PILAR L. DE VALENZUELA, PETITIONER, VS. TITO M. DUPAYA. RESPONDENT

De Valenzuela versus Dupaya

The Case

This is De Valenzuela versus Dupaya, a petition for review brought by Pilar de Valenzuela against Tito Dupaya, decided by the Supreme Court in July 1966. The petitioner operated a small ice plant in Aparri, Cagayan, and had opposed before the Public Service Commission the application of Dupaya to establish and operate a larger ice plant in Lal-lo and to sell ice in Lal-lo and in several neighboring municipalities. The Commission granted Dupaya's application and overruled the opposition. The petitioner came to the Supreme Court charging that the Commission gravely abused its discretion by cutting short the time allowed her to present her evidence, so that she was denied her day in court. The case matters because it is the classic ruling on when a regulatory commission's control of its own hearing calendar amounts to reversible error, and on what an oppositor must do to preserve a complaint that she was not fully heard.

Procedural History

The case began before the Public Service Commission as an application by Tito Dupaya for authority to establish and operate an ice plant with a production capacity of fifteen tons of ice per day in Lal-lo, Cagayan, and to distribute and sell ice there and in the neighboring municipalities. Pilar de Valenzuela, an existing ice plant operator, filed an opposition. The Commission, through hearing officer Ernesto Alcala, heard the applicant's evidence on seven hearing days spread over a period of three and a half months. The oppositor was allowed to present her evidence before the Justice of the Peace of Aparri only up to a fixed date, which was later extended once, with a warning that no further extension would be entertained. After she had presented five witnesses, she asked for a further extension of fifteen or thirty days, which the Commission refused. The Commission then considered the case submitted for decision and rendered judgment in favor of Dupaya. From that decision the oppositor appealed to the Supreme Court by petition for review.

Facts

Tito Dupaya applied to the Public Service Commission for authority to establish and operate an ice plant producing fifteen tons of ice per day in Lal-lo, Cagayan, and to sell ice in Lal-lo and in the neighboring towns of Calamanlugan, Gattaran, Alcala, Cumao, Pagao, Lasam, Aliacapan, Buguey, Gonzaga, and Santa Ana, all in Cagayan Province. Pilar de Valenzuela, who operated a six-ton ice plant in Aparri with authority to sell in Calamanlugan, Buguey, Gonzaga, Lal-lo, and Gattaran, opposed the application.

The applicant was given seven days of hearing, spread over three and a half months, to present his evidence. The oppositor, by order of January 14, 1960, was permitted to submit her evidence before the Justice of the Peace of Aparri only up to February 10, 1960. On her motion this was extended to February 24, 1960, but with the warning that no other petition for extension would be entertained and that, upon her failure to present and complete her evidence on that date, the case would be considered submitted for decision on the merits of the evidence presented by the parties. The Justice of the Peace set the hearing for February 23, and the oppositor presented four witnesses that day and one more on February 24.

She then asked the Commission to extend the authority of the Justice of the Peace for fifteen or thirty more days, because her witnesses from Gonzaga could not arrive, the Pateng river being swollen so that they could not cross. The Commission refused the extension, considered the case submitted, and decided in favor of Dupaya. The Commission's limitation of the hearing period was motivated by its desire to have all the evidence heard and reported by hearing officer Alcala before his impending retirement.

Issues

• Whether or not the Public Service Commission gravely abused its discretion by unreasonably restricting to a short period the authority of the Justice of the Peace of Aparri to receive the evidence of the oppositor.
• Whether or not the Public Service Commission gravely abused its discretion by refusing to extend that authority so that the oppositor could complete her evidence.
• Whether or not the Public Service Commission acted without or in excess of jurisdiction in rendering its decision granting the applicant authority to operate the ice plant although the oppositor had not completed her evidence.

Applicable Provisions

The decision does not quote any statutory text; it rests on the settled administrative-law principle that a commission's refusal to extend a hearing is reversible only upon a showing of substantial injury. The Court states the governing rule in its own words:

We feel that the proper step for petitioner to take should have been the timely filing in the Commission of an apposite motion for rehearing, supported by affidavits of the witnesses who were not able to testify, giving the substance of their intended evidence.

This rule bears on the case because the petitioner never made that motion, and so the Court held she could not claim substantial injury to her rights.

Ruling

On the first issue, the Court found no grave abuse of discretion. The limitation of the period granted for the completion of the oppositor's evidence was shown on the record to be motivated by the desire to have all the evidence heard and reported by hearing officer Alcala before his impending retirement. The Court held this to be adequate reason, because if the appellant's evidence were heard by another hearing officer, further delay would be unavoidable, since the second referee would first have to acquaint himself with the evidence heard by his predecessor before making his own report and recommendation.

On the second issue, the Court likewise found no grave abuse of discretion. While it was true that rigid adherence to the Commission's hearing schedules prevented the appellant from placing on record the testimony of some of her witnesses, there was no showing of what they would have testified to, or that, if given the chance, they would have led the Commission to a different result. The appellant disclosed only what she expected to prove through her plant manager, namely, that the produce of her ice plant was more than sufficient to supply ice to the people in the municipalities where she was authorized to sell. The Court held that such testimony would not have sufficed to overcome the evidence that the oppositor did not distribute ice outside of Aparri, so that the people in the other municipalities had to go to that town to get ice, despite the twenty kilometers separating Aparri from Lal-lo. As the Court put it, production is one thing and proper distribution is something else.

The Court added that the Commission had held, on the authority of previous decisions of the Supreme Court, that in view of the universal and widespread demand for ice, no evidence is necessary to show that an ice plant in the locality is much more advantageous to the general public as to facility in acquiring the commodity, and that the petitioner had not demonstrated how the unreceived testimony would have affected this finding adversely. Finally, the proper step for the petitioner would have been the timely filing in the Commission of a motion for rehearing supported by affidavits of the witnesses who were not able to testify, giving the substance of their intended evidence; not having done so, she was in no position to claim substantial injury to her rights.

On the third issue, since the Commission had not yet lost its authority over the case and had acted within its power in considering the case submitted after the period it had fixed, the Court found no reversible error in the decision rendered.

Doctrine

A public service commission has wide discretion to control its hearing calendar, and its refusal to extend the time for presenting evidence is not grave abuse of discretion where the record shows an adequate reason, such as the impending retirement of the hearing officer who has heard the case. A party who complains that she was not fully heard must show substantial injury: she must show what the excluded witnesses would have testified to and that their testimony could have led to a different result. The proper remedy for the exclusion of evidence before an administrative body is a timely motion for rehearing supported by affidavits of the witnesses, giving the substance of their intended evidence; failing that, the party cannot claim substantial injury to her rights. And in ice plant cases, the universal and widespread demand for ice makes it unnecessary to prove that a plant in the locality is more advantageous to the public in the facility of acquiring the commodity.

Disposition

The Supreme Court found no reversible error and affirmed the decision of the Public Service Commission, with costs against the petitioner.

Remember This

Memorize the line that production is one thing and proper distribution is something else, and that the remedy for excluded evidence before a commission is a timely motion for rehearing supported by affidavits of the witnesses. Examiners use this case on the requisites of grave abuse of discretion in administrative hearings and on the oppositor's burden to show substantial injury.