THIRD DIVISION
[G.R. No. 139583. May 31, 2000]
CRUSADERS
BROADCASTING SYSTEM, INC., petitioner, vs. NATIONAL TELECOMMUNICATIONS
COMMISSION and COURT OF APPEALS, respondents.
D E C I S I O N
PURISIMA, J.:
At bar is a petition for review under Rule
45 of the Rules of Court seeking to nullify the Decision[1] of the Court of Appeals which affirmed the decision
of the National Telecommunications Commission (NTC, for brevity) denying
petitioner’s request for renewal of its temporary permit to operate DWCD-FM,
and recalling its assigned frequency.
Undisputed are the pertinent facts, to wit:
The petitioner, Crusaders Broadcasting
System, Inc. (Crusaders, for short), was the grantee of Temporary Permit No.
BSD-0459-92 to operate 10-KW DWCD-FM at a frequency of 97.9 Mhz.
On July 12, 1994, Mr. Cesar A. Dumlao,
Chairman of Crusaders, sent to the Commission a letter (Exh. "A")
requesting permission to stop the broadcast of DWCD-FM for around a month
starting July 12, 1994, so as to renovate its 20-year old Broadcast Booth and
the entire facilities of the station.
Subsequently, upon application of Crusaders,
NTC renewed Temporary Permit No. BSD-0814-94, dated December 14, 1994, covering
the period from January 1, 1995 to December 31, 1996. Again, on December 12,
1996, Crusaders applied for another renewal of its Temporary Permit.
Acting on subject application, the NTC
caused the inspection of the radio station of Crusaders and per report of
NTC-National Capital Region, which conducted such ocular inspection on February
21, 1997, the station of Crusaders was inoperative. Acting upon such finding,
the Broadcast Service Division of the NTC recommended the cancellation and
revocation of the permit of Crusaders and the recall of its frequency 97.9 Mhz.
Thus, on April 25, 1997 the Commission wrote
Chairman Cesar A. Dumlao of Crusaders, informing the latter of the denial of
his application for the renewal of Crusaders’ Temporary Permit.
Crusaders presented a motion for
reconsideration, thru its counsel, Atty. Felino Ganal, explaining that
Crusaders was not able to resume its operations because of the institution of
Civil Case No. 64739 before the Regional Trial Court of Pasig, Branch 163, by
Conamor Broadcasting Corporation (Conamor, for brevity), against Crusaders
Broadcasting System, Inc. and of the issuance of an order of injunction by the
said Court enjoining Crusaders from operating its radio station.
On July 14, 1997, the Commission issued a
show-cause Order directing Crusaders to explain: (1) Why its application for
renewal of Temporary Permit for station DWCD-FM should not be denied; (2) Why
its station, DWCD-FM, should not be ordered closed; and (3) Why its station
DWCD-FM assigned frequency should not be recalled.
On August 5, 1997, Atty. Felino Ganal filed
an "Urgent Motion For Extension" for the filing of Crusaders’
answer/explanation. Such motion was followed by a second "Urgent Motion
For Extension", dated August 15, 1997, and a third motion for extension,
dated August 22, 1997.
On August 28, 1997, for failure of Crusaders
to submit a responsive pleading, the Commission issued an order declaring
Crusaders in default, and, thereafter, handed down its decision recalling the
assigned frequency of Crusaders.
The following day, or on February 29, 1997,
to be precise, Atty. Ganal filed an Answer, averring that the show-cause order
was served upon him and not upon his client Crusaders and therefore, it was
only upon the filing of its answer that Crusaders should be deemed to have voluntarily
submitted itself to the jurisdiction of the Commission. It was further alleged
that Crusaders is a grantee of a congressional franchise (RA No. 8091) but it
could not yet resume its operation because its transmitter was taken by Conamor
by virtue of an order of injunction issued by the Regional Trial Court of Pasig
City in Civil Case No. 64739; that it has already applied with Commission for
authority to acquire an additional transmitter; that the said injunction was
already lifted and set aside by the same trial court, in an Order dated August
27, 1997; that it has mobilized its resources towards the operation of its
radio station and that it has, in fact, made a test broadcast.
