Case Digest (G.R. No. L-19850)
Facts:
In Vigan Electric Light Company, Inc. v. Public Service Commission (G.R. No. L-19850, January 30, 1964), petitioner Vigan Electric Light Company, Inc. (VELCo) held a franchise under Republic Act No. 316 (June 19, 1948) and a certificate of public convenience (May 31, 1950) to generate and distribute electric power within Ilocos Sur. VELCo’s authorized rates were set in 1950 and, with PSC approval, it contracted (May 22, 1957) to purchase power from the National Power Corporation for resale at these rates. On January 16, 1962, PSC notified VELCo of a conference (February 12) to consider rate revision based on a petition by Congressman Crisologo and residents alleging unlawful meter sales and meter inaccuracy. VELCo sought postponement, denied all allegations, and offered evidence. Meanwhile, PSC secured a General Auditing Office report (May 4, 1962) showing VELCo’s net operating income exceeded the allowable 12% return, thus ordering (May 17, 1962) an 18% rate reduction effectiveCase Digest (G.R. No. L-19850)
Facts:
- Franchise and Certificate of Public Convenience
- Republic Act No. 316 (June 19, 1948) granted Vigan Electric Light Co., Inc. (VELCI) a franchise to generate and distribute electric light, heat and/or power in Ilocos Sur municipalities.
- On May 31, 1950, the Public Service Commission (PSC) issued VELCI a certificate of public convenience authorizing specified flat, meter and temporary rates.
- Power Purchase and Initial Operations
- On May 22, 1957, VELCI contracted with National Power Corporation to buy bulk power for resale under its existing rate schedule.
- Operations continued under PSC‐approved rates for about five years.
- Rate Revision Proceedings and Audit
- January–February 1962: PSC scheduled conferences to reconsider VELCI’s rates upon alleged petition by local residents charging meter irregularities and black market sales. VELCI denied the allegations and requested postponement.
- March 15, 1962: General Auditing Office (GAO) audit of VELCI’s 1961 operations was ordered at PSC’s request.
- April–May 1962: PSC issued and then quashed a subpoena duces tecum for VELCI’s books; VELCI’s motion to quash was granted.
- May 17, 1962: PSC, relying on the GAO report showing a 45.45% return on invested capital (exceeding the allowable 12%), ordered an 18% reduction in VELCI’s meter rates effective June 1962.
- Petition for Certiorari
- June 25, 1962: VELCI filed an original certiorari petition in the Supreme Court to annul the PSC order, alleging lack of notice and hearing, denial of due process and erroneous audit findings.
- PSC defended on grounds of delegated legislative authority, non‐requirement of hearing, and failure to exhaust remedies.
Issues:
- Whether the PSC’s rate‐reduction order, based on the GAO audit and affecting VELCI alone, is legislative (rule‐making) or quasi‐judicial in nature.
- Whether the issuance of that order without prior notice and hearing violated VELCI’s right to due process under Commonwealth Act No. 146 and the Constitution.
- Whether VELCI was required to first seek administrative reconsideration before filing certiorari.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)