Case Digest: Hontiveros-Baraquel v. TollRegulatory Board

ISSUE:  Whether the TRB has the power to grant authority to operate a toll facility 

FACTS:  The Toll Regulatory Board (TRB) was created on 31 March 1977 by Presidential Decree No. (P.D.) 1112 in order to supervise and regulate, on behalf of the government, the collection of toll fees and the operation of toll facilities by the private sector. On the same date, P.D. 1113 was issued granting to the Construction and Development Corporation of the Philippines (now Philippine National Construction Corporation or PNCC) the right, privilege, and authority to construct, operate, and maintain toll facilities in the North and South Luzon Toll Expressways for a period of 30 years starting 1 May 1977. TRB and PNCC later entered into a Toll Operation Agreement, which prescribed the operating conditions of the right granted to PNCC under P.D. 1113. On 27 November 1995, the Republic of the Philippines through the TRB as Grantor, CMMTC as Investor, and PNCC as Operator executed a Supplemental Toll Operation Agreement (STOA) covering Stage 1, Phases 1 and 2; and Stage 2, Phase 1 of the South Metro Manila Skyway. Under the STOA, the design and construction of the project roads became the primary and exclusive privilege and responsibility of CMMTC. The operation and maintenance of the project roads became the primary and exclusive privilege and responsibility of the PNCC Skyway Corporation (PSC), a wholly owned subsidiary of PNCC, which undertook and performed the latter's obligations under the STOA. On 18 July 2007, the Republic of the Philippines, through the TRB, CMMTC, and PNCC executed the assailed Amendment to the Supplemental Toll Operation Agreement (ASTOA). Under the ASTOA, Skyway O & M Corporation (SOMCO) replaced PSC in performing the operations and maintenance of Stage 1 of the South Metro Manila Skyway. Petitioners argue that the franchise for toll operations was exclusively vested by P.D. 1113 in PNCC, which exercised the powers under its franchise through PSC in accordance with the STOA. 

DECISION:  Dismissed 

RATIO DECIDENDI:  TRB has the power to grant authority to operate a toll facility. In Francisco v. TRB, the court held: It is abundantly clear that Sections 3 (a) and (e) of P.D. 1112 in relation to Section 4 of P.D. 1894 have invested the TRB with sufficient power to grant a qualified person or entity with authority to construct, maintain, and operate a toll facility and to issue the corresponding toll operating permit or TOC. First, there is nothing in P.D. 1113 or P.D. 1894 that states that the franchise granted to PNCC is to the exclusion of all others. Second, if we were to go by the theory of petitioners, it is only the operation and maintenance of the toll facilities that is vested with PNCC. This interpretation is contrary to the wording of P.D. 1113 and P.D. 1894 granting PNCC the right, privilege and authority to construct, operate and maintain the North Luzon, South Luzon and Metro Manila Expressways and their toll facilities. Third, aside from having been granted the power to grant administrative franchises for toll facility projects, TRB is also empowered to modify, amend, and impose additional conditions on the franchise of PNCC in an appropriate contract, particularly when public interest calls for it.