On September 22, 1997, Crusaders filed an
"urgent Motion for New Trial and/or Reconsideration" praying for the
lifting of the order of default, setting aside of the decision, and for the
reopening of the case.
After hearing, the Commission granted the
motion for new trial and/or reconsideration and declared the case reopened for
reception of evidence by Crusaders in order to afford it ample opportunity to
be heard and to substantiate its defense as regards the show-cause order issued
by the Commission. The initial evidence presented in support of the motion for
new trial and/or reconsideration was later adopted as Crusaders evidence in the
main case.
Then, the Commission came out with its
assailed decision, disposing thus:
"WHEREFORE,
in light of all the foregoing, the Commission believes and so holds that
respondent’s request for renewal of its temporary permit to operate DWCD-FM
should be, as it is, hereby DENIED.
Consequently,
respondent’s assigned frequency, 97.9 Mhz, is hereby withdrawn and recalled,
the same to be assigned without reasonable delay to the best qualified applicant.
SO ORDERED."[2]
Crusaders’ next step was to go to the Court
of Appeals, which dismissed its petition for lack of merit.
Undaunted, Crusaders found its way to this
Court via the present petition for review.
It is petitioner’s submission that the NTC committed
a grave reversible error in considering as untenable the temporary stoppage of
Crusaders’ broadcast. Petitioner insists that were it not for the order of
injunction issued by the Regional Trial Court of Pasig City, which prohibited
it from broadcasting, and caused the seizure of its transmitter, antenna, and
other equipment, its station could have resumed operations.
Petitioner contends further that had the NTC
approved its application, dated December 12, 1995, for the acquisition of a new
transmitter, it could have re-started to operate DWCD-FM despite the Court’s
injunction order. In short, petitioner maintains that its failure to operate is
not unjustified because the stoppage of its broadcasting was not due to its own
fault or negligence.
It is likewise petitioner’s stance that the
Court of Appeals erred:
1......In upholding the finding of NTC that the
"Programming and Marketing Agreement" with Conamor Broadcasting
Corporation "to be one for a joint venture, which is a flagrant violation
of Radio laws in that it would allow a non-franchise grantee to operate a
public utility;"
2......In finding, in general terms, that "the
findings of the respondent NTC are supported by substantial evidence and,
therefore, should be "accorded respect and finality"; and
3......In upholding the NTC decision under the
so-called "doctrine of primary jurisdiction."
Crusaders likewise assigned some substantive
and procedural errors on the part of the NTC but the same were affirmed by the
Court of Appeals.
Petitioner theorizes that the Court of
Appeals gravely erred in affirming the decision of NTC, which denied the
renewal of its temporary permit to operate DWCD-FM and caused the withdrawal of
its assigned frequency.
On the other hand, respondent NTC, through
the Office of Solicitor General (OSG), countered that the NTC was justified in
denying petitioner’s application for renewal of temporary permit and in
recalling its assigned frequency. Anent the issue of the shifting of burden of
proof, it alleges that the show-cause order dated July 14, 1997 was based on
the inspection reports, dated February 21, 1997 and July 11, 1997,
respectively, which indicated that petitioner failed to rehabilitate its
broadcast booth and other facilities. Consequently, the burden of proof shifted
to the petitioner.
Respondent also contends that subject
inspection reports need not be authenticated and identified by competent
witnesses, the same being public documents; citing Section 23, Rule 132 of the
Rules of Court, which provides that "Documents consisting of entries in
public records made in the performance of a duty by a public officer are prima
facie evidence of the facts therein stated."
Indeed, it appears decisively clear that the
assailed NTC decision is anchored on substantial evidence.
The issue at bar may be encapsulated thus:
Whether or not the NTC properly denied the application for renewal of
Crusaders’ temporary permit to operate DWCD-FM, and validly ordered the
withdrawal of the latter’s assigned frequency.
