Title
Manila Electric Co. vs. Spouses Hua Kim Peng
Case
G.R. No. 109389
Decision Date
Jun 26, 2006
MERALCO accused respondents of using jumpers to bypass meters, demanding payment for unregistered electricity. Courts ruled MERALCO failed to prove claims, awarding damages to respondents and barring disconnection.
electric company
false accusation
illegal jumpers
A

Case Summary (G.R. No. 109389)

Factual Background

Respondents filed a Complaint for Injunction with Damages against MERALCO. They alleged that they owned two small factories and three residential units at 153 West Riverside, Quezon City, and that MERALCO supplied electricity to those premises through five metering devices under specified commercial and residential accounts: Account Nos. 05284-3885-18, 05284-3875-10, 05284-3877-18, 05284-3876-19, and 05284-3880-21. They claimed they had been religiously paying their monthly electric bills.

Respondents further alleged that originally MERALCO had installed the metering devices on the concrete wall inside their compound, but later transferred them to the outside wall, leaving an inside “idle meter base.” They reported that on September 24, 1988, while they were away, MERALCO’s inspection team entered the compound, climbed by ladder, removed the idle meter base, and allegedly presented pink papers asserting that “jumpers were connected” to respondents’ electric service, preventing the meter from registering actual consumption. Respondents, through counsel, disputed the allegation by registered letter dated September 28, 1988, asserting that the jumpers were a “fabrication” and requesting another inspection to determine the truth.

MERALCO allegedly ignored the request. After about a month, MERALCO sent respondents five letters marked “CONFIDENTIAL”, demanding P1,811,933.08 within ten days from notice for electricity allegedly “used but unregistered” because of jumpers connected to respondents’ electric service. MERALCO threatened to disconnect their electrical service when respondents refused to pay. Respondents then sought a writ of injunction and prayed for moral and exemplary damages and litigation expenses.

In their Answer with Compulsory Counterclaim and Opposition to the Application for Injunction, MERALCO denied the material allegations and asserted that its crew found permanent jumpers connected to respondents’ electric service. MERALCO claimed its inspection team took pictures of the jumpers, corrected defects in the metering installation, and that its findings were confirmed by an actual laboratory test. It anchored its counterclaim on alleged losses from “used but unregistered electricity” valued at P1,811,933.08, and it asserted its right to discontinue service due to respondents’ failure to pay, pursuant to its charter and service contracts.

Injunctive Relief and Trial Court Ruling

When the case was filed on December 7, 1988, the RTC issued a Temporary Restraining Order and ultimately a writ of preliminary injunction, enjoining MERALCO from disconnecting respondents’ electrical services. After trial, the RTC ruled in favor of MERALCO on April 8, 1991, dismissing respondents’ complaint and ordering respondents to pay P1,811,933.08 with interest at the legal rate until fully paid, plus the costs of the suit, consistent with MERALCO’s counterclaim.

Appeal and Court of Appeals’ Reversal

On appeal, the Court of Appeals reversed the RTC and entered judgment granting respondents permanent injunctive relief against MERALCO from cutting the electrical connection on the grounds that led to the filing of the injunction case. It also ordered MERALCO to pay P50,000.00 as moral damages and P50,000.00 as exemplary damages, as well as P50,000.00 as attorney’s fees, and it dismissed the remaining claims and counterclaims for lack of merit.

The Court of Appeals grounded its reversal on a finding of serious misapprehension of facts by the RTC. It examined MERALCO’s photographic evidence and reasoned that the photographs did not support MERALCO’s claim that respondents used jumpers to deflect electricity away from the meters. According to the Court of Appeals, the photographs showed that the “big wires” were the entrance wires from MERALCO’s main line and that these were not tapped. It explained that for a jumper to work as claimed, the tap must be from the segment between the main entrance wire and the meter; if the tap occurred after the current passed through the meter, then the consumed electricity would still be recorded by the meter, negating the alleged effect of a jumper.

The Court of Appeals also addressed the location and visibility of the wiring. It found it difficult to believe that respondents installed illegal jumpers in a place indicated by the MERALCO inspector and shown in the photographs, especially because the wires allegedly identified as jumpers were outside the compound and allegedly obvious to any passerby and to MERALCO employees reading the meters every month. The Court of Appeals thus concluded that MERALCO’s claims were illogical and maliciously fabricated and were made in bad faith.

The Court of Appeals likewise found internal inconsistency in MERALCO’s asserted “differential billing.” It held that if jumpers had prevented registration, electrical consumption after the alleged jumpers were removed on September 24, 1988 should have markedly differed from consumption before that date. It observed that respondents’ consumption remained practically the same, or even lower, after the alleged removal. The Court of Appeals also found MERALCO’s differential billing lacked rational basis because variation in consumption could arise from many legitimate factors, such as machine breakdowns or reduced production. It further held that MERALCO’s scheme for determining average consumption would apply only where meters did not function properly in certain months, and that such circumstances were not present.

Parties’ Contentions in the Petition for Review

MERALCO maintained in its petition that the Court of Appeals erred in (1) finding that respondents did not install jumpers, and (2) ruling that its “differential bills” for alleged “used but unregistered electricity” in the total amount of P1,811,933.08 lacked rational basis. Respondents countered that the Court of Appeals’ factual findings were supported by the evidence and prayed for dismissal of MERALCO’s petition.

Legal Basis and Reasoning of the Supreme Court

The Court held that the petition failed because, in a petition for review on certiorari, only questions of law may be raised and the Court is not a trier of facts. The Court reiterated that factual findings of the Court of Appeals are generally conclusive and not subject to review. It recognized exceptions, including where the conclusion reached by the Court of Appeals is based on misapprehension of facts or where findings conflict.

The Court observed that the appellate findings conflicted with those of the trial court. It therefore reviewed the factual record in order to determine whether the Court of Appeals had committed reversible error.

The Court affirmed the Court of Appeals’ conclusion that MERALCO failed to prove that its crew found jumpers connected to respondents’ electric service. It relied on the early case US v. Genato, which described a “jumper” as a contrivance used to deflect current and prevent its passage through the meter and consequent measurement. The Court explained that, consistent with the Court of Appeals’ reasoning, a jumper must tap from the segment between the entrance wire from MERALCO’s main line and the meter; tapping from a line that had already passed through the meter would result in the electricity being recorded by the meter.

The Court further noted that it was not disputed that the five electric meters installed outside respondents’ compound were functioning properly. It followed that any jumper intended to prevent registration would have to be installed outside the wall in order to deflect current from passing through the meters. The Court agreed with the Court of Appeals that MERALCO’s own photographs showed the big entrance wires were not tapped, and it found it contrary to human experience that respondents would install visible illegal jumpers outside their wall just above the meters where they would be observable by any employee reading the meter monthly.

As to the “differential bills,” the Court found MERALCO’s claim similarly unfounded. It emphasized that MERALCO’s inspectio

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