PHILIPPINE AIRLINES, INC., petitioner, vs.

CIVIL AERONAUTICS BOARD and GRAND INTERNATIONAL

AIRWAYS, INC., respondents.

Nature:
This Special Civil Action for Certiorari and Prohibition under Rule 65 of the Rules of Court seeks to prohibit
respondent Civil Aeronautics Board from exercising jurisdiction over private respondent's Application for the issuance
of a Certificate of Public Convenience and Necessity, and to annul and set aside a temporary operating permit issued
by the Civil Aeronautics Board in favor of Grand International Airways (GrandAir, for brevity) allowing the same to
engage in scheduled domestic air transportation services, particularly the Manila-Cebu, Manila-Davao, and converse
routes.

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.