PHILIPPINE AIRLINES, INC vs. CIVIL AERONAUTICS BOARD and GRAND INTERNATIONAL AIRWAYS, INC.

G.R. No. 119528 March 26, 1997

I. Nature

Delegation to administrative bodies

II. Facts

Grand Air applied for a Certificate of Public Convenience and Necessity with the Civil
Aeronautics Board ACABS. The Chief Hearing Officer issued a notice of hearing directing Grand
Air to serve a copy of the application and notice to all scheduled Philippine Domestic operators.
Grand Air filed its compliance and requested for a Temporary Operating Permit ATOPS. PAL
filed an opposition to the application on the ground that the CAB had no jurisdiction to hear
the application until Grand Air first obtains a franchise to operate from Congress. The Chief
Hearing Officer denied the opposition and the CAB approved the issuance of the TOP for a
period of 3 months. The opposition for the TOP was likewise denied. The CAB justified its
assumption of jurisdiction over Grand Air’s application on the basis of Republic Act 776 which
gives it the specific power to issue any TOP or Certificate of Public Convenience and Necessity.

III. Issue

Whether or not the CAB can issue a Certificate of Public Convenience and Necessity or TOP
even though the prospective operator does not have a legislative franchise?

IV. Ruling

Yes, as mentioned by the CAB, it is duly authorized to do so under Republic Act 776 and a
legislative franchise is not necessary before it may do so, since Congress has delegated the
authority to authorize the operation of domestic air transport services to the CAB, an
administrative agency. The delegation of such authority is not without limits since Congress
had set specific standard and limitations on how such authority should be exercised.

Public convenience and necessity exists when the proposed facility will meet a reasonable want
of the public and supply a need which the existing facilities do not adequately afford.

Thus, the Board should be allowed to continue hearing the application, since it has jurisdiction
over it provided that the applicant meets all the requirements of the law.
yYy TRANSIT CO, INC., vs.
THE NATIONAL LABOR RELATIONS COMMISSION AND YUJUICO TRANSIT EMPLOYEES UNION AASSOCIATED
LABOR UNIONS, MANUEL VILLARTA,

G.R. No. 88195-96 January 27, 1994

I. Nature

II. Facts

In 1960 Yujuico Transit Co., Inc., mortgaged ten of its buses to the Development Bank of the
Philippines ADBPS to secure a loan. Thereafter, a resolution was passed authorizing its President,
Jesus Yujuico to enter into a dacion en pago arrangement with the DBP, whereby Jesus Yujuico
would transfer to the DBP the Saint Martin Technical Institute in consideration of the full
settlement of the obligations. The transfer of the property was made and DBP released the
mortgages constituted on the buses of Yujuico Transit Co., Inc. Consequently, the company
transferred the ownership of its mortgaged properties, including the buses, to Jesus Yujuico.

In 1979, the Yujuico Transit Employees Union AAssociated labor UnionS filed two complaints
against Yujuico Transit Co., Inc. for Unfair Labor Practice and non-payment of living allowances.In
1980, Jesus Yujuico sold the subject buses to herein petitioner yYy Transit Co. In 1981, the Labor
Arbiter held Yujuico Transit Co., Inc. liable for non-payment of living allowances in the amount of
P142,790.49. An alias writ of execution was issued and levy was made upon the ten A10S buses.

Y filed Affidavits of Third Party Claim, which Union opposed on the grounds that: A1S the
transactions leading to the transfer of the buses to Y were void because they lacked the approval
of the BOT as required by the Public Service Act; and A2S the buses were still registered in the
name of Yujuico which means it is still the lawful owner. On appeal the NLRC reversed the decision
on the ground that the transfer of the buses lacked the BOT approval.

III. Issue

Were the transfer of the buses, without BOT approval, valid insofar as the respondents are
concerned?

IV. Ruling

No. There being no prior BOT approval in the transfer of property from Yujuico Transit Co., Inc. to
Jesus Yujuico, it only follows that as far as the BOT and third parties are concerned, Yujuico Transit
Co., Inc. still owned the properties. and Yujuico, and later, yYy Transit Co., Inc. only held the same
as agents of the former. The Court stated that In operating the truck without transfer thereof
having been approved by the Public Service Commission, the transferee acted merely as agent of
the registered owner and should be responsible to him Athe registered ownerS for any damages
that he may cause the latter by his negligence. Thus, yYy Transit Co., Inc. cannot now argue that
the buses could not be levied upon to satisfy the money judgment in favor of herein respondents.
However, this does not deprive the transferee of the right to recover from the registered owner
 any damages which may have been incurred by the former since the transfer or lease is valid and
binding between the parties.

DOMINADOR RAYMUNDO vs. LUNETA MOTOR CO., ET AL.

G.R. Nos. L-39902, L-39903 November 29, 1933

I. Nature

II. Facts

Nicanor De Guzman signed as yGuzco Transity, purchased trucks from the Luneta Motor Co. He
then executed promissory notes guaranteed by a chattel mortgage on several trucks. However, he
failed to comply with his obligation. Because of failure to perform obligation, a suit was filed against
Guzco Transit for the collection of the unpaid and outstanding amount. A writ of attachment vas
obtained against the properties of Guzco Transit, so garnishment was made by the Sec. of Public
Service Commission attacking the right, title, and participation of the Guzco Transit in the
certificates of public convenience covering bus transportation lines Aroute: Manila-Cardona, Rizal;
Manila-Pilila, RizalS.

The CFI ordered the selling of the certificates of public convenience. The highest bidder was Luneta
Motor Co. After several days, or after a writ of attachment vas issued, these certificates were sold
by Luneta Motor to Dominador Raymundo. The Public Service Commission approved the sale at
public auction in favor of Luneta Motor but denied the sale of the certificates of public convenience
to Raymundo.

III. Issue

Whether a certificate of public convenience may be the object of execution and garnishment sale

What will prevail, a sale of certificates of public convenience at public auction by virtue of an
attachment or voluntary sale made after the property had been levied upon

IV. Ruling

Certificate of of public convenience secured by public service operators are liable to execution.

The Public Service Law Act 4567 as amended permits the Public Service Commission to approve sale,
alienation, mortgaging, encumbering or leasing of property, franchises, privileges, or rights or any part
thereof, and in practice the purchase and sale of certificates of public convenience has been permitted
by the Public Service Commission. If the holder of a certificate of public convenience can sell it
voluntarily, there is no valid reason why these certificates cannot be taken and sold involuntarily
pursuant to process