THIRD DIVISION
G.R. No. 189026, November 09, 2016
PHILIPPINE TELEGRAPH TELEPHONE CORP., Petitioner, v. SMART COMMUNICATIONS, INC., Respondent.
D E C I S I O N
JARDELEZA, J.:
Since 1979, the National Telecommunications Commission (NTC) has been the lead government agency in charge of regulating the telecommunications industry. The Public Telecommunications Policy Act of the Philippines1 (RA 7925) gave the NTC the authority to approve or adopt access charge arrangements between two public telecommunication entities. The issues here are whether the NTC has primary jurisdiction over questions involving access charge stipulations in a bilateral interconnection agreement, and whether regular courts can restrain the NTC from reviewing the negotiated access charges.chanroblesvirtuallawlibrary
Access Charge/Revenue Sharing. - The access charge/revenue sharing arrangements between all interconnecting carriers shall be negotiated between the parties and the agreement between the parties shall be submitted to the Commission. In the event the parties fail to agree thereon within a reasonable period of time, the dispute shall be submitted to the Commission for resolution.The first paragraph mandates that any agreement pertaining to access charges must be submitted to the NTC for approval; in case the parties fail to agree, the matter shall be resolved by the NTC. Smart contends that the NTC's authority under the second paragraph of Section 18 is limited to instances where the parties fail to agree on the rates. This interpretation is incorrect. There is no indication that-and Smart has not pointed to any significant reason why-the second paragraph of Section 18 should be construed as limited to the latter instances. On the contrary, We observe that Congress deliberately used the word "approve," in conjunction with "adopt," in describing the action that the NTC may take. The plain dictionary meaning of approve is "to express often formally agreement with and support of or commendation of as meeting a standard."25 This presupposes that something has been submitted to the NTC, as the approving authority, contrasted with the NTC adopting its own formula. Under Section 18, it is either the access charge formula or revenue-sharing arrangement that is submitted to the NTC for approval. Smart and PT&T's Agreement, insofar as it specifies the access charge rates for the interconnection of their networks, falls within the coverage of the provision. Therefore, the Agreement should have been submitted to the NTC for its review and approval in accordance with the second paragraph of Section 18. Conspicuously, however, neither Smart nor PT&T claims that the access charges in the Agreement have been submitted to, much less approved, by the NTC. This further justifies the intervention of the NTC.
In adopting or approving an access charge formula or revenue sharing agreement between two or more carriers, particularly, but not limited to a local exchange, interconnecting with a mobile radio, interexchange long distance carrier, or international carrier, the Commission shall ensure equity, reciprocity and fairness among the parties concerned. In so approving the rates for interconnection between the telecommunications carriers, the Commission shall take into consideration the costs of the facilities needed to complete the interconnection, the need to provide the cross-subsidy to local exchange carriers to enable them to fulfill the primary national objective of increasing telephone density in the country and assure a rate of return on the local exchange network investment that is at parity with those earned by other segments of the telecommunications industry: Provided, That international carriers and mobile radio operators which are mandated to provide local exchange services, shall not be exempt from the requirement to provide the cross-subsidy when they interconnect with the local exchanges of other carriers: Provided, further, That the local exchanges which they will additionally operate, shall equally be entitled to the cross-subsidy from other international carriers, mobile radio operators, or inter-exchange carriers interconnecting with them. (Emphasis supplied.)
