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[G.R. No. 101825. April 2, 1996] TIERRA INTERNATIONAL CONSTRUCTION CORPORATION, PERINIJMONENCO, CHERRY LYNN S. RICAFRENTE and KENNETH BUTT, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION, MANUEL S. CRUZ, RAYMUNDO G. NEPA and ROLANDO F. CARINO, respondents. SYLLABUS LABOR LAW AND SOCIAL LEGISLATION; LABOR CODE; RIGHT OF EMPLOYER TO REGULATE ALL ASPECTS OF EMPLOYMENT; SHOULD BE EXERCISED IN KEEPING WITH GOOD FAITH. - The right of an employer to regulate all aspects of employment is recognized. Let there be no doubt about this. This right, aptly called management prerogative, gives employers the freedom to regulate, according to their discretion and best judgment, all aspects of employment including work assignments, working methods, processes to be followed, working regulations, transfer of employees, work supervision, layoff of workers and the discipline, dismissal and recall of work. But the exercise of this right must be in keeping with good faith and not be used as a pretext for defeating the rights of employees under the laws and applicable contracts. APPEARANCES OF COUNSEL Robles, Ricafrente & Aguirre Law Firm for petitioners. Fausto C. Ignacio and Jaime Linsangan for private respondents. DECISION MENDOZA, J.: This is a petition for certiorari to set aside the decision of the National Labor Relations Commission (Second Division) dated February 22, 1991, finding private respondents to have been illegally dismissed, reversing for this purpose the contrary decision of the Labor Arbiter, as well as the resolution of the NLRC denying reconsideration. The facts are as follows: Private respondents Manuel S. Cruz, Raymundo G. Nepa and Rolando F. Cario were recruited by petitioner Tierra International Construction Corporation to work as transit mixer, truck driver, and batch plant operator, respectively, in a construction project at Diego Garcia, British Indian Ocean Territory. The contract of employment was for a period of twelve months at the following rates of salary per month: Name Salary Date Hired Manuel S. Cruz US$375.00 12-01-88 Raymundo G. Nepa US$375.00 11-23-88 Rolando F. Cario US$500.00 11-20-88 Private respondents had barely started work in the foreign assignment when they had a disagreement with the plant supervisor, Engineer Terrance Filby. What exactly they had been ordered to do which they refused to execute - whether to dig and excavate canals and to haul bags of cement, cement pipes, heavy plumbing equipments and large electric cables, as they claimed, or only to do household chores consisting of keeping the work place clean, as the company alleges - is the question in this case. The fact is that private respondents refused to work as ordered and for this, they were dismissed on January 28, 1989 and sent back to the Philippines. The company offered to pay the final fees representing their salaries from December 26, 1988 to January 28, 1989, but private respondents demanded as well the payment of their salaries corresponding to the balance of their employment contracts. Private respondents made their formal demand on petitioners on February 27, 1989, claiming that, in violation of their contract of employment, they had been required to perform work not related to the jobs for which they had been hired. As their demand was denied, private respondents filed on March 20, 1989 a complaint for illegal dismissal with the POEA. They sought recovery of unpaid salaries and salaries corresponding to the unexpired portion of their employment contracts. Private respondents alleged that they had been required by the company to dig and excavate canals and to haul bags of cement and cement pipes, heavy plumbing equipment and electric cables which was outside the work

for which they had been recruited and that because they refused to carry out their supervisors order, they were dismissed and immediately sent back to the Philippines. Petitioners denied the allegations of private respondents and claimed that the latters dismissal was for cause. Petitioners claimed that, on January 27, 1989, private respondents were merely requested by the plant supervisor, Terrance Filby, to do housekeeping job since they were idle for the rest of the day. Because private respondents did not do what they had been ordered to do, they were confronted by Filby. This led to an altercation between Filby and private respondents. When brought before the project manager, private respondents allegedly said that they refused to execute Filby s order because it involved doing the menial job of cleaning up the mess. They allegedly said in the vernacular, Nakakahiya naman yatang magpulot kami ng basura.1 According to petitioners, because private respondents were unyielding, they were given three options: (1) apologize to their supervisors; (2) go back to work; or (3) repatriation.2 Private respondents refused to go back to work and instead asked to be repatriated. Accordingly, they were sent home on January 28, 1989. The POEA dismissed private respondents claim that they had been required to do work other than that for which they had been hired. The POEA said no evidence had been presented to support this allegation. But finding that private respondents had not been paid their salaries, it ordered petitioners as follows: WHEREFORE, in view of the foregoing, respondents are hereby ordered, jointly and severally, to pay complainants the following, in Philippine Currency at the prevailing rate of exchange at the time of payment: Manuel S. Cruz - FIVE HUNDRED FIFTY ONE & 34/ 100 (US$551.34) US DOLLARS - representing salaries for the period December 26, 1988 to January 28, 1989; Raymundo G. Nepa - FIVE HUNDRED FIFTY NINE and 46/100 US DOLLARS (US$559.46) - representing salaries for the period December 26, 1988 to January 28, 1989; Rolando F. Cario - SEVEN HUNDRED SIXTY SIX and 48/100 (US$766.48) US DOLLARS - representing salaries for the period December 26, 1988 to January 28, 1989. Private respondents appealed to the NLRC. In its decision rendered on February 22, 1991, the NLRC found private respondents to have been illegally dismissed. Accordingly, it modified the decision of the POEA and ordered petitioners to pay private respondents salaries corresponding to the unexpired portion of their contracts, in addition to the salaries ordered paid to them by the POEA. Petitioners filed a motion for reconsideration but their motion was denied on April 19, 1991 for lack of merit. Hence this petition. Petitioners contend that the NLRC gravely abused its discretion and/or acted in excess of its jurisdiction by (1) deciding the wrong issue of the case; (2) not considering the evidence presented; (3) rendering a decision which is not supported by substantial evidence; and (4) rendering a decision not based on the evidence presented at the hearing or at least contained in the record and disclosed to the parties. The question in this case boils down to whether private respondents were dismissed because they had been required to dig canals and haul construction materials and they refused to do so, or whether they had simply been asked to do housekeeping chores which they refused to do because they thought it was menial work and beneath their dignity to do. Petitioners claim that the NLRC assumed that private respondents had been required to do work other than that for which they were hired, which was contrary to the finding of the POEA that the allegations that they [private respondents] were required, in addition to their regular jobs, to perform work which were not in any way connected with their jobs, was not supported even by a single evidence. Petitioners argue that the decision of the POEA was not based on the provision of employment contract giving the company the power to assign any employee to some other type of work of which he is capable but on two documents submitted, (1) the letter-report of the companys Site Administration Officer and (2) the termination notices given to private respondents which they did not dispute. As the Solicitor General states, the burden of proving that private respondents had been dismissed for cause was on petitioners, as employers. While it is true that in the letter-report dated January 27, 1989 of the Site
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Administration Officer it was stated that private respondents had been merely asked to do some housekeeping around their work area as they will not have something to do for the day, we think the NLRC correctly found that what they had actually been ordered to do was to dig canals and haul construction materials. First, as private respondents stated in their Position Paper: If it were mere HOUSEKEEPING CHORES, they would not have refused specially if they were not then performing their respective jobs. Everybody knows that it is difficult to secure a job in the Philippines for abroad and, if one has a job in the Philippines, one would find difficulty sustaining the needs of the family because the salary is insignificant compared to the high cost of living and prices. That is why the job with the respondents is welcome. Complainant Cruz stands to receive the equivalent of more than P8,000.00 a month, while complainant Cario stands to receive the equivalent of more than P 10,500.00 a month, excluding overtime pay. . . . They would have willingly performed the simple housekeeping chores, even if they know that this is not covered by their employment contracts, merely to keep their jobs. BUT SUCH WAS NOT THE CASE. In addition to their regular jobs, they were required to perform different and completely foreign jobs not called for in their contract of employment. When they refused to do these heavy, grievous and oppressive works, their services were unlawfully terminated. Second, petitioners own counsel, in denying respondents demand for the payment of salaries for the balance of their contracts, invoked paragraphs I (b) and XIII (b)(1) of the contracts which provided: Paragraph 1(b): EMPLOYEE shall be utilized by EMPLOYER to perform work in the classification above at the location of the project. There is no representation nor guarantee that the EMPLOYEE will be employed on any particular work or job, EMPLOYER having the right to assign EMPLOYEE to some other type of work for which he might be capable. Paragraph XIII (b) (1): Termination for cause: (1) Notwithstanding any other terms and conditions of this Agreement, EMPLOYER may, at his sole discretion, terminate EMPLOYEES services for cause at any time. Termination for CAUSE shall include but not limited to the following: Lack of ability of EMPLOYEE to perform in the classification for which hired . . . failure or refusal to work or comply with EMPLOYERs working rules; . The NLRCs mistake was in attributing to the POEA, rather than to petitioners the claim that the dismissal of private respondents was justified on the basis of these provisions of the employment contract. But the mistake may be overlooked because the fact is that the POEA sustained petitioners claim or allegation based on these provisions of the contract. There is therefore basis for the finding of the NLRC that private respondents had been required to dig canals, make excavations, and haul construction materials. It is not disputed that to make them do this would be to require them to do work not connected to their employment as transit mixer, truck driver and batch operator. They were therefore fully justified in refusing to do the assignment. The right of an employer to regulate all aspects of employment is recognized. Let there be no doubt about this. This right, aptly called management prerogative, gives employers the freedom to regulate, according to their discretion and best judgment, all aspects of employment, including work assignments, working methods, processes to be followed, working regulations, transfer of employees, work supervision, lay-off of workers and the discipline, dismissal and recall of work.3 But the exercise of this right must be in keeping with good faith and not be used as a pretext for defeating the rights of employees under the laws and applicable contracts.4 Petitioners assert that private respondents were dismissed because they refused to go back to work and instead opted for repatriation. According to the report of the companys Site Administration Officer, private respondents were given three options: (1) to go back to work; (2) to apologize to their supervisor; and (3) to
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be repatriated. What private respondents were given were not really options. They were given the choice of apologizing for their refusal to work and then resume working as ordered, or else, resign and be sent back home. Under the circumstances they really had no choice but to resign. It was not pride or arrogance which made them refuse to work as ordered, but the assertion of their right not to be made to work Outside of what they had been hired to do. For asserting their right, private respondents should not be punished. We, therefore, hold that private respondents dismissal was illegal and that for this reason they are entitled to be paid their salaries corresponding to the unexpired portion of their employment contract,5 in addition to their unpaid salaries prior to their dismissal, as found by both the POEA and the NLRC. WHEREFORE, this petition is DISMISSED. SO ORDERED.

