G.R. No. L-25078 December 24, 1968
ALATCO TRANSPORTATION, INC., BICOL TRANSPORTATION CO., and CONSOLIDATED AUTO LINES, INC., petitioners, vs. ROSALIO S. BONETE, JR., respondent.

FACTS

Respondent Rosalio S. Bonete, Jr. filed an application with the Public Service Commission (PSC) for a certificate of public convenience to operate a PUB auto-truck service of six units on the route Naga City-Legaspi City, via Libon. Due to lack of opposition despite publication and notice, the application was heard ex parte. Before a decision was rendered, petitioners Alatco Transportation, Inc., Bicol Transportation Co., Inc., and Consolidated Auto Lines filed a motion to set aside the proceedings, alleging they were affected operators but failed to file a timely opposition due to a strike disrupting communications with their lawyer. The PSC denied the motion to set aside but allowed petitioners to file a formal opposition and present evidence. After trial, the PSC rendered a decision awarding a certificate to respondent for four units (instead of six). Petitioners sought review by the Supreme Court, arguing the PSC gravely abused its discretion in finding: (1) public necessity for the service, and (2) that respondent was legally and financially qualified.
The PSC’s finding of public necessity was based on testimonies from respondent and a government auditor, Celso Bombase, who both regularly traveled the route and observed existing operators could not cope with public demand. Regarding financial capacity, respondent testified he had a monthly salary and commission, a net income of P3,734.74 in 1964, real properties with a market value of P61,000.00 given by his father, a bank deposit of P2,030.00, and ownership of three trucks. Petitioners presented a witness, their common supervisor, who testified passenger load factors were 70% on weekends, 50% mid-week, and 40% during lean hours, which the PSC disbelieved. Petitioners challenged the credibility of Bombase and argued respondent lacked sufficient funds to operate four units, estimating he needed P27,730.00 for initial expenses, an amount he did not possess.

ISSUE

1. Whether the Public Service Commission gravely abused its discretion in finding a public necessity and demand for the proposed auto-truck service.
2. Whether the Public Service Commission gravely abused its discretion in finding the applicant legally and financially qualified to operate the service.

RULING

The Supreme Court affirmed the decision of the Public Service Commission.
1. On public necessity, the Court held that the credibility of witnesses in public service cases is not a proper subject for review, as doing so would convert the review into a trial de novo. The number of buses and frequency of trips alone do not suffice to prove no additional service is needed. The PSC’s finding that public necessity existed was not shown to be an abuse of discretion.
2. On financial capacity, the Court found petitioners’ argument untenable as it was based on assumed probabilities not proven as facts, such as the cost of constructing truck bodies and registration fees. The Court noted respondent already owned three trucks, and the PSC’s finding of financial capacity was essentially one of fact. The Court declined to substitute its judgment for that of the Commission, as the finding was not patently unjustified. The case differed from A.L. Ammen Transportation Co., et al. vs. Del Rosario, where the evidence clearly showed the applicant’s financial incapacity.
Costs were awarded against the petitioners.