The interconnection which has been required of PLDT is a form of "intervention" with property rights [recognized by Article XII, Section 6 of the Constitution] dictated by "the objective of government to promote the rapid expansion of telecommunications services in all areas of the Philippines, x x x to maximize the use of telecommunications facilities available, x x x in recognition of the vital role of communications in nation building x x x and to ensure that all users of the public telecommunications service have access to all other users of the service wherever they may be within the Philippines at an acceptable standard of service and at reasonable cost" (DOTC Circular No. 90-248). Undoubtedly, the encompassing objective is the common good. The NTC, as the regulatory agency of the State, merely exercised its delegated authority to regulate the use of telecommunications networks when it decreed interconnection.The same reasoning obtains here. Access charges directly affect the State's goal of making basic telecommunications services accessible to everyone at affordable rates. If the access charges are too high, the cost to end-users may well be prohibitive. Smart cannot simply invoke the freedom of contract to shield it from the intervention of the NTC, especially when the law itself sanctions the agency's intervention. As correctly pointed out by PT&T, "[b]ecause petitioner and respondent are public utility PTEs subject to regulation by the NTC, their freedom to enter into contracts is not absolute but subject to the police power of the State, especially when it comes to matters affecting public interest and convenience."36x x x
The decisive considerations are public need, public interest, and the common good. x x x Article II, Section 24 of the 1987 Constitution, recognizes the vital role of communication and information in nation building. It is likewise a State policy to provide the environment for the emergence of communications structures suitable to the balanced flow of information into, out of, and across the country (Article XVI, Section 10, x x x). A modem and dependable communications network rendering efficient and reasonably priced services is also indispensable for accelerated economic recovery and development. To these public and national interests, public utility companies must bow and yield.35 (Emphasis omitted.)
The doctrine of primary jurisdiction has been increasingly called into play on matters demanding the special competence of administrative agencies even if such matters are at the same time within the jurisdiction of the courts. A case that requires for its determination the expertise, specialized skills, and knowledge of some administrative board or commission because it involves technical matters or intricate questions of fact, relief must first be obtained in an appropriate administrative proceeding before a remedy will be supplied by the courts although the matter comes within the jurisdiction of the courts. The application of the doctrine does not call for the dismissal of the case in the court but only for its suspension until after the matters within the competence of the administrative body are threshed out and determined.Here, it would be more proper for the RTC to yield its jurisdiction in favor of the NTC since the determination of a central issue, i.e., the matter of access charges, requires the special competence and expertise of the latter. "In this era of clogged court dockets, administrative boards or commissions with special knowledge, experience and capability to promptly hear and determine disputes on technical matters or intricate questions of facts, subject to judicial review in case of grave abuse of discretion, are well-nigh indispensable. Between the power lodged in an administrative body and a court, therefore, the unmistakable trend is to refer it to the former."40
To accord with the doctrine of primary jurisdiction, the courts cannot and will not determine a controversy involving a question within the competence of an administrative tribunal, the controversy having been so placed within the special competence of the administrative tribunal under a regulatory scheme. In that instance, the judicial process is suspended pending referral to the administrative body for its view on the matter in dispute. Consequently, if the courts cannot resolve a question that is within the legal competence of an administrative body prior to the resolution of that question by the latter, especially where the question demands the exercise of sound administrative discretion requiring the special knowledge, experience, and services of the administrative agency to ascertain technical and intricate matters of fact, and a uniformity of ruling is essential to comply with the purposes of the regulatory statute administered, suspension or dismissal of the action is proper.39 (Emphasis supplied; citations omitted.)
The Public Service Law, Act No. 3108, as amended, creates a Public Service Commission which is vested with the powers and duties therein specified. The Public Service Commissioners are given the rank, prerogatives, and privileges of Judges of First Instance. Any order made by the commission may be reviewed on the application of any person or public service affected thereby, by certiorari, in appropriate cases or by petition, to the Supreme Court, and the Supreme Court is given jurisdiction to review any order of the Commission and to modify or set it aside (sec. 35).The above ruling is deemed to have been modified by Batas Pambansa Blg. 129, which granted the Court of Appeals exclusive appellate jurisdiction over "all final judgments, resolutions, orders or awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards or commission" except those falling within the appellate jurisdiction of the Supreme Court in accordance with the Constitution and the Labor Code.57 In this regard, Rule 43 of the Rules of Court provides that an appeal from any award, judgment or resolution of or authorized by a quasi-judicial agency in the exercise of its quasi-judicial functions, including the NTC, shall be through a petition for review with the Court of Appeals.58
x x x In the absence of a specific delegation of jurisdiction to Courts of First Instance to grant injunctive relief against orders of the Public Service Commission, it would appear that no court, other than the Supreme Court, possesses such jurisdiction. To hold otherwise would amount to a presumption of power in favor of one branch of the judiciary, as against another branch of equal rank. If every Court of First Instance had the right to interfere with the Public Service Commission in the due performance of its functions, unutterable confusion would result. The remedy at law is adequate, and consists either in making the proper defense in the criminal action or in the Ice Company following the procedure provided in the Public Service Law. An injunction is not the proper remedy, since other and exclusive remedies are prescribed by law.56 (Emphasis supplied.)