Ditan v POEA Administrator

JURISDICTION OF NLRC ANDRES E. DITAN, petitioner, vs. PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION ADMINISTRATOR, NATIONAL LABOR RELATIONS COMMISSION, ASIAWORLD
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RECRUITMENT, INC., AND/OR INTRACO SALES CORPORATION, respondents. G.R. No. 79560 December 3, 1990 Facts: Andres E. Ditan was recruited by private respondent Intraco Sales Corporation, through its local agent, Asia World, the other private respondent, to work in Angola as a welding supervisor. The contract was for nine months, at a monthly salary of US$1,100.00 or US$275.00 weekly, and contained the required standard stipulations for the protection of our overseas workers. Arriving on November 30, 1984, in Luanda, capital of Angola, the petitioner was assigned as an ordinary welder in the INTRACO central maintenance shop from December 2 to 25, 1984. On December 26, 1984, he was informed, to his distress that would be transferred to Kafunfo, some 350 kilometers east of Luanda. This was the place where, earlier that year, the rebels had attacked and kidnapped expatriate workers, killing two Filipinos in the raid. Naturally, Ditan was reluctant to go. However, he was assured by the INTRACO manager that Kafunfo was safe and adequately protected by government troops; moreover and this was more persuasive he was told he would be sent home if he refused the new assignment. In the end, with much misgiving, he relented and agreed. On December 29, 1984, his fears were confirmed. The Unita rebels attacked the diamond mining site where Ditan was working and took him and sixteen other Filipino hostages, along with other foreign workers. The rebels and their captives walked through jungle terrain for 31 days to the Unita stronghold near the Namibian border. They trekked for almost a thousand kilometers. They subsisted on meager fare. Some of them had diarrhea. Their feet were blistered. It was only on March 16, 1985, that the hostages were finally released after the intercession of their governments and the International Red Cross. Six days later, Ditan and the other Filipino hostages were back in the Philippines. The repatriated workers had been assured by INTRACO that they would be given priority in re-employment abroad, and eventually eleven of them were taken back. Ditan having been excluded, he filed in June 1985 a complaint against the private respondents for breach of contract and various other claims. Specifically, he sought the amount of US$4,675.00, representing his salaries for the unexpired 17 weeks of his contract; US$25,000.00 as war risk bonus; US$2,196.50 as the value of his lost belongings; US$1,100 for unpaid vacation leave; and moral and exemplary damages in the sum of US$50,000.00, plus attorney's fees. All these claims were dismissed by POEA Administrator Tomas D. Achacoso in a decision dated January 27, 1987. 2 This was affirmed in toto by respondent NLRC in a resolution dated July 14, 1987, 3 which is now being challenged in this petition. Issue: Whether or not Ditan is entitled to any relief and his case is under the jurisdiction of NLRC? Held: Yes. The fact that stands out most prominently in the record is the risk to which the petitioner was subjected when he was assigned, after his reluctant consent, to the rebel-infested region of Kafunfo. This was a dangerous area.

The petitioner had gone to that foreign land in search of a better life that he could share with his loved ones after his stint abroad. That choice would have required him to come home empty-handed to the disappointment of an expectant family. It is not explained why the petitioner was not paid for the unexpired portion of his contract which had 17 more weeks to go. The hostages were immediately repatriated after their release, presumably so they could recover from their ordeal. The promise of INTRACO was that they would be given priority in re-employment should their services be needed. In the particular case of the petitioner, the promise was not fulfilled. It would seem that his work was terminated, and not again required, because it was really intended all along to assign him only to Kafunfo. The private respondents stress that the contract Ditan entered into called for his employment in Angola, without indication of any particular place of assignment in the country. This meant he agreed to be assigned to work anywhere in that country, including Kafunfo. When INTRACO assigned Ditan to that place in the regular course of its business, it was merely exercising its rights under the employment contract that Ditan had freely entered into. Hence, it is argued, he cannot now complain that there was a breach of that contract for which he is entitled to monetary redress.
The private respondents also reject the claim for war risk bonus and point out that POEA Memorandum Circular No. 4, issued pursuant to the mandatory war risk coverage provision in Section 2, Rule VI, of the POEA Rules and Regulations on Overseas Employment, categorizing Angola as a war risk took effect only on February 6, 1985"after the petitioner's deployment to Angola on November 27, 1984." Consequently, the stipulation could not be applied to the petitioner as it was not supposed to have a retroactive effect. The paramount duty of this Court is to render justice through law. The law in this case allows two opposite interpretations, one strictly in favor of the employers and the other liberally in favor of the worker. The choice is obvious. We find, considering the totality of the circumstances attending this case, that the petitioner is entitled to relief. The petitioner went to Angola prepared to work as he had promised in accordance with the employment contract he had entered into in good faith with the private respondents. Over his objection, he was sent to a dangerous assignment and as he feared was taken hostage in a rebel attack that prevented him from fulfilling his contract while in captivity. Upon his release, he was immediately sent home and was not paid the salary corresponding to the unexpired portion of his contract. He was immediately repatriated with the promise that he would be given priority in re-employment, which never came. To rub salt on the wound, many of his co-hostages were re-employed as promised. The petitioner was left only with a bleak experience and nothing to show for it except dashed hopes and a sense of rejection. Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on the humane justification that those with less privileges in life should have more privileges in law. WHEREFORE, the challenged resolution of the NLRC is hereby MODIFIED. The private respondents are hereby DIRECTED jointly and severally to pay the petitioner: a) the current equivalent in Philippine pesos of US$4,675.00, representing his unpaid salaries for the balance of the contract term; b) nominal damages in the amount of P20,000.00;

and c) 10% attorney's fees. No costs. SO ORDERED.

