GSIS v HLURB (2010, CARPIO MORALES)Petitioner: GSISRespondents: Board of Commissioners of the Housing and Land Use Regulartory Board (HLURB), 2nd Div; Sps. de los Reyes; New San Jose BuildersBrief Facts: NSJ mortgaged several lands and condo units to GSIS. Sps. Reyes purchased one of these condo units, only for GSIS to end up foreclosing on the mortgages. Sps. Reyes filed suit for delivery of the property and to enjoin the GSIS from consolidating ownership. The GSIS lost at every turn.Doctrine: Procedural rules are among those rules allowed in various agencies. For as long as they are not in conflict with the law, they are to be held valid.FACTS:1. Respondent New San Jose Builders (NSJ) mortgaged three parcels of land (with improvements), 366 lots with low cost houses, and 102 condo units on Sct. Rallos to the GSIS to secure the payment of a loan amounting to P6 million. One of these was Unit 312, which the Sps. de los Reyes purchased on May 28, 2001.2. However, NSJ defaulted in its loan, leading GSIS to foreclose the mortgage and purchase the properties on sale. When the spouses learned of the sale, they filed a complaint against NSJ with the HLURB, praying for a release of the mortgage and the delivery of the property to the spouses. - GSIS defense: Was not party to the sale to the spouses3. The spouses then filed an Urgent Motion for Issuance of a Writ of Prelim Injunction with prayer for Temporary Restraining Order to restrain GSIS from consolidating its title to the unit.- GSIS opposition: PD 385 prohibits the issuance of a restraining order against any government financial institution in any action taken by it in compliance with the mandatory foreclosure under the decree.4. The motion was granted by the HLURB Arbiter, and a cease-and-desist order was issued against GSIS. The HLURB 2nd Division then affirmed the said decision.5. On appeal to the CA, the GSIS first questioned the HLURB's jurisdiction to entertain the appeal as EO 648 supposedly required them to act en banc, not merely on a division of three. Such was not considered by the CA as the HLURB's Revised Rules of Procedure allows for appeals to be decided sitting en banc or by division.ISSUES:1. Whether or not the HLURB Board may sit in divisions in handling appeals.2. Whether or not PD 385 prohibits the issuance of a CDO against the consolidation of title.RATIO:1. YES, nothing prevents them, and given the configuration of the board, it is in fact necessary.- Sec. 5 of EO 648 mandates the HLURB to adopt rules of procedure for the conduct of its business and perform such functions necessary for the effective discharge thereof. Such grant was held to be an adequate source of authority to delegate a particular function, unless by express provision of the law or by implication, it has been withheld.- The power is vested on the commissioners, but a reading of the law shows nothing that would require them to act in a certain manner.- This means that the HLURB Rules of Procedure are indeed in line with the law, and are not ultra vires.- Another thing to consider is that the present composition of the board has 5/9 members as members in an ex oficio capacity with the others serving as full time commissioners (these are often department secretaries). With this kind of membership, there really has to be a procedure for appeal through a division.2. NO, the law is directed only towards mandatory foreclosure.- Sec. 2 of PD 385 prevents restraining orders and injunction against mandatory foreclosure alone.- This means that PD 385 cannot be relied on in this case, as the act subject of the cease and disest was the consolidation of ownership. At any rate, the same section allows the borrower to liquidate the arrearages due in order to safeguard the lender's interests.- This is also part of the jurisdiction of the HLURB-- its power to regulate is broad enough to include jurisdiction over a complaint for annulment of foreclosure sale, and the grant of incidental reliefs. Even laws and decrees such as PD 957 recognize the HLURB's jurisdiction to issue CDOs (here, with respect to condominiums and subdivisions).--PANAY AUTOBUS v PHIL RAILWAY (1933, VICKERS)Petitioner: Panay Autobus Co.Respondent: Philippine Railway Co.Brief Facts: Phil Railway wants to be able to adjust freight rates based on what they deem necessary. This was opposed by different companies, but was allowed by the PSC.Doctrine: Rate fixing is a legislative function, and cannot simply be re-delegated unless allowed under the law. More especially so if it is an interested party (e.g. a transport company) that is given such power.FACTS:1. On Apr 8 1932, VP Hancock of the respondent railway company filed with the Public Service Commission a petition requesting for power to adjust their freight rates based on whatever they deemed necessary in order to meet the competition of road trucks and auto buses, arguing that because their rates are fixed while their competitors have a variable scheme, working to their disadvantage. They would reiterate similar arguments in a later hearing.- At the time, they had a similar pending petition on passenger rates.2. The hearing was set on June 21. A month before the hearing, Cebu Autobus filed an opposition to Phil Railway's petition, arguing that (1) it already has a CPC for the service and the route, and (2) the proposed rate scheme is repugnant to the fundamental principles of Public Utility Regulations, promoting ruinous competition and causing discrimination in enforcement.3. The commission ruled in favor of Phil Railway. In the meantime, petitioner Panay Autobus also filed an opposition against Phil Railway's application on similar grounds as Cebu Railway.- (caveat lector, using Google Translate) Phil Railway had the burden of proof of showing that the rates proposed were fair and reasonable, and it appears they were able to present a sufficient enough case. They also point out that they have the authority to hear requests for rate fixing, and to delegate the power. 4. Hence this petition to the SC.ISSUES:1. Whether or not the proposed rate scheme by Phil Railway is valid.RATIO:1. No, the PSC cannot redelegate that power, and even then, such a delegation would cause much instability and discrimination.