Act No. 3505






Be it enacted by the Senate and House of Representatives of the Philippines in Legislature assembled and by the authority of the same:

SECTION 1.  Subject to the conditions established in this Act and the provisions of Act Numbered Thirty-one hundred and eight and amendments applicable thereto, there is hereby granted to Artemio Lejano and Rafael G. Abiera, for a period of fifty years from the approval of this Act, the right, privilege, and authority to construct, maintain, and operate an electric light, heat, and power system for the purpose of generating and distributing electric light, heat, and power for sale within the limits of the municipality of Calivo, Province of Capiz, Philippine Islands.  The grantees shall further have the right and privilege to install, lay, and maintain on all the streets, public thoroughfares, bridges, and public places within said limits poles, conductors, interrupters, transformers, cables, wires, and other overhead appliances, and all other necessary apparatus and appurtenances for the furnishing and distribution of electric current, and to supply, sell, and furnish such current to any person, corporation, or public or private concern within said limits for provincial, municipal, domestic, or manufacturing uses and for any other use to which electricity may be put, and to charge and collect a schedule of prices and conventional rates for the use of same:  Provided, That the grantees shall not exercise any right or privilege under this franchise nor commence any construction thereunder unless and until they shall have obtained from the Public Service Commission a certificate showing the public necessity and convenience of the exercise of such rights and privileges and such construction, in accordance with Act Numbered Thirty-one hundred and eight, as amended, and shall have filed such certificate with the Secretary of Commerce and Communications upon accepting the terms and conditions of this franchise:  And provided, further, That if the grantees do not file the proper application for said certificate with the Public Service Commission within three months from the date of the approval of this Act, this franchise shall become null and void.


SEC. 2.  The poles erected by the grantees shall be of such a height as to maintain the wires stretched on the same at a distance of at least twenty feet above the level of the ground, and shall be of such appearance as not to disfigure the streets, and shall be placed with due regard for the public safety so as not to be a danger for the same, in accordance with a plan approved by the provincial or municipal authorities concerned, represented by the provincial governor or municipal president, as the case may be, and said grantees shall supply electric power, heat, and light to any applicant for the same, within fifteen days after the date of his application, in the order of the date of his application up to the limit of the capacity of the plant of said grantees to be determined by the electrical engineer of the Public Service Commission on the application of said grantees, and should the demand for electric power, heat, and light at any time increase beyond the capacity of the plant of said grantees to supply the same, the capacity of said plant shall be increased by said grantees to meet such demand, in accordance with the decision of the Public Service Commission or its legal successor:  Provided, however, That in case the point at which the electric light, heat, or power is to be supplied, is more than thirty meters from the lines or wires operated by said grantees the latter shall not be obliged to furnish said service.


SEC. 3.  All apparatus and appurtenances used by the grantees or hereafter by their successors or assigns shall be modern and first class in every respect, and the electric transmission wires shall be insulated and carefully connected and fastened so as not to come in direct contact with any object through which a “ground” could be formed, and shall be stretched so as not to interfere with the free use of said streets and public thoroughfares nor cause any injury to the public, danger of fire, or damage and inconvenience to the owners of property:  Provided, That in the maintenance and operation of their plant and system for the transmission and distribution of electric current, the grantees shall always be subject to such reasonable regulations as the municipal council of Calivo and the provincial board of Capiz may promulgate in the premises, and also to the regulations prescribed by the “National Electrical Code” of America:  Provided, further, That the grantees shall, whenever the Philippine Legislature, upon recommendation of the Public Service Commission or its legal successor, so directs, place said wires in underground pipes or conduits at their own expense, and without any cost and prejudice to the municipality above mentioned.


SEC. 4.  Whenever it shall be necessary in the erection of said poles to take up any portion of the sidewalks or dig up the ground of the sidewalks of the public streets or thoroughfares, then the said grantees shall, after said poles are erected without delay replace said sidewalks in the proper manner or arrange said streets or public thoroughfares, removing from the same all rubbish, dirt, refuse, or other material which may have been placed there, taken up or dug up in the erection of said poles, leaving them in as good condition as they were before the work was done; and whenever it shall become necessary, by reason of the extension of roads determined upon by the provincial board of Capiz, or by reason of the extension of streets or plazas determined upon by the municipal council of the municipality above mentioned, to change the location of said poles, such change shall be made by the grantees, their successors or assigns, at their expense, without delay, and said poles shall be placed where directed by said provincial board or by said municipal council.


