GR 37288; (February, 1933) (Digest)
G.R. No. 37288 ; February 6, 1933
MANILA ELECTRIC COMPANY, complainant-appellant, vs. ORLANES & BANAAG TRANSPORTATION CO., respondent-appellee.
FACTS
The Public Service Commission (PSC) issued a certificate of public convenience to Orlanes & Banaag Transportation Co. to operate a bus line from San Felipe Neri to Divisoria Market. After operating for only one month, the company suspended service in October 1929 because a bridge was incomplete, making the route impassable. The company applied for authority to suspend service, but the PSC took no action on the application. The certificate and company assets were later sold at public auction to satisfy a debt, passing through several assignees (Parsons Hardware Co., Laguna-Tayabas Bus Co., and finally Pasay Transportation Co.), with each transfer approved by the PSC. After the bridge was completed, Pasay Transportation Co. resumed operation on the line in February 1932. Manila Electric Company, which held a certificate for a competing route, petitioned the PSC to cancel the original certificate due to its prolonged suspension and abandonment by the original operator.
ISSUE
1. Can a certificate of public convenience, acquired at a public auction while in force and with PSC approval, be annulled because the original operator suspended service without prior authorization?
2. What is the duty of the Public Service Commission regarding certificate holders who fail to render service?
RULING
1. No. The Supreme Court affirmed the PSC’s decision. The certificate remained in force because the Public Service Law contained no provision for automatic revocation due to suspension or abandonment, and the PSC had issued no cancellation order. The successive transfers of the certificate were approved by the PSC, thereby recognizing its continued validity. It would be unfair to deprive the innocent last purchaser (Pasay Transportation Co.) of the certificate due to the original operator’s abandonment and negligence.
2. The PSC is duty-bound to ensure that certificate holders render the authorized public service within a reasonable time and to prevent speculation on certificates to the detriment of the public. While the original operator’s suspension was prejudicial to the public, the proper remedy was for the PSC to compel service or impose penalties (as it did by imposing a fine), not to cancel the certificate after its bona fide transfer. The appealed decision was affirmed in toto.
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