Facts:

• Villa Rey Transit, Inc. (petitioner) purchased five certificates of public convenience from Valentin A. Fernando for PHP 249,500.00 on April 7, 1959.
• The certificates authorized the operation of TPU buses on various lines, including Lingayen-Manila via Dagupan and Lingayen-Manila via Camiling.
• One certificate was excluded as it had expired before the purchase.
• Villa Rey Transit applied for approval of the purchase and provisional authority to operate the lines covered by the certificates.
• The Public Service Commission provisionally approved the sale on May 19, 1959, and granted provisional authority to operate, requiring Villa Rey Transit to register the fleet of 45 buses within 45 days.
• Villa Rey Transit began operating the buses and requested an extension to complete repairs and registration, which was granted until July 30, 1959.
• Villa Rey Transit registered the buses within the extended period.
• On July 22, 1959, the Commission provisionally approved a certificate of sale executed by the Sheriff of Manila in favor of Eusebio E. Ferrer and another deed of sale by Ferrer to Pangasinan Transportation Co. (Pantranco) covering two of the five certificates Villa Rey Transit had purchased.
• Ferrer claimed ownership through a certificate of sale from an auction conducted by the Sheriff of Manila due to a levy in execution from a court case in Pangasinan.
• Villa Rey Transit filed a petition for reconsideration, arguing that Fernando was no longer the owner at the time of the levy and auction.
• The Commission held a joint hearing for both applications and the petition for reconsideration.
• Fernando appealed the decision in the civil case, and Villa Rey Transit filed an action to cancel the sheriff's sale and the deed of sale to Pantranco, both still pending.
• On September 13, 1960, the Public Service Commission decided in favor of Pantranco, declaring it the lawful owner of the two certificates and ordering Villa Rey Transit to cease operations on the same lines.
• Villa Rey Transit's motion for reconsideration was denied, leading to the present petition for review.

Issue:

• (Unlock)

Ruling:

1. The Supreme Court reversed the decision of the Public Service Commission.
2. The Court set aside the Commission's order dated July 22, 1959.
3. The Court directed the Commission to allow Villa Rey Transit to continue operating the lines covere...(Unlock)

Ratio:

• The Supreme Court found that Villa Rey Transit purchased the certificates in good faith and for valuable consideration, much earlier than Ferrer or Pantranco.
• The Commission's provisional approval and the subsequent registration of the buses within the extended period suppo...continue reading