APPLICATION FOR A CERTIFICATE OF PUBLIC CONVENIENCE FOR THE OPERATION OF AN ICE PLANT SERVICE. QUIRINO G. GREGORIO, APPLICANT.

This is a petition for a writ of certiorari by Quirino G. Gregorio. The
petition seeks to annul an order of the Public Service Commission and to require
it “to proceed for the reconstruction and reconstitution of petitioner’s
original application (case No. 59690)” to operate an ice plant.

The facts that led to the bringing of this action are these. On May 10, 1940,
petitioner herein filed with the Public Service Commission an application for a
certificate of convenience and public necessity to install, operate and maintain
an ice plant service within the municipality of Pasay, Province of Rizal, an
application which was docketed as Commission case No. 59690. Following the usual
procedure, petitioner published the notice of hearing in the manner provided by
law and regulations and took other steps to put the case in shape to be heard.
For diverse reasons hearing on the application was postponed several times until
war came and caused the case to be shelved indefinitely.

In February, 1945, the records of the Public Service Commission, including
that of case No. 59690, were lost or destroyed. The brief for petitioner states
that upon the re-establishment of the Public Service Commission, the latter
announced that within a period of one year, which later was extended to six
months more, the Commission would entertain requests for reconstitution of all
records which had been burned. Then the herein petitioner moved for
reconstitution of case No. 59690 with a view to having it adjudicated, but,
petitioner alleges, the Commission docketed his motion for reconstitution as a
new application under a new number and compelled him to pay again P25 as fee as
well as to publish anew the notice of hearing. However, the last allegation is
not entirely accurate, as we shall have occasion to show.

Petitioner’s case and eleven other applications for authority to install and
operate ice plants in various places around the City of Manila were set for
hearing and taken up jointly on September 17, 1945. Before that hearing started,
the Commissioner informed the parties that should he decide to grant
certificates for ice plants he would da so for a temporary period only, not more
than three or four years. It was also announced that no applications for ice
plant service would be considered unless the applicants already possessed
complete machineries and equipment ready to be set up. After trial, the
applicants who had machineries and equipment were forthwith granted certificates
of public convenience valid up to December 31, 1948. There were six of them.
Among those who had no ice-making machineries and equipment and whose
applications were denied was the present petitioner.

On motion of the applicant for reconsideration, the Commission elaborated on
the grounds of the dismissal of his application in an order from which we quote
the following passages:

“The reasons for the adoption of this policy are already set forth in our
decisions in cases Nos. 307, 417, et al., and case No. 401. It was adopted for
the purpose of insuring that applicants for ice plant certificates would render
this urgently needed service as soon as possible after their applications are
approved, and to discourage possible attempts to apply for and obtain ice plant
certificates with no intention of rendering the service but simply for purposes
of speculation. Soon after the Commission was organized, numerous applications
for ice plant certificates were filed b??t after this policy was announced not a
few desisted from prosecuting their applications and all those who showed real
disposition to render the service by obtaining the necessary equipment have been
granted certificates in the interest of the public and are now operating or
about to operate. The policy was laid down in the exercise of the regulatory
power which Commonwealth Act No. 146, as amended, confers upon this Commission.
It is a policy justified and required by present conditions and circumstances
which are totally different from those prevailing before the
War.”

As stated at the outset, the present petition is one for a writ of certiorari
as distinguished from a petition for review. There is a marked and fundamental
difference between the two remedies, which are the only remedies provided for by
law for the consideration by this Court of orders or decisions of the Public
Service Commission. (Section 36, Commonwealth Act No. 146, as amended; Manila
Railroad Co. vs. A. L. Ammen Transportation Co., 48 Phil., 266.) The
remedy by certiorari is available only in case the Commission has exceeded its
jurisdiction or gravely abused its discretion. When no question of jurisdiction
is involved but merely an error of law or fact, the appropriate remedy is reveiw
and not certiorari. (Genanichi Ishi vs. Public Service Commission, 63
Phil., 428.)

