EN BANC

[G.R. No. L-21804. September 25, 1967.]

TERESA ELECTRIC AND POWER CO., INC., petitioner, vs.

PUBLIC SERVICE COMMISSION AND FILIPINAS CEMENT
CORPORATION, respondents.

Lino B. Azicate & Associates for petitioner.

G. A. Borja for respondents.

SYLLABUS

1. PUBLIC SERVICE COMMISSION; ISSUANCE OF CERTIFICATES OF

PUBLIC CONVENIENCE; MUNICIPAL OR LEGISLATIVE FRANCHISE; WHEN NOT
A CONDITION PRECEDENT; CASE AT BAR. — The requirement of a municipal
franchise under the provisions of Act No. 667 was intended to apply
exclusively to any person or corporation who desires a franchise to construct
and maintain an electric line or power plant and line, for business purposes;
it should not be made to apply to Filipinas who applied for a certificate of
public convenience and service to operate and maintain an electric plant
exclusively for its own use in connection with the operation of its cement
factory and for free use of its employees living within the compound of the
factory.
2. PUBLIC UTILITIES; PRIMORDIAL CONSIDERATIONS. — While it is
true that operators of public convenience and service deserve protection
from unlawful or unnecessary competition, yet the rule is that nobody has
any exclusive right to secure a franchise or a certificate of public
convenience. Public service and interest are the primordial considerations
taken into account in the granting of franchises and certificates of public
convenience and service.

