Panay Autobus vs PNR

PANAY AUTOBUS COMPANY VS PHILIPPINE RAILWAY CO. February 17, 1933 | J. Vickers | Fixing of Rates, Wages, Prices April 18, 1932 - RR Hancock, vice-president and general manager of Philippine Railway Co. filed a petition with the Public Service Commission

• requesting the Commission to alter the freight rates whenever in their (Phil Railway) judgment they find it necessary in order to meet the competition of road trucks and auto busses

• because of their fixed rates, they find it hard to bid for business - unlike the trucks and autobuses that can change their prices at will May 28, 1932 - Cebu Autobus filed an opposition, stating that

• the establishment of sliding rates would be against the Public Utility Regulations • granting the application of sliding rates would promote unnecessary and ruinous competition between operators and promote discrimination with regard to enforcement

April 23, 1932 - the general manager of the Phil Railway Co filed with the Public Service Commission several proposals for classification, tariff and revised rules governing traffic (which provided for a reduction in the freight rates) A hearing on the first petition was held. The tariff schedule was submitted in the same hearing. Afterwards, the commission rendered a decision (I assume it was granting the petition, the entire decision was in Spanish and walang translation/mini summary sa baba) June 28, 1932 - Panay Autobus Company filed its opposition to Phil Railway’s applications on the following grounds:

• that the petition for flexible rates shouldn’t be granted since it is against the fundamental principles of public utility regulation

• that granting flexible rates will work ruinous competition with other common carriers in the field They also asked for a rehearing, which was denied. This petition if for the review of the previous decision by the Public Service Commission. SC: The decision of the Commission was confusing, but it seems that the commission overruled the objection of the attorney for the appellant and apparently granted the application of Phil Railway Co. W/N the Public Service Commission was authorized to delegate to Phil Railway Co. the power of altering its freight rates whenever it finds it necessary to do so - NO The Legislature delegated to the Public Service Commission the power of fixing the rates of public services but it has not authorized the Public Service Commission to delegate that power to a common carrier or other public service. The rates of public services have been approved or fixed by the Public Service Commission and any change in such rates must be authorized or approved by the Public Service Commission after

they are shown to be just and reasonable. The public service may propose new rates but it cannot lawfully make said new rates effective without the approval of the Public Service Commission and the Public Service Commission itself cannot authorize a public service to enforce new rates without the prior approval of said rates by the Commission. The commission must approve new rates when they are submitted to it, if the evidence shows them to be just and reasonable, otherwise it must disapprove them. APPLICATION: In the instant case, Phil Railway Co in effect asked for permission to change its freight rates at will. It may change them every day or every hour, whenever it deems it necessary to do so in order to meet competition or whenever in its opinion it would be to its advantage. This would largely defeat the purposes of the public service law. Sec 16 of the Public Service Law prohibits any public service from exacting any unjustly discriminatory rate, but if the Phil Railway Co is to alter its rates whenever it may be necessary to meet the competition of road trucks and autobuses, or to reduce its rates whenever it would be to the advantage of the railway company, it cannot prevent its rates from being discriminatory.