Manila Electric Company v.

Public Service Commission

Facts: Petitioner, the Manila Electric Company (MERALCO) filed with the Public Service two (2)
applications, namely, one for the reduction of rates for non-residential customers and
commercial customers and another for the reduction of rates for residential customers.
Subsequently, MERALCO filed a third application, this time for the reduction of general power
rates. The last application was provisionally approved, whereas the first two (2) were granted.
Respondent Public Service Commissioner (PSC) rendered a decision setting the rates
MERALCO was authorized to charge its customers. The decision was based on the report of
the General Auditing Office which had audited and examined the MERALCOs books of account.
The PSC denied MERALCOs request for a hearing and reception of evidence on the rate of
return it was to be allowed on its invested capital. Two (2) of the Commissioners denied the
motion stating, among other things, the desire of the MERALCO to cross-examine witnesses
and present oral testimonies may just lead to more years of protracted and delayed hearings,
which will undoubtedly affect adversely the public interest. Hence, the procedure followed by the
Commission in deciding cases was the usual practice long adopted by the Commission in fixing
rates of electric power plants.
Issue: Whether or not MERALCO was afforded due process of law
Held: No, The procedure followed by the PSC in deciding rate fixing cases for electric power
plants upon the submission of prepared forms issued by the agency or the submission of
pleadings, briefs and memorandum or even by mere inspection, without any hearing, amounts
to a denial of the petitioners day in court. It is the cardinal right of a party in trials and
administrative proceedings to be heard, which includes the right of the party interested or
affected to present his own case and submit evidence in support thereof and to have such
evidence presented considered by the tribunal.