SEC. 5.  Whenever any person has obtained permission to use any of the streets or public thoroughfares of the municipality above mentioned for the purpose of removing any building or in the prosecution of any municipal work or for any other just cause whatsoever, making it necessary to raise or remove any of said poles or electric wires which may obstruct the removal of said building or hinder the prosecution of said work, the said grantees upon written notice by the municipal president of said municipality served upon said grantees at least forty-eight hours in advance, shall raise or remove any of said wires which may hinder the prosecution of such work or obstruct the removal of said building so as to allow the free and unobstructed passage of said building and the free and unobstructed prosecution of said work, and the person or entity at whose request the building has been moved or the construction undertaken, shall pay one-half of the actual cost of removing or raising and of replacing the poles, wires and other overhead or underground conductors.  The notice shall be served in the usual form, and in case of the refusal or failure of the grantees to comply with such notice, said municipal president, with the proper approval of the municipal council first had, shall order such poles or wires to be raised or removed at the expense of said grantees, for the purposes aforesaid:  Provided, however, That the grantees may appeal from any such decision to the provincial board of Capiz, whose decision shall be final.


SEC. 6.  The grantees shall be liable to the municipality-above named for any injury arising from any claims caused by accidents to person or property by reason of the construction under this franchise or of any neglect or omission to keep the said poles and wires in a safe condition.


SEC. 7.  Said grantees shall file their written acceptance of this franchise with the Secretary of Commerce and Communications within one hundred and twenty days from the date when they obtained the certificate required by section one of this Act, and shall commence work under the supervision and subject to the approval of the electrical engineer of the Public Service Commission, in accordance with the plan, specifications, and estimates previously approved by the Public Service Commission, within six months’ time from and after the date of filing such acceptance, unless prevented by act of God or force majeure, usurped or military power, martial law, riot, or .civil commotion or other inevitable cause, and shall complete the system and have the same in operation within eighteen months from the date of such acceptance, and shall thereafter maintain a first-class electric light, heat, and power service:  Provided, That in consideration of the franchise hereby granted, the grantees shall pay quarterly into the municipal treasury of the municipality above named, one per centum of the gross earnings of their electrical business during the first thirty years, and two per centum during the remaining twenty years of the life of this franchise.


SEC. 8.  Upon the acceptance of this franchise as provided in section seven, the grantees shall deposit in the Insular Treasury or with any of its agents in the Province of Capiz one thousand pesos, or negotiable bonds of the United States or other securities approved by the Secretary of Commerce and Communications, of the face value of one thousand pesos, as an earnest of good faith and a guaranty that they will begin the electric light, heat, and power business and may be completely provided with the necessary equipment therefor and ready to begin operation in accordance with the terms of this franchise:  Provided, however, That if such deposit is in cash, it may be made in some official depository of the Government in the name of the grantees and subject to the order of the Insular Treasurer, who shall retain the evidence of the deposit so made.  In this case, as well as in the case of the deposit being made in negotiable bonds or other securities, as provided in this section, the interest of the cash deposit or of the bonds or securities deposited, if any, shall belong to the grantees.


In case such grantees shall fail, refuse, or neglect, unless prevented by fortuitous cause or force majeure, the public enemy, usurped or military power, martial law, riot, civil commotion, or other inevitable cause, to commence the work for the electric light, heat, and power service within six months from the date of the acceptance of this franchise, or shall fail to provide the necessary equipment and be ready to operate within eighteen months after the date of such acceptance, in accordance with the terms of this franchise, then the deposit prescribed in this section and in the possession of the Insular Treasurer, whether in cash, bonds, or other securities, shall be forfeited to the provincial government of Capiz, as damages for the breach of the implied contract involved in the acceptance of this franchise.  In case the grantees begin to operate the electric light, heat, and power service, and are ready for operation under this franchise, within the time limits specified, the deposit provided for in this section shall, upon order of the Public Service Commission or its legal successor, be returned by the Insular Treasury to said grantees:  Provided, That the time during which such grantees have been prevented by any of the causes above referred to from carrying out the terms and conditions of this franchise, shall be added to the time granted by this franchise for the fulfillment of its conditions.


