Tatad vs. Garcia

FRANCISCO S. TATAD, JOHN H. OSMENA and RODOLFO G. BIAZON vs. HON. JESUS B. GARCIA, JR., in his capacity as the Secretary of the Department of Transportation and Communications, and EDSA LRT CORPORATION, LTD.
G.R. No. 114222 April 6, 1995

Facts:
1.      In 1989, the government planned to build a railway transit line along EDSA.
2.      No bidding was made but certain corporations were invited to prequalify.
3.      The only corporation to qualify was the EDSA LRT Consortium which was obviously formed for this particular undertaking.
4.      An agreement was then made between the government, through the DOTC, and EDSA LRT Consortium.
5.      The agreement was based on the Build-Operate-Transfer scheme provided for by law (RA 6957, amended by RA 7718).
6.      Under the agreement, EDSA LRT Consortium shall build the facilities, i.e., railways, and shall supply the train cabs.
7.      Every phase that is completed shall be turned over to the DOTC and the latter shall pay rent for the same for 25 years.
8.      By the end of 25 years, it was projected that the government shall have fully paid EDSA LRT Consortium.
9.      Thereafter, EDSA LRT Consortium shall sell the facilities to the government for $1.00.
10.  However, Senators Francisco Tatad, John Osmeña, and Rodolfo Biazon opposed the implementation of said agreement as they averred that EDSA LRT Consortium is a foreign corporation as it was organized under Hongkong laws; that as such, it cannot own a public utility such as the EDSA railway transit because this falls under the nationalized areas of activities..

Issue:
Can respondent EDSA LRT Corporation, Ltd., a foreign corporation own EDSA LRT III; a public utility?

Ruling:
What private respondent owns are the rail tracks, rolling stocks like the coaches, rail stations, terminals and the power plant, not a public utility. While a franchise is needed to operate these facilities to serve the public, they do not by themselves constitute a public utility. What constitutes a public utility is not their ownership but their use to serve the public.
The Constitution, in no uncertain terms, requires a franchise for the operation of a public utility. However, it does not require a franchise before one can own the facilities needed to operate a public utility so long as it does not operate them to serve the public.
Ownership is defined as a relation in law by virtue of which a thing pertaining to one person is completely subjected to his will in everything not prohibited by law or the concurrence with the rights of another.
The exercise of the rights encompassed in ownership is limited by law so that a property cannot be operated a used to serve the public as a public utility unless the operator has a franchise.
While private respondent is the owner of the facilities necessary to operate the EDSA. LRT III, it admits that it is not enfranchised to operate a public utility. In view of this incapacity, private respondent and DOTC agreed that on completion date, private respondent will immediately deliver possession of the LRT system by way of lease for 25 years, during which period DOTC shall operate the same as a common carrier and private respondent shall provide technical maintenance and repair services to DOTC.
Private respondent will not run the light rail vehicles and collect fees from the riding public. It will have no dealings with the public and the public will have no right to demand any services from it.

Even the mere formation of a public utility corporation does not ipso facto characterize the corporation as one operating a public utility. The moment for determining the requisite Filipino nationality is when the entity applies for a franchise, certificate or any other form of authorization for that purpose

Comments

Post a Comment

Popular posts from this blog

PEOPLE OF THE PHILIPPINES, vs. HON. HENEDINO P. EDUARTE, in his capacity as Acting Presiding Judge of the RTC, Br. 22, Cabagan, Isabela; ELVINO AGGABAO and VILLA SURATOS G.R. No. 88232 February 26, 1990

PEOPLE OF THE PHILIPPINES, vs. HON. HENEDINO P. EDUARTE, in his capacity as Acting Presiding Judge of the RTC, Br. 22, Cabagan, Isabela; ELVINO AGGABAO and VILLA SURATOS G.R. No. 88232 February 26, 1990 Facts: Alma T. Aggabao filed  with the RTC, an information against private respondents Elvino Aggabao and Villa Suratos for the crime of concubinage. Upon being arraigned, private respondents entered a plea of not guilty. During the trial, private respondents filed a motion to dismiss on the ground of lack of jurisdiction.  They argued that concubinage, under Art. 334 of the RPC is punishable with prision correccional in its minimum and medium periods, which is equivalent to imprisonment of six (6) months and one (1) day to four (4) years and two (2) months, well within the exclusive original jurisdiction of the Municipal Trial Court, and not of the RTC The prosecution filed an opposition to the motion contending that the RTC has jurisdiction over the crime of concubinage...
Read more

DE PEREZ vs. GARCHITORENA

CARMEN G. DE PEREZ vs. MARIANO GARCHITORENA, and JOSE CASIMIRO G.R. No. L-31703 February 13, 1930 ROMUALDEZ, J.: Facts: The question here raised is confined to the scope and meaning of the institution of heirs made in the will of the late Ana Maria Alcantara already admitted to probate, and whose legal force and effect is not in dispute. The clauses of said will relevant to the points in dispute, between the parties are the ninth, tenth, and eleventh, quoted below: Ninth. Being single and without any forced heir, to show my gratitude to my niece-in-law, Carmen Garchitorena, of age, married to my nephew, Joaquin Perez Alcantara, and living in this same house with me, I institute her as my sole and universal heiress to the remainder of my estate after the payment of my debts and legacies, so that upon my death and after probate of this will, and after the report of the committee on claims and appraisal has been rendered and approved, she will receive from my executrix and...
Read more

J.L.T. AGRO, INC., VS. ANTONIO BALANSAG

J.L.T. AGRO, INC., REPRESENTED BY ITS MANAGER, JULIAN L. TEVES VS. ANTONIO BALANSAG AND HILARIA CADAYDAY G.R. No. 141882, March 11, 2005 TINGA, J.: Facts: Don Julian L. Teves contracted two marriages, first with Antonia Baena, and after her death, with Milagros Donio Teves. Don Julian had two children with Antonia, namely: Josefa Teves Escaño and Emilio Teves. He had also four (4) children with Milagros Donio, namely: Maria Evelyn Donio Teves, Jose Catalino Donio Teves, Milagros Reyes Teves and Pedro Reyes Teves. The present controversy involves a parcel of land. When Antonia died, the land was among the properties involved in an action for partition and damages, the second wife of Don Julian, participated as an intervenor. Thereafter, the parties to the case entered into a Compromise Agreement which embodied the partition of all the properties of Don Julian. Paragraph 13 of the Compromise Agreement, at the heart of the present dispute, lays down the effect of the eventual ...
Read more