Tierra International Corporation v NLRC

Chester Cabalza recommends his visitors to please read the original & full text of the case cited. Xie xie! TIERRA INTERNATIONAL CONSTRUCTION CORPORATION, PERINI/MONENCO, CHERRY LYNN S. RICAFRENTE and KENNETH BUTT, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION, MANUEL S. CRUZ, RAYMUNDO G. NEPA and ROLANDO F. CARIO, respondents. G.R. No. 101825 April 2, 1996 Facts: Private respondents Manuel S. Cruz, Raymundo C. Nepa and Rolando F. Cario were recruited by petitioner Tierra International Construction Corporation to work as transit mixer, truck driver, and batch plant operator, respectively, in a construction project at Diego Garcia, British Indian Ocean Territory. Private respondents had barely started work in the foreign assignment when they had a disagreement with the plant supervisor, Engineer Terrance Filby. What exactly they had been ordered to do which they refused to execute whether to dig and excavate canals and to haul bags of cement, cement pipes, heavy plumbing equipments and large electric cables, as they claimed, or only to do household chores consisting of keeping the work place clean, as the company alleges is the question in this case. The fact is that private respondents refused to work as ordered and for this, they were dismissed on January 28, 1989 and sent back to the Philippines. Petitioners denied the allegations of private respondents and claimed that the latter's dismissal was for cause. Petitioners claimed that, on January 27, 1989, private respondents were merely requested by the plant supervisor, Terrance Filby, to do housekeeping job since they were idle for the rest of the day. Because private respondents did not do what they had been ordered to do, they were confronted by Filby. This led to an altercation between Filby and private respondents. When brought before the project manager, private respondents allegedly said that they refused to execute Filby's order because it involved doing the menial job of cleaning up the mess. They allegedly said in the vernacular, "Nakakahiya naman yatang magpulot kami ng basura." According to petitioners, because private respondents were unyielding, they were given three options: apologize to their supervisors; (2) go back to work; or (3) repatriation. Private respondents refused to go back to work and instead asked to be repatriated. Accordingly, they were sent home on January 28, 1989. Issue: Whether or not the respondents were illegally dismissed? Held: The right of an employer to regulate all aspects of employment is recognized. Let there be no doubt about this. This right, aptly called management prerogative, gives employers the freedom to regulate, according to their discretion and best judgment, all aspects of employment, including work assignments, working methods, processes to be followed, working regulations, transfer of employees, work supervision, lay-off of workers and the discipline, dismissal and recall of work. But the exercise of this right must be in keeping with good faith and not be used as a pretext for defeating the rights of employees under the laws and applicable contracts.

Petitioners assert that private respondents were dismissed because they refused to go back to work and instead opted for repatriation. According to the report of the company's Site Administration Officer, private respondents were given three "options:" (1) to go back to work; (2) to apologize to their supervisor; and (3) to be repatriated. What private respondents were given were not really "options." They were given the choice of apologizing for their refusal to work and then resume working as ordered, or, else, resign and be sent back home. Under the circumstances they really had no choice but to resign. It was not pride or arrogance which made them refuse to work as ordered, but the assertion of their right not to be made to work outside of what they had been hired to do. For asserting their right, private respondents should not be punished. We, therefore, hold that private respondents' dismissal was illegal and that for this reason they are entitled to be paid their salaries corresponding to the unexpired portion of their employment contract, in addition to their unpaid salaries prior to their dismissal, as found by both the POEA and the NLRC.

People v Goce

Chester Cabalza recommends his visitors to please read the original & full text of the case cited. Xie xie! RECRUITMENT AND PLACEMENT PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. LOMA GOCE y OLALIA, DAN GOCE and NELLY D. AGUSTIN, accused, NELLY D. AGUSTIN, accused-appellant. G.R. No. 113161 August 29, 1995 Facts: On January 12, 1988, an information for illegal recruitment committed by a syndicate and in large scale, punishable under Articles 38 and 39 of the Labor Code (Presidential Decree No. 442) as amended by Section 1(b) of Presidential Decree No. 2018, was filed against spouses Dan and Loma Goce and herein accusedappellant Nelly Agustin in the Regional Trial Court of Manila, Branch 5, alleging That in or about and during the period comprised between May 1986 and June 25, 1987, both dates inclusive, in the City of Manila, Philippines, the said accused, conspiring and confederating together and helping one another, representing themselves to have the capacity to contract, enlist and transport Filipino workers for employment abroad, did then and there willfully and unlawfully, for a fee, recruit and promise employment/job placement abroad, to (1) Rolando Dalida y Piernas, (2) Ernesto Alvarez y Lubangco, (3) Rogelio Salado y Savillo, (4) Ramona Salado y Alvarez, (5) Dionisio Masaya y de Guzman, (6) Dave Rivera y de Leon, (7) Lorenzo Alvarez y Velayo, and (8) Nelson Trinidad y Santos, without first having secured the required license or authority from the Department of Labor. Four of the complainants testified for the prosecution. Rogelio Salado was the first to take the witness stand and he declared that sometime in March or April, 1987 he was introduced by Lorenzo Alvarez, his brother-in-law and a co-applicant, to Nelly Agustin in the latter's residence at Factor, Dongalo, Paraaque, Metro Manila. Representing herself as the manager of the Clover Placement Agency, Agustin showed him a job order as proof that he could readily be deployed for overseas employment. Salado learned that he had to pay P5,000.00 as processing fee, which amount he gave sometime in April or May of the same year. He was issued the corresponding receipt. Also in April or May, 1987, Salado, accompanied by five other applicants who were his relatives, went to the office of the placement agency at Nakpil Street, Ermita, Manila where he saw Agustin and met the spouses Dan and Loma Goce, owners of the agency. He submitted his bio-data and learned from Loma Goce that he had to give P12,000.00, instead of the original amount of P5,000.00 for the placement fee. Although surprised at the new and higher sum, they subsequently agreed as long as there was an assurance that they could leave for abroad. Thereafter, a receipt was issued in the name of the Clover Placement Agency showing that Salado and his aforesaid co-applicants each paid P2,000.00, instead of the P5,000.00 which each of them actually paid. Several months passed but Salado failed to leave for the promised overseas employment. Hence, in October, 1987, along with the other recruits, he decided to go to the Philippine Overseas Employment Administration (POEA) to verify the real status of Clover Placement Agency. They discovered that said agency was not duly licensed to recruit job applicants. Later, upon learning that Agustin had been arrested, Salado decided to see her and to demand the return of the money he had paid, but Agustin could only give him P500.00.

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Ramona Salado, the wife of Rogelio Salado, came to know through her brother, Lorenzo Alvarez, about Nelly Agustin. Accompanied by her husband, Rogelio, Ramona went to see Agustin at the latter's residence. Agustin persuaded her to apply as a cutter/sewer in Oman so that she could join her husband. Encouraged by Agustin's promise that she and her husband could live together while working in Oman, she instructed her husband to give Agustin P2,000.00 for each of them as placement fee, or the total sum of P4,000.00. Much later, the Salado couple received a telegram from the placement agency requiring them to report to its office because the "NOC" (visa) had allegedly arrived. Again, around February, or March, 1987, Rogelio gave P2,000.00 as payment for his and his wife's passports. Despite follow-up of their papers twice a week from February to June, 1987, he and his wife failed to leave for abroad. Complainant Dionisio Masaya, accompanied by his brother-in-law, Aquiles Ortega, applied for a job in Oman with the Clover Placement Agency at Paraaque, the agency's former office address. There, Masaya met Nelly Agustin, who introduced herself as the manager of the agency, and the Goce spouses, Dan and Loma, as well as the latter's daughter. He submitted several pertinent documents, such as his bio-data and school credentials. In May, 1986, Masaya gave Dan Goce P1,900.00 as an initial downpayment for the placement fee, and in September of that same year, he gave an additional P10,000.00. He was issued receipts for said amounts and was advised to go to the placement office once in a while to follow up his application, which he faithfully did. Much to his dismay and chagrin, he failed to leave for abroad as promised. Accordingly, he was forced to demand that his money be refunded but Loma Goce could give him back only P4,000.00 in installments. As the prosecution's fourth and last witness, Ernesto Alvarez took the witness stand on June 7, 1993. He testified that in February, 1987, he met appellant Agustin through his cousin, Larry Alvarez, at her residence in Paraaque. She informed him that "madalas siyang nagpapalakad sa Oman" and offered him a job as an ambulance driver at the Royal Hospital in Oman with a monthly salary of about $600.00 to $700.00. On March 10, 1987, Alvarez gave an initial amount of P3,000.00 as processing fee to Agustin at the latter's residence. In the same month, he gave another P3,000.00, this time in the office of the placement agency. Agustin assured him that he could leave for abroad before the end of 1987. He returned several times to the placement agency's office to follow up his application but to no avail. Frustrated, he demanded the return of the money he had paid, but Agustin could only give back P500.00. Thereafter, he looked for Agustin about eight times, but he could no longer find her. Only herein appellant Agustin testified for the defense. She asserted that Dan and Loma Goce were her neighbors at Tambo, Paraaque and that they were licensed recruiters and owners of the Clover Placement Agency. Previously, the Goce couple was able to send her son, Reynaldo Agustin, to Saudi Arabia. Agustin met the aforementioned complainants through Lorenzo Alvarez who requested her to introduce them to the Goce couple, to which request she acceded. Denying any participation in the illegal recruitment and maintaining that the recruitment was perpetrated only by the Goce couple, Agustin denied any knowledge of the receipts presented by the prosecution. She insisted that the complainants included her in the complaint thinking that this would compel her to reveal the whereabouts of the Goce spouses. On November 19, 1993, the trial court rendered judgment finding herein appellant guilty as a principal in the crime of illegal recruitment. Issue:

