GMCR vs. Bell Telecoms [G.R. No. 126496. April 30, 1997.]; also Kintanar vs. Bell Telecoms [G.R. No. 126526]
First Division, Hermosisima Jr. (J): 2 concur, 1 concur in result, 1 took no part.
Facts: On 19 October 1993, Bell Telecommunication Philippines, Inc. (BellTel) filed with the National Telecommunications Commission (NTC) an Application for a Certificate of Public Convenience and Necessity to Procure, Install, Operate and Maintain Nationwide Integrated Telecommunications Services and to Charge Rates Therefor and with Further Request for the Issuance of Provisional Authority (NTC Case 93-481). At the time of the filing of this application, private respondent BellTel had not been granted a legislative franchise to engage in the business of telecommunications service. Since BellTel was, at that time, an unenfranchised applicant, it was excluded in the deliberations for service area assignments for local exchange carrier service Only GMCR, Inc., Smart Communications, Inc., Isla Communications Co., Inc. and International Communications Corporation, among others, were beneficiaries of formal awards of service area assignments in April and May 1994. On 25 March 1994, RA 7692 was enacted granting BellTel a congressional franchise which gave private respondent BellTel the right, privilege and authority to carry on the business of providing telecommunications services. On 12 July 1994, BellTel filed with the NTC a second Application (NTC Case 94-229) praying for the issuance of a Certificate of Public Convenience and Necessity for the installation, operation and maintenance of a combined nationwide local toll (domestic and international) and tandem telephone exchanges and facilities using wire, wireless, microwave radio, satellites and fiber optic cable with Public Calling Offices (PCOs) and very small aperture antennas (VSATs) under an integrated system. In the second application, BellTel proposed to install 2,600,000 telephone lines in 10 years using the most modern and latest state-of-the-art facilities and equipment and to provide a 100% digital local exchange telephone network. BellTel moved to withdraw its earlier application docketed as NTC Case 93-481. In an Order dated 11 July 1994, this earlier application was ordered withdrawn, without prejudice. BellTel’s second application was opposed by GMCR, Inc., Smart Communications, Inc., Isla Communications Co., Inc. and International Communications Corporation, Capitol Wireless, Inc., Eastern Misamis Oriental Telephone Cooperative, Liberty Broadcasting Network, Inc., Midsayap Communication, Northern Telephone, PAPTELCO, Pilipino Telephone Corporation, Philippine Global Communications, Inc., Philippine Long Distance Telephone Company, Philippine Telegraph and Telephone Corporation, Radio Communications of the Philippines, Inc. and Extelcom and Telecommunications Office. On 20 December 1994, BellTel completed the presentation of its evidence-in-chief. On 21 December 1994, BellTel filed its Formal Offer of Evidence together with all the technical, financial and legal documents in support of its application. Pursuant to its rules, the application was referred to the Common Carriers Authorization Department (CCAD) for study and recommendation. On 6 February 1995, the CCAD submitted to Deputy Commissioner Fidelo Q. Dumlao, a Memorandum manifesting that “based on technical documents submitted, BellTel’s proposal is technically feasible.” Subsequently, the chief of the Rates and Regulatory Division of CCAD, conducted a financial evaluation of the project proposal of BellTel. On 29 March 1995, it was declared that BellTel has the financial capability to support its proposed project at least for the initial 2 years. Agreeing with the findings and recommendations of the CCAD, NTC Deputy Commissioners Fidelo Dumlao and Consuelo Perez adopted the same and expressly signified their approval thereto. In view of the favorable recommendations by the CCAD and two members of the NTC, the Legal Department thereof prepared a working draft 10 of the order granting provisional authority to BellTel. The said working draft was initialed by Deputy Commissioners Fidelo Q. Dumlao and Consuelo Perez but was not signed by Commissioner Simeon Kintanar.