Section 1 of Act No. 3846[3] reads:
Section 1. No
person, firm, company, association or corporation shall construct, install,
establish, or operate a radio transmitting station, or a radio receiving
station used for commercial purposes, or a radio broadcasting station, without
having first obtained a franchise therefore from the Congress of the
Philippines: xxx
While Section 3 of the same Act provides:
Section 3. The
Secretary of Public Works and Communications is hereby empowered, to regulate
the construction or manufacture, possession, control, sale and transfer of
radio transmitters or transceivers (combination transmitter-receiver) and the
establishment, use, the operation of all radio stations and of all form of
radio communications and transmissions within the Philippines. In addition to
the above he shall have the following specific powers and duties:
(1) He may approve
or disapprove any application for renewal of station or operator license:
Provided, however, That no application for renewal shall be disapproved without
giving the licensee a hearing.
xxx.
It should be noted that by virtue of
Executive Order (E.O) No. 546, creating the Ministry of Public Works and
Ministry of Transportation and Communications, the regulation of radio
communications is a function assigned to, and being performed by, the NTC.
Petitioner does not deny and in fact, uses
it as the reason for the stoppage of its broadcast that it was the filing of
the aforementioned civil case against it (petitioner) which grounded DWCD-FM’s
broadcasting. It is not disputed, either, that what prompted Conamor to bring a
complaint against petitioner was the latter’s rescission of a "Programming
and Marketing Agreement", which gave Conamor the following rights and
privileges akin to those of an owner, among others, to wit:
(a).....The sole discretion to determine and implement
whatever programs are deemed suitable to make the station competitive;
(b).....The full discretion to change the station call
letters, name, slogan or tagline and such other services that bear upon the
station’s identity to improve the station’s market position;
(c).....The acquisition, at its expense, of a new
transmitter, studio, broadcast equipment recording booth, including cost of
construction; and
(d).....A share in the net profit at the rate of 65%,
leaving only 35% to respondent, when the new facilities of Conamor became
operational. (Exhibits "E-2" and "E-2-a")
It is uncontested as well, that under the
said Agreement, Conamor was free from any claim arising from employer-employee
relationship.
In order to settle the civil case, Crusaders
and Conamor later entered into a "Compromise Agreement" which
superseded the programming and marketing agreement. The Court approved
compromise containing the following conditions:
"1. Upon
execution hereof, the parties hereby agree to jointly operate DWCD-FM at its
original office and Broadcasting Station at No. 209 Dela Paz Street,
Mandaluyong City, Metro Manila;
2......The parties shall equally share in the expenses
as well as in the profits or losses, as the case may be, while they are jointly
operating the radio station;
3......The plaintiff shall immediately return the
radio station’s official transmitter, antenna system and other available
equipment of DWCD-FM from the Strata 200 Building, Emerald Avenue, Pasig City,
Metro Manila to the above Mandaluyong City office of defendant;
4......The parties further agree that in the event the
subject DWCD-FM would be sold or assigned to a third part, the written consent
of the plaintiff shall be indispensably necessary to give effect and validity
to any such sale, assignment or disposition of the said radio station;
5......In case of sale, assignment or any disposition
of the subject radio station to any third party, 78.94% of the proceeds thereof
shall go to the defendant (3.57% of which shall be paid to Atty. Felino Ganal a
s (sic) his attorney’s fees) while the remaining 21.06% shall belong to the
plaintiff." (Exhibit "J")
The said compromise agreement speaks for
itself. Conamor has been given the right to operate and manage a radio station
despite the clear mandate of the Radio Law that only holders of a legislative
franchise can do so. Even on this ground alone, Crusaders can be prevented by
the NTC from broadcasting. That the said ground was not reflected in the
show-cause order does not mean that the same cannot be raised thereafter by the
NTC, as it has done in the present case, when it gleaned a basis therefor
during the administrative proceedings, from the evidence presented by the
petitioner itself the substance of the agreement between petitioner and
Conamor. The said findings were not rebutted by petitioner which kept on
harping only on the alleged unfairness of NTC in the application of its
procedures as well as on the existence of the said civil case against it and on
the refusal of NTC to approve its application for the acquisition of a new
transmitter.
