GR 43504; (October, 1936) (Digest)
G.R. No. 43504; October 22, 1936
INDALECIO DE TORRES, plaintiff-appellee, vs. VICENTE ONA, defendant-appellant.
FACTS
Indalecio de Torres (plaintiff) and Vicente Ona (defendant) executed a deed of sale (Exhibit A) for a Chevrolet truck used for loading (a TH truck). The contract stipulated that Ona would pay the purchase price in installments. Ona failed to pay the installments for September and October 1933. De Torres filed an action to recover the unpaid sum. The defendant admitted the genuineness of the contract and the non-payment but contended that the sale was null and void because it lacked the prior approval of the Public Service Commission, as required by law for the sale of property of a public utility. The trial court rendered judgment in favor of de Torres, ordering Ona to pay the amount due. Ona appealed.
ISSUE
Whether the deed of sale for the truck is valid and enforceable without the prior approval of the Public Service Commission.
RULING
No. The appealed judgment is reversed. Under Section 16(h) of the Public Service Act (Act No. 3108), no public utility may sell, alienate, or encumber its property without the prior approval of the Public Service Commission. A TH truck used for transporting freight for hire is considered public service property. The law requires the Commission’s approval for its sale, unless the Commission itself determines that the utility is of little public importance. Since the parties did not seek or obtain such approval before or after executing the contract, the sale is ineffectual and cannot bind the defendant. Consequently, the action to enforce payment under the contract is premature. The contract is without force, and the plaintiff’s action cannot be sustained.
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