G.R. No. 141949 & 151108. October 14, 2002.
CEFERINO PADUA, petitioner, vs. HON. SANTIAGO RANADA, PRESIDING JUDGE OF MAKATI, RTC, BRANCH 137, PHILIPPINE NATIONAL CONSTRUCTION CORP., TOLL REGULATORY BOARD, DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS, and REPUBLIC OF THE PHILIPPINES, respondents.

EDUARDO C. ZIALCITA, petitioner, vs. TOLL REGULATORY BOARD AND CITRA METRO MANILA TOLLWAYS CORPORATION, respondents.

FACTS

On November 9, 2001, the Toll Regulatory Board (TRB) issued Resolution No. 2001-89 authorizing provisional toll rate adjustments at the Metro Manila Skyway, effective January 1, 2002. The Resolution was published on December 17, 24, and 31, 2001. The adjustments were based on Citra Metro Manila Tollways Corporation’s (CITRA) application and subsequent “Urgent Motion for Provisional Approval,” which invoked Section 3, Rule 10 of the TRB Rules of Procedure, allowing the Board to grant provisional relief on its own initiative. CITRA’s application was grounded on a “significant currency devaluation” provision in the Supplemental Toll Operation Agreement (STOA), citing the peso’s devaluation from P26.1671 in 1995 to P48.00 in 2000, which increased its debt-service burden. CITRA later withdrew its Urgent Motion, and the TRB issued the Resolution. Petitioner Ceferino Padua, a toll payer, filed an urgent motion in a pending mandamus case (G.R. No. 141949) seeking to stop the increase, arguing the Resolution was issued without required publication and due process, that the TRB Executive Director alone could not authorize it, and that CITRA had no standing as it was an investor, not a franchisee-operator. Petitioner Eduardo Zialcita, a taxpayer and Congressman, filed a separate petition for prohibition (G.R. No. 151108), asserting the adjustments were exorbitant, issued without a public hearing in violation of P.D. No. 1112, and that the Resolution failed to state its factual and legal basis.

ISSUE

Whether Resolution No. 2001-89 issued by the Toll Regulatory Board is valid.

RULING

No. The Supreme Court declared TRB Resolution No. 2001-89 null and void. The TRB, in granting the provisional toll rate adjustment, committed a grave abuse of discretion. The power to approve toll rates under P.D. No. 1112 requires notice and hearing. While the TRB Rules of Procedure allow for provisional relief, such rule cannot contravene the substantive law (P.D. No. 1112) which mandates a hearing. The provisional increase was effectively a final grant of the increase sought without the requisite hearing, depriving the public of due process. Furthermore, the Resolution failed to comply with the constitutional requirement that decisions must state clearly and distinctly the facts and the law on which they are based. The Court also noted that the TRB’s authority is limited to public utilities, and CITRA, as a mere investor, did not have the requisite franchise to operate a toll facility and thus could not directly seek a toll rate adjustment. The temporary restraining order issued was made permanent.