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SENATOR MACEDA v. ERB

FACTS:

The petitioners in this case seek injunctive relief to stop the Energy Regulatory Board (Board) from implementing its Order, dated September 21, 1990, which mandated a provisional increase in the prices of petroleum and petroleum products. On September 10, 1990, Caltex (Philippines) Inc., Pilipinas Shell Petroleum Corporation, and Petron Corporation applied separately to the Board for permission to increase the wholesale posted prices of petroleum products. The Board granted provisional relief on September 21, 1990, authorizing a weighted average provisional increase in the wholesale posted prices of various petroleum products. The petitioners argue that the Board's Order was issued without proper notice and hearing, and in violation of Executive Order No. 172. They also contend that the Board's order created a new source for the Oil Price Stabilization Fund (OPSF) or levied a tax, which is a power vested in the legislature. On the other hand, the intervenor argues against the increase, stating that the oil companies had not yet exhausted their existing oil stock, which had been purchased at old prices. The case was heard on October 25, 1990, and the parties submitted their memorandums. The Court found no merit in the petitions and ordered their consolidation on November 20, 1990. On November 27, 1990, the Court gave due course to both petitions.

ISSUES:

  1. Whether the Energy Regulatory Board (Board) issued its Order mandating a provisional increase in the prices of petroleum products with grave abuse of discretion and without proper notice and hearing.

  2. Whether the Board's Order creating a new source for the Oil Price Stabilization Fund (OPSF) or levying a tax is within its jurisdiction and violates legislative powers.

  3. Whether the petitioners have a valid argument that the oil companies should not be allowed to charge new rates for stock purchased at lower rates.

RULING:

  1. The Court finds no merit in the petitions and upholds the Board's Order. The lack of hearing is justified under Section 8 of Executive Order No. 172, which allows the Board to grant provisional relief without prior hearing, as long as a hearing is scheduled and conducted within thirty days thereafter. The provision for provisional increase falls within this authority. The petitioner's argument regarding a violation of notice and hearing is deemed inaccurate. The Board's action is comparable to a temporary restraining order or a writ of preliminary attachment issued by the courts, which are normally given ex parte and subject to resolution in the main case. There is also no violation of legislative powers as the order does not create a new source for the OPSF or levy a tax; rather, it provides for provisional relief pending further proceedings. The petitioner's contention that the oil companies should not charge new rates for stock purchased at lower rates is not upheld.

PRINCIPLES:

  • The Energy Regulatory Board may issue provisional relief without prior hearing under Section 8 of Executive Order No. 172, as long as a hearing is scheduled and conducted within thirty days thereafter.

  • The lack of hearing in the issuance of provisional relief by the Board does not constitute a violation of due process, as it is akin to temporary restraining orders or writs of preliminary attachment issued by the courts.

  • The Board's action of ordering provisional increase in petroleum product prices is not an exercise of legislative powers, but falls within its jurisdiction as outlined in Section 3, paragraph (e) of Executive Order No. 172.

  • Oil companies may charge new rates for stock purchased at lower rates, as the Board's provisional increase applies to wholesale posted prices of petroleum products.