G.R. No. L-34143, December 26, 1974
Ramon A. Gonzales, petitioner, vs. Public Service Commission and Philippine Long Distance Telephone Company, respondents.

FACTS

The petitioner sought a review of the Public Service Commission’s September 1, 1971 decision in BC Case No. 70-3496, which made permanent a provisional increase in PLDT’s rates. The Commission had determined that, based on a 12% authorized rate of return on an invested capital (rate base) of P537,170,252 as of December 1969, PLDT’s normalized revenue under the proposed rates would yield an 11.932% return, showing a minor revenue deficiency. The Commission justified the increase by citing economic factors like currency devaluation, increased operational costs, and wage hikes, aligning it with relief granted to other utilities.
During the pendency of this Supreme Court review, PLDT filed a new application in 1973 (BC Case No. 73-011) with the Board of Communications, the PSC’s successor, seeking a 40% across-the-board rate increase. The Board, on April 27, 1973, provisionally authorized a 35% increase on local service rates, citing urgent financial needs for debt servicing and operational costs based on a newly determined 1973 rate base of over P900 million. Petitioner Gonzales and another entity moved to dismiss this new application, arguing the Board lacked jurisdiction because the matter of the 1970 rates was still pending before the Supreme Court.

ISSUE

Whether the petition for review of the 1971 PSC decision has been rendered moot and academic by the subsequent 1973 provisional rate authorization issued in a separate proceeding.

RULING

Yes, the petition is moot and academic. The Supreme Court ruled that the 1973 provisional authority, granted in the new and separate BC Case No. 73-011, is based on a significantly different and updated factual milieu—specifically a 1973 rate base nearly double the 1970 figure—which is decisive for determining just and reasonable contemporary rates. The legal logic is twofold. First, the Board of Communications possesses continuing statutory authority under the Public Service Act to amend or establish new rates upon a proper application, which PLDT duly filed. The 1973 case constitutes a new proceeding, and the Board’s provisional order was immediately operative by law. Second, the supervening event of PLDT already collecting the new 1973 rates under the provisional authority rendered the challenge to the 1970 rates futile. The Court emphasized that the petitioner’s proper recourse was to challenge the 1973 rates before the Board in the new case, especially since the provisional order was subject to a refund condition if ultimately unwarranted. Therefore, further review of the 1970 decision served no practical purpose and the case was dismissed.