Endnotes:
** Designated as Acting Chairperson per Special Order No. 2395 dated October 19, 2016.
*** Designated as Additional Member in lieu of Hon. Bienvenido L. Reyes per Raffle dated October 22, 2012.
1 Republic Act No. 7925 (1995).
2Rollo, pp. 109-130.
3Id. at 37.
4Id. at 38; 131-132.
5Id. at 38.
6Id. at 81.
7Id. at 80.
8Id. at 82.
9Id. at 313-338.
10Id. at 326.
11Id. at 142-143.
12Id. at 144-162.
13Id. at 203-205.
14Id. at 211-213.
15Id. at 36-46. Eighth Division, penned by Associate Justice Isaias Dicdican, with Associate Justices Bienvenido L. Reyes (now a Member of this Court) and Marlene Gonzales-Sison, concurring.
16Id. at 42-45.
17Id. at 3-35.
18 G.R. No. L-61438, June 24, 1983, 122 SCRA 945.
19Rollo, p. 304.
20Id. at 288-312.
21Globe Telecom, Inc. v. National Telecommunications Commission, G.R. No. 143964, July 26, 2004, 435 SCRA 110, 132.
22 RA 7925, Sec. 4(f).
23 The State shall regulate or prohibit monopolies when the public interest so requires. No combinations in restraint of trade or unfair competition shall be allowed.
24Philippine Long Distance Telephone Company, Inc. v. City of Davao, G.R. No. 143867, March 25, 2003, 399 SCRA 442, 449-450.
25 Webster's Third New International Dictionary of the English Language Unabridged, Merriam-Webster Inc., Springfield, MA, 1993.
26 See Panay Autobus Co. v. Philippine Railway Co., 57 Phil. 872 (1933).
27Philippine Communications Satellite Corporation v. Alcuaz, G.R. No. 84818, December 18, 1989, 180 SCRA 218, 228.
28 RA 7925, Sec. 4(b).
29 RA 7925, Sec. 5(e) & 5(g).
30Bank of Commerce v. Planters Development Bank, G.R. Nos. 154470-71, September 24, 2012, 681 SCRA 521, 566.
31Bank of the Philippine Islands v. Securities and Exchange Commission, G.R. No. 164641, December 20, 2007, 541 SCRA 294, 301.
32 RA 7925, Sec. 5(c).
33 CONSTITUTION, Art. II, Sec. 24.
34 G.R. No. 88404, October 18, 1990, 190 SCRA 717.
35PLDT v. National Telecommunications Commission, supra, at 734-737.
36Rollo, p. 17.
37Supra note 18 at 953.
38 G.R. No. 166836, September 4, 2013, 705 SCRA 38.
39San Miguel Properties, Inc. v. Perez, supra, at 60-61.
40GMA Network, Inc. v. ABS-CBN Broadcasting Corporation, G.R. No. 160703, September 23, 2005, 470 SCRA 727, 737.
