PHILIPPINE AIR LINES, INC., PETITIONER, VS. CIVIL AERONAUTICS BOARD, AND FILIPINAS ORIENT AIRWAYS, INC., RESPONDENTS.

Original petition for certiorari, to set aside and annul a resolution
of the Civil Aeronautics Board – hereinafter referred to as CAB – granting
respondent Filipinas Orient Airways, Inc. – hereinafter referred to as Fairways
– “provisional authority to operate scheduled and non-scheduled domestic
air services with the use of DC-3 aircrafts”, subject to specified
conditions.

Pursuant to Republic Act No. 4147, granting thereto “a
franchise to establish, operate and maintain transport services for the
carriage of passengers, mail, industrial flights and cargo by air in and
between any and all points and places throughout the Philippines and other
countries”, on September 16, 1964, Fairways filed with CAB the corres­ponding
application for a “certificate of public convenience and necessity”,
which was Docketed as economic proceedings (EP) No.
625, and was objected to by herein petitioner, Philippine Air Lines, Inc.,
hereinafter referred to as PAL. 
Subsequently, a CAB hearing officer began to receive evidence on said
application.  After several hearings
before said officer, or on December 14, 1964, Fairways filed an “urgent
petition for provisional authority to operate” under a detailed “program of
implementation” attached to said petition, and for the approval of its
bond therefor, as well as the provisional approval of
its “tariff regulations and the conditions of carriage to be printed at
the back of the passenger tickets.” Despite PAL’s
opposition thereto, in a resolution issued on January 5, 1965, CAB granted said urgent petition of
Fairways.  The pertinent part of said
resolution provides:

“Filipinas Orient Airways, Inc., (FAIRWAYS) having presented
to the Board evidence showing prima facie its fitness,
willingness and ability to operate the services applied for and the pu­blic
need for more air transportation service, and to encourage and develop
commercial air transportation, RESOLVED, to grant, as the Board here­by grants,
the said Filipinas Orient Airways, Inc., provisional authority to operate
scheduled and non-scheduled domestic air services with the use of DC-3 aircraft,
subject to the following conditions:

1. The term of the provisional authority herein granted shall be
until such time as the main application for a certificate of public convenience
and necessity is finally decided or for such period as the Board may at any
time deter­mine;

          x    x    x    x    x    x    x    x    x    x”

A reconsideration of this resolution having been denied, PAL
filed the present civil action alleging that, in issuing said resolution, CAB
had acted illegally and in excess of its jurisdiction or with grave abuse of
discretion, because:

(1) CAB is not empowered to grant any provisional authority to
operate, prior to the submission for decision of the main application for a
certificate of public con­venience and necessity;

(2) CAB had no evidence before it that could have justified the
granting of the provisional authority com­plained of;

(3) PAL was denied due process when CAB granted said authority
before the presentation of its evidence on Fairways’ main application; and

(4) In granting said provisional authority, the CAB had prejudged
the merits of said application.

The first ground is devoid of merit.  Section 10-C (1) of Republic Act No. 776,
reading:

“(C) The Board shall have the
following specific po­wers and duties:

(1) In accordance with the provisions of Chapter IV of this Act, to
issue, deny, amend, re­vise, alter, modify, cancel, suspend or revoke, in whole
or in part, upon petitioner complaint, or upon its own initiative, any
temporary operat­ing permit or Certificate of Public Convenience and Necessity;
Provided, however, That in the case of foreign air carriers, the permit shall
be issued with the approval of the President of the Republic of the Philippines
x x x“.

explicitly
authorizes CAB to issue a “temporary operating permit,” and nothing contained,
either in said section, or in Chapter IV of Republic Act No. 776, negates the
power to issue said “permit”, before the completion of the
applicant’s evidence and that of the oppositor
thereto on the main petition.  Indeed,
the CAB’s authority to grant a temporary permit “upon its own
initiative,” strongly suggests the power to exercise said authority, even
before the presentation of said evidence has begun.

