G.R. No.

L-23004             June 30, 1965

MAKATI STOCK EXCHANGE, INC., petitioner,
vs.
SECURITIES AND EXCHANGE COMMISSION and MANILA STOCK EXCHANGE, respondents.

BENGZON, C.J.:
This is a review of the resolution of the Securities and Exchange Commission which would deny the Makati Stock Exchange, Inc., permission to
operate a stock exchange unless it agreed not to list for trading on its board, securities already listed in the Manila Stock Exchange.

Objecting to the requirement, Makati Stock Exchange, Inc. contends that the Commission has no power to impose it and that, anyway, it is illegal,
discriminatory and unjust.

Under the law, no stock exchange may do business in the Philippines unless it is previously registered with the Commission by filing a statement
containing the information described in Sec. 17 of the Securities Act (Commonwealth Act 83, as amended).

It is assumed that the Commission may permit registration if the section is complied with; if not, it may refuse. And there is now no question that the
section has been complied with, or would be complied with, except that the Makati Stock Exchange, upon challenging this particular requirement of the
Commission (rule against double listing) may be deemed to have shown inability or refusal to abide by its rules, and thereby to have given ground for
denying registration. [Sec. 17 (a) (1) and (d)].

Such rule provides: "... nor shall a security already listed in any securities exchange be listed anew in any other securities exchange ... ."

The objection of Makati Stock Exchange, Inc., to this rule is understandable. There is actually only one securities exchange — The Manila Stock
Exchange — that has been operating alone for the past 25 years; and all — or presumably all — available or worthwhile securities for trading in the
market are now listed there. In effect, the Commission permits the Makati Stock Exchange, Inc., to deal only with other securities. Which is tantamount
to permitting a store to open provided it sells only those goods not sold in other stores. And if there's only one existing store, 1 the result is a monopoly.

It is not farfetched to assert — as petitioner does 2 that for all practical purposes, the Commission's order or resolution would make it impossible for the
Makati Stock Exchange to operate. So, its "permission" amounted to a "prohibition."

Apparently, the Commission acted "in the public interest." 3 Hence, it is pertinent to inquire whether the Commission may "in the public interest" prohibit
(or make impossible) the establishment of another stock exchange (besides the Manila Stock Exchange), on the ground that the operation of two or
more exchanges adversely affects the public interest.

At first glance, the answer should be in the negative, because the law itself contemplated, and, therefore, tacitly permitted or tolerated at least, the
operation of two or more exchanges.

Wherever two or more exchanges exist , the Commission, by order, shall require and enforce uniformity of trading regulations in and/or between said
exchanges. [Emphasis Ours] (Sec. 28b-13, Securities Act.)

In fact, as admitted by respondents, there were five stock exchanges in Manila, before the Pacific War (p. 10, brief), when the Securities Act was
approved or amended. (Respondent Commission even admits that dual listing was practiced then.) So if the existence of more than one exchange
were contrary to public interest, it is strange that the Congress having from time to time enacted legislation amending the Securities Act, 4 has not
barred multiplicity of exchanges.

Forgetting for the moment the monopolistic aspect of the Commission's resolution, let us examine the authority of the Commission to promulgate and
implement the rule in question.

It is fundamental that an administrative officer has only such powers as are expressly granted to him by the statute, and those necessarily implied in the
exercise thereof.

In its brief and its resolution now subject to review, the Commission cites no provision expressly supporting its rule. Nevertheless, it suggests that the
power is "necessary for the execution of the functions vested in it"; but it makes no explanation, perhaps relying on the reasons advanced in support of
its position that trading of the same securities in two or more stock exchanges, fails to give protection to the investors, besides contravening public
interest. (Of this, we shall treat later) .
On the legality of its rule, the Commission's argument is that: (a) it was approved by the Department Head — before the War; and (b) it is not in conflict
with the provisions of the Securities Act. In our opinion, the approval of the Department, 5 by itself, adds no weight in a judicial litigation; and the test is
not whether the Act forbids the Commission from imposing a prohibition, but whether it empowers the Commission to prohibit. No specific portion of the
statute has been cited to uphold this power. It is not found in sec. 28 (of the Securities Act), which is entitled "Powers (of the Commission) with Respect
to Exchanges and Securities." 6

According to many court precedents, the general power to "regulate" which the Commission has (Sec. 33) does not imply authority to prohibit." 7
 The Manila Stock Exchange, obviously the beneficiary of the disputed rule, contends that the power may be inferred from the express power of the
Commission to suspend trading in a security, under said sec. 28 which reads partly:

And if in its opinion, the public interest so requires, summarily to suspend trading in any registered security on any securities exchange ... . (Sec. 28[3],
Securities Act.)

However, the Commission has not acted — nor claimed to have acted — in pursuance of such authority, for the simple reason that suspension under it
may only be for ten days . Indeed, this section, if applicable, precisely argues against the position of the Commission because the "suspension," if it is,
and as applied to Makati Stock Exchange, continues for an indefinite period, if not forever; whereas this Section 28 authorizes suspension for ten days
only. Besides, the suspension of trading in the security should not be on one exchange only, but on all exchanges; bearing in mind that suspension
should be ordered "for the protection of investors" (first par., sec. 28) in all exchanges, naturally, and if "the public interest so requires" [sec. 28(3)].

This brings up the Commission's principal conclusions underlying its determination viz.: (a) that the establishment of another exchange in the environs
of Manila would be inimical to the public interest; and (b) that double or multiple listing of securities should be prohibited for the "protection of the
investors."

