Silva vs. Cabrera

In a contested case before the Public Service Commission, the reception of evidence — consisting of conducting hearings, receiving evidence, ruling on objections, and admitting exhibits — may be delegated only to one of the Commissioners, and to no other person. A delegation under Section 32 of the Public Service Act to an attorney or chief of division is limited to the taking of depositions or testimony in the manner prescribed by Rule 18 of the Rules of Court and does not authorize that person to exercise the adjudicatory functions of a hearing officer.

Belen Cabrera applied for a certificate of public convenience to install and operate a 15‑ton ice plant in Lipa City and to sell its product in several municipalities of Batangas province and in Lipa City. Eliseo Silva and the firm Opulencia & Lat, who each held certificates for a 15‑ton ice plant, opposed the application, asserting that their existing service adequately met public demand and that public convenience did not require a new ice plant. Instead of conducting the hearing itself, the Public Service Commission, through Commissioner Feliciano Ocampo, issued an order delegating the taking of testimony to Atty. Antonio H. Aspillera, Chief of the Legal Division, under Section 32 of Commonwealth Act No. 146.

• The Application and Opposition: Respondent Belen Cabrera sought a certificate of public convenience to install, maintain, and operate a 15‑ton ice plant in Lipa City and to sell ice in the city and in several municipalities of Batangas. Petitioner Eliseo Silva and the entity Opulencia & Lat, each already holding a certificate for a 15‑ton ice plant, opposed the application on the ground that their existing service was adequate and public convenience did not require the proposed plant.

• The Delegation Order: By order dated July 14, 1949, Commissioner Feliciano Ocampo, acting for the Public Service Commission, delegated to Atty. Antonio H. Aspillera, Chief of the Legal Division, the taking of the testimony of witnesses, invoking Section 32 of the Public Service Act (Commonwealth Act No. 146).

• Proceedings before Atty. Aspillera: At the initial hearing, counsel for oppositor Silva objected and requested that the hearing be conducted before one of the Commissioners because the case was contested. The objection was overruled, and counsel made of record that continuing with the hearing did not constitute a waiver. Atty. Aspillera thereafter presided over multiple hearing sessions. He acted as the representative of the Commission, addressed questions to witnesses, passed upon the competency and admissibility of exhibits, ruled on petitions and objections, and either sustained or overruled them. The transcript of stenographic notes repeatedly referred to him as the “Commission” and to the proceedings as “hearings.” After the close of evidence, he declared the case submitted. The entire record consisted of 227 pages of transcript.

• Decision of the Commission: The Commission en banc rendered a decision finding that public interest and convenience would be promoted by a 10‑ton ice plant, that Cabrera was a Filipino citizen and financially qualified, and overruled the oppositions. A certificate of public convenience for a 10‑ton ice plant was granted to Cabrera, subject to specified conditions.

• Illegal Delegation: Petitioner maintained that Section 3 of the Public Service Act as amended by Republic Act No. 178 prohibits a hearing before any person other than a Commissioner in contested cases; consequently, the delegation to Atty. Aspillera was illegal and contrary to law. He stressed that the objection had been timely raised and was not waived.

• Insufficiency of Evidence: Petitioner argued that the decision was not supported by evidence sufficient to warrant the grant of the certificate to respondent Cabrera.

• Validity of Delegation under Section 32: Respondent countered that the delegation was perfectly proper under Section 32 of the Public Service Act. She characterized the authority given to Atty. Aspillera as a mere authorization “to take the testimony of witnesses,” akin to a deposition, and not a reception of evidence or a hearing; thus, Section 3 was not violated.

• Precedent Upholding Delegation: Respondent cited the case of Flores v. A. L. Ammen Transportation Co. (PSC Case No. 27141, elevated to the Supreme Court as G.R. No. L-1637), where a petition for certiorari challenging a similar delegation was dismissed for lack of merit. She also invoked Cebu Transit Co., Inc. v. Jereza (58 Phil. 760), in which the Supreme Court held that the Commission was authorized to designate commissioners to receive evidence, arguing that no prohibition existed.

• Delegation of Reception of Evidence: Whether, in a contested case before the Public Service Commission, the delegation of the reception of evidence to a person other than a Commissioner is valid under Section 3 of the Public Service Act as amended by Republic Act No. 178, in light of the authority to commission attorneys or chiefs of division under Section 32 of the same Act.

• Sufficiency of Evidence: Whether the evidence on record adequately supported the grant of the certificate of public convenience.

