Rosal’s authorization on the ground that Rosal was selling diluted gasoline.
Following his revocation, Pulido demanded the return of the station, which Rosal refused.
As a result, Pulido instituted an unlawful detainer suit against Rosal.
The city court dismissed the complaint, holding that there was no lease relationship between the parties and effectively affirming the deed of sale.
The dismissal of the ejectment case was not appealed by Pulido, thereby crystallizing the sale.

On September 20, 1979, Shell filed an application with the BEU to replace Pulido with Rosal as the authorized dealer of the station.
In support of its application, Shell submitted the copy of the city court decision from the ejectment case, among other documents.
Initially, the BEU provisionally allowed Rosal to continue as the dealer, and on April 7, 1980, it finally granted the application favoring Rosal.

Pulido claimed that he was only informed of the change in authorization on May 28, 1980, and thus challenged the validity of the BEU decision on due process grounds.
BEU required both Shell and Rosal to answer Pulido’s complaint regarding his due process claim.

Concurrently, Pulido manifested in writing that he was waiving all claims for damages against Shell in connection with the change of dealership.
The BEU dismissed Pulido’s complaint, among others, on the ground of res judicata.
The decision of the BEU was reversed by the Minister of Energy, only for the Minister’s reversal to itself be reversed by the Office of the President, through respondent Manuel M. Lazaro.

Pulido filed a petition before the Supreme Court challenging the order of April 24, 1985, which reinstated the BEU decision favoring Rosal.
The issue centered on whether Pulido could still claim rights as the authorized dealer and whether due process was observed during the administrative proceedings.

Whether Pulido could validly claim entitlement to remain the authorized dealer even after having sold his rights and given that his dealership contract had already expired.

The effect of the sale and the city court’s affirmation (via the dismissal of the ejectment suit) on Pulido’s rights.
Whether the absence of a renewal provision in Pulido’s own contract bars him from asserting his claim.

Whether the administrative proceedings leading to the substitution of Pulido by Rosal sufficiently met the requirements of due process.

The opportunity given to Pulido to be heard at various stages of the proceedings, including filing a letter-complaint and motions for reconsideration at different administrative levels.
Whether his claim of being inadequately notified or heard holds merit.

Whether the doctrine of tacita reconduccion, as provided under Article 1670 of the Civil Code, applies to Rosal’s contract, thereby legitimizing his continued operation of the station beyond the original expiration date.

Whether the previous judicial decision establishing the sale (and the subsequent res judicata) precludes Pulido from reopening the issues regarding the dealership contract and his rights over the station.