(a) Public Interest — Having already adverted to this aspect of the matter, and the emerging monopoly of the Manila Stock Exchange, we may,
at this juncture, emphasize that by restricting free competition in the marketing of stocks, and depriving the public of the advantages thereof the
Commission all but permits what the law punishes as monopolies as "crimes against public interest." 8
"A stock exchange is essentially monopolistic," the Commission states in its resolution (p. 14-a, Appendix, Brief for Petitioner). This reveals the basic
foundation of the Commission's process of reasoning. And yet, a few pages afterwards, it recalls the benefits to be derived "from the existence of two
or more exchanges," and the desirability of "a healthy and fair competition in the securities market," even as it expresses the belief that "a fair field of
competition among stock exchanges should be encouraged only to resolve, paradoxically enough, that Manila Stock Exchange shall, in effect, continue
to be the only stock exchange in Manila or in the Philippines.

"Double listing of a security," explains the Commission, "divides the sellers and the buyers, thus destroying the essence of a stock exchange as a two-
way auction market for the securities, where all the buyers and sellers in one geographical area converge in one defined place, and the bidders
compete with each other to purchase the security at the lowest possible price and those seeking to sell it compete with each other to get the highest
price therefor. In this sense, a stock exchange is essentially monopolistic."

Inconclusive premises, for sure. For it is debatable whether the buyer of stock may get the lowest price where all the sellers assemble in only one
place. The price there, in one sale, will tend to fix the price for the succeeding, sales, and he has no chance to get a lower price except at another
stock exchange. Therefore, the arrangement desired by the Commission may, at most, be beneficial to sellers of stock — not to buyers — although
what applies to buyers should obtain equally as to sellers (looking for higher prices). Besides, there is the brokerage fee which must be considered. Not
to mention the personality of the broker.

(b) Protection of investors. — At any rate, supposing the arrangement contemplated is beneficial to investors (as the Commission says), it is to be
doubted whether it is "necessary" for their "protection" within the purview of the Securities Act. As the purpose of the Act is to give adequate and
effective protection to the investing public against fraudulent representations, or false promises and the imposition of worthless ventures, 9 it is hard to
see how the proposed concentration of the market has a necessary bearing to the prevention of deceptive devices or unlawful practices. For it is not
mere semantics to declare that acts for the protection of investors are necessarily beneficial to them; but not everything beneficial to them is necessary
for their protection.

And yet, the Commission realizes that if there were two or more exchanges "the same security may sell for more in one exchange and sell for less in
the other. Variance in price of the same security would be the rule ... ." Needless to add, the brokerage rates will also differ.

This, precisely, strengthens the objection to the Commission's ruling. Such difference in prices and rates gives the buyer of shares alternative options,
with the opportunity to invest at lower expense; and the seller, to dispose at higher prices. Consequently, for the investors' benefit (protection is not the
word), quality of listing 10 should be permitted, nay, encouraged, and other exchanges allowed to operate. The circumstance that some people "made a
lot of money due to the difference in prices of securities traded in the stock exchanges of Manila before the war" as the Commission noted, furnishes
no sufficient reason to let one exchange corner the market. If there was undue manipulation or unfair advantage in exchange trading the Commission
should have other means to correct the specific abuses.

Granted that, as the Commission observes, "what the country needs is not another" market for securities already listed on the Manila Stock Exchange,
but "one that would focus its attention and energies on the listing of new securities and thus effectively help in raising capital sorely needed by our ...
unlisted industries and enterprises."

Nonetheless, we discover no legal authority for it to shore up (and stifle) free enterprise and individual liberty along channels leading to that economic
desideratum. 11
The Legislature has specified the conditions under which a stock exchange may legally obtain a permit (sec. 17, Securities Act); it is not for the
Commission to impose others. If the existence of two competing exchanges jeopardizes public interest — which is doubtful — let the Congress speak.
12
Undoubtedly, the opinion and recommendation of the Commission will be given weight by the Legislature, in judging whether or not to restrict
individual enterprise and business opportunities. But until otherwise directed by law, the operation of exchanges should not be so regulated as
practically to create a monopoly by preventing the establishment of other stock exchanges and thereby contravening:

(a) the organizers' (Makati's) Constitutional right to equality before the law;
(b) their guaranteed civil liberty to pursue any lawful employment or trade; and
(c) the investor's right to choose where to buy or to sell, and his privilege to select the brokers in his employment.

And no extended elucidation is needed to conclude that for a licensing officer to deny license solely on the basis of what he believes is best for the
economy of the country may amount to regimentation or, in this instance, the exercise of undelegated legislative powers and discretion.

Thus, it has been held that where the licensing statute does not expressly or impliedly authorize the officer in charge, he may not refuse to grant a
license simply on the ground that a sufficient number of licenses to serve the needs of the public have already been issued. (53 C.J.S. p. 636.)

Concerning res judicata. — Calling attention to the Commission's order of May 27, 1963, which Makati Stock did not appeal, the Manila Stock
Exchange pleads the doctrine of res judicata. 14 (The order now reviewed is dated May 7, 1964.)

It appears that when Makati Stock Exchange, Inc. presented its articles of incorporation to the Commission, the latter, after making some inquiries,
issued on May 27, 1963, an order reading as follows.

Let the certificate of incorporation of the MAKATI STOCK EXCHANGE be issued, and if the organizers thereof are willing to abide by the foregoing
conditions, they may file the proper application for the registration and licensing of the said Exchange.

In that order, the Commission advanced the opinion that "it would permit the establishment and operation of the proposed Makati Stock Exchange,
provided ... it shall not list for trading on its board, securities already listed in the Manila Stock Exchange ... ."
Admittedly, Makati Stock Exchange, Inc. has not appealed from that order of May 27, 1963. Now, Manila Stock insists on res judicata.

