Power distributor Meralco has lost a decades-old legal battle against a small factory owner in Valenzuela, which reached all the way to the Supreme Court (SC).
The tribunal’s Second Division recently affirmed a lower court’s ruling that Meralco illegally disconnected the power supply to a spare parts factory and residence of businesswoman Lucy Yu based in Valenzuela City in 1999.
In its June 2023 ruling, the SC affirmed the decision of the Valenzuela City Regional Trial Court Branch 172 favoring Yu’s New Supersonic Industrial Corporation. Yu claimed that Meralco representatives forcibly entered her factory on December 9, 1999 to inspect her electric meter, issued her a notice of disconnection, and completely cut off the facility’s power supply on same day, claiming that the factory had been using a reversing current transformer with removable tapping wire which was unsafe and unfair to the private firm.
Meralco restored services in 2008, or nine years after the incident. Yu claimed it cost her P23.5 million in production losses.
In turn, Meralco filed a P33.94-million counterclaim, representing supposed losses from Yu’s use of the reversing transformer.
The high court found that Meralco did not give due process to Yu when it cut off power in one day.
“Electricity is a basic necessity that is imbued with public interest. Its provider is considered as a public utility subject to the strict regulation by the State in the exercise of its police power. Failure to comply with the regulations laid down by the State gives rise to the presumption of bad faith or abuse of right,” read the decision penned by Associate Justice Antonio Kho Jr.
“The disconnection notice was issued by Chan on the very same day that the electricity supply at Yu’s residence and NSIC’s place of business was cut off,” he added. “Clearly, this could not have afforded Yu with enough time to respond to the situation or allegations interposed by MERALCO. Thus, it does not fall within the definition of “due notice.”
“Considering there is no evidence of tampering and Yu had religiously paid her electricity bills before her electric supply was disconnected, MERALCO’s counterclaim has no factual basis.”