Thursday, April 26, 2012

Vigan Electric Light Co., Inc. v. Public Service Commission, 11 SCRA 317 (1964)


FACTS: In an alleged letter-petition, petitioner was charged with black market of electric meters and that its meters were installed in bad faith to register excessive rates. Petitioner received a communication from General Auditing Office (GAO) that it will be audited. PSC issued subsequently a subpoena duces tecum requiring petitioners to produce before PSC, during a conference scheduled for April 10, 1962, certain book of accounts. Petitioner moved to quash such subpoena. The conference was postponed twice until it was finally cancelled. In May 1962, PSC issued an order, which after finding that petitioner had an excess of revenues by 18%, lowered the present meter rates of petitioner. Hence, this petition for certiorari is instituted.

ISSUE: WON notice and hearing is required                 

RULING: Yes.

In support to its special defense, respondent PSC maintains that rate-fixing is a legislative function; that legislative or rule-making powers may constitutionally be exercised without previous notice or hearing. Although the rule-making power and even the power to fix rates – when such are meant to apply to all enterprises of a given kind throughout the Philippines – may partake of legislative character, such is not the nature of the order complained of. Here, the order exclusively applies to petitioner. What is more, it is predicated upon the finding of fact, whether the petitioner is making a profit more than 12% of its invested capital which is denied by the petitioner. Obviously, the latter is entitled to cross-examine the maker of the said report, and to introduce evidence to disprove the contents thereof and/or explain or complement the same, as well as to refute the conclusions drawn therefrom by the respondent. In other words, in making said finding of fact, respondent performed a function partaking of a quasi-judicial character, the valid exercise of which demands previous notice and hearing.

Indeed, Sections 16(c) and 20 (a) of CA No. 146, explicitly require notice and hearing.
Wherefore, we hold that the determination of the issue involved in the order complained of partakes the nature of quasi-judicial function and that, having been issued without previous notice and hearing, said order is clearly violative of the due process clause, and hence, null and void. 

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