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l\tpubltt of tbe llbilippine~ DivisiVn Clerk of Court
~upreme QCourt Third Division
THIRD DIVISION
DECISION
JARDELEZA, J.:
On leave.
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.
Republic Act No. 79; 75).
Rollo, pp. I 09-130. ' (
Decision 2 G.R. No. 189026
Id. at 37.
4
Id. at38; 131-132.
Id. at 38.
Id. at 81.
Id. at 80.
Id. at 82.
9
Id. at 313-338.
10
Id. at 326.
,, ld.atl42-143.r
Decision 3 G.R. No. 189026
In its answer to the complaint, 12 PT&T sought for the dismissal of the
civil case on the grounds of lack of jurisdiction, non-observance of the
doctrine of primary jurisdiction, exhaustion of administrative remedies, litis
pendentia and res judicata. It also prayed that the restraining order be
immediately set aside. After several hearings, the RTC issued a writ of
preliminary injunction in favor of Smart. 13 The RTC reasoned that allowing
the NTC to proceed and adjudicate access charges would violate Smart's
contractual rights. The RTC also denied PT&T's motion to dismiss, finding
that the nature of the civil case was incapable of pecuniary estimation which
squarely falls within its jurisdiction. 14 It added that the NTC has no
jurisdiction to adjudicate breaches of contract and award damages.
PT&T elevated the case to the Court of Appeals through a petition for
certiorari. The Court of Appeals held that the RTC did not commit grave
abuse of discretion and, consequently, denied the petition. 15 It found that the
RTC had jurisdiction over the case because it involved an action for specific
performance, i.e., PT&T's compliance with the Agreement, and is therefore
incapable of pecuniary estimation. And insofar as the dispute involved an
alleged breach of contract, there was no need to refer the matter to the NTC
because it had no jurisdiction over breach of contract cases. 16
II
Like the Court of Appeals below, Smart relies on the argument that its
complaint before the RTC is one which is incapable of pecuniary estimation
and, accordingly, falls within the RTC's jurisdiction. Smart's theory is that,
because it is seeking to enforce the Agreement, the action falls within the
12
Id. at 144-162.
13
L.y
Id. at 203-205.
14
Id. at 211-213.
15
Id. at 36-46. Eighth Division, penned by Associate Justice Isaias Dicdican, with Associate Justices
Bienvenido Ryes now a Member of this Court) and Marlene Gonzales-Sison, concurring.
16
Id. at 42-45.
17
Id. at 3-35. .
Decision 4 G.R. No. 189026
ruling of Boiser v. Court of Appeals 18 that the regular courts, not the NTC,
have jurisdiction over cases involving breach of contract and damages.
Invoking the freedom to contract and non-impairment clause, Smart posits
that "[t]he specialized knowledge and expertise of the NTC is not
indispensable or even necessary in this case since x x x [Smart] simply seeks
to enforce and implement the contractual agreement between the parties and
their rights and obligations in relation thereto." 19 Responding to PT&T's
claim that it is seeking the NTC intervention only to resolve the issue on
validity of the rates of charges between the two PTEs, Smart downplays this
by stating that there is no dispute on the applicable rates since these were
20 '
already stated in the Agreement.
18
G.R. No. L-61438, June 24, 1983, 122 SCRA 945.
19
Rollo, p. 304.
20
Id. at 288-312.
21
Globe 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.
Philippine Long Distance Tel~e Company, Inc. v. City of Davao, G.R. No. 143867, March 25,
24
Webster's Third New Inte~~I Dictionary of the English Language Unabridged, Merriam-Webster
25
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.
It is clear that the law did not intend the approval to simply be a
ministerial function. The second paragraph of Section 18 enumerates the
guidelines to be considered by the NTC before it approves the access
charges. Thus, the NTC must be satisfied that the access charge formula is
fair and reasonable based on factors such as cost, public necessity and
industry returns; otherwise, it has the discretion to disapprove the rates in the
event that it finds that they fall short of the statutory standards. 26 Evidently,
the proceeding under Section 18 is quasi-judicial in nature. Any action by
the NTC would particularly and immediately affect the rights of the
interconnecting PTEs-in this case, Smart and PT&T-rather than being
applicable to all PTEs throughout the Philippines. 27 The NTC, therefore,
correctly treated the dispute as adversarial and gave both Smart and PT&T
the opportunity to be heard.
