FILIPINO BUS COMPANY, PETITIONER VS. PHILIPPINE RAILWAY COMPANY, RESPONDENT. PUBLIC SERVICE COMMISSION, INTERVENOR.

This
is a petition for the review of an order of the Public Service
Commission brought here under section 35 of Act No. 3108 as amended by
Act No. 3316. This section provides in part as follows:

“The
Supreme Court is hereby given jurisdiction to review said order of the
Commission, and to modify or set aside such order when it clearly
appears that there was no evidence before the Commission to support
reasonably such order, or that the same was without the jurisdiction of
the Commission. * * *”

The dispositive part of the commission’s order which is assailed by the petitioner, reads as follows:

“For
all the foregoing, a fine of five hundred pesos (P500) plus the payment
of cost of investigation in the sum of P25 is hereby imposed upon the
respondent company payable within thirty days from receipt hereof, with
the understanding that upon its failure to pay the said amount, fine
and costs, within the thirty days period, the certificates issued to
the respondent shall be suspended until the said amount is entirely
paid without prejudice to the collection of the same by way of ordinary
proceedings.

“This decision shall take effect from date hereof and shall become final thirty days after the parties were duly notified.”

The facts of the case, may be summarized as follows: On September 12,
1932, a complaint was filed with the Public Service Commission (case
No. 30939), charging that the Filipino Bus Company (petitioner herein)
during the months of January and February, 1932, had repeatedly
violated the law and the orders of the Public Service Commission, in
the sense that it charged and accepted lower fares for the
transportation of passengers than permitted by its authorized schedules
and the orders of the Public Service Commission. After the
complainant’s evidence was submitted (and it seems to us conclusive)
the Filipino Bus Company presented no evidence. Its attorney made the
following statements:

“Mr. EDILLON (on
behalf of the respondent). The respondent has no desire to present any
evidence at all. It wishes to state this manifestation to the
commission that in the Province of Cebu since January 20, 1932, the
question of rates is acute. The respondent finds it hard and difficult
to stand the strain of competition without adopting the rates charged
by the other competing operators. By force of necessity and in order to
preserve its existence, maintain its franchise and serve the interests
of public convenience, the respondent is left helpless in the face of
no alternatives than to follow the rates prevailing in the Province of
Cebu. The respondent stands first for law enforcement and commits
itself to adhere to the force of the rules and regulations of this
commission on which it relies for protection and security in the field
of business. The respondent respectfully prays and calls the attention
of this Honorable Public Service Commission to consider the
circumstances under which the respondent is laboring in order to exist
and minimize its losses occasioned by the rate-cutting practice and
practices of the bus operators competing in the Province of Cebu.

“With the foregoing manifestation, respondent submits the case for decision.

“Mr. ARMSTRONG. Do I understand from your manifestation that you virtually admit the charges contained in the complaint?

“Mr.
EDILLON. The manifestation will speak for itself, Mr. Armstrong. I
think it is clear.” We can find no merit whatever in petitioner’s first
assignment of error which, in substance, is that the charges were not
substantiated by the evidence.

Its second
assignment of error is as follows: “That the Public Service Commission
erred in imposing a P500 fine—a very excessive penalty for the slight
offense charged in the complaint.” The brief of the petitioner
concludes with the following prayer:

“Wherefore, this Honorable Supreme Court is respectfully prayed to render a judgment: (a)
setting aside the order of the Public Service Commission imposing P500
fine upon the petitioner on the ground that there was no evidence
before the commission to reasonably support said order; (b) or
to reduce the penalty to the amount of P50 plus the costs of
investigation, in case this Hon. Supreme Court finds that the charges
are clearly sustained by the evidence presented.”

In view of said prayer and the appellate powers of this court in
relation to the Public Service Commission, this court, on November 23,
1932, entered the following order:

“The court on this 22d day of November, 1932, having under consideration the petition of the Filipino Bus Company vs.
Philippine Railway Co. (respondent), G. R. No. 37929, for a review of
the decision of the Public Service Commission, dated June 3, 1932, in
case No. 30939 in which the said commission imposes upon the Filipino
Bus Company a fine of P500 plus P25 the cost of investigation, to be
payable within 30 days and if not so paid the certificates of
convenience issued to said company shall be suspended, and it appearing
that the Public Service Commission is not made a party respondent in
the present proceeding for review of the said order of the commission,
and a question having arisen as to the jurisdiction of the commission
to make the order aforesaid, it is ordered that the clerk of this court
forward to the Attorney-General, as law officer of said commission, a
copy of the petition for review herein filed, without exhibits, and a
copy of the said order of June 3, 1932, of the commission and the
Attorney-General is hereby granted a period of fifteen (15) days from
the receipt of notice within which to intervene in this cause on behalf
of the Public Service Commission and to file such memorandum specially
with relation to said jurisdictional question as he may deem proper.”