Why should Makati have appealed? It got the certificate of incorporation which it wanted. The condition or proviso mentioned would only apply if and
when it subsequently filed the application for registration as stock exchange. It had not yet applied. It was not the time to question the condition; 15
Makati was still exploring the convenience of soliciting the permit to operate subject to that condition. And it could have logically thought that, since the
condition did not affect its articles of incorporation, it should not appeal the order (of May 27, 1963) which after all, granted the certificate of
incorporation (corporate existence) it wanted at that time.

And when the Makati Stock Exchange finally found that it could not successfully operate with the condition attached, it took the issue by the horns, and
expressing its desire for registration and license, it requested that the condition (against double listing) be dispensed with. The order of the Commission
denying, such request is dated May 7, 1964, and is now under, review.
Indeed, there can be no valid objection to the discussion of this issue of double listing now, 16 because even if the Makati Stock Exchange, Inc. may be
held to have accepted the permission to operate with the condition against double listing (for having failed to appeal the order of May 27, 1963), still it
was not precluded from afterwards contesting 17 the validity of such condition or rule:
(1) An agreement (which shall not be construed as a waiver of any constitutional right or any right to contest the validity of any rule or regulation ) to
comply and to enforce so far as is within its powers, compliance by its members, with the provisions of this Act, and any amendment thereto, and any
rule or regulation made or to be made thereunder. (See. 17-a-1, Securities Act [Emphasis Ours].)

Surely, this petition for review has suitably been coursed. And making reasonable allowances for the presumption of regularity and validity of
administrative action, we feel constrained to reach the conclusion that the respondent Commission possesses no power to impose the condition of the
rule, which, additionally, results in discrimination and violation of constitutional rights.
ACCORDINGLY, the license of the petition to operate a stock exchange is approved without such condition. Costs shall be paid by the Manila Stock
Exchange. So ordered.

Summary: Jaworski vs. Philippine Amusement and Gaming Corporation (PAGCOR) (GR 144463, 14 January 2004)
Jaworski vs. Philippine Amusement and Gaming Corporation (PAGCOR)
[GR 144463, 14 January 2004]
En Banc, Ynares-Santiago (J): 13 concur

Facts: PAGCOR is a government owned and controlled corporation existing under PD 1869, issued on 11 July 1983 by then President Ferdinand
Marcos. The PAGCOR was granted, subject to the terms and conditions established in the Decree, for a period of 25 years, renewable for another 25
years, the rights, privileges and authority to operate and maintain gambling casinos, clubs, and other recreation or amusement places, sports, gaming
pools, i.e. basketball, football, lotteries, etc. whether on land or sea, within the territorial jurisdiction of the Republic of the Philippines. On 31 March
1998, PAGCOR’s board of directors approved an instrument denominated as "Grant of Authority and Agreement for the Operation of Sports Betting
and Internet Gaming", which granted SAGE the authority to operate and maintain Sports Betting station in PAGCOR’s casino locations, and Internet
Gaming facilities to service local and international bettors, provided that to the satisfaction of PAGCOR, appropriate safeguards and procedures are
established to ensure the integrity and fairness of the games. On 1 September 1998, PAGCOR, represented by its Chairperson, Alicia Ll. Reyes, and
SAGE, represented by its Chairman of the Board, Henry Sy, Jr., and its President, Antonio D. Lacdao, executed the document. Pursuant to the
authority granted by PAGCOR, SAGE commenced its operations by conducting gambling on the Internet on a trial-run basis, making pre-paid cards
and redemption of winnings available at various Bingo Bonanza outlets. Senator Robert S. Jaworski, in his capacity as member of the Senate and
Chairman of the Senate Committee on Games, Amusement and Sports, files the petition for certiorari and prohibition, praying that the grant of authority
by PAGCOR in favor of SAGE be nullified. He maintains that PAGCOR committed grave abuse of discretion amounting to lack or excess of jurisdiction
when it authorized SAGE to operate gambling on the internet. He contends that PAGCOR is not authorized under its legislative franchise, P.D. 1869, to
operate gambling on the internet for the simple reason that the said decree could not have possibly contemplated internet gambling since at the time of
its enactment the internet was yet inexistent and gambling activities were confined exclusively to real-space. Further, he argues that the internet, being
an international network of computers, necessarily transcends the territorial jurisdiction of the Philippines, and the grant to SAGE of authority to operate
internet gambling contravenes the limitation in PAGCOR’s franchise.

Issue: Whether PAGCOR’s legislative franchise include the right to vest another entity, SAGE, with the authority to operate Internet gambling.

Held: A legislative franchise is a special privilege granted by the state to corporations. It is a privilege of public concern which cannot be exercised at
will and pleasure, but should be reserved for public control and administration, either by the government directly, or by public agents, under such
conditions and regulations as the government may impose on them in the interest of the public. It is Congress that prescribes the conditions on which
the grant of the franchise may be made. Thus the manner of granting the franchise, to whom it may be granted, the mode of conducting the business,
the charter and the quality of the service to be rendered and the duty of the grantee to the public in exercising the franchise are almost always defined
in clear and unequivocal language. Herein, PAGCOR has acted beyond the limits of its authority when it passed on or shared its franchise to SAGE.
While PAGCOR is allowed under its charter to enter into operator’s and/or management contracts, it is not allowed under the same charter to relinquish
or share its franchise, much less grant a veritable franchise to another entity such as SAGE. PAGCOR can not delegate its power in view of the legal
principle of delegata potestas delegare non potest, inasmuch as there is nothing in the charter to show that it has been expressly authorized to do so.