41 The following civil actions are considered as incapable of pecuniary estimation:cralawlawlibrary
(1) Actions for specific performance;ChanRoblesVirtualawlibrary
(2) Actions for support which will require the determination of the civil status;ChanRoblesVirtualawlibrary
(3) The right to support of the plaintiff;ChanRoblesVirtualawlibrary
(4) Those for the annulment of decisions of lower courts;ChanRoblesVirtualawlibrary
(5) Those for the rescission or reformation of contracts; and
(6) Interpretation of a contractual stipulation.
Surviving Heirs of Alfredo R. Bautista v. Lindo, G.R. No. 208232, March 10, 2014, 718 SCRA 321, 330.
42 For Metro Manila. Batas Pambansa Blg. 129 (The Judiciary Reorganization Act of 1980), Sec. 19(8), as amended by Republic Act No. 7691.
43 CONSTITUTION, Art. VIII, Sec. 2.
44 LABOR CODE, Art. 266.
45 An Act to Ensure the Expeditious Implementation and Completion of Government Infrastructure Projects by Prohibiting Lower Courts from Issuing Temporary Restraining Orders, Preliminary Injunctions or Preliminary Mandatory Injunctions, Providing Penalties for Violations Thereof, and for Other Purposes (2000).
46 RA 8975, Sec. 3.
47Ching v. Court of Appeals, G.R. No. 118830, February 24, 2003, 398 SCRA 88, 92-93, citing Orais v. Escaño, 14 Phil. 208 (1909); Nuñez v. Low, 19 Phil. 244 (1911); Cabigao and Izquierdo v. Del Rosario and Lim, 44 Phil. 182 (1922); Hubahib v. Insular Drug Co., 64 Phil. 119 (1937); National Power Corp. v. De Veyra, G.R. No. L-15763, December 22, 1961, 3 SCRA 646; Luciano v. Provincial Governor, G.R. No. L-30306, June 20, 1969, 28 SCRA 517; De Leon v. Salvador, G.R. No. L-30871, December 28, 1970, 36 SCRA 567; Cojuangco v. Villegas, G.R. No. 76838, April 17, 1990, 184 SCRA 374; Darwin v. Tokonaga, G.R. No. 54177, May 27, 1991, 197 SCRA 442.
48Municipality of Malolos v. Libangang Malolos, Inc., G.R. No. L-78592, August 11, 1988, 164 SCRA 290, 296.
49 Creating A Ministry of Public Works and Ministry of Transportation and Communications.
50 Created by Commonwealth Act No. 146 (CA 146), as amended, otherwise known as the Public Service Act. The Public Service Commission was abolished by Presidential Decree No. 1 dated September 24, 1972 as part of an integrated reorganization plan of the executive department.
51 Reorganizing the Ministry of Transportation and Communications, Defining Its Powers and Functions, and for Other Purposes, as amended by Executive Order No. 125-A (April 13, 1987).
52 Integrated Reorganization Plan (1972), Part X, Chapter I, Art. III, Sec. 7.
53 CA 146, as amended, Sec. 35. The Supreme Court is hereby given jurisdiction to review any order, ruling, or decision of the Commission and to modify or set aside such order, ruling, or decision when it clearly appears that there was no evidence before the Commission to support reasonably such order, ruling, or decision, or that the same is contrary to law, or that it was without the jurisdiction of the Commission. The evidence presented to the Commission, together with the record of the proceedings before the Commission, shall be certified by the secretary of the Commission to the Supreme Court. Any order, ruling, or decision of the Commission may likewise be reviewed by the Supreme Court upon a writ of certiorari in proper cases. The procedure for review, except as herein provided, shall be prescribed by rules of the Supreme Court.
54 56 Phil. 28 (1931).
55Id. at 30-31. Also cited in Regalado v. Provincial Commander of Negros Occidental, G.R. No. L-15674, November 29, 1961 SCRA 503, 504.
56Supra note 54 at 30-31.
57 Batas Pambansa Blg. 129, Sec. 9(3).
58 RULES OF COURT, Rule 43, Secs. 1 & 5.