But while the only subject of complaint in the petition is the dismissal of
the application and the only prayer is to annul the order of the Commission and
to direct it “to proceed for the reconstruction and reconstitution of
petitioner’s original application (case No. 59690),” petitioner in his brief
brings up questions having only remote relation with the allegations in the
petition and quite foreign to the function and office of certiorari. Moreover,
the pleadings and the briefs do not present with reasonable certainty the
precise grounds of attack on the Commissioner’s order, and petitioner does not
cite any law or authority. We have to look through the trends of the arguments
to formulate the concrete propositions on which the writ is sought. Building up
out of the discussions of the assignment of errors, we assume the following to
be the questions on which decision has to be rendered:

(1) Has the Public Service Commission jurisdiction to disregard petitioner’s
old application and consider his motion for reconsideration as a new
application? (2) Has the Commission authority to dismiss petitioner’s
application on the sole ground that he has no ice-making equipment on hand? (3)
Was petitioner “denied his day in court?”

On the first question we may start with the reminder that Act No. 3110, which
prescribes the method for reconstitution of records of judicial tribunals, makes
no reference to lost or destroyed records of the Public Service Commission. The
matter of reconstitution of such records in the Public Service Commission must
be governed by section 11 of Commonwealth Act No. 146, as amended, which
provides that the Commission shall make needful rules for its government and
other proceedings not inconsistent with the provisions of that Act.

Under this section it is our opinion that the Commission has power to decree
that an application which has been lost or destroyed need not be reconstituted
and the applicant should, instead, file a new application if he desires to
proceed on his intention to secure a certificate of public convenience and
necessity. This procedure does not contravene the essential requirements of law.
It does not constitute illegality, irregularity or an abuse of discretion.

Furthermore, the petitioner himself suggested the conversion of his motion
for reconsideration into a new application. In his prayer he asked that “if this
(reconstitution) could not be done, that this petition be considered as an
application.” This precludes petitioner from taking exception to the conversion
of which he now complains. It is a well-established rule applicable to appellate
proceedings and review on certiorari that objection not raised in the lower
court cannot be relied on in the appellate court. (14 C. J. S., 286.) If then
mere failure to object to a supposed erroneous action bars consideration thereof
by the reviewing court, how true it must be when that action was the
petitioner’s own idea or was actively acquiesced in by him.

We also note that the conversion did not cause any wrong. It has been held
that in the absence of some substantial injury or manifest injustice to the
petitioner the writ of certiorari does not, as a rule, issue. (14 C.J.S.,
141.) It results that, aside from petitioner’s having incurred the additional
expense to be referred to below, the practice pursued by the Commission did not
work substantial injury or injustice to him. The Commission did not deprive him
of any legal right. There was no right he could have enjoyed under the old
application which was denied him under the new. In reality he did not acquire
any right under his pre-war application which he now wants restored. When it was
burned no action had been taken on that application beyond what was needed to
bring it to trial. The result would not have been any different if the original
application instead of the substituted one had been considered.

As to the imposition upon the applicant of the burden of paying docketing fee
on the new application and making new publication of the notice of hearing, it
should be made clear that this objection was not urged with the Commission; it
is mentioned in the petition only by way of describing the various steps which
were taken in the case. At any rate, petitioner’s expressed willingness to have
his motion for reconstitution treated as a new application carried with it an
implied conformity to defraying the expenses incident to the filing of a new
application.

It is said that pre-war applications should not have been brought within the
operation of the post-war, temporary policy of the Commission set forth in its
order. This brings us to the second question. This branch of the case involves
the reasonableness of the Commission’s order. Reasonableness, in turn, in its
broad aspects, may be said to import proper exercise of discretion.

The petitioner’s contention assumes that it was the original application
which was dismissed, when, as has been seen, that application was not
reconstituted and it was the second application which was denied. However, the
petitioner’s conclusion would still be wrong even if this premise were correct.
In other words, even if the old application had been reconstituted and no new
application had been docketed, it was within the authority of the Commission to
dispose of it upon the same level as applications of new applicants.

An application for a certificate of public convenience has to be decided in
the light of the conditions obtaining, not at the time of its filing but at the
time of the hearing or of the decision. This is so because in the exercise of
its authority, the Commission’s first consideration is public interest and
convenience. (Cebu Ice & Cold Stores Corp. vs. Veluz, 57 Phil., 309.)
With public interest and necessity as guide, it may go so far as to revoke
certificates of public convenience already issued if the circumstances under
which they were granted have materially changed. (Section 16 [m] of Act
No. 146, as amended; Pasay Transportation Co. vs. Public Service
Commission and Perez Samanillo, 59 Phil., 278.) It stands to reason that, if the
Commission may annul certificates that ceased to respond to public utility and
convenience, it may dispose of an application, which has not yet ripened into a
certificate, in pursuance of a new policy which new situations brought about by
a disastrous war demand.