DECISION

DIZON, J : p

This is a petition to review and set aside the decision of the Public
Service Commission dated March 15, 1963 in Case No. 62-3521 granting to
the Filipinas Cement Corporation — hereinafter referred to as Filipinas — a
certificate of public convenience and necessity to establish, maintain and
operate an electric plant in its factory site at Teresa, Rizal, for a period of
fifty years from June 26, 1958. By resolution of September 11, 1963, We
denied petitioner's petition for the issuance of a writ of preliminary
mandatory and prohibitory injunction restraining the Commission from
enforcing its decision during the pendency of the appeal.
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 The Teresa Electric Light and Power Co., Inc., — hereinafter referred to
as petitioner — is a domestic corporation operating an electric plant in
Teresa, Rizal, under a subsisting certificate of public convenience and
necessity issued on June 2, 1960 (PSC Case No. 129940), while the
respondent Filipinas is likewise a domestic corporation engaged in the
manufacture and sale of cement.
On May 24, 1962 Filipinas filed an application with the Public Service
Commission for a certificate of public convenience to install, maintain and
operate an electric plant in sitio Kaysapon of barrio Pamanaan, municipality
of Teresa, Rizal, for the purpose of supplying electric power and light to its
cement factory and its employees living within its compound.
Petitioner filed its written opposition alleging: that it is the duly
authorized operator of an electric light, heat and power service in Teresa,
Rizal; that Filipinas is not authorized by its articles of incorporation to
operate an electric plant; that the Municipal Council of Teresa had not
authorized it either to operate the proposed service; that it is willing to
supply Filipinas' need for electricity; and that Filipinas' principal business
does not come within the jurisdiction of the respondent Commission.
Answering the opposition, Filipinas averred that, under paragraph 7 of
its articles of incorporation, it is authorized to operate the proposed electric
plant; that there is no need for securing the approval of the Municipal
Council before operating its electric plant as this is not a necessary requisite
for the issuance of a certificate of public convenience inasmuch as it already
possesses the 3 basic requirements of law, namely: Filipino citizenship,
financial capacity and the need for the service in the interest and
convenience of the consuming public.
During the hearings before the Commission Filipinas presented its
evidence and petitioner's counsel cross-examined the witnesses. Upon the
resumption of the hearing on December 17, 1962, petitioner's counsel filed
an urgent motion for the postponement of the presentation of its evidence
that day alleging that he was to attend a preliminary hearing at Caloocan
City. As the date agreed upon by the parties was se only after the attorneys
for the parties had consulted their respective calendar, the Commission, in
open court, denied said motion and considered the application as submitted
for resolution.
Upon consideration of the evidence, oral and documentary, adduced by
Filipinas to the effect that the proposed electric service will be limited to the
exclusive needs of its cement factory and to give light facilities to its
employees living in the compound only, without adversely affecting the
interests and services of petitioner; that like the latter, Filipinas will not
generate its own electric current but buy it from the MERALCO; and that no
municipal streets will be traversed by its electric wires and posts except
small portions of private properties, the Commission, pursuant to section 15
of Commonwealth Act 146, as amended, issued a certificate of public
convenience to it on March 15, 1963, subject to the conditions set forth
therein.
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 Petitioner filed a motion to set aside the above decision and re- open
the case but the same was denied en banc on August 12, 1963. Hence the
instant petition for review filed on September 9 of the same year.
Considering the assignment of errors made in petitioner's brief, the
following are the questions to be resolved in this appeal: firstly, whether or
not Filipinas should have secured either a municipal or legislative franchise
before it could be entitled to a certificate of public convenience and
necessity to operate and maintain an electric plant; secondly, whether under
its articles of incorporation Filipinas is authorized to operate and maintain an
electric plant; and lastly, whether Filipinas could be granted a certificate of
public convenience and necessity to operate and maintain an electric plant
notwithstanding the existence of an electric plant operator in the same
municipality.
In relation to the first question petitioner contends that under the
provisions of Act No. 667 of the Philippine Commission, a municipal or
legislative franchise is a condition precedent to the granting to Filipinas of a
certificate of public convenience and necessity to operate and maintain an
electric plant.
Section 1 of the act mentioned above requires the filing of a formal
application with the Council of the municipality in which or through which
the petitioner desires to construct or maintain its line, stating, among other
things, the rate per month to be charged for electric light by lamp of
specified standard candle-power, and by amount of electricity consumed
where a meter is used, and the rate per centum of the gross receipts which
petitioner is willing to pay into the provincial treasury for the franchise.
Paragraphs 2 and 3, section 2 of the same act also provide that not less than
one-half of one per centum of the gross earnings shall be paid into the
provincial treasury, and that the rates to be charged shall always be subject
to regulations by act of the Philippine Commission or the legislative body of
the Islands.
The above requirements show that the act was intended to apply
exclusively to any person or corporation who desires a franchise to construct
and maintain an electric line or power plant and line for business purposes,
that is, to render service to the general public at such rate of compensation
as may be approved and regulated by the government. Clearly, therefore, it
should not be made to apply to Filipinas who applied for a certificate of
public convenience and service to operate and maintain an electric plant
exclusively for its own use in connection with the operation of its cement
factory and for the use of its employees living within the compound of the
factory — the latter to receive service free of charge.
It is, consequently, our view that all that Filipinas needs for the
purpose above mentioned is a certificate of public convenience and
necessity such as the one granted to it by the respondent Public Service
Commission.
In relation to the second question, it appears that the Articles of
Incorporation of Filipinas (paragraph 7) provide for authority to secure from
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 any governmental, state, municipality, or provincial, city or other authority,
and to utilize and dispose of in any lawful manner, rights, powers, and
privileges, franchises and concessions — obviously necessary or at least
related to the operation of its cement factory. Moreover, said Articles of
Incorporation also provide that the corporation may generally perform any
and all acts connected with the business of manufacturing portland cement
or arising therefrom or incidental thereto.
It can not be denied that the operation of an electric light, heat and
power plant is necessarily connected with the business of manufacturing
cement. If in the modern world where we live today electricity is virtually a
necessity for our daily needs, it is more so in the case of industries like the
manufacture of cement.
Upon the last question, petitioner claims that Filipinas is not entitled to
a certificate of public convenience to maintain and operate electric service
for its cement plant and its employees because petitioner is operating an
electric plant in the same municipality where Filipinas cement plant is
located.
While it is true that operators of public convenience and service
deserve some protection from unnecessary or unlawful competition, yet the
rule is that nobody has any exclusive right to secure a franchise or a
certificate of public convenience. Above any or all considerations, the grant
of franchises and certificates of public convenience and service should be
guided by public service and interest; the latter are the primordial
considerations to be taken into account.

Moreover, it has been established in this case that petitioner was in no

condition to supply the power needs of Filipinas, because its load capacity
was only 200 kilowatts while Filipinas was in need of 6,000 kilowatts power
to operate its cement factory.
IN VIEW OF THE FOREGOING, the decision appealed from is affirmed,
with costs.
Concepcion, C.J., Reyes, J.B.L., Makalintal, Bengzon, J.P., Zaldivar,
Sanchez, Castro, Angeles and Fernando, JJ., concur.

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