Anxious over the inaction of the NTC in the matter of its petition praying for the issuance of a provisional authority, BellTel filed on 5 May 1995 an Urgent Ex-Parte Motion to Resolve Application and for the Issuance of a Provisional Authority. No action was taken by the NTC on the aforecited motion. Thus, on 12 May 1995, BellTel filed a Second Urgent Ex-Parte Motion reiterating its earlier prayer. In an Order dated 16 May 1995, signed solely by Commissioner Simeon Kintanar, the NTC, instead of resolving the two pending motions of BellTel, set the said motions for a hearing on 29 May 1995. On said date, however, no hearing was conducted as the same was reset on 13 June 1995. On the latter date, BellTel filed a Motion to Promulgate (Amending the Motion to Resolve), praying for the promulgation of the working draft of the order granting a provisional authority to BellTel, on the ground that the said working draft had already been signed or initialed by Deputy Commissioners Dumlao and Perez who, together, constitute a majority out of the three commissioners composing the NTC. On 4 July 1995, the NTC denied the said motion in an Order solely signed by Commissioner Simeon Kintanar.
On 17 July 1995, BellTel filed with the Supreme Court a Petition for Certiorari, Mandamus and Prohibition seeking the nullification of the aforestated Order dated 4 July 1995 denying the Motion to Promulgate. On 26 July 1995, the Court issued a Resolution referring said petition to the Court of Appeals for proper determination and resolution pursuant to Section 9, par. 1 of BP 129. On 23 September 1996, the Court of Appeals promulgated decision, granting BellTel’s petition for a writ of Certiorari and Prohibition, setting aside NTC Memorandum Circulars 1-1-93 and 3-1-93 for being contrary to law. BellTel’s petition for mandamus was also granted, directing the NTC to meet and banc and to consider and act on the draft order within 15 days. Chairman Kintanar and the opposing telecommunications companies filed their separate petitions for review.
The Supreme Court dismissed the instant consolidated petitions for lack of merit; with costs against petitioners.
1. NTC is a collegial body; Vote requirement
NTC is a collegial body requiring a majority vote out of the three members of the commission in order to validly decide a case or any incident therein. Corollarily, the vote alone of the chairman of the commission, absent the required concurring vote coming from the rest of the membership of the commission to at least arrive at a majority decision, is not sufficient to legally render an NTC order, resolution or decision.
2. Commissioner Kintanar is not the National Telecommunications Commission
Commissioner Kintanar is not the National Telecommunications Commission. He alone does not speak for and in behalf of the NTC. The NTC acts through a three-man body, and the three members of the commission each has one vote to cast in every deliberation concerning a case or any incident therein that is subject to the jurisdiction of the NTC. Having been organized by EO 146 as a three-man commission, the NTC is a collegial body and was a collegial body even during the time when it was acting as a one-man regime.
3. Historical milieu of the NTC: CA 146 as amended by RA 2677
On 17 November 1936, the National Assembly passed Commonwealth Act 146 which created the Public Service Commission (PSC). While providing that the PSC shall consist of a Public Service Commissioner and a Deputy Commissioner, the law made it clear that the PSC was not a collegial body by stating that the Deputy Commissioner could act only on matters delegated to him by the Public Service Commissioner. As amended by RA 2677, the Public Service Commission was transformed into and emerged as a collegial body, composed of one Public Service Commissioner and five (5) Associate Commissioners. The amendment provided that contested cases and all cases involving the fixing of rates shall be decided by the Commission en banc.
4. Historical milieu of the NTC: PD 1 (Integrated Reorganization Plan)
On 24 September 1972, then President Ferdinand E. Marcos signed, into law, PD 1 adopting and approving the Integrated Reorganization Plan which, in turn, created the Board of Communications (BOC) in place of the PSC. This time, the new regulatory board was composed of 3 officers exercising quasi-judicial functions. On 25 January 1978, the BOC promulgated its “Rules of Procedure and Practice” in connection with applications and proceedings before it.
5. Historical milieu of the NTC: EO 546, merger of BOC and the Telecommunications Control Bureau as NTC
On 23 July 1979, President Marcos issued Executive Order 546, creating the Ministries of Public Works, and of Transportation and Communications, merged the defunct Board of Communications and the Telecommunications Control Bureau into a single entity, the National Telecommunications Commission (NTC). The said law was issued by then President Marcos in the exercise of his legislative powers. Sec. 16 of EO 546 provides that “the Commission shall be composed of a Commissioner and two Deputy Commissioners, preferably one of whom shall be a lawyer and another an economist.” The Executive Order took effect on 24 September 1979 . However, the NTC did not promulgate any Rules of Procedure and Practice. Consequently, the then existing Rules of Procedure and Practice promulgated by the BOC was applied to proceedings in the NTC.