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Whether or not Agustins act of introducing couple Goce falls within the meaning of illegal recruitment and placement under Art 13(b) in relation to Art 34 of the Labor Code. Held: The testimonial evidence hereon show that she indeed further committed acts constitutive of illegal recruitment. All four prosecution witnesses testified that it was Agustin whom they initially approached regarding their plans of working overseas. It was from her that they learned about the fees they had to pay, as well as the papers that they had to submit. It was after they had talked to her that they met the accused spouses who owned the placement agency. As correctly held by the trial court, being an employee of the Goces, it was therefore logical for appellant to introduce the applicants to said spouses, they being the owners of the agency. As such, appellant was actually making referrals to the agency of which she was a part. She was therefore engaging in recruitment activity. There is illegal recruitment when one gives the impression of having the ability to send a worker abroad. It is undisputed that appellant gave complainants the distinct impression that she had the power or ability to send people abroad for work such that the latter were convinced to give her the money she demanded in order to be so employed. WHEREFORE, the appealed judgment of the court a quo is hereby AFFIRMED in toto, with costs against accused-appellant Nelly D. Agustin. SO ORDERED.

Vinta Maritime Company v NLRC

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Chester Cabalza recommends his visitors to please read the original & full text of the case cited. Xie xie! Vinta Maritime Company v NLRC G.R. No. 113911 January 23, 1998 Facts: Leonides Basconsillo, private respondent, filed a complaint with the Philippine Overseas Employment Administration IPOEA) for illegal dismissal against Vinta Maritime Co. Inc. and Elkano Ship Management, Inc. petitioners alleged that Leonides was dismissed for his gross negligence and incompetent performance as chief engineer of the M/V Boracay. The POEA ruled that private respondent was illegally dismissed. On appeal, the NLRC affirmed the POEA. Likewise, the NLRC denied the motion for reconsideration. Hence, this petition. Issue: Whether or not private respondent is illegally dismissed. Held: The absence of a valid cause for termination in this case is apparent. For an employees dismissal to be valid, (1) the dismissal must be for a valid cause and (2) the employee must be afforded due process. Petitioners allege that private respondent was dismissed because of his incompetence, enumerating incidents in proof thereof. However, this is contradicted by private respondents seamans book which states that his discharge was due to an emergency leave. Moreover, his alleged incompetence is belied by the remarks made by petitioners in the same book that private respondents services were highly recommended and that his conduct and ability were rated very good . Petitioners allegation that such remark and ratings were given to private respondent as an accommodation for future employment fails to persuade. The Court cannot consent to such an accommodation, even if the allegation were true, as it is a blatant misrepresentation. It cannot exculpate petitioners based on such misrepresentation. When petitioners issued the accommodation, they must have known its possible repercussions. Due process, the second element for a valid dismissal, requires notice and hearing. Before the employee can be dismissed under Art. 282, the Code requires the service of a written notice containing a statement of the cause/s of termination and giving said employee ample opportunity to be heard and to defend himself. A notice of termination in writing is further required if the employees dismissal is decided upon. The employer must furnish the worker with two written notices before termination of employment can be legally effected: (1) notice which apprises the employee of the particular acts or omissions for which his dismissal is sought and (2) subsequent notice which informs the employee of the employers decision to dismiss. The twin requirements of notice and hearing constitute the essential elements of due process, and neither of these elements can be eliminated without running afoul of the constitutional guaranty. Illegally dismissed workers are entitled to the payment of their salaries corresponding to the unexpired portion of their employment where the employment is for a definite period. Conformably, the administrator and the NLRC properly awarded private respondent salaries for the period of the effectivity of his contract. WHEREFORE, the petition is hereby dismissed. The challenged decision and resolution are affirmed.

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SERRANO v. GALLANT MARITIME SERVICES INC. & MARLOWE NAVIGATION CO., INC. G.R. No. 167614. March 24, 2009 Facts: Petitioner was hired by Gallant Maritime Services, Inc. and Marlow Navigation Co., Ltd. (respondents) under aPOEAapproved Contract of Employment. On March 19, 1998, the date of his departure, petitioner was constrained toaccept a downgraded employment contract for the position of Second Officer with a monthly salary of US$1,000.00, uponthe assurance and representation of respondents that he would be made Chief Officer by the end of April. However,respondents did not deliver on their promise to make petitioner Chief Officer. Hence, petitioner refused to stay on as SecondOfficer and was repatriated to the Philippines on May. Petitioner's employment contract was for a period of 12 months or from March 19, 1998 up to March 19, 1999, butat the time of his repatriation on May 26, 1998, he had served only two (2) months and seven (7) days of his contract,leaving an unexpired portion of nine (9) months and twenty-three (23) days. Petitioner filed with the Labor Arbiter (LA) a Complaint against respondents for constructive dismissal and for payment of his money claims. LA rendered the dismissal of petitioner illegal and awarding him monetary benefits.Respondents appealed to the NLRC to question the finding of the LA. Likewise, petitioner also appealed to the NLRC onthe sole issue that the LA erred in not applying the ruling of the Court in Triple Integrated Services, Inc. v. National Labor Relations Commission that in case of illegal dismissal, OFWs are entitled to their salaries for the unexpired portion of their contracts. Petitioner also appealed to the NLRC on the sole issue that the LA erred in not applying the ruling of the Courtin Triple Integrated Services, Inc. v. National Labor Relations Commission that in case of illegal dismissal, OFWs areentitled to their salaries for the unexpired portion of their contracts. Petitioner filed a Motion for Partial Reconsideration; hequestioned the constitutionality of the subject clause. Petitioner filed a Petition for Certiorari with the CA, reiterating theconstitutional challenge against the subject clause. CA affirmed the NLRC ruling on the reduction of the applicable salaryrate; however, the CA skirted the constitutional issue raised by petitioner.The last clause in the 5 th paragraph of Section 10, Republic Act (R.A.) No. 8042, to wit: Sec. 10. Money Claims . - x x x In case of termination of overseas employment without just, validor authorized cause as defined by law or contract, the workers shall be entitled to the full reimbursement of his placement fee with interest of twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term,whichever is less. Applying the subject clause, the NLRC and the CA computed the lump-sum salary of petitioner at the monthly rateof US$1,400.00 covering the period of three months out of the unexpired portion of nine months and 23 days of hisemployment contract or a total of US$4,200.00.Impugning the constitutionality of the subject clause, petitioner contends that, in addition to the US$4,200.00awarded by the NLRC and the CA, he is entitled to US$21,182.23 more or a total of US$25,382.23, equivalent to hissalaries for the entire nine months and 23 days left of his employment contract, computed at the monthly rate of US$2,590.00 Issue: 1.) Is petitioner entitled to his monetary claim which is the lump-sum salary for the entire unexpired portion of his12-month employment contract, and not just for a period of three months? 2.) Should petitioners overtime and leave pay form part of the salary basis in the computation of his monetaryaward, because these are fixed benefits that have been stipulated into his contract? Held:1.) Yes.

