G.R. No. 31310, September 5, 1929
G.C. JAVIER, petitioner-appellant, vs. CAYETANO ORLANES, JUAN GONZALEZ and SATURNINO CORTEZ, respondents-appellees

FACTS

Gregorio C. Javier, Cayetano Orlanes, Juan M. Gonzalez, and Saturnino Cortez filed separate applications with the Public Service Commission (PSC) for certificates of public convenience to operate autotruck services for passengers and freight on the San Pablo-Manila line via Calauang and other routes. The PSC consolidated the cases and granted certificates to all four applicants, subject to specific schedules and conditions. Javier, who was the first to operate on the line and had objected to the other applications, appealed the PSC’s decision. He argued that granting licenses to four operators on the same line would cause ruinous competition, that as the first regular operator he had a preferential right, and that the public need did not justify additional operators.

ISSUE

1. Whether the Public Service Commission erred in granting certificates of public convenience to multiple operators on the same line, thereby allegedly creating ruinous competition and disregarding Javier’s preferential right as the first operator.
2. Whether a land carrier with regular and adequate service is entitled to an opportunity to extend its service to meet public demand before a new carrier is permitted to operate on the same line.

RULING

The Supreme Court partially granted the petition. It affirmed the PSC’s decision with respect to Juan M. Gonzalez and Saturnino Cortez but reversed it with respect to Cayetano Orlanes.

1. On Multiple Operators and Preferential Right: The Court held that priority in obtaining a certificate of public convenience does not confer an absolute or exclusive monopoly. The controlling factor is public convenience and necessity. The evidence showed that existing transportation on the San Pablo-Manila line was insufficient, and many passengers had to use other means. Therefore, the public need justified the grant of certificates to additional operators Gonzalez and Cortez. However, the principle of protecting an established, adequate carrier applies.

2. On the Right to Extend Service: The Court established the doctrine that a land carrier with regular and adequate service is entitled to be given an opportunity to extend its service to meet public demand before a new carrier is allowed to operate on the same line. Since Javier was already providing regular and satisfactory service, and the public need for additional service was established, he should have been given the chance to increase his trips to meet that need before a stranger (Orlanes) was permitted to operate. Orlanes, whose application was filed later, could not invade the territory of Javier, whose prior application had already been granted and who was operating under it.

Dispositive Portion:
The appealed decision was affirmed concerning the applications of Juan M. Gonzalez and Saturnino Cortez. It was reversed concerning Cayetano Orlanes. Gregorio C. Javier was granted all the trips between San Pablo and Manila he applied for, during hours to be fixed by the PSC. No costs were awarded.