450 SUPREME COURT REPORTS ANNOTATED
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
*
No. L-68729. May 29, 1987.
RADIO COMMUNICATIONS OF THE PHILIPPINES,
INC., petitioner, vs. NATIONAL
TELECOMMUNICATIONS COMMISSION and
KAYUMANGGI RADIO NETWORK INCORPORATED,
respondents.
Administrative Law; Specialized Regulatory Boards; Public
Service Commission; Transfer of certain functions of the Public
Service Commission to the specialized regulatory board under PD
No. 1 and under Executive Order No. 546.—Pursuant to
Presidential Decree No. 1 dated September 23, 1972, reorganizing
the executive branch of the National Government, the Public
Service Commission was abolished and its functions were
transferred to three specialized regulatory boards, as follows: the
Board of Transportation, the Board of Communications and the
Board of Power and Waterworks. The functions so transferred
were still subject to the limitations provided in sections 14 and 15
of the Public Service Law, as amended. With the enactment of
Executive Order No. 546 on July 23, 1979 implementing P.D. No.
1, the Board of Communications and the Telecommunications
Control Bureau were abolished and their functions were
transferred to the National Telecommunications Commission
(Sec. 19(d), Executive Order No. 546).
Same; Same; Same; Jurisdiction; Exemption enjoyed by radio
companies from the jurisdiction of the Public Service Commission
and the Board of Communications no longer exists.—lt is clear
from the aforequoted provision that the exemption enjoyed by
radio companies from the jurisdiction of the Public Service
Commission and the Board of Communications no longer exists
because of the changes effected by the Reorganization Law and
implementing executive orders. The petitioner's claim that its
franchise cannot be affected by Executive Order No. 546 on the
ground that it has long
_______________
* SECOND DIVISION.
451
VOL. 150, MAY 29, 1987 451
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
been in operation since 1957 cannot be sustained.
Same; Same; Constitutional Law; Franchise; Definition of
franchise; Franchise, being merely a privilege emanating from the
state's sovereign power is subject to the regulation by the State
itself by virtue of its police power.—A franchise started out as a
"royal privilege or (a) branch of the King's prerogative, subsisting
in the hands of a subject." This definition was given by Finch,
adopted by Blackstone, and accepted by every authority since
(State v. Twin Village Water Co., 98 Me 214, 56 A 763 (1903)).
Today, a franchise, being merely a privilege emanating from the
sovereign power of the state and owing its existence to a grant, is
subject to regulation by the state itself by virtue of its police
power through its administrative agencies.
Same; Same; Same; Same; Petitioner cannot install and
operate radio telephone services on the basis of its legislative
franchise alone.—Executive Order No. 546, being an
implementing measure of P.D. No. 1 insofar as it amends the
Public Service Law (CA No. 146, as amended) is applicable to the
petitioner who must be bound by its provisions. The petitioner
cannot install and operate radio telephone services on the basis of
its legislative franchise alone.
Same; Same; Same; Same; Statutory Construction; Where the
statutory norm speaks unequivocally, there is nothing for the
courts to do except to apply it.—Thus, in the words of R.A. No.
2036 itself, approval of the then Secretary of Public Works and
Communications was a precondition before the petitioner could
put up radio stations in areas where it desires to operate. It has
been repeated time and again that where the statutory norm
speaks unequivocally, there is nothing for the courts to do except
to apply it. The law, leaving no doubt as to the scope of its
operation, must be obeyed. (Gonzaga v. Court of Appeals, 51
SCRA 381).
Same; Same; Same; Same; Absence of required authority from
the then Secretary of Public Works and Communications and a
certificate of public convenience and necessity from the National
Telecommunications Commission before petitioner installed its
radio telephone services.—The records of the case do not show any
grant of authority from the then Secretary of Public Works and
Communications before the petitioner installed the questioned
radio telephone services in San Jose, Mindoro in 1971. The same
is true as regards the radio telephone services opened in
Sorsogon, Sorsogon and
452
452 SUPREME COURT REPORTS ANNOTATED
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
Catarman, Samar in 1983. No certificate of public convenience
and necessity appears to have been secured by the petitioner from
the public respondent when such certificate was required by the
applicable public utility regulations. (See Executive Order No.
546, sec. 15, supra.; Philippine Long Distance Telephone Co. v.
City of Davao, 15 SCRA 75; Olongapo Electric Light and Power
Corp. v. National Power Corporation, et al., G.R. No. L-24912,
promulgated April 9, 1987.)