14

Petitioner is awarded his salaries for the entire unexpired portion of his employment contract consisting of nine months and 23 days computed at the rate of US$1,400.00 per month. The subject clause or for three months for everyyear of the unexpired term, whichever is less in the 5 th paragraph of Section 10 of Republic Act No. 8042 is declaredunconstitutional. In sum, prior to R.A. No. 8042, OFWs and local workers with fixed-term employment who were illegallydischarged were treated alike in terms of the computation of their money claims: they were uniformly entitled to their salaries for the entire unexpired portions of their contracts. But with the enactment of R.A. No. 8042, specifically theadoption of the subject clause, illegally dismissed OFWs with an unexpired portion of one year or more in their employmentcontract have since been differently treated in that their money claims are subject to a 3-month cap, whereas no suchlimitation is imposed on local workers with fixed-term employment. The Court concludes that the subject clause contains a suspect classification in that, in the computation of themonetary benefits of fixed-term employees who are illegally discharged, it imposes a 3-month cap on the claim of OFWswith an unexpired portion of one year or more in their contracts, but none on the claims of other OFWs or local workerswith fixed-term employment. The subject clause singles out one classification of OFWs and burdens it with a peculiar disadvantage. The Court further holds that the subject clause violates petitioner's right to substantive due process, for it depriveshim of property, consisting of monetary benefits, without any existing valid governmental purpose. The subject clause beingunconstitutional, petitioner is entitled to his salaries for the entire unexpired period of nine months and 23 days of hisemployment contract, pursuant to law and jurisprudence prior to the enactment of R.A. No. 8042. 2.) No. The word salaries in Section 10(5) does not include overtime and leave pay. For seafarers like petitioner,DOLE Department Order No. 33, series 1996, provides a Standard Employment Contract of Seafarers, in which salary isunderstood as the basic wage, exclusive of overtime, leave pay and other bonuses; whereas overtime pay is compensation for all work performed in excess of the regular eight hours, and holiday pay is compensation for any work performed ondesignated rest days and holidays. By the foregoing definition alone, there is no basis for the automatic inclusion of overtime and holiday pay inthe computation of petitioner's monetary award; unless there is evidence that he performed work during those periods

ANTONIO M. SERRANO VS. GALLANT MARITIME SERVICES, INC. AND MARLOW NAVIGATION CO., INC.

15

GR No. 167614 March 24, 2009 En banc FACTS: Petitioner Antonio Serrano was hired by respondents Gallant Maritime Services, Inc. and Marlow Navigation Co., Inc., under a POEA-approved contract of employment for 12 months, as Chief Officer, with the basic monthly salary of US$1,400, plus $700/month overtime pay, and 7 days paid vacation leave per month. On March 19, 1998, the date of his departure, Serrano was constrained to accept a downgraded employment contract for the position of Second Officer with a monthly salary of US$1,000 upon the assurance and representation of respondents that he would be Chief Officer by the end of April 1998. Respondents did not deliver on their promise to make Serrano Chief Officer. Hence, Serrano refused to stay on as second Officer and was repatriated to the Philippines on May 26, 1998, serving only two (2) months and seven (7) days of his contract, leaving an unexpired portion of nine (9) months and twenty-three (23) days. Serrano filed with the Labor Arbiter (LA) a Complaint against respondents for constructive dismissal and for payment of his money claims in the total amount of US$26,442.73 (based on the computation of $2590/month from June 1998 to February 199, $413.90 for March 1998, and $1640 for March 1999) as well as moral and exemplary damages. The LA declared the petitioners dismissal illegal and awarded him US$8,770, representing his salaray for three (3) months of the unexpired portion of the aforesaid contract of employment, plus $45 for salary differential and for attorneys fees equivalent to 10% of the total amount; however, no compensation for damages as prayed was awarded. On appeal, the NLRC modified the LA decision and awarded Serrano $4669.50, representing three (3) months salary at $1400/month, plus 445 salary differential and 10% for attorneys fees. This decision was based on the provision of RA 8042, which was made into law on July 15, 1995. Serrano filed a Motion for Partial Reconsideration, but this time he questioned the constitutionality of the last clause in the 5th paragraph of Section 10 of RA 8042, which reads: Sec. 10. Money Claims. x x x In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, the workers shall be entitled to the full reimbursement of his placement fee with interest of twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less. The NLRC denied the Motion; hence, Serrano filed a Petition for Certiorari with the Court of Appeals (CA), reiterating the constitutional challenge against the subject clause. The CA affirmed the NLRC ruling on the reduction of the applicable salary rate, but skirted the constitutional issue raised by herein petitioner Serrano.

ISSUES:

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1. Whether or not the subject clause violates Section 10, Article III of the Constitution on non-impairment of contracts; 2. Whether or not the subject clause violate Section 1, Article III of the Constitution, and Section 18, Article II and Section 3, Article XIII on labor as a protected sector. HELD: On the first issue. The answer is in the negative. Petitioners claim that the subject clause unduly interferes with the stipulations in his contract on the term of his employment and the fixed salary package he will receive is not tenable. Section 10, Article III of the Constitution provides: No law impairing the obligation of contracts shall be passed. The prohibition is aligned with the general principle that laws newly enacted have only a prospective operation, and cannot affect acts or contracts already perfected; however, as to laws already in existence, their provisions are read into contracts and deemed a part thereof. Thus, the non-impairment clause under Section 10, Article II is limited in application to laws about to be enacted that would in any way derogate from existing acts or contracts by enlarging, abridging or in any manner changing the intention of the parties thereto. As aptly observed by the OSG, the enactment of R.A. No. 8042 in 1995 preceded the execution of the employment contract between petitioner and respondents in 1998. Hence, it cannot be argued that R.A. No. 8042, particularly the subject clause, impaired the employment contract of the parties. Rather, when the parties executed their 1998 employment contract, they were deemed to have incorporated into it all the provisions of R.A. No. 8042. But even if the Court were to disregard the timeline, the subject clause may not be declared unconstitutional on the ground that it impinges on the impairment clause, for the law was enacted in the exercise of the police power of the State to regulate a business, profession or calling, particularly the recruitment and deployment of OFWs, with the noble end in view of ensuring respect for the dignity and well-being of OFWs wherever they may be employed. Police power legislations adopted by the State to promote the health, morals, peace, education, good order, safety, and general welfare of the people are generally applicable not only to future contracts but even to those already in existence, for all private contracts must yield to the superior and legitimate measures taken by the State to promote public welfare. On the second issue. The answer is in the affirmative. Section 1, Article III of the Constitution guarantees: No person shall be deprived of life, liberty, or property without due process of law nor shall any person be denied the equal protection of the law. Section 18, Article II and Section 3, Article XIII accord all members of the labor sector, without distinction as to place of deployment, full protection of their rights and welfare. To Filipino workers, the rights guaranteed under the foregoing constitutional provisions translate to economic security and parity: all monetary benefits should be equally enjoyed by workers of similar category, while all

17

monetary obligations should be borne by them in equal degree; none should be denied the protection of the laws which is enjoyed by, or spared the burden imposed on, others in like circumstances. Such rights are not absolute but subject to the inherent power of Congress to incorporate, when it sees fit, a system of classification into its legislation; however, to be valid, the classification must comply with these requirements: 1) it is based on substantial distinctions; 2) it is germane to the purposes of the law; 3) it is not limited to existing conditions only; and 4) it applies equally to all members of the class. There are three levels of scrutiny at which the Court reviews the constitutionality of a classification embodied in a law: a) the deferential or rational basis scrutiny in which the challenged classification needs only be shown to be rationally related to serving a legitimate state interest; b) the middle-tier or intermediate scrutiny in which the government must show that the challenged classification serves an important state interest and that the classification is at least substantially related to serving that interest; and c) strict judicial scrutiny in which a legislative classification which impermissibly interferes with the exercise of a fundamental right or operates to the peculiar disadvantage of a suspect class is presumed unconstitutional, and the burden is upon the government to prove that the classification is necessary to achieve a compelling state interest and that it is the least restrictive means to protect such interest. Upon cursory reading, the subject clause appears facially neutral, for it applies to all OFWs. However, a closer examination reveals that the subject clause has a discriminatory intent against, and an invidious impact on, OFWs at two levels: First, OFWs with employment contracts of less than one year vis--vis OFWs with employment contracts of one year or more; Second, among OFWs with employment contracts of more than one year; and Third, OFWs vis--vis local workers with fixed-period employment; In sum, prior to R.A. No. 8042, OFWs and local workers with fixed-term employment who were illegally discharged were treated alike in terms of the computation of their money claims: they were uniformly entitled to their salaries for the entire unexpired portions of their contracts. But with the enactment of R.A. No. 8042, specifically the adoption of the subject clause, illegally dismissed OFWs with an unexpired portion of one year or more in their employment contract have since been differently treated in that their money claims are subject to a 3-month cap, whereas no such limitation is imposed on local workers with fixed-term employment. The Court concludes that the subject clause contains a suspect classification in that, in the computation of the monetary benefits of fixed-term employees who are illegally discharged, it imposes a 3-month cap on the claim of OFWs with an unexpired portion of one year or more in their contracts, but none on the claims of other OFWs or local workers with fixed-term employment. The subject clause singles out one classification of OFWs and burdens it with a peculiar disadvantage. There being a suspect classification involving a vulnerable sector protected by the Constitution, the Court now subjects the classification to a strict judicial scrutiny, and determines whether it serves a compelling state interest through the least restrictive means. What constitutes compelling state interest is measured by the scale of rights and powers arrayed in the Constitution and calibrated by history. It is akin to the paramount interest of the state for which some individual