6. Historical milieu of the NTC: Opinion of Justice Secretary (Puno) entitled to great weight but not conclusive upon the courts
The opinion of the Secretary of Justice is entitled to great weight. However, the same is not controlling or conclusive on the courts. The Puno Opinion that the NTC is not a collegial body is not correct. Admittedly, EO 546 does not specifically state that the NTC was a collegial body, and neither does it provide that the NTC should meet En Banc in deciding a case or in exercising its adjudicatory or quasi-judicial functions. But the absence of such provisions does not militate against the collegial nature of the NTC under the context of Section 16 of EO 546 and under the Rules of Procedure and Practice applied by the NTC in its proceedings. Under [Rule 15] of said Rules, the BOC (now the NTC), a case before the BOC may be assigned to and heard by only a member thereof who is tasked to prepare and promulgate his Decision thereon, or heard, En Banc, by the full membership of the BOC in which case the concurrence of at least 2 of the membership of the BOC is necessary for a valid Decision.
7. Historical milieu of the NTC: BOC Rules are NTC Rules, Philippine Consumers Foundation vs. NTC
While it may be true that the BOC Rules of Procedure was promulgated before the effectivity of Executive Order 546, however, the Rules of Procedure of BOC governed the rules of practice and procedure before the NTC when it was established under Executive Order 546. This was enunciated by the Supreme Court in the case of ‘Philippine Consumers Foundation, Inc. versus National Telecommunications Commission, 131 SCRA 200’ when it declared that: “The Rules of Practice and Procedure promulgated on 25 January 1978 by the Board of Communications, the immediate predecessor of NTC govern the rules of practice and procedure before the BOC then, now NTC.”
8. Commission defined
A Commission is a body composed of several persons acting under lawful authority to perform some public service. (City of Louisville Municipal Housing Commission versus Public Housing Administration, 261 Southwestern Reporter, 2nd, page 286). A Commission is also defined as a board or committee of officials appointed and empowered to perform certain acts or exercise certain jurisdiction of a public nature or service . . . (Black, Law Dictionary, page 246). There is persuasive authority that a ‘commission’ is synonymous with ‘board’ (State Ex. Rel. Johnson versus Independent School District No. 810, Wabash County, 109 Northwestern Reporter 2nd, page 596).
9. Statutory Construction: “And” construed
The conjunctive word ‘and’ is not without any legal significance. It is not, by any chance, a surplusage in the law. It means ‘in addition to’ (McCaull Webster Elevator Company versus Adams, 167 Northwestern Reporter, 330, page 332). The word ‘and’, whether it is used to connect words, phrases or full sentence[s], must be accepted as binding together and as relating to one another. From the context of Section 16 of Executive Order 546, the Commission is composed of a Commissioner and 2 deputy commissioners; not the commissioner alone.
10. Statutory Construction: Every part of statute should be given effect
In interpreting a statute, every part thereof should be given effect on the theory that it was enacted as an integrated law and not as a combination of dissonant provisions. As the aphorism goes, “that the thing may rather have effect than be destroyed.” Herein, if it was the intention of President Marcos to constitute merely a single entity, a ‘one-man’ governmental body, instead of a commission or a three-man collegial body, he would not have constituted a commission and would not have specifically decreed that the Commission is composed of, not the commissioner alone, but of the commissioner and the 2 deputy commissioners.
11. Use of word “deputy” does not militate against the collegiality of the NTC
Even if Executive Order 546 used the word ‘deputy’ to designate the 2 other members of the Commission does not militate against the collegiality of the NTC. The collegiality of the NTC cannot be disparaged by the mere nominal designation of the membership thereof. Such nominal designations are without functional implications and are designed merely for the purpose of administrative structure or hierarchy of the personnel of the NTC.