Same; Same; Same; Same; National Telecommunications
Commission, empowered to authorize the installation by private
network of radio communications in the same areas as petitioner
despite petitioner's possession of a franchise to operate in said
areas; Franchise, not exclusive in nature.—It was well within the
powers of the public respondent to authorize the installation by
the private respondent network of radio communications systems
in Catarman, Samar and San Jose, Mindoro. Under the
circumstances of this case, the mere fact that the petitioner
possesses a franchise to put up and operate a radio
communications system in certain areas is not an insuperable
obstacle to the public respondent's issuing the proper certificate to
an applicant desiring to extend the same services to those areas.
The Constitution mandates that a franchise cannot be exclusive
in nature nor can a franchise be granted except that it must be
subject to amendment, alteration, or even repeal by the
legislature when the common good so requires. (Art. XII, sec. 11 of
the 1986 Constitution). There is an express provision in the
petitioner's franchise which provides compliance with the above
mandate (RA 2036, sec. 15).
Same; Same; Same; Same; General rule that the findings of
fact of the public respondent will not be disturbed when reasonably
supported by evidence; Exception; Petitioner has not overcome the
presumption that when public respondent disturbed petitioner's
monopoly in certain areas, it was for the public interest and the
common good; Case at bar.—ln view of the foregoing, we find no
reason to disturb the public respondent's findings of fact, and
conclusions of law insofar as the private respondent was
authorized to operate in Catarman, Samar and San Jose,
Mindoro. As a rule, the Commission's findings of fact, if supported
by substantial evidence, are conclusive upon this Court. We may
modify or ignore them only when it clearly appears that there is
no evidence to support reasonably such a conclusion. (Halili v.
Daplas, 14 SCRA 14). The petitioner has not
453
VOL. 150, MAY 29, 1987 453
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
shown why the private respondent should be denied the authority
to operate its services in Samar and Mindoro. It has not overcome
the presumption that when the public respondent disturbed the
petitioner's monopoly in certain areas, it was doing so pursuant to
public interest and the common good.
PETITION to review the Order of the National
Telecommunications Commission.
The facts are stated in the opinion of the Court.
GUTIERREZ, JR., J.:
This petition seeks the reversal of the decision of the
National Telecommunications Commission (NTC) which
ordered petitioner Radio Communications of the
Philippines, Incorporated (RCPI) to desist from operating
its radio telephone services in Catarman, Northern Samar;
San Jose, Occidental Mindoro; and Sorsogon, Sorsogon.
Petitioner has been operating a radio communications
system since 1957 under its legislative franchise granted
by Republic Act No. 2036 which was enacted on June 23,
1957.
In 1968, the petitioner established a radio telegraph
service in Sorsogon, Sorsogon. In 1971, another radio
telegraph service was put up in San Jose, Mindoro followed
by another in Catarman, Samar in 1976. The installation of
radio telephone services started in 1971 in San Jose,
Mindoro; then in Sorsogon, Sorsogon and Catarman, Samar
in 1983.
In a decision dated June 24, 1980 in NTC Case No. 80-
08, private respondent Kayumanggi Radio Network
Incorporated was authorized by the public respondent to
operate radio communications systems in Catarman,
Samar and in San Jose, Mindoro.
On December 14, 1983, the private respondent filed a
complaint with the NTC alleging that the petitioner was
operating in Catarman, Samar and in San Jose, Mindoro
without a certificate of public convenience and necessity.
The petitioner, on the other hand, counter-alleged that its
telephone services in the places subject of the complaint
are covered by the
454
454 SUPREME COURT REPORTS ANNOTATED
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
legislative franchise recognized by both the public
respondent and its predecessor, the Public Service
Commission. In its supplemental reply, the petitioner
further stated that it has been in operation in the
questioned places long before private respondent
Kayumanggi filed its application to operate in the same
places.
After conducting a hearing, NTC, in its decision dated
August 22,1984 ordered petitioner RCPI to immediately
cease or desist from the operation of its radio telephone
services in Catarman, Northern Samar; San Jose,
Occidental Mindoro; and Sorsogon, Sorsogon stating that
under Executive Order No. 546, a certificate of public
convenience and necessity is mandatory for the operation of
communication utilities and services including radio
communications.
On September 4, 1984, the petitioner filed a motion for
reconsideration which was denied in an order dated
September 12,1984.
On October 1, 1984, the present petition was filed
raising the issue of whether or not petitioner RCPI, a
grantee of a legislative franchise to operate a radio
company, is required to secure a certificate of public
convenience and necessity before it can validly operate its
radio stations including radio telephone services in
Catarman, Northern Samar; San Jose, Occidental Mindoro;
and Sorsogon, Sorsogon.
The petitioner's main argument states that the abolition
of the Public Service Commission under Presidential
Decree No. 1 and the creation of the National
Telecommunications Commission under Executive Order
No. 546 to replace the defunct Public Service Commission
did not affect sections 14 and 15 of the Public Service Law
(Commonwealth Act No. 146, as amended).