G.R. No. L-68729 May 29, 1987

RADIO COMMUNICATIONS OF THE PHILIPPINES, INC., petitioner,
vs.
NATIONAL TELECOMMUNICATIONS COMMISSION and KAYUMANGGI RADIO NETWORK INCORPORATED, respondents.
GUTIERREZ, JR, J.:

This petition seeks the reversal of the decision of the National Telecommunications Commission (NTC) which ordered petitioner Radio
Communications of the Philippines, Incorporated (RCPI) to desist from operating its radio telephone services in Catarman, Northern Samar; San Jose,
Occidental Mindoro; and Sorsogon, Sorsogon.

Petitioner has been operating a radio communications system since 1957 under its legislative franchise granted by Republic Act No. 2036 which was
enacted on June 23, 1957.

In 1968, the petitioner established a radio telegraph service in Sorsogon, Sorsogon. In 1971, another radio telegraph service was put up in San Jose,
Mindoro followed by another in Catarman, Samar in 1976. The installation of radio telephone services started in 1971 in San Jose, Mindoro; then in
Sorsogon, Sorsogon and Catarman, Samar in 1983.

In a decision dated June 24, 1980 in NTC Case No. 80-08, private respondent Kayumanggi Radio Network Incorporated was authorized by the public
respondent to operate radio communications systems in Catarman, Samar and in San Jose, Mindoro.

On December 14, 1983, the private respondent filed a complaint with the NTC alleging that the petitioner was operating in Catarman, Samar and in
San Jose, Mindoro without a certificate of public covenience and necessity. The petitioner, on the other hand, counter-alleged that its telephone
services in the places subject of the complaint are covered by the legislative franchise recognized by both the public respondent and its predecessor,
the Public Service Commission. In its supplemental reply, the petitioner further stated that it has been in operation in the questioned places long before
private respondent Kayumanggi filed its application to operate in the same places.

After conducting a hearing, NTC, in its decision dated August 22, 1984 ordered petitioner RCPI to immediately cease or desist from the operation of its
radio telephone services in Catarman Northern Samar; San Jose, Occidental Mindoro; and Sorsogon, Sorsogon stating that under Executive Order No.
546, a certificate of public convenience and necessity is mandatory for the operation of communication utilities and services including radio
communications.

On September 4, 1984, the petitioner filed a motion for reconsideration which was denied in an order dated September 12, 1984.
On October 1, 1984, the present petition was filed raising the issue of whether or not petitioner RCPI, a grantee of a legislative franchise to operate a
radio company, is required to secure a certificate of public convenience and necessity before it can validly operate its radio stations including radio
telephone services in Catarman, Northern Samar; San Jose, Occidental Mindoro; and Sorsogon, Sorsogon.
The petitioner's main argument states that the abolition of the Public Service Commission under Presidential Decree No. 1 and the creation of the
National Telecommunications Commission under Executive Order No. 546 to replace the defunct Public Service Commission did not affect sections 14
and 15 of the Public Service Law (Commonwealth Act. No. 146, as amended).
The provisions of the Public Service Law pertinent to the petitioner's allegation are as follows:

Section 13. (a) the Commission shall have jurisdiction, supervision, and control over all public services and their franchises, equipment and other
properties, and in the exercise of its authority, it shall have the necessary powers and the aid of public force: ...
Section 14. The following are exempted from the provisions of the preceding section:
xxx xxx xxx
(d) Radio companies except with respect to the fixing of rates;
xxx xxx xxx
Section 15. With the exception of those enumerated in the preceding section, no public service shall operate in the Philippines without possessing a
valid and subsisting certificate from the Public Service Commission, known as "certificate of public convenience," or "certificate of convenience and
public necessity," as the case may be, to the effect that the operation of said service and the authorization to do business will promote the public
interests in a proper and suitable manner. ...

We find no merit in the petitioner's contention.

Pursuant to Presidential Decree No. 1 dated September 23,1972, reorganizing the executive branch of the National Government, the Public Service
Commission was abolished and its functions were transferred to three specialized regulatory boards, as follows: the Board of Transportation, the Board
of Communications and the Board of Power and Waterworks. The functions so transferred were still subject to the limitations provided in sections 14
and 15 of the Public Service Law, as amended. With the enactment of Executive Order No. 546 on July 23, 1979 implementing P.D. No.1, the Board of
Communications and the Telecommunications Control Bureau were abolished and their functions were transferred to the National Telecommunications
Commission (Sec. 19(d), Executive Order No. 546). Section 15 of said Executive Order spells out the functions of the National Telecommunications
Commission as follows:

Sec. 15. Functions of the Commission.-The Commission shall exercise the following functions:
a. Issue Certificate of Public Convenience for the operation of communications utilities and services, radio communications petitions systems, wire or
wireless telephone or telegraph system, radio and television broadcasting system and other similar public utilities;
b. Establish, prescribe and regulate areas of operation of particular operators of public service communications; and determine and prescribe charges
or rates pertinent to the operation of such public utility facilities and services except in cases where charges or rates are established by international
bodies or associations of which the Philippines is a participating member or by bodies recognized by the Philippine Government as the proper arbiter of
such charges or rates;
c. Grant permits for the use of radio frequencies for wireless telephone and telegraph systems and radio communication systems including amateur
radio stations and radio and television broadcasting systems;
d. Sub-allocate series of frequencies of bands allocated by the International Telecommunications Union to the specific services;
e. Establish and prescribe rules, regulations, standards, specifications in all cases related to the issued Certificate of Public Convenience and
administer and enforce the same;
f. Coordinate and cooperate with government agencies and other entities concerned with any aspect involving communications with a view to
continuously improve the communications service in the country;
g. Promulgate such rules and regulations, as public safety and interest may require, to encourage a larger and more effective use of communications,
radio and television broadcasting facilities, and to maintain effective competition among private entities in these activities whenever the Commission
finds it reasonably feasible;
h. Supervise and inspect the operation of radio stations and telecommunications facilities;
i. Undertake the examination and licensing of radio operators;
j. Undertake, whenever necessary, the registration of radio transmitters and transceivers; and
k. Perform such other functions as may be prescribed by law.

