G.R. No. 36900 ; October 19, 1934
SAN MIGUEL BREWERY, petitioner-appellant, vs. ESTEBAN C. ESPIRITU, respondent-appellee.

G.R. No. 37003 ; October 19, 1934
PEDRO CRUZ, petitioner-appellant, vs. ESTEBAN C. ESPIRITU, respondent-appellee.

FACTS

Esteban C. Espiritu applied with the Public Service Commission for a certificate of public convenience to install and operate a 10-ton daily capacity ice plant in Caloocan, Rizal, and to sell ice in several surrounding municipalities. San Miguel Brewery and Pedro Cruz opposed the application. After hearings, the Commission, through Commissioner M.V. del Rosario and with the concurrence of two associate commissioners, denied the application on December 21, 1931, finding no public necessity and that it would cause ruinous competition. On December 28, 1931, Espiritu filed a motion for reconsideration, limiting his requested area of distribution to Caloocan only. On January 4, 1932, the two associate commissioners (Cruz and Teodoro), with Commissioner del Rosario dissenting, granted the motion and approved the application for Caloocan only. San Miguel Brewery and Pedro Cruz appealed this decision.

ISSUE

1. Whether the Public Service Commission, represented by only two members who did not take part in the hearing, erred in reconsidering its prior decision and granting the certificate of public convenience.
2. Whether there was sufficient evidence to support the grant of the certificate for an ice plant in Caloocan.

RULING

The Supreme Court reversed the decision of the Public Service Commission and denied Espiritu’s application. On the first issue, the Court found that the two associate commissioners who decided the motion for reconsideration had not taken part in the hearing of the case, which violated the procedure mandated by Act No. 3844 (amending the Public Service Act). The law required that contested matters be heard and decided by the Commission in full or by at least two Commissioners, and that before a decision is written, it must be voted upon by the members who took part in the hearing. Since the two commissioners who voted to grant the application did not hear the case, the decision was rendered without jurisdiction. On the second issue, the Court found the evidence insufficient to establish public necessity. Espiritu’s own testimony revealed that a 10-ton plant could not be maintained by serving Caloocan alone, and a key exhibit (Exhibit L) purporting to show customer commitments was found to contain false information, indicating bad faith. Therefore, the grant of the certificate was not justified.

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