18

liberties must give way, such as the public interest in safeguarding health or maintaining medical standards, or in maintaining access to information on matters of public concern. In the present case, the Court dug deep into the records but found no compelling state interest that the subject clause may possibly serve. In fine, the Government has failed to discharge its burden of proving the existence of a compelling state interest that would justify the perpetuation of the discrimination against OFWs under the subject clause. Assuming that, as advanced by the OSG, the purpose of the subject clause is to protect the employment of OFWs by mitigating the solidary liability of placement agencies, such callous and cavalier rationale will have to be rejected. There can never be a justification for any form of government action that alleviates the burden of one sector, but imposes the same burden on another sector, especially when the favored sector is composed of private businesses such as placement agencies, while the disadvantaged sector is composed of OFWs whose protection no less than the Constitution commands. The idea that private business interest can be elevated to the level of a compelling state interest is odious. Moreover, even if the purpose of the subject clause is to lessen the solidary liability of placement agencies visa-vis their foreign principals, there are mechanisms already in place that can be employed to achieve that purpose without infringing on the constitutional rights of OFWs. The POEA Rules and Regulations Governing the Recruitment and Employment of Land-Based Overseas Workers, dated February 4, 2002, imposes administrative disciplinary measures on erring foreign employers who default on their contractual obligations to migrant workers and/or their Philippine agents. These disciplinary measures range from temporary disqualification to preventive suspension. The POEA Rules and Regulations Governing the Recruitment and Employment of Seafarers, dated May 23, 2003, contains similar administrative disciplinary measures against erring foreign employers. Resort to these administrative measures is undoubtedly the less restrictive means of aiding local placement agencies in enforcing the solidary liability of their foreign principals. Thus, the subject clause in the 5th paragraph of Section 10 of R.A. No. 8042 is violative of the right of petitioner and other OFWs to equal protection. The subject clause or for three months for every year of the unexpired term, whichever is less in the 5th paragraph of Section 10 of Republic Act No. 8042 is DECLARED UNCONSTITUTIONAL.

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[G.R. No. 172038, April 14, 2008] DANTE D. DE LA CRUZ, Petitioner, vs. MAERSK FILIPINAS CREWING, INC. and ELITE SHIPPING A.S., Respondents. DECISION CORONA, J.: This petition for review on certiorari[1] seeks to set aside the November 26, 2004 decision[2] and March 9, 2006 resolution[3] of the Court of Appeals (CA) in CA-G.R. SP No. 74097. Respondent Elite Shipping A.S. hired petitioner Dante D. de la Cruz as third engineer for the vessel M/S Arktis Morning through its local agency in the Philippines, co-respondent Maersk Filipinas Crewing Inc. The contract of employment was for a period of nine months, starting April 19, 1999, with a monthly basic salary of US$1,004.00 plus other benefits. Petitioner was deployed to Jebel Ali, United Arab Emirates and boarded M/S Arktis Morning on May 14, 1999. In a logbook entry dated June 18, 1999, chief engineer Normann Per Nielsen expressed his dissatisfaction over petitioner's performance:

20

3rd Eng. Dante D. de la Cruz has[,] since he signed on[,] not been able to live up to the company's SMS job describtion (sic) for 3rd Engineer[.] Today he has been informed that if he do[es] not improve his Job/Working performance within [a] short time he will be signed off according to CBA Article 1 (7). Said Article 1 (7) of the collective bargaining agreement (CBA) between respondent Elite Shipping A.S. and its employees reads: (7) The first sixty (60) days of service is to be considered a probationary period which entitles a shipowner or his representative, i.e.[,] the master of the vessel[,] to terminate the contract by giving fourteen (14) days of written notice. This entry was followed by another one dated June 26, 1999 which was similar in content. On June 27, 1999, petitioner was informed of his discharge through a notice captioned "Notice according to CBA Article 1 (7)," to wit: To: 3rd engineer Dante D. de la Cruz Pls. be informed that you will be discharged according to CBA article 1 (7) in first possible port. Reason for the decision is, as you have been informed by chief engineer Per Nielsen on several occasions, he [does] not find you qualified for the position as 3rd engineer onboard this vessel. The chief engineer has also made 2 entries in the engine logbook, regarding your insufficient job/working, which you are well aware of. Petitioner was then made to disembark at the port of Houston, Texas and was repatriated to Manila on July 17, 1999. Petitioner thereafter filed a complaint for illegal dismissal with claims for the monetary equivalent of the unexpired portion of his contract, damages and attorney's fees in the National Labor Relations Commission (NLRC) on September 21, 1999. The labor arbiter (LA) ruled that petitioner was dismissed without just cause and due process as the logbook entry (which respondents claimed to be the first notice to petitioner) was vague. It failed to expound on or state the details of petitioner's shortcomings or infractions. As such, petitioner was deprived of a real or meaningful opportunity to explain his side. Hence, the LA ruled that petitioner was entitled to a monetary equivalent of salaries for three months, moral and exemplary damages and attorney's fees. On appeal, the NLRC upheld the LA's finding of illegal dismissal but deleted the award of moral and exemplary damages. Respondents moved for reconsideration. It was denied. Thereafter, respondents filed a petition for certiorari (under Rule 65) with the CA. It granted the petition. It held that, although the findings of fact of the LA and NLRC were entitled to great respect, this rule was inapplicable because the NLRC committed grave abuse of discretion in upholding the LA's decision. The findings were not only unsupported by substantial evidence but were also based solely on the ground that the logbook entries were vague and without concrete standards. The CA deemed the logbook entries to be sufficient compliance with the first notice requirement of the law. It was a written appraisal of petitioner's poor job performance coupled with a warning that should he fail to improve his performance, he would be signed off in accordance with the provisions of the CBA. It reasoned that a probationary employee may be dismissed at anytime during the probationary period for failure to live up to the expectations of the employer. Petitioner filed a motion for reconsideration of the CA decision. It was denied. Hence, this petition. The main issue raised before us is whether or not petitioner was illegally dismissed by respondents.

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Before addressing the merits of the controversy, we need to settle two preliminary issues. First, respondents interposed in their comment that the present petition should be dismissed outright as the motion for extension of time to file this petition for review was filed late. In his petition, petitioner indicated that he received a copy of the CA resolution (dated March 9, 2006) denying his motion for reconsideration on March 24, 2006. He, therefore, had until April 8, 2006 to appeal said resolution to this Court or to file a motion for extension of time to file the petition. However, as April 8, 2006 fell on a Saturday, petitioner deemed it sufficient compliance to file his motion for extension on April 10, 2006, in accordance with Section 1, Rule 22 of the Rules of Court: SECTION 1. How to compute time. - xxx If the last day of the period, as thus computed, falls on a Saturday, a Sunday, or a legal holiday in the place where the court sits, the time shall not run until the next working day. Respondents countered that A.M. No. 00-2-14-SC dated February 29, 2000 (Re: Computation of Time When the Last Day Falls on Saturday, Sunday or Legal Holiday and a Motion for Extension on Next Working Day is Granted) clarified that the aforementioned rule is applicable only to the filing of pleadings other than motions for extension of time, such that when a party seeks an extension to file a desired pleading, the provision no longer applies and the motion should be filed on the due date itself, regardless of the fact that it falls on a Saturday, Sunday or legal holiday. Respondents' contention is incorrect. A.M. No. 00-2-14-SC provides: xxx Whereas, the aforecited provision [Section 1, Rule 22 of the Rules of Court] applies in the matter of filing of pleadings in courts when the due date falls on a Saturday, Sunday or legal holiday, in which case, the filing of the said pleading on the next working day is deemed on time; Whereas, the question has been raised if the period is extended ipso jure to the next working day immediately following where the last day of the period is a Saturday, Sunday or legal holiday so that when a motion for extension of time is filed, the period of extension is to be reckoned from the next working day and not from the original expiration of the period. NOW THEREFORE, the Court Resolves, for the guidance of the Bench and the Bar, to declare that Section 1, Rule 22 speaks only of "the last day of the period" so that when a party seeks an extension and the same is granted, the due date ceases to be the last day and hence, the provision no longer applies. Any extension of time to file the required pleading should therefore be counted from the expiration of the period regardless of the fact that said due date is a Saturday, Sunday or legal holiday. (emphasis supplied) Section 1, Rule 22, as clarified by the circular, is clear. Should a party desire to file any pleading, even a motion for extension of time to file a pleading, and the last day falls on a Saturday, Sunday or a legal holiday, he may do so on the next working day. This is what petitioner did in the case at bar. However, according to the same circular, the petition for review on certiorari was indeed filed out of time. The provision states that in case a motion for extension is granted, the due date for the extended period shall be counted from the original due date, not from the next working day on which the motion for extension was filed. In Luz v. National Amnesty Commission,[4] we had occasion to expound on the matter. In that case, we held that the extension granted by the court should be tacked to the original period and commences immediately after the expiration of such period.

