BATANGAS TRANSPORTATION COMPANY, PETITIONER, VS. MANILA RAILROAD COMPANY AND PUBLIC SERVICE COMMISSION, RESPONDENTS.

This petition for a writ of certiorari puts in
issue the right of the respondent Manila Railroad Company to establish
a line of motor vehicles for the transportation of passengers between
the City of Manila and the municipality of Batangas, Province of
Batangas, via the municipalities of Noveleta and Mendez-Nunez, Province
of Cavite, with branch lines from and to certain points which are not
necessary to specify here.

Petitioner alleges that the establishment of such a line by the
Manila Railroad Company would constitute an invasion of territory over
which the petitioner has certificates of public convenience; would
result in ruinous and unfair competition with the established
transportation business of the petitioner; and would destroy and render
valueless property and property rights of the petitioner to the amount
of at least five hundred thousand pesos (P500,000), Philippine currency.

Petitioner challenges the right of the Manila Railroad Company to
establish the line in question without first obtaining a certificate of
public convenience from the Public Service Commission.

The Manila Railroad Company is a corporation organized and existing
under the laws of the Philippines. It is controlled by the government
which owns ninety-nine per centum of its subscribed and paid up capital
stock. Among the purposes for which the corporation was formed, as
stated in its articles of incorporation, are the following:

” (g) To transport for hire, passengers and mails, goods,
wares, merchandise, animals, and all other property of every kind and
nature whatsoever, to, from, and between the various cities, towns,
ports and places in the Philippine

Islands and between any of said cities, towns, ports and places and
any port or ports of the United States, its dependencies and
possessions, or foreign countries.

” (h) To establish, acquire, own, maintain and operate
express lines for the carrying of parcels and other articles, moneys
and valuables; sleeping car and parlor car lines; tramways, stage
lines, pipe lines, pneumatic tubes, and all other facilities that may
be necessary or useful in the transportation of passengers and property
to, from, and between the various cities, towns, ports and places in
the Philippine Islands, and between any of said cities, towns, ports
and places and any port or ports of the United States, its dependencies
and possessions, or foreign countries.”

The statute under which a corporation is organized and its articles
of incorporation constitute its charter; and the charter, read in
connection with the general laws applicable to it, is the measure of
the powers of the corporation. (Green Bay, etc., R. Co. vs. Union Steamboat Co., 107 U. S., 98, 100; 27 Law. ed., 413; Pittsburg, etc., R. Co. vs. Keokuk, etc., Bridge Co., 131 U. S., 371, 385; 33 Law. ed., 157; Central Transp. Co. vs. Pullman’s Palace Car Co., 139 U. S., 24, 49; 35 Law. ed., 55.)

By its charter the Manila Railroad Company is not only authorized to
transport passengers, but to establish, maintain and operate tramways,
stage lines, and “all other facilities that may be necessary or useful
in the transportation of passengers and property to. from, and between
the various cities, towns, ports and places in the Philippine Islands.”
It seems too clear for argument that such grant cf powers is broad
enough to include the operation by the company of a line of motor
vehicles for the transportation of passengers between the City of
Manila and the municipality of Batangas, Province of Batangas, with
such branch lines as the company may deem necessary to maintain.

Granted that the Manila Railroad Company is empowered by its
charter, it remains to consider whether it can establish and operate
the line under discussion without first obtaining a certificate of
public convenience from the Public Service Commission. Upon this point
Act No. 3376 is pertinent. This Act provides that the Public,Service
Commission shall not exercise “any control or supervision over the
Manila Railroad Company so long as the same shall be controlled by the
Government of the Philippine Islands, except with regard to its rates.”
The language of the statute is clear. It requires no construction to
ascertain its meaning. There is no ambiguity. The Manila Railroad
Company is subject to the control or supervision of the Public Service
Commission only with regard to its rates. In all other respects it can
exercise its powers under the charter free from any interference by the
commission. We conclude that the Manila Railroad Company can establish
and operate lines of motor vehicles for the transportation of
passengers between the various cities, towns and places in the
Philippines, without obtaining any certificate or certificates of
public convenience from the Public Service Commission.

We find no merit in the contention that the conclusion thus reached
will deny the petitioner the equal protection of the laws. (The
constitutional requirement of the equal protection of the laws does not
preclude the legislative department from resorting to classification
for the purpose of legislation. (Aero Mayflower T. Co. vs. Georgia Pub. Serv. Com., 295 U. S., 285; 79 Law. ed., 1439; Colgate vs.
Harvey, 80 U. S. [Adv. Ops.], 225.) In the enactment of regulatory
measures the legislature may, without offending such constitutional
provision, make exceptions in pursuance of a policy designed to promote
the public interest.

Counsel have discussed at length the scope of section 14 (c) of the
Public Service Commission Act. The controversy is whether or not, under
this provision of law, approval by the commission of the rates over a
new line is necessary. While petitioner urges that it is, the Manila
Railroad Company claims that it is not.

In United States vs. Illinois C. R. Co. (263 U. S., 515;
68 Law. ed., 417, 424), the Supreme Court of the United States declared
that “a carrier is entitled to initiate rates, and, in this connection,
to adopt such policy of rate making as to it seems wise.” A careful
analysis will show that section 14 (c) of the Public Service
Commission Act does not refer to initial rates. Said section empowers
the commission to fix just and reasonable individual rates, joint
rates, tolls, charges or schedules thereof, whenever the commission shall determine any existing
individual rate, joint rate, toll, charge, or schedule thereof, to be
unjust, unreasonable, insufficient, or unjustly discriminatory or
preferential. The power of the commission to act under the section must
be predicated on its determination that the existing rates are unjust,
unreasonable, insufficient, or unjustly discriminatory or preferential.
There is no provision of law which requires approval by the Public
Service Commission of the rates over a new line. It follows that in
approving the rates proposed by the Manila Railroad Company over its
new line between the City of Manila and the municipality of Batangas,
the commission merely recognized the right of the carrier to initiate
rates.

The petition for a writ of certiorari is denied, with costs against the petitioner. So ordered.

Avancena, C. J., Villa-Real, Imperial, Diaz, Laurel, and Concepcion, JJ., concur.