Coming down to the main topic of the second question, was the policy of the
Public Service Commission by virtue of which the plaintiff’s application was
dismissed reasonable? Or to put the question in the language of the law on
certiorari, did it constitute a grave abuse of discretion?

The pertinent provisions, rules and decisions on this subject are succinctly
summarized in Tolentino’s Commentaries and Jurisprudence on Commercial Laws of
the Philippines. This summary is to the point and we will make use of it.

The Public Service Commission is the entity vested with the power to
authorize the operation of public services and to issue certificates of public
convenience therefor. (Section 15, Act No. 146, as amended.) In the exercise of
this power, the Commission must be guided by public necessity and convenience as
the primary consideration. (Manila Electric Co. vs. Pasay Transportation
Co., 57 Phil., 825; Manila Electric Co. vs. Pasay Transportation Co., 66 Phil.,
36; Manila Railroad Co. vs. Parsons Hardware Co., 66 Phil., 706.) In the
granting or refusal of a certificate of public convenience, all things
considered, the question is what is best for the interest of the public.
(Carmelo and Oriol vs. Monserrat, 55 Phil., 644.) It follows that, when
public convenience would not be served, the issuance of a certificate is not in
order. As this Court has once held, since the granting of a certificate of
public convenience presupposes that it is for the use and benefit of the
travelling public, so where it appears that the route over which the certificate
is granted is nothing but a proposed road which has not been constructed, the
certificate itself is null and void. (A. L. Ammen Transportation Co. vs.
De Margallo, 54 Phil., 570.)

Tested by this standard, the order of the Commission under review is not
arbitrary. Although no evidence was adduced in support of the order, its
underlying bases were matters of public knowledge of which judicial notice may
be taken.

We may take judicial notice of the fact that, as a result of the destruction
of the various ice plants in Manila and its environs during the war, and the use
by the United States Army of what was left of the ice cold storage, there was an
acute shortage of ice on the advent of liberation. We do not think the
Commission abused its authority when, to ease this situation, applicants who had
facilities for making ice were granted certificates of public convenience good
up to December 31, 1948, and those who had not were refused authority. The
severe scarcity of ice and the confusion that followed in the wake of a wide
devastation and holocaust gave justification to a policy which confined the
Commission’s attention to the immediate production of essential services. It was
an emergency measure demanded by a serious crisis. Under the circumstances there
was no. point in issuing permanent certificates of public convenience to
applicants who had no visible means of supplying public needs. Far from
promoting public interest and welfare, permanent certificates in the hands of
petitioner and others similarly situated could only be of use to the holders for
speculative purposes. More than this, they would be likely to create
complication and hamper the Commission’s freedom of action in the final
adjustment of public service operations. One day, as rehabilitation advanced,
the Commission would be called upon to map out a definite program. With the
return of normalcy, the manufacture and distribution of ice would have to be
regulated on a sound and permanent basis. To improve the service and to
eliminate wasteful and ruinous competition, operators and holders of
certificates might have to be screened, territories might have to be allocated,
and the privilege might have to be restricted to those who financially and by
administrative ability were in a position to give the best and maximum of
service with the minimum of friction and inefficiency.

The Commission was dealing with a transitional situation and was confronted
with a complex problem of business, economy and statesmanship. With the formula
adopted by the Commission we cannot interfere in the absence of a clear showing
that it is arbitrary, unlawful, or outside the jurisdiction of the Commission to
make. (Section 35, Com. Act No. 146, as amended.)

The remaining alleged error to be considered is the assertion that the
petitioner’s application was dismissed without a hearing.

To say that the petitioner was not given a hearing is not quite correct. In a
broad sense there was a hearing. There was a session in which the petitioner or
his attorney was present for the purpose of determining whether he possessed the
machinery required by the Commission as a condition precedent to the granting of
an application. In that session questions were asked and statements made
relative to the ability of the applicant to manufacture ice. The hearing thus
conducted was adequate. It fitted into the scope of the inquiry. If it was
lawful for the Commission to deny petitioner’s application for the sole reason
that he did not have an ice-making outfit, it committed no error in confining
its investigation to this feature of the application, and the hearing afforded
the petitioner fulfilled the legal requirements of a fair trial.

The petition is denied and dismissed without costs.

Moran, C.J., Feria,
Hilado, Bengzon, and Padilla, JJ., concur.
Briones, J.,
concurs in the result.