On December 12, 1932, the Attorney-General, on behalf of the Public
Service Commission, filed a petition for leave to intervene in this
cause on behalf of the Public Service Commission, which was granted and
the court was favored with the views of the Attorney-General, presented
in a memorandum filed on December 21, 1932.

The
Attorney-General finds in section 30 of the Public Service Commission
Act (No. 3108 as amended by section 8 of Act No. 3316) the authority
and jurisdiction of the commission to impose the fine herein complained
of. He cites three decisions of this court in support of his view,
namely: G. R. No. 33691, Bohol Land Transportation Co. vs. Butalid and Jureidini^[1]; G. R. No. 34815, Pasay Transportation Co. vs. Silang Traffic Company^[2]; G. R. No. 36192, Cabacungan vs. Northern Luzon Transportation Inc.^[3]
A brief review of these cases, we think, will disclose that the
question of the jurisdiction of the commission to impose a penalty or
fine was not decided or discussed.

In the case of Bohol Land
Transportation Co. vs Butalid and Jureidini, which was promulgated
January 27, 1931, it appears that the commission, instead of cancelling
the certificates of public convenience and necessity of the respondents
as desired by the petitioner, merely fined the respondent and approved
the transfer of the certificates to Jureidini. Apparently, the
respondent paid the fine but the complainant petitioner was not
satisfied with that action and insisted in its assignments of error to
the effect that the Public Service Commission should have applied the
more drastic penalty of cancelling the certificates. This court
confirmed the decision of the commission; but, as stated, the party who
was fined did not appeal.

In the case of Cabacungan vs.
Northern Luzon Transportation Inc., which was promulgated September 3,
1932, the commission imposed upon the appellant the penalty of P800
plus P25 for the costs of investigation; and ordered the TPU license
plates on the appellant’s trucks to be removed and confiscated. The
fourth assignment of error of the appellant was as follows:

“The
commission erred in imposing upon the appellant a fine other than and
in excess of the fine provided for in section 30 of Act No. 3108; as
section 33 of the said Act should be declared unconstitutional in that
it offers wide room for discrimination and abuse by merely setting the
maximum limit for such fines which under this Act is excessively and
unreasonably high.”

The question as to the
authority of the commission to impose a penalty was not discussed. But
it was argued that the amount fixed in the statute (“not exceeding P200
per day for every day during which such default continues”) was so
excessive and unreasonable as to violate the provisions of our Organic
Law prohibiting cruel and unusual punishments. With regard to this
particular argument, this court said the following:

“En
cuanto al cuarto senalamiento de error, tambien se suscita en el una
cuestion al parecer de derecho constitucional pero que en realidad y
verdad no es mas que la de si o no el poder legislativo esta facultado
a fijar un limite maximo para las multas, y la de si la multa que no
exceda de P200 al dia fijada en el articulo 30 de la Ley No. 3108 es
excesiva e irrazonable. La legislatura esta ciertamente facultada a
fijar el maximum de la pena pecuniaria que desea imponer por cada
infraccion de cualquier orden de la Comision de Servicios Publicos y la
referida multa maxima de P200 al dia arriba mencionada no es ni cruel
ni inusitada, puesto que la Ley no obliga su imposicion en todos los
casos, sino que puede imponerse cantidad menor segun la mayor o menor
gravedad de la infraccion.”

It is apparent,
therefore, from the foregoing that no interpretation of section 30 of
Act No. 3108, as amended, as related to the question of the
jurisdiction of the commission to impose a penalty, was involved.

In the case of Pasay Transportation Co. vs.
Silang Traffic Company, which was decided on December 3, 1931, the
appellant assigned in substance the following errors: First, that the
Public Service Commission erred in not cancelling the certificate of
the respondent; second, in reducing the fine imposed upon the
respondent to P75; and, third, in not granting the motion for
reconsideration presented by the complainant with reference to the fine
imposed upon the respondent.