Moreover, we perceive no cogent reason to depart, in connection
with the commercial air transport service, from the policy of our public
service law, which sanctions the issuance of temporary or provisional permits
or certificates of public convenience and necessity, before the submission of a
case for decision on the merits.^[1]
The overriding considerations in both instances are the same, namely, that the
service be required by public convenience and necessity, and, that the
applicant is fit, as well as willing and able to render such service properly,
in conformity with law and the pertinent rules, regulations and requirements.^[2]

As regards PAL’s second contention, we
have no more than PAL’s assertion and conclusion
regarding the absence of substantial evidence in support of the finding, in the
order complained of, to the effect that Fairways’ evidence had established
“prima facie” its fitness, willingness and ability to
operate the services applied for and the public need for more transportation
service x x x”. x Apart from PAL’s assertion being
contradicted by the tenor of said order, there is the legal presumption that
official duty has been duly performed.

Such presumption is particularly strong as regards administrative
agencies, like the CAB, vested with powers said to be quasi-judicial in nature,
in connection with the enforcement of laws affecting particular fields of
activity, the proper regulation and/or promotion of which requires a technical
or special training, aside from a good knowledge and grasp of the overall
conditions, relevant to said field, obtaining in the nation.^[3]
The consequent policy and prac­tice underlying our Administrative Law is that
courts of justice should respect the findings of fact of said adminis­trative
agencies, unless there is absolutely no evidence in support thereof or such
evidence is clearly, manifestly and patently insubstantial.^[4]
This, in turn, is but a recog­nition of the necessity
of permitting the executive depart­ment to adjust law enforcement to changing
conditions, with out being unduly hampered by the rigidity and the delays often
attending ordinary court proceedings or the enactment of new or amendatory
legislations.  In the case at bar,
petitioner has not satisfactorily shown that the aforemen­tioned findings of
the CAB are lacking in the necessary evidentiary support.

Needless to say, the case of Ang Tibay vs. C.I.R.^[5]
on which petitioner relies, is not in point. 
Said case re­fers to the conditions essential to a valid decision on
the merits, from the viewpoint of due process, whereas, in the case at bar,
we are concerned with an interlocutory order prior to the
rendition of said decision.  In fact,
interlocutory orders may sometimes be issued ex parte,
parti­cularly, in administrative proceedings, without previous notice and
hearing, consistently with due process.^[6] Again the constitutional provision to the effect that “no decision
shall be rendered by any court of record without expressing therein clearly and
distinctly the facts and the law on which it is based”,^[7]
applies, not to such interlocutory orders, but to the determination of the case
on the merits.^[8]

Lastly, the provisional nature of the permit granted to Fairways
refutes the assertion that it prejudges the merits of Fairways’ application and
PAL’s opposition thereto.  As stated in the questioned order, CAB’s
findings therein made reflect its view merely on the prima facie
effect of the evidence so far introduced and do not connote a pro­nouncement or
an advanced expression of opinion on the merits of the case.

WHEREFORE, the petition herein should be, as it is hereby
dismissed, and the writ prayed for denied, with costs against petitioner,
Philippine Air Lines, Inc.

IT IS SO ORDERED.  

Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez,
Castro and Angeles, JJ.,
concur.

Fernando, J., took no part.

^[1] Javellana v. La Paz Ice Plant & Cold Storage
Co., 66 Phil. 893; Ablaza v. Transportation
Co., 88 Phil. 412.

^[2]
Section 21, Republic Act No. 776; Act No. 3108, Section (1); Batangas Transportation v. Orlanes,
55 Phil. 659; Manila Electric v. Pasay
Transportation, 57 Phil. 825.

^[3] Pangasinan Transportation v. Public Utility
Commission, 70 Phil. 221.

^[4] Heacock v. National Labor Union, 95 Phil. 553.

^[5] 60 Phil. 635.

^[6] Cornejo v. Gabriel, 41 Phil. 188.

^[7] Article
VIII, Section 12, Constitution of the Philippines.

^[8] Soncuya v. National Loan & Investment Board, 69
Phil. 602.