SEC. 9.  The municipality above named shall have the privilege, without compensation, of using the poles of the grantees for the purpose of installing, maintaining, and operating a police telephone and fire alarm system; but the wires of such telephone and alarm system shall be placed and stretched in such manner as to cause no interference with or damage to the wires of the electric service of the grantees.


SEC. 10.  This franchise is granted with the understanding and upon the condition that it shall be subject to amendment, alteration, or repeal by the Congress of the United States as provided in section twenty-eight of the Act of Congress approved August twenty-ninth, nineteen hundred and sixteen, entitled “An Act to declare the purpose of the people of the United States as to the future political status of the people of the Philippine Islands, and to provide a more autonomous government for those Islands,” or by the Philippine Legislature, and that it shall be subject, in all respects, to the limitations upon corporations and the granting of franchises contained in said Act of Congress, and that all lands or rights of use or occupation of lands secured by virtue of this franchise shall revert upon its termination to the insular, provincial, or municipal governments which were the owners thereof upon the date on which this franchise was granted, and all property of the grantees used in connection with this franchise shall become the property of the Insular Government.


SEC. 11.  In case the grantees sell, convey, lease, assign or give in usufruct this franchise and all the property and right acquired thereunder to any firm, company, or corporation, the assignee shall be forbidden to issue stock or bonds under this franchise except in exchange for actual cash or for property at a fair valuation equal to the par value of the stock or bonds issued and upon prior authority of the Public Service Commission.  Nor shall said assignee declare any stock or bond dividend.


SEC. 12.  The books and accounts of the grantee shall always be open to the inspection of the provincial treasurer of Capiz or his authorized representative, and it shall be the duty of the grantees to submit to the provincial treasurer quarterly reports in duplicate showing the gross receipts and the net receipts for the quarter past and the general condition of the business, one of which shall be forwarded by the provincial treasurer to the Insular Auditor.


SEC. 13.  The grantees shall pay on their real estate, buildings, plant, machinery, and other personal property the same taxes as are now or may hereafter be acquired by law from other persons.


SEC. 14.  The grantees herein shall not, without the approval of the Philippine Legislature first had, lease, grant, sell, convey or give in usufruct this franchise and the property and rights acquired thereunder to any person, firm, company or corporations:  Provided, That for the purpose of such lease, granting, sale, conveyance, or giving in usufruct, it shall be necessary to file in the office of the Secretary of Commerce and Communications an agreement in writing by which the person, firm, company, or corporation in whose favor such lease, granting, sale, conveyance, or giving in usufruct is made, shall bind himself to comply with all the terms and conditions imposed upon the grantees by this franchise, and to accept the same subject to all existing terms and conditions.


SEC. 15.  The Public Service Commission or its legal successor, after hearing the interested parties, upon notice and order in writing, shall have the power to declare the forfeiture of this franchise and all rights inherent in the same for failure on part of the grantees to comply with any of the terms and conditions thereof, unless such failure shall have been directly and primarily caused by the act of God, the public enemy, or force majeure.  Against such declaration of forfeiture by the Public Service Commission or its legal successor, the grantees may apply for the remedies provided in section thirty-five of Act Numbered Thirty-one hundred and eight, as amended.


SEC. 16.  At any time after twenty years from the date of this Act, the Government of the Philippine Islands or any political subdivision thereof to which the right may be assigned, may purchase, and the grantees shall sell thereto all of their plant, poles, wires, buildings, real estate, and all other property used in the enjoyment of this franchise, at a valuation based in part upon the net earnings of the grantees and the actual value on the books, making the proper deduction for depreciation, in part on the present cost of reproduction of said property less depreciation, and in part on the original cost thereof less depreciation, the valuation to be determined, after hearing evidence, by the Supreme Court of the Islands, sitting as a board of arbitrators, whose decision, by a majority of the members thereof, shall be final.


SEC. 17.  The rates for the light service, flat rate as well as meter rate, fixed by the grantees, shall always be subject to regulation by act of the Philippine Legislature or by the authorities authorized by law, and shall in no case be in excess of forty centavos per kilowatt hour.


SEC. 18.  Wherever in this franchise the term “grantees” is used, it shall be held and understood to mean and represent Artemio Lejano and Rafael G. Abiera, their representatives, successors, or assigns.


SEC. 19.  This Act shall take effect on its approval.


Approved, December 8, 1928

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