• Delegation of Reception of Evidence: The delegation to Atty. Aspillera was declared invalid, and all proceedings held thereunder were nullified. Section 3 of the Public Service Act, as amended, explicitly provides that contested cases shall be heard by the Commission en banc and that the reception of evidence may be delegated only to one of the Commissioners, who shall report the evidence received to the Commission en banc. The legislative intent was to reserve the conduct of hearings in contested matters to the Commissioners themselves, a departure from the prior regime under Commonwealth Act No. 146 where a single Commissioner could delegate broadly. The proceedings before Atty. Aspillera constituted a full reception of evidence — he presided over hearings, passed upon the relevancy and competency of evidence, ruled on petitions and objections, admitted and rejected evidence, and declared the case submitted — thereby acting as a Commissioner under Rule 34 of the Rules of Court, not as a mere official taking a deposition under Rule 18. Section 32, which allows attorneys or chiefs of division to “receive evidence,” must be construed consistently with Section 3: it authorizes only the taking of depositions or testimonies of witnesses in the manner prescribed by Rule 18, where the person taking the testimony exercises no adjudicatory powers but merely certifies the testimony. The decision in Flores v. A. L. Ammen Transportation Co. was distinguished because the delegation there was to a justice of the peace for the taking of a deposition, not to conduct a hearing. Cebu Transit Co. v. Jereza was inapplicable, having been decided in 1933, before Republic Act No. 178 introduced the contested‑case limitation. Because the law was clear, neither convenience nor expediency could justify circumventing it; the remedy lay with the Legislature.

• Sufficiency of Evidence: The Court did not reach this issue, the entire proceedings having been voided and the case remanded for a lawful hearing.

• Strict Construction of Delegation Authority in Contested PSC Cases — Under Section 3 of Commonwealth Act No. 146, as amended by Republic Act No. 178, the reception of evidence in contested cases and cases involving the fixing of rates is exclusively entrusted to the Commission en banc or to a single Commissioner to whom the Commission en banc has properly delegated that function. The delegation of such reception of evidence — comprising the conduct of hearings, the receipt of oral and documentary evidence, the ruling on relevancy and competency, and the admission or rejection of evidence — to any person other than a Commissioner is void. Section 32 of the same Act, which permits the Commission to commission attorneys, chiefs of division, clerks of court, or justices of the peace to receive evidence, must be interpreted narrowly: it authorizes only the taking of depositions or testimonies under Rule 18 of the Rules of Court, wherein the commissioned officer acts as a certifying official with no power to resolve evidentiary disputes or to make findings. A delegation that exceeds this limited scope is illegal, and all proceedings conducted pursuant to it are null and void. In this case, the Court applied the doctrine by annulling the delegation to Atty. Aspillera, who had exercised full adjudicatory powers during the hearings.

• “It is obvious that the evidence received by Atty. Aspillera were not mere depositions or testimonies, and that his actuation that of a mere official like a justice of the peace receiving a deposition under the provisions of Rule 18 of the Rules of Court. The role played by Atty. Aspillera was rather that of a Commissioner under Rule 34 wherein he acted as a representative of the Commission that made the delegation to him, passed upon petitions and objections during the trial, either overruling or sustaining the same and ordered witnesses to answer if the objection to the question was overruled, and then making his findings and report to the body that commissioned him.”

• “where the law is clear, neither this court nor the commission may on grounds of convenience, expediency or prompt dispatch of cases, disregard the law or circumvent the same. The remedy lies with the Legislature if it could be convinced of the necessity of amending the law, and persuaded to approve a suitable amendment.”

• Flores v. A. L. Ammen Transportation Co. , G.R. No. L-1637 — Distinguished. The delegation in that case was to a justice of the peace for the taking of a deposition under Rule 18, not for the reception of evidence as a hearing officer. The order of Commissioner Prieto expressly recognized that a deposition does not constitute a delegation of the reception of evidence and that the officer taking it is not vested with the faculties of the tribunal.

• Cebu Transit Co., Inc. v. Jereza , 58 Phil. 760 — Inapplicable. The decision was rendered in 1933, before Republic Act No. 178 amended the Public Service Act in 1947 to require that contested cases be heard by the Commission en banc and that the reception of evidence be delegated only to a Commissioner. The ruling therefore predated the statutory provision that controlled the present case.

• Section 3, Commonwealth Act No. 146, as amended by Republic Act No. 178 — Mandates that all contested cases, cases involving the fixing of rates, and petitions for reconsideration be heard by the Commission en banc, and that the reception of evidence may be delegated only to one of the Commissioners, who shall report the evidence to the Commission en banc. The provision was applied to invalidate the delegation to Atty. Aspillera because he was not a Commissioner and the delegation encompassed a full reception of evidence.

• Section 32, Commonwealth Act No. 146 — Authorizes the Commission to commission attorneys or chiefs of division to receive evidence, and to commission clerks of court or justices of the peace to take the testimony of witnesses in cases where witnesses reside far from Manila. The provision was interpreted in light of Section 3: it permits only the taking of depositions or testimony in the manner prescribed by Rule 18 of the Rules of Court and does not authorize the conduct of hearings or the exercise of adjudicatory powers.

Paras, Feria, Pablo, Bengzon, Padilla, Tuason, Reyes, Jugo, and Bautista Angelo, JJ., concurred.