The supreme court (sc) en banc has denied the motion for reconsideration filed by northern davao electric cooperative inc. (nordeco) to challenge the expansion of davao light and power co. inc.'s franchise under republic act no. 12144 and its implementation in areas previously serviced by nordeco. the supreme court:he Supreme Court (SC) en banc has denied the motion for reconsideration filed by Northern Davao Electric Cooperative Inc. (Nordeco) to challenge the expansion of Davao Light and Power Co. Inc.'s franchise under Republic Act No. 12144 and its implementation in areas previously serviced by Nordeco. The Supreme Court, in a resolution dated April 29 and released to the public over the weekend, likewise denied and dismissed petitions filed by Nordeco in relation to the expropriation of its assets in the Island Garden City of Samal, Tagum City, and several municipalities of Davao del Norte.
According to Philippines News Agency, Davao Light president and chief operating officer Enriczar Tia welcomed the decision, saying the resolution provides further clarity on the legal challenges to Republic Act No. 12144 as Davao Light continues to carry out its responsibilities within its expanded franchise area. "The Supreme Court's resolution provides further clarity on the legal challenges to Republic Act No. 12144. As we move forward, our priority remains the same -- to provide safe, reliable and dependable electric service to the communities we serve," he added.
The resolution reaffirms the Court's earlier ruling that Congress may expand Davao Light's franchise to areas covered by another public utility's franchise. The Court also reiterated that a public utility franchise is a privilege granted by the State and does not give a utility an exclusive right to serve an area. "We will continue to perform our responsibilities in accordance with the law while working closely with government agencies, local government units, and other stakeholders to ensure that the transition is carried out in an orderly and responsible manner," Tia said.
Congress may also change, amend, or revoke a franchise when the common good requires it. The Court found no violation of Nordeco's right to due process, noting that Congress extensively deliberated on the franchise expansion and that it was provided opportunities to participate in the legislative process. The Court also ruled that the expansion of Davao Light's franchise did not violate Nordeco's existing contracts with its power suppliers.
The decision further affirmed that Davao Light may acquire, through expropriation, distribution assets that are reasonably necessary for the efficient maintenance and operation of electric service within its franchise area, subject to proper expropriation proceedings and the payment of just compensation as required by law.
