Political Law, Remedial Law

CREBA v. ERC G.R. No. 174697 July 8, 2010 Rule 65, Legal Standing, Transcendental Issue


Petitioner Chamber of Real Estate and Builders’ Association, Inc. (CREBA) is a non-stock, non-profit corporation, with almost 4,500 members, comprising of developers, brokers, appraisers, contractors, manufacturers, suppliers, engineers, architects, and other persons or entities engaged in the housing and real estate business.

The ERC is a quasi-judicial and quasi-legislative regulatory body, as an administrative agency vested with broad regulatory and monitoring functions over the Philippine electric industry.

ERC promulgated the Magna Carta for Residential Electricity Consumers (Magna Carta), which establishes residential consumers’ rights to have access to electricity and electric service, subject to the requirements set by LGUs and distribution utilities (DUs). 

Article 14 of the Magna Carta pertains to the rights of consumers to avail of extension lines or additional facilities. It also distinguishes between consumers located within 30 meters from existing lines and those who are located beyond 30 meters; the latter have the obligation to advance the costs of the requested lines and facilities.

The ERC modified this provision when it issued the DSOAR. Petitioner CREBA alleged that the entities it represented – applied for electrical power service, and respondent MERALCO, as distributor of electricity, required them to sign pro forma contracts that (1) obligated them to advance the cost of the construction of new lines and other facilities and (2) allowed annual refunds at 25% of the gross distribution revenue derived from the customer’s electric service, until the amount advanced is fully paid, pursuant to Section 2.6 of the DSOAR.

The petitioner seeks to nullify Section 2.6 of the DSOAR, on the following grounds: 

(1) it is unconstitutional since it is oppressive and it violates the due process and equal protection clauses; 

(2) it contravenes the provisions of the EPIRA; and 

(3) it violates the principle of unjust enrichment.

Petitioner, in filing the instant petition for certiorari under Rule 65, claims that Section 2.6 of the DSOAR is unconstitutional as it is oppressive to the affected end-users who must advance the amount for the installation of additional facilities.

Contradicting the petitioner’s arguments, the ERC avers that it issued Section 2.6 of the DSOAR as an exercise of police power directed at promoting the general welfare, and that the equal protection clause is observed. The ERC points out that the DSOAR provisions do not result in unjust enrichment since the DUs do not stand to be materially benefited by the customers’ advances.

Respondent MERALCO reiterated the defenses raised by the ERC.


Whether or not this case is one of transcendental importance which merits the waiver of the procedural rule on legal standing in a petition for certiorari under Rule 65 of the Rules of Court.


We resolve to dismiss the petition for its serious procedural and technical defects.

The Petitioner Has No Legal Standing

Legal standing or locus standi refers to a party’s personal and substantial interest in a case, arising from the direct injury it has sustained or will sustain as a result of the challenged governmental action. Legal standing calls for more than just a generalized grievance. The term “interest” means a material interest, an interest in issue affected by the governmental action, as distinguished from mere interest in the question involved, or a mere incidental interest. Unless a person’s constitutional rights are adversely affected by a statute or governmental action, he has no legal standing to challenge the statute or governmental action.

Petitioner does not question the challenged DSOAR provision as a residential end-user and it cannot because the challenged provision only refers to the rights and obligations of DUs and residential end-users; neither the petitioner nor its members are residential end-users.

No Transcendental Issue Involved

We do not, however, view the present case as one involving a matter of transcendental importance so that a waiver of the locus standi rule should be recognized.

The Court, through retired Associate Justice Florentino P. Feliciano, provided the following instructive guides as determinants in determining whether a matter is of transcendental importance: 

(1) the character of the funds or other assets involved in the case; (2) the presence of a clear case of disregard of a constitutional or statutory prohibition by the public respondent agency or instrumentality of the government; and 

(3) the lack of any other party with a more direct and specific interest in the questions being raised.

In this case, the three determinants are glaringly absent. Public funds are not involved. The allegations of constitutional and statutory violations of the public respondent agency are unsubstantiated by facts and are mere challenges on the wisdom of the rules, and, the residential end-users are not included as parties to the petition.

Thus, we cannot waive the rule on standing where the three determinants were not established.

Finally, in the present case, the petitioner cannot come before this Court using an incorrect remedy and claim that it was oppressed, or that its rights to due process and equal protection have been violated by an administrative issuance that does not even affect its rights and obligations. 

The writ of certiorari is an extraordinary remedy that the Court issues only under closely defined grounds and procedures that litigants and their lawyers must scrupulously observe. They cannot seek refuge under the umbrella of this remedy on the basis of an undemonstrated claim that they raise issues of transcendental importance, while at the same time flouting the basic ground rules for the remedy’s grant.

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