The provisions of the Public Service Law pertinent to
the petitioner's allegation are as follows:
"Section 13. (a) The Commission shall have jurisdiction,
supervision, and control over all public services and their
franchises, equipment and other properties, and in the exercise of
its authority,
455
VOL. 150, MAY 29, 1987 455
Radio Communications of the Philippines, Inc. us. National
Telecommunications Commission
it shall have the necessary powers and the aid of public force: x x
x.
"Section 14. The following are exempted from the provisions of
the preceding section:
x x x x x x x x x
"(d) Radio companies except with respect to the fixing of rates;
x x x x x x x x x
"Section 15. With the exception of those enumerated in the
preceding section, no public service shall operate in the
Philippines without possessing a valid and subsisting certificate
from the Public Service Commission, known as 'certificate of
public convenience,' or 'certificate of convenience and public
necessity,' as the case may be, to the effect that the operation of
said service and the authorization to do business will promote the
public interests in a proper and suitable manner. x x x"
We find no merit in the petitioner's contention.
Pursuant to Presidential Decree No. 1 dated September
23, 1972, reorganizing the executive branch of the National
Government, the Public Service Commission was abolished
and its functions were transferred to three specialized
regulatory boards, as follows: the Board of Transportation,
the Board of Communications and the Board of Power and
Waterworks. The functions so transferred were still subject
to the limitations provided in sections 14 and 15 of the
Public Service Law, as amended. With the enactment of
Executive Order No. 546 on July 23, 1979 implementing
P.D. No. 1, the Board of Communications and the
Telecommunications Control Bureau were abolished and
their functions were transferred to the National
Telecommunications Commission (Sec. 19(d), Executive
Order No. 546). Section 15 of said Executive Order spells
out the functions of the National Telecommunications
Commission as follows:
"Sec. 15. Functions of the Commission.—The Commission shall
exercise the following functions:
" a. I ssue Certif icate of Public Convenience f or the operation
of communications utilities and services, radio communica-
456
456 SUPREME COURT REPORTS ANNOTATED
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
tions systems, wire or wireless telephone or telegraph
system, radio and television broadcasting system and
other similar public utilities;
"b. Establish, prescribe and regulate areas of operation of
particular operators of public service communications; and
determine and prescribe charges or rates pertinent to the
operation of such public utility facilities and services
except in cases where charges or rates are established by
international bodies or associations of which the
Philippines is a participating member or by bodies
recognized by the Philippine Government as the proper
arbiter of such charges or rates;
"c. Grant permits for the use of radio frequencies for wireless
telephone and telegraph systems and radio
communication systems including amateur radio stations
and radio and television broadcasting systems;
"d. Sub-allocate series of frequencies of bands allocated by the
International Telecommunications Union to the specific
services;
"e. Establish and prescribe rules, regulations, standards,
specifications in all cases related to the issued Certificate
of Public Convenience and administer and enforce the
same;
"f. Coordinate and cooperate with government agencies and
other entities concerned with any aspect involving
communications with a view to continuously improve the
communications service in the country;
"g. Promulgate such rules and regulations, as public safety
and interest may require, to encourage a larger and more
effective use of communications, radio and television
broadcasting facilities, and to maintain effective
competition among private entities in these activities
whenever the Commission finds it reasonably feasible;
"h. Supervise and inspect the operation of radio stations and
telecommunications facilities;
"i. Undertake the examination and licensing of radio
operators;
"j. Undertake, whenever necessary, the registration of radio
transmitters and transceivers; and
"k. Perform such other functions as may be prescribed by law.
457
VOL. 150, MAY 29, 1987 457
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
It is clear from the aforequoted provision that the
exemption enjoyed by radio companies from the jurisdiction
of the Public Service Commission and the Board of
Communications no longer exists because of the changes
effected by the Reorganization Law and implementing
executive orders. The petitioner's claim that its franchise
cannot be affected by Executive Order No. 546 on the
ground that it has long been in operation since 1957 cannot
be sustained.
A franchise started out as a "royal privilege or (a)
branch of the King's prerogative, subsisting in the hands of
a subject." This definition was given by Finch, adopted by
Blackstone, and accepted by every authority since (State v.
Twin Village Water Co., 98 Me 214, 56 A 763 (1903)).
Today, a franchise, being merely a privilege emanating
from the sovereign power of the state and owing its
existence to a grant, is subject to regulation by the state
itself by virtue of its police power through its
administrative agencies. We ruled in Pangasinan
Transportation Co., Inc. v. Public Service Commission (70
Phil. 221) that:
"x x x statutes enacted for the regulation of public utilities, being
a proper exercise by the State of its police power, are applicable
not only to those public utilities coming into existence after its
passage, but likewise to those already established and in
operation x x x"
Executive Order No. 546, being an implementing measure
of P.D. No. 1 insofar as it amends the Public Service Law
(CA No. 146, as amended) is applicable to the petitioner
who must be bound by its provisions. The petitioner cannot
install and operate radio telephone services on the basis of
its legislative franchise alone.