12. NTC Circulars 1-1-93 and 3-1-93 void
NTC Circular No. 1-1-93, Memorandum Circular No. 3-1-93, and the Order of Kintanar declaring the NTC as a single entity or non-collegial entity, are contrary to law and thus null and void. Administrative regulations derive their validity from the statute that they were, in the first place, intended to implement. Memorandum Circulars 1-1-93 and 3-1-93 are on their face null and void ab initio for being unabashedly contrary to law. The fact that implementation of these illegal regulations has resulted in the institutionalization of the one-man rule in the NTC, is not and can never be a ratification of such an illegal practice. At the least, these illegal regulations are an erroneous interpretation of EO 546 and in the context of and its predecessor laws. At the most, these illegal regulations are attempts to validate the one-man rule in the NTC as executed by persons with the selfish interest of maintaining their illusory hold of power.
13. Courts cannot refrain from duty to nullify illegal regulations
Since the questioned memorandum circulars are inherently and patently null and void for being totally violative of the spirit and letter of EO 546 that constitutes the NTC as a collegial body, no court may shirk from its duty of striking down such illegal regulations.
14. Only the NTC and Commissioner Kintanar are indispensable parties in the action for certiorari
In its certiorari action before the Court of Appeals, BellTel was proceeding against the NTC and Commissioner Kintanar for the former’s adherence and defense of its one-man rule as enforced by the latter. Thus, only the NTC and Commissioner Kintanar may be considered as indispensable parties. After all, it is they whom BellTel seek to be chastised and corrected by the court for having acted in grave abuse of their discretion amounting to lack or excess of jurisdiction.
15. Oppositors not absolutely necessary in an action for certiorari, as the action does not go into merits of the case; Claim of non-joinder of indispensable parties untenable
The oppositors in NTC Case 94-229 are not absolutely necessary for the final determination of the issue of grave abuse of discretion on the part of the NTC and of Commissioner Kintanar in his capacity as chairman of NTC because the task of defending them primarily lies in the Office of the Solicitor General. Furthermore, were the court to find that certiorari lies against the NTC and Commissioner Kintanar, the oppositors’ cause could not be significantly affected by such ruling because the issue of grave abuse of discretion goes not into the merits of the case in which the oppositors are interested but into the issue of collegiality that requires, regardless of the merits of a case, that the same be decided on the basis of a majority vote of at least two members of the commission. All that Court of Appeals passed upon was the question of whether or not the NTC and Commissioner Kintanar committed grave abuse of discretion, and so the Supreme Court must review and ascertain the correctness of the findings of the appellate court on this score, and this score alone.
16. Mandamus does not control discretion
Jurisprudence is settled as to the propriety of mandamus in causing a quasi-judicial agency to exercise its discretion in a case already ripe for adjudication and long-awaiting the proper disposition. As to how this discretion is to be exercised, however, is a realm outside the office of the special civil action of mandamus. It is elementary legal knowledge, after all, that mandamus does not lie to control discretion. Herein, when the Court of Appeals directed Commissioners to meet en banc and to consider and act on the working draft of the order granting provisional authority to BellTel, said court was simply ordering the NTC to sit and meet en banc as a collegial body, and the subject of the deliberation of the 3-man commission would be the said working draft which embodies one course of action that may be taken on BellTel’s application for a provisional authority. The appellate court did not order the NTC to forthwith grant said application.
17. No evidence proffered that working draft was obtained by BellTel was obtained through illegal means
The working draft was said to have been prepared by Atty. Basilio Bolante of the Legal Department of the NTC; initialed by the CCAD Head, Engr. Edgardo Cabarios and by Deputy Commissioners Dumlao and Perez. No one among the aforementioned persons has renounced the working draft or declared it to be spurious. Petitioners have not proffered a single piece of evidence to prove the charge that the working draft of the order granting provisional authority to BellTel was obtained by the latter through illegal means. In the ultimate, the issue of the procurement of the working draft is more apropos for a criminal or administrative investigation than in the instant proceedings largely addressed to the resolution of a purely legal question.
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