The mere fact that Smart and PT&T negotiated and executed a
bilateral interconnection agreement does not take their stipulations on access
charges out of the NTC's regulatory reach. This has to be so in order to
further one of the declared policies of RA 7925 of expanding the
telecommunications network by improving and extending basic services in
unserved and underserved areas at affordable rates. 28 A GOntrary ruling
would severely limit the NTC's ability to discharge its twin mandates of
protecting consumers and promoting consumer welfare, 29 and would go
against the trend towards greater delegation of judicial authority to
administrative agencies in matters requiring technical knowledge. 30 Smart
cannot rely on the non-impairment clause because it is a limit on the exercise
of legislative power and not of judicial or quasi-judicial power. 31 As
discussed in the preceding paragraph, the approval of the access charge
formula under Section 18 is a quasi-judicial function.
r
28
RA 7925, Sec. 4(b ).
29
RA 7925, Sec. 5(e) & 5(g).
30
Bank of Commerce v. Planters Development Bank, G.R. Nos. 154470-71, September 24, 2012, 681
31 SCRA 52 I, 566.
Bank of the Philippine Islands v. Securities and Exchange Commission, G.R. No. 164641, December
20, 2007, 541 SCRA 294, 301
Decision 7 G.R. No. 189026
xxx
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
32
RA 7925, Sec. 5(c).
33
CONSTITUTION, Art. II, Sec. 24.
34
G.R. No. 88404, October 18, 1990, 190 SCRA 717. /
35
PLDTv. National Telecommunications Commission, supra, at 734-737;
1
Decision 8 G.R. No. 189026
The case relied upon by Smart, Boiser, finds no application here for
the simple reason that the dispute in that case did not involve access charges.
Boiser arose from PLDT's alleged failure to observe the 30-day pre-
disconnection notice requirement stated in the parties' Interconnecting
Agreement. In holding that regular courts had jurisdiction, we said that
"[t]here is nothing in the Commission's powers which authorizes it to
adjudicate breach of contract cases, much less to award moral and
exemplary damages." 37 In stark contrast, jurisdiction over negotiated access
charge formulas, such as Smart and PT&T's Agreement, has been allocated
to the NTC by express provision of law.
36
37
38
Rollo, p. 17.
Supra note 18 at 953.
G.R. No. 166836, September 4, 2013, 705 SCRA 38.
I
Decision 9 G.R. No. 189026
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
III
Under Rule 58, Section 2 of the 1997 Rules of Civil Procedure, the
court where the action is pending may grant the provisional remedy of
preliminary injunction. Generally, trial courts have the ancillary jurisdiction
to issue writs of preliminary injunction in cases falling within its
jurisdiction, including civil actions that are incapable of pecuniary
estimation41 and claims for sum of money exceeding P400,000.00, 42 among
others. There are, however, exceptions to this rule, such as when Congress,
39
San Miguel Properties, Inc. v. Perez, supra, at 60-61.
40
GMA 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:
(1) Actions for specific performance;
(2) Actions for support which will require the determination of the civil status;
(3) The right to support of the plaintiff;
(4) Those for the annulment of decisions oflower courts;
(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,
42
330.
For Metro Manila. Batas Pambansa
as amended by Republic Act No. 7691.
N9
I (The Judiciary Reorganization Act of 1980), Sec. 19(8),
Decision 10 G.R. No. 189026
The NTC was created pursuant to Executive Order No. 54649 (EO
546), promulgated on July 23, 1979. It assumed the functions formerly
assigned to the Board of Communications and the Telecommunications
Control Bureau and was placed under the administrative supervision of the
Ministry of Public Works. Meanwhile, the Board of Communications
previously exercised the authority which originally pertained to the Public
Service Commission (PSC). 50 Under Executive Order No. 125, 51 issued in
January 1987, the NTC became an attached agency of the Department of
Transportation and Communications.
at
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. /
" CA 146, ., amended, Soc. 35. The Supceme Court fa hoceby given jw-i,diction to cevicw
Decision 11 G.R. No. 189026
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
56Phil.28(1931).
55
Id at 30-31. Also cited infiegalado v. Provincial Commander of Negros Occidental, G.R. No. L-
15674, November29, 1961,SCRA503, 504.
56
Supra note 54 at 30-3
Decision 12 G.R. No. 189026
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
58
through a petition for review with the Court of Appeals.
SO ORDERED.
FRANCIS H. J
Associate Justice
WE CONCUR:
(On leave)
PRESBITERO J. VELASCO, JR.
Associate Justice
Chairperson
57
Batas Pambansa Big. 129, Sec. 9(3).
58
RULES OF COURT, Rule 43, Secs. I & 5.
Decision 13 G.R. No. 189026
JO
Associa'f Justice
Acting Chairperson
,,g; J.MI
ESTELA MfERLAS-BERNABE
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court's Division.
Associ~teJustice
Acting Chairperson, Third Division
CERTIFICATION
Third Division
DEC 0 1 zat&