It is clear from the aforequoted provision that the exemption enjoyed by radio companies from the jurisdiction of the Public Service Commission and the
Board of Communications no longer exists because of the changes effected by the Reorganization Law and implementing executive orders. The
petitioner's claim that its franchise cannot be affected by Executive Order No. 546 on the ground that it has long been in operation since 1957 cannot
be sustained.

A franchise started out as a "royal privilege or (a) branch of the King's prerogative, subsisting in the hands of a subject." This definition was given by
Finch, adopted by Blackstone, and accepted by every authority since (State v. Twin Village Water Co., 98 Me 214, 56 A 763 (1903)). Today, a
franchise, being merely a privilege emanating from the sovereign power of the state and owing its existence to a grant, is subject to regulation by the
state itself by virtue of its police power through its administrative agencies. We ruled in Pangasinan transportation Co., Inc. v. Public Service
Commission (70 Phil. 221) that:

... statutes enacted for the regulation of public utilities, being a proper exercise by the State of its police power, are applicable not only to those public
utilities coming into existence after its passage, but likewise to those already established and in operation ...
Executive Order No. 546, being an implementing measure of P.D. No. I insofar as it amends the Public Service Law (CA No. 146, as amended) is
applicable to the petitioner who must be bound by its provisions. The petitioner cannot install and operate radio telephone services on the basis of its
legislative franchise alone.

The position of the petitioner that by the mere grant of its franchise under RA No. 2036 it can operate a radio communications system anywhere within
the Philippines is erroneous. Section 1 of said statute reads:

Section 1. Subject to the provisions of the Constitution, and to the provisions, not inconsistent herewith, of Act Numbered Three thousand eight
hundred and forty-six, entitled.' An Act providing for the regulation of radio stations and radio communications in the Philippine Islands, and for other
purposes;' Commonwealth Act Numbered One hundred forty-six, known as the Public Service Act, and their amendments, and other applicable laws,
there is hereby granted to the Radio Communications of the Philippines, its successors or assigns, the right and privilege of constructing, installing,
establishing and operating in the Philippines, at such places as the said corporation may select and the Secretary of Public Works and
Communications may approve, radio stations for the reception and transmission of wireless messages on radiotelegraphy and/or radiotelephone,
including both coastal and marine telecommunications, each station to consist of two radio apparatus comprising of a receiving and sending radio
apparatus. (Emphasis supplied).

Section 4(a) of the same Act further provides that:

Sec. 4(a). This franchise shall not take effect nor shall any powers thereunder be exercised by the grantee until the Secretary of Public works and
Communications shall have allotted to the grantee the frequencies and wave lengths to be used, and issued to the grantee a license for such case .
(Emphasis supplied)

Thus, in the words of R.A. No. 2036 itself, approval of the then Secretary of Public Works and Communications was a precondition before the petitioner
could put up radio stations in areas where it desires to operate. It has been repeated time and again that where the statutory norm speaks
unequivocally, there is nothing for the courts to do except to apply it. The law, leaving no doubt as to the scope of its operation, must be obeyed.
(Gonzaga v. Court of Appeals, 51 SCRA 381).

The records of the case do not show any grant of authority from the then Secretary of Public Works and Communications before the petitioner installed
the questioned radio telephone services in San Jose, Mindoro in 1971. The same is true as regards the radio telephone services opened in Sorsogon,
Sorsogon and Catarman, Samar in 1983. No certificate of public convenience and necessity appears to have been secured by the petitioner from the
public respondent when such certificate,was required by the applicable public utility regulations (See executive Order No. 546, sec. 15, supra.;
Philippine Long Distance Telephone Co. v. City of Davao, 15 SCRA 75; Olongapo Electric Light and Power Corp. v. National Power Corporation, et al.,
G.R. No. L-24912, promulgated April 9, 1987.)

It was well within the powers of the public respondent to authorize the installation by the private respondent network of radio communications systems
in Catarman, Samar and San Jose, Mindoro. Under the circumstances of this case, the mere fact that the petitioner possesses a franchise to put up
and operate a radio communications system in certain areas is not an insuperable obstacle to the public respondent's issuing the proper certificate to
an applicant desiring to extend the same services to those areas. The Constitution mandates that a franchise cannot be exclusive in nature nor can a
franchise be granted except that it must be subject to amendment, alteration, or even repeal by the legislature when the common good so requires.
(Art. XII, sec. 11 of the 1986 Constitution). There is an express provision in the petitioner's franchise which provides compliance with the above
mandate R.A. 2036, sec. 15).

In view of the foregoing, we find no reason to disturb the public respondent's findings of fact, and conclusions of law insofar as the private respondent
was authorized to operate in Catarman, Samar and San Jose, Mindoro. As a rule, the Commission's findings of fact, if supported by substantial
evidence, are conclusive upon this Court. We may modify or ignore them only when it clearly appears that there is no evidence to support reasonably
such a conclusion. (Halili v. Daplas, 14 SCRA 14). The petitioner has not shown why the private respondent should be denied the authority to operate
its services in Samar and Mindoro. It has not overcome the presumption that when the public respondent disturbed the petitioner's monopoly in certain
areas, it was doing so pursuant to public interest and the common good.