Here, too, the party upon whom
the penalty was imposed by the commission did not appeal and there is
no discussion whatever as to the jurisdiction of the commission. The
appellant contended that the commission should have cancelled the
certificate instead of imposing a penalty. Upon that issue alone this
court confirmed the action of the commission. If this court passed over
the jurisdictional question sub silentio in that case,
because the question was not presented by either of the parties, that
does not preclude an appellant, or the court on its own motion, from
raising the question in a future case in which the issue is squarely
presented.

The case at bar stands on a different footing
from the cases above cited. This court is now asked to reverse or, in
its discretion, to modify a penalty imposed by the Public Service
Commission; and we proceed directly to the consideration of the
jurisdiction of the Public Service Commission to impose the penalty
which we are now asked to reduce. Necessarily, if the commission had no
jurisdiction to make the order, this court has no jurisdiction to
modify it on appeal.

As the sole enactment, on the basis of
which the commission assumed to exercise this jurisdiction, is section
30 of Act No. 3108, as amended by Act No. 3316, that section is quoted
here:

“Sec. 30. In default of compliance
with any order of the Commission when the same shall become effective
the person or public service affected thereby shall be subject to a
penalty of not exceeding two hundred pesos per day for every day during
which such default continues, to be recovered in an action in the name
of the Government of the Philippine Islands, and observance of the
orders of the Commission may be enforced by mandamus or injunction in
appropriate cases, or by action to compel the specific performance of
the order or orders so made, or of the duties imposed by law upon such
public service: Provided, That the Commission may compromise
any civil or other action arising under this Act, in such manner and
for such sum as it may deem just and reasonable.”

A cursory reading of the foregoing language indicates that there are no
words which delegate to the Public Service Commission the jurisdiction
to determine first, whether or not an offense was committed, and
second, to determine in its discretion what is the proper penalty, and
third, to enter and record with legal effect an order or judgment
imposing upon the offender the penalty to which section 30 subjects
him. Moreover, the words “shall be subject to a penalty * * * to be
recovered in an action in the name of the Government of the Philippine
Islands”, considered in their context, plainly indicate that the
adjudication of the liability for the penalty and the determination of
the amount thereof, and the execution for the enforcement thereof, are
confided by the statute to a court of competent jurisdiction, and not
to the Public Service Commission.

This conclusion, we think,
is reinforced by an examination of the other penal clauses1 of the
Public Service Law. There is only one section (section 23) in which the
Public Service Commission is given jurisdiction to impose a fine and
here that power is granted in express and unmistakable language. The
jurisdiction to impose fines or penalties is ordinarily a judicial
function; and when the Legislature, in derogation of the judicial
department, confers such jurisdiction on an administrative commission
of its own creation, it will not leave its purpose to inference but
will make it known in clear and unequivocal words, as it did, in this
Act, in section 23.

In all the other penal clauses of the Public Service Law (sections 24 [a], 24 [b], 24 [d], 24 [f], 24 [g], 24 [h], 24 [i],
section 31, section 32) relating to various violations of the orders of
the commission or the provisions of the Public Service Law, the
jurisdiction to punish the offender is vested in courts of competent
jurisdiction. Section 33, which provides in substance that any public
service corporation which shall commit any act prohibited by the
statute or omit to perform any act required to be done thereby shall be
punished by a fine not exceeding P25,000, makes no express reference to
a court of competent jurisdiction, but we think confers upon such a
court, and not upon the Public Service Commission, the jurisdiction to
impose such a fine. So far as we are advised, the commission has never
assumed to exercise that jurisdiction.

The Public Service
Commission, being a creature of the Legislature, and not a court, it
can exercise only such jurisdiction and powers as are expressly, or by
necessary implication, conferred upon it by statute. As we do not find
in section 30, or any other provision of the Public Service Law, any
delegation to the commission, in express words or by necessary
implication, of the authority and jurisdiction to determine the guilt
of the appellant, or the discretion to determine the amount of the
penalty, or the authority to “impose” the penalty here in question
under pain of suspension of the appellant’s certificate of public
convenience and necessity, we must hold that the commission had no
jurisdiction to make the order herein complained of. The order must be
declared void and is hereby vacated, without prejudice to any other
proceedings that may be brought lawfully against the Filipino Bus
Company.

There will be no special pronouncement as to costs.

Avanceña, C. J., Street, Villamor, Ostrand, Villa-Real, Abad Santos, Hull, Vickers, and Imperial, JJ., concur.

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^[1] Promulgated January 27, 1931, not reported.

^[2] 56 Phil., 822.

^[3] Page 977, post.