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PARAS, J.:

I cannot acquiesce in the majority opinion in so far as it sanctions the
action of the respondent Public Service Commission in summarily dismissing
petitioner’s application for authority to install, operate and maintain an ice
plant on the sole ground that the petitioner did not have as yet the necessary
equipment. This is not, under the law, a condition precedent. Assuming that the
Commission, in the interest of public service and convenience, may validly
impose such a requirement, the petitioner should have been sufficiently alerted,
if the Commission wanted to be just and fair to everybody. It is significant
that the petitioner is a pre-war applicant whose good faith cannot, therefore,
be seriously doubted. The fear that he might be merely speculating is not a
valid reason for denying him his day in court, since the law empowers the
Commission to cancel any certificate upon failure on the part of the applicant
to operate after a certain period. The action of the Commission is a dangerous
precedent and virtually authorizes intending operators to first purchase
equipment and thereafter obtain the necessary certificate of public convenience
which will surely be issued by the Commission as a matter of routine. Any
supposition to the contrary would work fraud and difficulties on future
applicants who have acquired machineries in advance. In either case, however,
the effect is certainly unwholesome.

The Commission should have heard
petitioner’s application on the merits.

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PABLO, M.:

Disiento. El solicitante tiene derecho a una vista para presentar pruebas en
apoyo de su solicitud.

El 17 de Septiembre de 1945, el Comisionado en sesion abierta anuncio que la
vista de las causas en que los solicitantes tenian maquinarias y equipos
disponibles para su inmediata instalacion e inspeccion tendria lugar el 15 de
Octubre, y la vista de las causas en que los solicitantes no tenian maquinarias
y equipos se posponia indefinidamente. El 15 de Octubre de 1945, el Comisionado
dijo:

“I will hear the following cases with equipment falling under the first
group: 300, 401, 417, 2226, 2492 and 2909. Hearing on the other cases of
applicants without equipment, Nos. 70, 136, 253, 254, 299, 307, 439, 466 and
2548, is hereby postponed indefinitely. The Commission will decide what action
it will take on said cases of applicants without equipment.”

El 4 de Febrero de 1946, el Comisionado, sin vista, y por el solo motivo de
que el solicitante en la presente causa No. 446 no tenia, segun el expediente,
maquinarias y equipos, para su inmediata instalacion, sobreseyo la solicitud. Lo
expuesto demuestra claramente que el solicitante no se le dio debida oportunidad
para presentar sus pruebas.

Un solicitante que compra maquinarias y equipos sin saber con seguridad si ha
de obtener certificado de conveniencia publica para explotar el negocio o
industria que solicita, no obra con prudencia: esta jugando con el azar. Por tal
razon, no puede estar en mejor condicion, ni tiene mejor derecho en operar una
empresa de tal naturaleza que aquel que primeramente presento su solicitud antes
do invertir al azar su capital, o tal vez toda su fortuna.

Obligar al solicitante, como condicion indispensable, que tenga antes de la
vista, maquinarias y equipos es obligarle a comprarlos y adquirirlos en el
mercado negro y esto conduciria a operaciones absurdas.

Si hay tres solicitantes para un solo municipio pequeño, y se sigue la
politica de la Comision, cada uno de los tres solicitantes para poder entrar en
vista compraria la maquinaria y equipos necesarios y los montaria inmediatamente
para estar preparados para la inspeccion. ¿Concedera entonces la Comision a cada
uno de los solicitantes el certificado de conveniencia publica sin tener en
cuenta cual de los tres esta en mejores condiciones economicas para operar una
empresa para el servicio de hielo y sin tener en cuenta si los tres operadores
entrarian en una competencia ruinosa? La teoria adoptada por la Comision es
peligrosa.

Cada solicitud debe ser vista en su fondo para que el solicitante tenga
oportunidad de demostrar si esta en condiciones o no de prestar el servicio que
solicita, sin tener en cuanta si tenia de antemano o no maquinarias y equipos.
Ademas, en los certificados de conveniencia publica se pone como condicion, bajo
pena de cancelacion, la de que la operacion de la empresa debe comenzar dentro
de seis meses desde la fecha de la notificacion de la decision. ¿Por que exigir
que el solicitante tenga las maquinarias y equipos antes de la vista? Pero esta
condicion no se exigio a Imus Electric Company en la causa No. 58825.

Este Tribunal debe revocar la orden de sobreseimiento y ordenar nueva
vista.

PERFECTO, M.:

Concurro con la disidencia del Magistrado
Pablo. Tambien encuentro fundada la del Magistrado Paras.