The position of the petitioner that by the mere grant of
its franchise under RA No. 2036 it can operate a radio
communications system anywhere within the Philippines is
erroneous. Section 1 of said statute reads:
"Section 1. Subject to the provisions of the Constitution, and
458
458 SUPREME COURT REPORTS ANNOTATED
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
to the provisions, not inconsistent herewith, of Act Numbered
Three thousand eight hundred and forty-six, entitled 'An Act
providing for the regulation of radio stations and radio
communications in the Philippine Islands, and for other
purposes;' Commonwealth Act Numbered One hundred forty-six,
known as the Public Service Act, and their amendments, and
other applicable laws, there is hereby granted to the Radio
Communications of the Philippines, its successors or assigns, the
right and privilege of constructing, installing, establishing and
operating in the Philippines, at such places as the said corporation
may select and the Secretary of Public Works and Communications
may approve, radio stations for the reception and transmission of
wireless messages on radiotelegraphy and/or radiotelephony,
including both coastal and marine telecommunications, each
station to consist of two radio apparatus comprising of a receiving
and sending radio apparatus." (Italics ours).
Section 4(a) of the same Act further provides that:
"Sec. 4(a). This franchise shall not take effect nor shall any
powers thereunder be exercised by the grantee until the Secretary
of Public Works and Communications shall have allotted to the
grantee the frequencies and wave lengths to be used, and issued to
the grantee a license for such case." (Italics ours.)
Thus, in the words of R.A. No. 2036 itself, approval of the
then Secretary of Public Works and Communications was a
precondition before the petitioner could put up radio
stations in areas where it desires to operate. It has been
repeated time and again that where the statutory norm
speaks unequivocally, there is nothing for the courts to do
except to apply it. The law, leaving no doubt as to the scope
of its operation, must be obeyed. (Gonzaga v. Court of
Appeals, 51 SCRA 381).
The records of the case do not show any grant of
authority from the then Secretary of Public Works and
Communications before the petitioner installed the
questioned radio telephone services in San Jose, Mindoro
in 1971. The same is true as regards the radio telephone
services opened in Sorsogon, Sorsogon and Catarman,
Samar in 1983. No certificate of public convenience and
necessity appears to have been secured by the petitioner
from the public respondent when such certificate
459
VOL. 150, MAY 29, 1987 459
Radio Communications of the Philippines, Inc. vs. National
Telecommunications Commission
was required by the applicable public utility regulations.
(See Executive Order No. 546, sec. 15, supra.; Philippine
Long Distance Telephone Co. v. City of Davao, 15 SCRA 75;
Olongapo Electric Light and Power Corp. v. National Power
Corporation, et al., G.R. No. L-24912, promulgated April 9,
1987.)
It was well within the powers of the public respondent to
authorize the installation by the private respondent
network of radio communications systems in Catarman,
Samar and San Jose, Mindoro. Under the circumstances of
this case, the mere fact that the petitioner possesses a
franchise to put up and operate a radio communications
system in certain areas is not an insuperable obstacle to
the public respondent's issuing the proper certificate to an
applicant desiring to extend the same services to those
areas. The Constitution mandates that a franchise cannot
be exclusive in nature nor can a franchise be granted
except that it must be subject to amendment, alteration, or
even repeal by the legislature when the common good so
requires. (Art. XII, sec. 11 of the 1986 Constitution). There
is an express provision in the petitioner's franchise which
provides compliance with the above mandate (RA 2036, sec.
15).
In view of the foregoing, we find no reason to disturb the
public respondent's findings of fact, and conclusions of law
insofar as the private respondent was authorized to operate
in Catarman, Samar and San Jose, Mindoro. As a rule, the
Commission's findings of fact, if supported by substantial
evidence, are conclusive upon this Court. We may modify or
ignore them only when it clearly appears that there is no
evidence to support reasonably such a conclusion. (Halili v.
Daplas, 14 SCRA 14). The petitioner has not shown why
the private respondent should be denied the authority to
operate its services in Samar and Mindoro. It has not
overcome the presumption that when the public respondent
disturbed the petitioner's monopoly in certain areas, it was
doing so pursuant to public interest and the common good.
WHEREFORE, the challenged order of the public
respondent dated August 22, 1984 is hereby AFFIRMED.
The peti-
460
460 SUPREME COURT REPORTS ANNOTATED
Lacuna vs. Intermediate Appellate Court
tion is dismissed for lack of merit.
SO ORDERED.
Fernan (Chairman), Paras, Padilla, Bidin and
Cortés, JJ., concur.
Order affirmed.
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