- Such is completely untenable. To start, the legislature has delegate the rate fixing power to the PSC, and has not authorized the PSC to further delegate that power. Public services may propose new rates, but it cannot lawfully make said rates effective without approval.- Why? The commission cannot possibly determine in advance whether or not the new rates will be just and reasonable, which is the threshold for valid rates in public utilities.- What makes this case worse is that Phil Railway asked for permission to change its rates at will. Such a procedure would create an unsatisfactory state of affairs and would largely defeat the purposes of the public service law. Phil Railway may even impose rates that are discriminatory and unjust given the instability and their power to decide what the rates will be.- As to the argument that steamers are allowed to fix their rates, this is a deliberate distinction in the law. Act 3418, inapplicable to land transportation, has a policy of deregulation, with only control as to maximum rates. (this is the case even today with the Marina)--KMU LABOR CENTER v GARCIA (1994, KAPUNAN)Petitioner: KMU Labor CenterRespondents: Hon. Jesus Garcia, LTFRB, Provincial Bus Operators Association of the PhilippinesBrief Facts: DOTC and LTFRB allow bus operators to prescribe their own rates based on a given range without need for notice and hearing. In addition, when granting CPCs, there is now a disputable presumption of public need. Unsurprisingly, bus operators went for the maximum possible rate. All of this is questioned by KMU, but were denied at the LTFRB.Doctrine: Rate fixing cannot be re-delegated, especially to economically interested parties. It cannot be left to anyone's whims, as it is a delicate process that balances just returns and the public interest.FACTS:1. Then-secretary of DOTC, Oscar Orbos, issued Memo Circular 90-395 to then LTFRB Chairman Fernando allowing provincial bus operators to charge passenger rates within a range of 15% above and 15% below the LTFRB official rate for a period of one year.- Fernando found the scheme unfeasible, expressing worry about potential issues: (1) not meeting the requirements of notice and hearing under the Public Service Act, (2) possible criticism based on the present situation given the recent earthquake.2. Respondent bus operators association still filed an application for a rate increase (P0.085/km for non-aircon, P0.5/km for aircon), which became P0.065/km on the next day (as to non-aircon).- The Phil. Consumers Foundation opposed this application alleging that the proposed rates were exorbitant and unreasonable, and that the application contained no allegation on the rate of returns.3. In spite of the previous findings of Fernando, the LTFRB granted the fare rate increase.4. Two years later, Secretary Prado of the DOTC issued DO 92-587 on the regulation of the industry. It not only maintained the rate fixing scheme (in fact calling for deregulation), but it added that there would be a presumption of need in the application for CPCs.- Respondent Garcia then issued a memoradum to the Acting Chairman of the LTFRB on the rules and procedures to implement the said DO. It was also mentioned that these deregulation schemes were conditions for the approval of a loan from the World Bank.- The LTFRB then issued Memo Circular 92-009 for this purpose. It even widened the limits of the range to 20% and -25% with respect to a reference rate.5. The respondent bus association availed of the policy without notice and hearing. Unsurprisingly, it announced a fare increase of 20%, effective within days.6. KMU then filed a petition before the LTFRB opposing the adjustment of fares. Such was dismissed for lack of merit. Hence this petition for certiorari.ISSUES:1. Whether or not the proposed floating rate-fixing scheme is valid.2. Whether or not the presumption of public need referred to in the memo circulars is valid.RATIO:1. NO, delegation imposes a duty which cannot be re-delegated, and such delegation of rate fixing to the operators themselves would create a very dangerous situation.- Sec. 16(c) of the Public Service Act grants the PSC the power to fix rates, subject to notice and haring except in cases of provisional approval (but there will still be a hearing in such a case-- it just applies the rate change immediately). Profits are to be considered alongside public service in fixing such rates. This is essentially a filling in of details.- However, the authority given to fix rates cannot be re-delegated. Potestas delegata non delegari potest. The PSC has the duty to fix rates, and it cannot delegate that duty, especially if this duty is given to the bus operators, who (like in this case) will not waste time to leave the riding public at their mercy who may increase fares every hour, every day, every month or every year, whenever it pleases them. Such was the case in Panay Autobus.- Rate fixing is not an easy task. It is a delicate and sensitive government function that requires careful judgment and discretion in arriving at just and reasonable rates that considers both just returns in business (not confiscatory) and the public interest (not discriminatory).- Worse, there is no notice and hearing, which is required under the law. All the more reason to have the rate fixing scheme declared ultra vires.2. NO, as it defeats the entire point of public convenience and hearing.- Normally, a CPC, under Sec. 16(a) of the Public Service Act, requires applicants to prove that the operation of the public service proposed and the authorization to do business will promote the public interest in a proper and suitable manner.- Clearly, the presumption of public need in the memo circular runs afoul of this principle and renders the provision on notice and hearing nugatory. There is a conflict between the statute and the administrative rule, which must resolved in favor of the former.- Why? Public convenience means a determination of whether or not the proposed service meets a reasonable want of the public and supply a need which existing facilities do not adequately supply. This is a factual finding that must be established by evidence and a hearing. Worse, recognizing this presumption is an intrusion to the Supreme Court's rule making power as it in effect amends the rule on evidence by adding another disputable presumption.