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In the case at bar, although petitioner's filing of the motion for extension was within the period provided by law, the filing of the petition itself was not on time. Petitioner was granted an additional period of 30 days within which to file the petition. Reckoned from the original period, he should have filed it on May 8, 2006. Instead, he did so only on May 11, 2006, that is, 3 days late. Nevertheless, we will gloss over this technicality and resolve the case on its merits in the exercise of this Court's equity jurisdiction as we have done in a number of cases.[5] Well settled is the rule that litigations should, as much as possible, be decided on their merits and not on technicalities.[6] In accordance with this legal precept, this Court has ruled that being a few days late in the filing of the petition for review does not automatically warrant the dismissal thereof,[7] specially where strong considerations of substantial justice are manifest in the petition.[8] Such is the case here. The second preliminary issue we need to address is the matter of this Court's jurisdiction in petitions for review on certiorari under Rule 45. It should be noted that our jurisdiction in such cases is limited only to questions of law. It does not extend to questions of fact. This doctrine applies with greater force in labor cases.[9] As such, the findings of fact of the CA are binding and conclusive upon this Court. However, this rule is not absolute but admits of certain exceptions. Factual findings may be reviewed in a case when the findings of fact of the LA and the NLRC are in conflict with those of the CA.[10] In this case, the LA and the NLRC held that respondents did not comply with the notice requirement; the CA found otherwise. Thus, although the instant petition involves a question of fact, that is, whether or not the notice requirement was met, we can still rule on it. Now, the merits of the instant controversy. The CA committed an error in holding that petitioner was not illegally dismissed. The contrary findings and conclusions made by the LA and the NLRC were supported by jurisprudence and the evidence on record. An employer has the burden of proving that an employee's dismissal was for a just cause. Failure to show this necessarily means that the dismissal was unjustified and therefore illegal.[11] Furthermore, not only must the dismissal be for a cause provided by law, it should also comply with the rudimentary requirements of due process, that is, the opportunity to be heard and to defend oneself.[12] These requirements are of equal application to cases of Filipino seamen recruited to work on board foreign vessels. Procedural due process requires that a seaman must be given a written notice of the charges against him and afforded a formal investigation where he can defend himself personally or through a representative before he can be dismissed and disembarked from the vessel.[13] The employer is bound to furnish him two notices: (1) the written charge and (2) the written notice of dismissal (in case that is the penalty imposed).[14] This is in accordance with the POEA Revised Standard Employment Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels (POEA Revised Standard Employment Terms and Conditions). Section 17 of the POEA Revised Standard Employment Terms and Conditions laid down the disciplinary procedures to be taken against erring seafarers: Section 17. DISCIPLINARY PROCEDURES The Master shall comply with the following disciplinary procedures against an erring seafarer: A. The Master shall furnish the seafarer with a written notice containing the following: 1. Grounds for the charges as listed in Section 31 of this Contract.

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2.

Date, time and place for a formal investigation of the charges against the seafarer concerned.

B. The Master or his authorized representative shall conduct the investigation or hearing, giving the seafarer the opportunity to explain or defend himself against the charges. An entry on the investigation shall be entered into the ship's logbook. C. If, after the investigation or hearing, the Master is convinced that imposition of a penalty is justified, the Master shall issue a written notice of penalty and the reasons for it to the seafarer, with copies furnished to the Philippine agent. Furthermore, the notice must state with particularity the acts or omissions for which his dismissal is being sought.[15] Contrary to respondents' claim, the logbook entries did not substantially comply with the first notice, or the written notice of charge(s). It did not state the particular acts or omissions for which petitioner was charged. The statement therein that petitioner had "not been able to live up to the company's SMS job description for 3rd Engineer" and that he had "been informed that if he [does] not improve his job/working performance within [a] short time he will have to be signed off according to CBA Article 1 (7)" was couched in terms too general for legal comfort. The CA held that the logbook entries were sufficient to enable petitioner to explain his side or to contest the negative assessment of his performance and were clearly intended to inform him to improve the same. We cannot fathom how the CA arrived at such a conclusion. The entries did not contain any information at all as to why he was even being warned of discharge in the first place. Even we were left to speculate as to what really transpired, calling for such an extreme course of action from the chief engineer. The entries raised more questions than answers. How exactly was he unable to live up to the company's SMS job description of a third engineer? Respondents should have indicated the grounds for the threatened termination, the specific acts or omissions illustrating the same, along with the date and the approximate time of their occurrence. For how else could petitioner be expected to meet the charges against him if all he was given as reason for his discharge was a vague and general accusation such as that handed down by the chief engineer? Even if the chief engineer verbally informed him of what his specific shortcomings were, as insisted upon by respondents, the POEA Revised Standard Employment Terms and Conditions and jurisprudence require that the charges be put in writing. The same thing may be said of the written notice of dismissal. It sorely lacked the necessary details that should accompany it. Instead of delving into the grounds for petitioner's discharge, it merely echoed the logbook entries by nebulously justifying his dismissal on the ground that the chief engineer "[did] not find [petitioner] qualified for the position as 3rd engineer." Much like the first notice, it barely made mention of the grounds for his discharge. Again, we were left in the dark as to the nature of the acts or omissions relied upon as basis for the termination of petitioner's employment. These ambiguities, attributable solely to respondents, should be resolved against them. Moreover, we observed that the records were devoid of any proof indicating that petitioner was ever given an opportunity to present his side. In their comment, respondents in fact admitted not having conducted any formal investigation: A formal investigation in this case was not necessary because the findings against petitioner were not in the form of infractions that ought to be investigated. The issue against petitioner was the quality of his work as 3rd

