PHILIPPINE AIRLINES INC. VS. CIVIL AERONAUTICS BOARD (G.R. NO.

119528)
MARCH 26, 1997
TORRES, JR., J.

Facts:
Grand Air applied for a Certificate of Public Convenience and Necessity with the Civil
Aeronautics Board (CAB). The Chief Hearing Officer issued a notice of hearing directing
Grand Air to serve a copy of the application and notice to all scheduled Philippine
Domestic operators. Grand Air filed its compliance and requested for a Temporary
Operating Permit (TOP). PAL filed an opposition to the application on the ground that
the CAB had no jurisdiction to hear the application until Grand Air first obtains a
franchise to operate from Congress. The Chief Hearing Officer denied the opposition and
the CAB approved the issuance of the TOP for a period of 3 months. The opposition for
the TOP was likewise denied. The CAB justified its assumption of jurisdiction over Grand
Air’s application on the basis of Republic Act 776 which gives it the specific power to
issue any TOP or Certificate of Public Convenience and Necessity.

Issue:
Whether or not the CAB can issue a Certificate of Public Convenience and Necessity or
TOP even though the prospective operator does not have a legislative franchise?

Held: Yes.

As mentioned by the CAB, it is duly authorized to do so under Republic Act 776 and a
legislative franchise is not necessary before it may do so, since Congress has delegated
the authority to authorize the operation of domestic air transport services to the CAB,
an administrative agency. The delegation of such authority is not without limits since
Congress had set specific standard and limitations on how such authority should be
exercised.

Public convenience and necessity exists when the proposed facility will meet a
reasonable want of the public and supply a need which the existing facilities do not
adequately afford.

Thus, the Board should be allowed to continue hearing the application, since it has
jurisdiction over it provided that the applicant meets all the requirements of the law.