WHEREFORE, the challenged order of the public respondent dated August 22, 1984 is hereby AFFIRMED. The petition is dismissed for lack of merit.
SO ORDERED.

G.R. No. L-45839 June 1, 1988

RUFINO MATIENZO, GODOFREDO ESPIRITU, DIOSCORRO FRANCO, AND LA SUERTE TRANSPORTATION CORPORATION, petitioners,
vs.
HON. LEOPOLDO M. ABELLERA, ACTING CHAIRMAN OF THE BOARD OF TRANSPORTATION, HON. GODOFREDO Q. ASUNCION, MEMBER
OF THE BOARD OF TRANSPORTATION, ARTURO DELA CRUZ, MS TRANSPORTATION CO., INC., NEW FAMILIA TRANSPORTATION CO.,
ROBERTO MOJARES, ET AL., respondents.
GUTIERREZ, JR., J.:

This is a petition for certiorari and prohibition, with application for preliminary injunction, seeking the annulment and inhibition of the grant or award of
provisional permits or special authority by the respondent Board of Transportation (BOT) to respondent taxicab operators, for the operation and
legalization of "excess taxicab units" under certain provisions of Presidential Decree No. 101 "despite the lapse of the power to do so thereunder," and
"in violation of other provisions of the Decree, Letter of Instructions No. 379 and other relevant rules of the BOT."

The petitioners and private respondents are all authorized taxicab operators in Metro Manila. The respondents, however, admittedly operate "colorum"
or "kabit" taxicab units. On or about the second week of February, 1977, private respondents filed their petitions with the respondent Board for the
legalization of their unauthorized "excess" taxicab units citing Presidential Decree No. 101, promulgated on January 17, 1973, "to eradicate the harmful
and unlawful trade of clandestine operators, by replacing or allowing them to become legitimate and responsible operators." Within a matter of days,
the respondent Board promulgated its orders setting the applications for hearing and granting applicants provisional authority to operate their "excess
taxicab units" for which legalization was sought. Thus, the present petition.

Opposing the applications and seeking to restrain the grant of provisional permits or authority, as well as the annulment of permits already granted
under PD 101, the petitioners allege that the BOT acted without jurisdiction in taking cognizance of the petitions for legalization and awarding special
permits to the private respondents.

Presidential Decree No. 101 vested in the Board of Transportation the power, among others "To grant special permits of limited term for the operation
of public utility motor vehicles as may, in the judgment of the Board, be necessary to replace or convert clandestine operators into legitimate and
responsible operators." (Section 1, PD 101)

Citing, however, Section 4 of the Decree which provides:

SEC. 4. Transitory Provision. — Six months after the promulgation of this Decree, the Board of Transportation, the Bureau of Transportation, The
Philippine Constabulary, the city and municipal forces, and the provincial and city fiscals shall wage a concerted and relentless drive towards the total
elimination and punishment of all clandestine and unlawful operators of public utility motor vehicles."

the petitioners argue that neither the Board of Transportation chairman nor any member thereof had the power, at the time the petitions were filed (i.e.
in 1977), to legitimize clandestine operations under PD 101 as such power had been limited to a period of six (6) months from and after the
promulgation of the Decree on January 17, 1973. They state that, thereafter, the power lapses and becomes functus officio.

To reinforce their stand, the petitioners refer to certain provisions of the Rules and Regulations implementing PD 101 issued by respondent Board,
Letter of Instructions No. 379, and BOT Memorandum Circular No. 76-25 (a). In summary, these rules provide inter alia that (1) only applications for
special permits for "colorum" or "kabit" operators filed before July 17, 1973 shall be accepted and processed (Secs. 3 and 16 (c), BOT-LTC-HPG Joint
Regulations Implementing PD 101, pp. 33 and 47, Rollo); (2) Every provisional authority given to any taxi operator shall be cancelled immediately and
no provisional authority shall thereafter be issued (par. 6, Letter of Instructions No. 379, issued March 10, 1976, p. 58, Rollo); (3) Effective immediately,
no provisional authorities on applications for certificates of public convenience shall be granted or existing provisional authorities on new applications
extended to, among others, taxi denominations in Metro Manila (BOT Memorandum Circular No. 75-25 (a), August 30, 1976, p. 64, Rollo); (4) All taxis
authorized to operate within Metro Manila shall obtain new special permits from the BOT, which permits shall be the only ones recognized within the
area (par. 8, LOI No. 379, supra); and (5) No bonafide applicant may apply for special permit to operate, among others, new taxicab services, and, no
application for such new service shall be accepted for filing or processed by any LTC agency or granted under these regulations by any LTC Regional
Office until after it shall have announced its program of development for these types of public motor vehicles (Sec. 16d, BOT-LTC-HPG Joint
Regulations, p. 47, Rollo).

The petitioners raise the following issues:

I. WHETHER OR NOT THE BOARD OF TRANSPORTATION HAS THE POWER TO GRANT PROVISIONAL PERMITS TO OPERATE DESPITE THE
BAN THEREON UNDER LETTER OF INSTRUCTIONS NO. 379;
II. WHETHER OR NOT THE BOARD OF TRANSPORTATION HAS THE POWER TO LEGALIZE, AT THIS TIME, CLANDESTINE AND UNLAWFUL
TAXICAB OPERATIONS UNDER SECTION 1, P.D. 101; AND
III. WHETHER OR NOT THE PROCEDURE BEING FOLLOWED BY THE BOARD IN THE CASES IN QUESTION SATISFIES THE PROCEDURAL
DUE PROCESS REQUIREMENTS. (p. 119, Rollo)

We need not pass upon the first issue raised anent the grant of provisional authority to respondents. Considering that the effectivity of the provisional
permits issued to the respondents was expressly limited to June 30, 1977, as evidenced by the BOT orders granting the same (Annexes G, H, I and J
among others) and Memorandum Circular No. 77-4 dated January 20, 1977 (p. 151, Rollo), implementing paragraph 6 of LOI 379 (ordering immediate
cancellation of all provisional authorities issued to taxicab operators, supra), which provides:

5. After June 30, 1977, all provisional authorities are deemed cancelled, even if hearings on the main application have not been terminated.

the issue is MOOT and ACADEMIC. Only the issue on legalization remains under consideration.