On the matter of factual findings by the NTC
as to the inoperativeness of subject radio station, the Court agrees with the
Court of Appeals that the said findings are supported by substantial evidence.
Substantial evidence is such relevant evidence which a reasonable mind might
accept as adequate to support a conclusion. As aptly stressed upon and ratiocinated
by the Court of Appeals:
"In the main,
therefore, the findings of the respondent NTC are supported by substantial
evidence. As to whether or not it should have adopted a policy of leniency is a
matter that is addressed solely to its discretion.
As in the case of
other administrative agencies, the technical matters involved are entrusted to
NTC’s expertise. In the matter of issuance of licenses to operate radio
stations, it is in a better position than the courts to determine to whom such
privilege should be granted in order that public interest will be served. As
long as its decisions are supported by substantial evidence, they are entitled
to respect from the courts.
The National
Telecommunications Commission (NTC) numbers among those administrative agencies
discharging specialized functions, in this case, the regulation of the nation’s
airwaves. As in the case of other administrative tribunals, its findings of
fact will be accorded respect, and on occasion, even finality, by reason of
their acquired expertise on specific matters within their particular
jurisdiction. (Bataan Shipyard and Engineering Corporation v. National Labor
Relations Commission, 269 SCRA 199 [1997]; Malonzo v. Commission on
Elections, 269 SCRA 380 [1987] (sic); Naguiat v. National Labor
Relations Commission, 269 SCRA 564 [1997]). The only requirement is that
its decisions must be supported by substantial evidence, which need be neither
overwhelming nor preponderant (Manila Central Line Corporation v. Manila
Central Line Free Workers Union-National Federation of Labor, 290 SCRA 690
[1998])."[4]
Neither can the Court find merit in the
submission by petitioner that the stoppage of its broadcast would not have
happened were it not for the case for injunction filed against it. In the first
place, the said case could not have been instituted had petitioner not entered
into a programming and marketing agreement with Conamor. What is more, it does
not dispute the finding of NTC that it (petitioner) could have resumed
broadcasting had it complied with the Order of RTC-Pasig to observe the formal
requirements for a motion to lift the order of injunction on the basis of a
counterbond. Such a simple step petitioner failed to take, and its failure to
put up a counterbond engendered the stoppage of its operations for three years
and rendered the stoppage of its operation justified.
The Court upholds the primary jurisdiction
exercised by the NTC and quotes with approval the following opinion of the
Court of Appeals, to wit:
"Moreover,
the doctrine of primary jurisdiction prevents this Court from "arrogating
unto itself" the authority to resolve a controversy which falls under the
jurisdiction of a tribunal possessed of a special competence. (Paat v. Court
of Appeals, 266 SCRA 167 [1997]). As held in Villaflor v. Court of
Appeals, 280 SCRA 297 [1997, which reiterates the rulings in Ismael, Jr.
and Co. v. Deputy Executive Secretary, 90 SCRA 673 [1990] and Concerned
Officials of MWSS v. Vasquez, 240 SCRA 502 [1995]:
‘Courts cannot and
will not resolve a controversy involving a question which is within the
jurisdiction of an administrative tribunal, especially where the question
demands the exercise of sound administrative discretion requiring the special
knowledge, experience and services to determine technical and intricate matters
of fact.’"[5]
WHEREFORE, the assailed decision of the
Court of Appeals is AFFIRMED and the petition for review under consideration is
DENIED for lack of merit. No pronouncement as to costs.
SO ORDERED.
Melo, (Chairman), Vitug, and Gonzaga-Reyes,
JJ., concur.
Panganiban, J., on leave.