DEGREES OF DILIGENCE — PUBLIC UTILITY COMPANES
G.R. No. 126074 February 24, 1998
RIDJO TAPE & CHEMICAL CORP. and RIDJO PAPER CORPORATION, petitioners,
vs.
HON. COURT OF APPEALS, MANILA ELECTRIC CO., HON. PRESIDING JUDGE,
Branch 104-REGIONAL TRIAL COURT OF QUEZON CITY, respondents.
Facts:
On September 4, 1991, petitioners Ridjo Tape & Ridjo Paper (Ridjo Corp.) received a
letter from Meralco demanding payment of PHP 415,317.66 which allegedly represented
their unregistered electric consumption for the period of November 1990 to February 1991
(4 months).
Meralco justified its demand on the ground that the unregistered electric consumption
was due to the defects of the electric meter located in the premises of Ridjo Corp.
Petitioners refused to pay the amount. Meralco warned them that disconnection will follow
on the event of an overdue account.
Not budging, Ridjo Corp. received another demand letter from Meralco. This time, it
required them to pay another PHP 89,710.58, representing their unregistered electric
consumption for the period of July 1991 to April 1992 (10 months).
This deficiency was again due to the defective meter installed in the Ridjo Corp.
compound. The demand letter was once more issued with a warning of disconnection for
any overdue account.
Determined to not pay any of the amounts demanded by Meralco, Ridjo Corp. filed a case
seeking to enjoin Meralco from disrupting their service.
The case was elevated to the Court of Appeals which decided against Ridjo Corp.,
ordering them to pay Meralco PHP 415,317.66 and PHP 89,710.58 as demanded.
Issue/s:
Whether or not Ridjo Corp. are liable to pay Meralco for the unregistered electrical service
rendered, in the alleged amounts of PHP 415,317.66 and PHP 89,710.58 (total of PHP
505,028.24)
Petitioner’s (Ridjo Corp.) Argument/s:
Ridjo Corp. refused to pay any amount on the basis of the terms and conditions of the
Service Agreement regarding payments, which reads:
“In the event of the stoppage or the failure by any meter to register the full amount of
energy consumed, the Customer shall be billed for such period on an estimated
consumption based upon his use of energy in a similar period of like use.”
According to petitioners, such “stoppage or failure” described therein only contemplates
an event of tampering on the part of the customer, which is absent in this case, and does
not include mechanical failure or defects.
Respondent’s (Meralco) Argument/s:
Petitioners’ interpretation of “stoppage or failure” would constitute an unjust enrichment
in favor of petitioners, and in general, in favor Meralco’s customers, to the prejudice of
Meralco.
Though unregistered by the defective meter, the amounts claimed by Meralco represent
the electric consumption by Ridjo Corp. Thus, benefitting from this consumption,
petitioners are liable to pay the amounts to Meralco.
Held:
No, petitioners are only liable to pay Meralco in the amount of PHP 168,342.75, which
represents only its average electric consumption of 3 months (period affixed by the Court).
This is opposed to Meralco’s claim of PHP 505,028.24 which totals Ridjo Corp.’s
estimated electric consumption for 4 months (Nov 1990 to Feb 1991) and 10 months (July
1991 to April 1992) respectively.
Ratio Decidendi:
Ridjo Corp.’s interpretation of the terms and conditions cannot be upheld.
The proper construction of the phrase “stoppage or failure” considers the fact that Meralco
runs a highly technical business undertaking that employs mechanical devices and
equipment which may experience technical difficulties for whatever reason.
Thus, the provision, forming part of the contract between the parties, enables Meralco to
collect an amount from Ridjo Corp.
However, Meralco is only allowed to collect a lower amount. This is due to Meralco’s
negligence to fulfill its imperative duty to make a reasonable and proper inspection of its
apparatus and equipment to ensure that they do not malfunction.
Meralco has the duty to exercise due diligence to discover and repair defects therein.
If an unusual electric consumption was not reflected in the statements of account of
petitioners, Meralco, considering its technical knowledge and vast experience in providing
electric service, could have easily verified any possible error in the meter reading. In the
absence of such a mistake, the electric meters themselves should be inspected for
possible defects or breakdowns and forthwith repaired and, if necessary, replaced.
Doctrine: If public utilities completely disregard their duty of keeping their electric meters
in serviceable condition, they run the risk of forfeiting, by reason of their negligence,
amounts originally due from their customers. The Court cannot sanction a situation
wherein the defects in the electric meter are allowed to continue indefinitely until suddenly
the public utilities concerned demand payment for the unrecorded electricity utilized
when, in the first place, they should have remedied the situation immediately. Turning a
blind eye on Meralco’s omission may encourage negligence on the part of public utilities,
to the detriment of the consuming public.