Justifying its action on private respondent's applications, the respondent Board emphasizes public need as the overriding concern. It is argued that
under PD 101, it is the fixed policy of the State "to eradicate the harmful and unlawful trade of clandestine operators by replacing or allowing them to
become legitimate and responsible ones" (Whereas clause, PD 101). In view thereof, it is maintained that respondent Board may continue to grant to
"colorum" operators the benefits of legalization under PD 101, despite the lapse of its power, after six (6) months, to do so, without taking punitive
measures against the said operators.

Indeed, a reading of Section 1, PD 101, shows a grant of powers to the respondent Board to issue provisional permits as a step towards the
legalization of colorum taxicab operations without the alleged time limitation. There is nothing in Section 4, cited by the petitioners, to suggest the
expiration of such powers six (6) months after promulgation of the Decree. Rather, it merely provides for the withdrawal of the State's waiver of its right
to punish said colorum operators for their illegal acts. In other words, the cited section declares when the period of moratorium suspending the
relentless drive to eliminate illegal operators shall end. Clearly, there is no impediment to the Board's exercise of jurisdiction under its broad powers
under the Public Service Act to issue certificates of public convenience to achieve the avowed purpose of PD 101 (Sec. 16a, Public Service Act, Nov.
7, 1936).
It is a settled principle of law that in determining whether a board or commission has a certain power, the authority given should be liberally construed
in the light of the purposes for which it was created, and that which is incidentally necessary to a full implementation of the legislative intent should be
upheld as being germane to the law. Necessarily, too, where the end is required, the appropriate means are deemed given (Martin, Administrative Law,
1979, p. 46). Thus, as averred by the respondents:

... [A]ll things considered, the question is what is the best for the interest of the public. Whether PD 101 has lost its effectiveness or not, will in no way
prevent this Board from resolving the question in the same candor and spirit that P.D. 101 and LOI 379 were issued to cope with the multifarious ills
that plague our transport system. ... (Emphasis supplied) (pp. 91-92, Rollo)

This, the private respondents appreciate, as they make reference to PD 101, merely to cite the compassion with which colorum operators were dealt
with under the law. They state that it is " in the same vein and spirit that this Honorable Board has extended the Decree of legalization to the operatives
of the various PUJ and PUB services along legislative methods," that respondents pray for authorization of their colorum units in actual operation in
Metro Manila (Petitions for Legalization, Annexes E & F, par. 7, pp. 65-79, Rollo).

Anent the petitioners' reliance on the BOT Rules and Regulations Implementing PD 101 as well as its Memorandum Circular No. 76-25(a), the BOT
itself has declared:

In line with its duty to rationalize the transport industry, the Board shall. from time to time, re- study the public need for public utilities in any area in the
Philippines for the purpose of re- evaluating the policies. (p. 64, Rollo)

Thus, the respondents correctly argue that "as the need of the public changes and oscillates with the trends of modern life, so must the Memo Orders
issued by respondent jibe with the dynamic and flexible standards of public needs. ... Respondent Board is not supposed to 'tie its hands' on its issued
Memo Orders should public interest demand otherwise" (Answer of private respondents, p. 121, Rollo).

The fate of the private respondent's petitions is initially for the Board to determine. From the records of the case, acceptance of the respondent's
applications appears to be a question correctly within the discretion of the respondent Board to decide. As a rule, where the jurisdiction of the BOT to
take cognizance of an application for legalization is settled, the Court enjoins the exercise thereof only when there is fraud, abuse of discretion or error
of law. Furthermore, the court does not interfere, as a rule, with administrative action prior to its completion or finality . It is only after judicial review is
no longer premature that we ascertain in proper cases whether the administrative findings are not in violation of law, whether they are free from fraud or
imposition and whether they find substantial support from the evidence.

Finally, with respect to the last issue raised by the petitioners alleging the denial of due process by respondent Board in granting the provisional permits
to the private respondents and in taking cognizance of their applications for legalization without notice and hearing, suffice it to say that PD 101 does
not require such notice or hearing for the grant of temporary authority . The provisional nature of the authority and the fact that the primary application
shall be given a full hearing are the safeguards against its abuse. As to the applications for legalization themselves, the Public Service Act does enjoin
the Board to give notice and hearing before exercising any of its powers under Sec. 16 thereof. However, the allegations that due process has been
denied are negated by the hearings set by the Board on the applications as expressed in its orders resolving the petitions for special permits (Annexes
G, H, I, pp. 80-102, Rollo).
The Board stated:
The grounds involved in the petition are of first impression. It cannot resolve the issue ex-parte. It needs to hear the views of other parties who may
have an interest, or whose interest may be affected by any decision that this Board may take.
The Board therefore, decides to set the petition for hearing.
xxx xxx xxx
As to the required notice, it is impossible for the respondent Board to give personal notice to all parties who may be interested in the matter, which
parties are unknown to it. Its aforementioned order substantially complies with the requirement. The petitioners having been able to timely oppose the
petitions in question, any lack of notice is deemed cured.
WHEREFORE. the petition is hereby DISMISSED for lack of merit. The questioned orders of the then Board of Transportation are AFFIRMED.

SO ORDERED.
ADMINISTRATIVE LAW
DIGESTED CASES

SUYAT JR. vs. HON. RUBEN TORRES

G.R. No. 133530

FACTS:A robbery incident took place at the residential house of Atty. Reynaldo V. Bautista located at Cainta, Rizal, and allegedly
committed by Randy Torres, Nelson Torres, Marlon Bonson, and Bernardo Bautista. The three were caught and dertained. Imelda Torres,
mother of suspects Randy and Nelson Torres, and also the aunt of suspect Marlon Bonson, followed up the case with the Prosecutor’s
Office of Rizal. She met the reviewing prosecutor, Prosecutor Suyat Jr. who demanded the sum of P20,000.00 for the dismissal of the
case where after negotiations came to P15,000.00. Imelda coordinated with the Anti-Organized crime Division of the NBI which formed a
team to entrap prosecutor Suyat Jr. Imelda and her daughter came with the money and after Suyat jr. accepted the money, they signaled
the NBI which caught him red-handed. Rosalina A. Espina, in her capacity as Supervising Agent of the National Bureau of Investigation,
filed with the Department of Justice an unnumbered administrative complaint accusing Prosecutor Suyat, Jr. of grave misconduct and
receiving for personal use of a fee, gift or other valuable thing in the course of official duties in violation of Anti-Graft laws. She prayed for
the dismissal of Prosecutor Suyat, Jr. from the government service after due hearing of the case. Finding that there was prima facie case,
Secretary Franklin M. Drilon of the Department of Justice issued a formal charge against Prosecutor Suyat, Jr. for the said administrative
charge as well as memorandum placing him under preventive suspension for ninety (90) days effective from receipt thereof and while the
case was under formal investigation of State Prosecutor Leah T. Armamento.
From the several hearings of the case, and in the light of the contending parties’ evidences Secretary Franklin M. Drilon of the Department
of Justice recommended to the then Executive Secretary Teofisto T. Guingona, Jr. of the Office of the President the immediate dismissal
of Prosecutor Suyat, Jr. from the government service with forfeiture of all benefits under the law who concurred and recommended to
President Fidel V. Ramos the approval of the proposed Administrative Order. On November 26, 1993, the Office of the President of the
Philippines thru then Executive Secretary Teofisto T. Guingona, Jr. issued the first questioned order dismissing Prosecutor Suyat, Jr. CA
dismissed the petition for review of the petitioner.

ISSUE: Whether or not petitioner’s petition for certiorari to the CA was an appropriate remedy.

HELD: No. Section 7 of AO No. 18, Series of 1987, prohibits the filing of a second motion for reconsideration of the final order or decision
of the Office of the President of the Philippines Thus, the filing by the petitioner of a second motion for reconsideration of AO No. 95,
being a prohibited pleading, did not suspend the period to appeal the February 28, 1996 Order to the CA via a petition for review.
Indubitably then, when the petitioner filed his petition for certiorari with the CA after the President denied his second motion for
reconsideration, AO No. 95 of the President had become final and executory, beyond the jurisdiction of the CA to alter, modify, or reverse.

POWERS OF ADMINISTRATIVE AGENCY

Sufficient Standard Test

ABAKADA GURO PARTY LIST vs. EXECUTIVE SECRETARY EDUARDO ERMITA, ET AL .

G.R. No. 168056
Sept. 1, 2005

FACTS:Before R.A. No. 9337 took effect, petitioners ABAKADA GURO Party List et al., filled a petition for prohibition on May 27, 2007
questioning the constitutionality of Sections 4,5, and 6 of R.A. No. 9337, amending Sections 106, 107, and 108, respectively of the
National Internal Revenue Code (NIRC). These questioned provision contain a uniform proviso authorizing the President, upon
recommendation of the Secretary of Finance, to raise the VAT rate to 12%, effective January 1, 2006, after certain conditions provided for
in the law have been satisfied, to wit:

(i) Value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous year exceeds two and four-fifth
percent( 24 /5 % ); or
(ii) National government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1 ½%) Petitioners argue
that the law is unconstitutional, as it constitutes abandonment by Congress of its exclusive authority to fix the rate of taxes under Article
VI, Section 28(2) of the 1987 Philippine Constitution. They contend that delegating to the President the legislative power to tax is contrary
to republicanism. They insist that accountability, responsibility, and transparency should dictate the actions of Congress and they should
not pass to the President the decision to impose taxes. They also argue that the law also effectively nullified the President’s power of
control, which includes the authority to set aside and nullify the acts of her subordinates like the Secretary of Finance, by mandating the
fixing of the tax rate by the President upon the recommendation of the Secretary of Finance.

ISSUE: Whether or not the stand-by authority granted to the President to increase the rate of VAT from 10% to 12% an undue delegation
of legislative power.
HELD: NO. There is no delegation of legislative power involved in the case at bar. There is but simply delegation of ascertainment of facts
upon which enforcement and administration of the increase rate under the law is contingent. Congress does not abdicate its functions or
unduly delegate power when it describes what job must be done, who must do it, and what is the scope of his authority. The legislature
has made the operation of the 12% rate effective January 1, 2006, contingent upon a specified fact or condition. It leaves the entire
operation or non-operation of the 12% rate upon factual matters outside of the control of the executive. As to the argument that delegating
to the President the legislative power to tax is contrary to the principle of republicanism, the same deserves scant consideration.
Congress did not delegate the power to tax but the mere implementation of the law. The intent and will to increase the VAT rate to 12%
came from Congress and the task of the President is to simply execute the legislative policy. That Congress chose to do so in such a
manner is not within the province of the Court to inquire into, its task being to interpret the law