24

Engineer. Having been duly notified of his shortcomings, it devolved upon the petitioner to improve the quality of his work in order to pass his probationary period and be a regular employee. But petitioner did not. They also insisted that as petitioner was served notice of his termination, the same constituted sufficient compliance with the requirement of notice and due process as the notice gave him an opportunity to defend himself.[16] Clearly, respondents were unmindful of the requirements explicitly laid down by law and jurisprudence. Anything short of complying with the same amounts to a dismissal. Thus, no amount of justification from respondents can move us now to declare the dismissal as being in accordance with the procedural requirements provided for by law. It cannot be overemphasized that sufficient notice should be given as part of due process because a worker's employment is his property in the constitutional sense.[17] As to the substantive aspect of the requirement, suffice it to say that respondents dismally failed to prove that petitioner's termination from employment was for cause. As the logbook entries were too general and vague, we cannot even reach any conclusion on whether or not respondents had a valid cause to discharge petitioner. Not only was petitioner's dismissal procedurally flawed, it was also without just cause. Lastly, petitioner and respondents were at odds over the former's employment status when he was discharged from the vessel. It was petitioner's position that he was already a regular employee when his services were terminated; respondents, on the other hand, insisted that he was then still on probationary status. This, according to respondents, entitled them to dismiss him in accordance with the provisions of Article 1 (7) of the CBA (which allows the master to terminate the contract of one under probation by merely serving a written notice 14 days prior to the contemplated discharge) and the requirements on the termination of a probationary employee's employment as laid down in Manila Hotel Corporation v. NLRC.[18] It is well to remind both parties that, as early as Brent School, Inc. v. Zamora,[19] we already held that seafarers are not covered by the term regular employment, as defined under Article 280 of the Labor Code. This was reiterated in Coyoca v. National Labor Relations Commission.[20] Instead, they are considered contractual employees whose rights and obligations are governed primarily by the POEA Standard Employment Contract for Filipino Seamen (POEA Standard Employment Contract), the Rules and Regulations Governing Overseas Employment, and, more importantly, by Republic Act No. 8042, otherwise known as The Migrant Workers and Overseas Filipinos Act of 1995.[21] Even the POEA Standard Employment Contract itself mandates that in no case shall a contract of employment concerning seamen exceed 12 months. It is an accepted maritime industry practice that the employment of seafarers is for a fixed period only. The Court acknowledges this to be for the mutual interest of both the seafarer and the employer. Seafarers cannot stay for a long and indefinite period of time at sea as limited access to shore activity during their employment has been shown to adversely affect them. Furthermore, the diversity in nationality, culture and language among the crew necessitates the limitation of the period of employment.[22] While we recognize that petitioner was a registered member of the Associated Marine Officers and Seamen's Union of the Philippines which had a CBA with respondent Elite Shipping A.S. providing for a probationary period of employment, the CBA cannot override the provisions of the POEA Standard Employment Contract. The law is read into, and forms part of, contracts. And provisions in a contract are valid only if they are not contrary to law, morals, good customs, public order or public policy.[23] In Millares v. NLRC,[24] this Court had occasion to rule on the use of the terms "permanent and probationary masters and employees" vis--vis contracts of enlistment of seafarers. In that case, petitioners made much of the fact that they were continually re-hired for 20 years by private respondent Esso International. By such

25

circumstances, they claimed to have acquired regular status with all the rights and benefits appurtenant thereto. The Court quoted with favor the NLRC's explanation that the reference to permanent and probationary masters and employees was a misnomer. It did not change the fact that the contract for employment was for a definite period of time. In using the terms "probationary" and "permanent" vis--vis seafarers, what was really meant was "eligible for re-hire." This is the only logical explanation possible as the parties cannot and should not violate the POEA's directive that a contract of enlistment must not exceed 12 months. WHEREFORE, the petition is hereby GRANTED. The November 26, 2004 decision and March 9, 2006 resolution of the Court of Appeals in CA-G.R. SP No. 74097 are REVERSED and SET ASIDE. The March 22, 2002 resolution of the National Labor Relations Commission in NLRC NCR CA No. 029139-01 is REINSTATED. SO ORDERED.

G.R. No. 162419

July 10, 2007

PAUL V. SANTIAGO, petitioner, vs. CF SHARP CREW MANAGEMENT, INC., respondent. DECISION TINGA, J.: At the heart of this case involving a contract between a seafarer, on one hand, and the manning agent and the foreign principal, on the other, is this erstwhile unsettled legal quandary: whether the seafarer, who was prevented from leaving the port of Manila and refused deployment without valid reason but whose POEAapproved employment contract provides that the employer-employee relationship shall commence only upon the seafarers actual departure from the port in the point of hire, is entitled to relief? This treats of the petition for review filed by Paul V. Santiago (petitioner) assailing the Decision and Resolution of the Court of Appeals dated 16 October 2003 and 19 February 2004, respectively, in CA-G.R. SP No. 68404.1 Petitioner had been working as a seafarer for Smith Bell Management, Inc. (respondent) for about five (5) years.2 On 3 February 1998, petitioner signed a new contract of employment with respondent, with the duration of nine (9) months. He was assured of a monthly salary of US$515.00, overtime pay and other benefits. The following day or on 4 February 1998, the contract was approved by the Philippine Overseas Employment Administration (POEA). Petitioner was to be deployed on board the "MSV Seaspread" which was scheduled to leave the port of Manila for Canada on 13 February 1998. A week before the scheduled date of departure, Capt. Pacifico Fernandez, respondents Vice President, sent a facsimile message to the captain of "MSV Seaspread," which reads:

26

I received a phone call today from the wife of Paul Santiago in Masbate asking me not to send her husband to MSV Seaspread anymore. Other callers who did not reveal their identity gave me some feedbacks that Paul Santiago this time if allowed to depart will jump ship in Canada like his brother Christopher Santiago, O/S who jumped ship from the C.S. Nexus in Kita-kyushu, Japan last December, 1997. We do not want this to happen again and have the vessel penalized like the C.S. Nexus in Japan. Forewarned is forearmed like his brother when his brother when he was applying he behaved like a Saint but in his heart he was a serpent. If you agree with me then we will send his replacement. Kindly advise.3 To this message the captain of "MSV Seaspread" replied: Many thanks for your advice concerning P. Santiago, A/B. Please cancel plans for him to return to Seaspread.4 On 9 February 1998, petitioner was thus told that he would not be leaving for Canada anymore, but he was reassured that he might be considered for deployment at some future date. Petitioner filed a complaint for illegal dismissal, damages, and attorney's fees against respondent and its foreign principal, Cable and Wireless (Marine) Ltd.5 The case was raffled to Labor Arbiter Teresita Castillon-Lora, who ruled that the employment contract remained valid but had not commenced since petitioner was not deployed. According to her, respondent violated the rules and regulations governing overseas employment when it did not deploy petitioner, causing petitioner to suffer actual damages representing lost salary income for nine (9) months and fixed overtime fee, all amounting to US$7, 209.00. The labor arbiter held respondent liable. The dispositive portion of her Decision dated 29 January 1999 reads: WHEREFORE, premises considered, respondent is hereby Ordered to pay complainant actual damages in the amount of US$7,209.00 plus 10% attorney's fees, payable in Philippine peso at the rate of exchange prevailing at the time of payment. All the other claims are hereby DISMISSED for lack of merit. SO ORDERED.6 On appeal by respondent, the National Labor Relations Commission (NLRC) ruled that there is no employeremployee relationship between petitioner and respondent because under the Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean Going Vessels (POEA Standard Contract), the employment contract shall commence upon actual departure of the seafarer from the airport or seaport at the point of hire and with a POEA-approved contract. In the absence of an employer-employee relationship between the parties, the claims for illegal dismissal, actual damages, and attorneys fees should be dismissed.7 On the other hand, the NLRC found respondents decision not to deploy petitioner to be a valid exercise of its management prerogative.8 The NLRC disposed of the appeal in this wise: WHEREFORE, in the light of the foregoing, the assailed Decision dated January 29, 1999 is hereby AFFIRMED in so far as other claims are concerned and with MODIFICATION by VACATING the

27

award of actual damages and attorneys fees as well as excluding Pacifico Fernandez as party respondent. SO ORDERED.9 Petitioner moved for the reconsideration of the NLRCs Decision but his motion was denied for lack of merit.10 He elevated the case to the Court of Appeals through a petition for certiorari. In its Decision11 dated 16 October 2003, the Court of Appeals noted that there is an ambiguity in the NLRCs Decision when it affirmed with modification the labor arbiters Decision, because by the very modification introduced by the Commission (vacating the award of actual damages and attorneys fees), there is nothing more left in the labor arbiters Decision to affirm.12 According to the appellate court, petitioner is not entitled to actual damages because damages are not recoverable by a worker who was not deployed by his agency within the period prescribed in the POEA Rules.13 It agreed with the NLRCs finding that petitioners non-deployment was a valid exercise of respondents management prerogative.14 It added that since petitioner had not departed from the Port of Manila, no employer-employee relationship between the parties arose and any claim for damages against the so-called employer could have no leg to stand on.15 Petitioners subsequent motion for reconsideration was denied on 19 February 2004.16 The present petition is anchored on two grounds, to wit: A. The Honorable Court of Appeals committed a serious error of law when it ignored [S]ection 10 of Republic Act [R.A.] No. 8042 otherwise known as the Migrant Workers Act of 1995 as well as Section 29 of the Standard Terms and Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going Vessels (which is deemed incorporated under the petitioners POEA approved Employment Contract) that the claims or disputes of the Overseas Filipino Worker by virtue of a contract fall within the jurisdiction of the Labor Arbiter of the NLRC. B. The Honorable Court of Appeals committed a serious error when it disregarded the required quantum of proof in labor cases, which is substantial evidence, thus a total departure from established jurisprudence on the matter.17 Petitioner maintains that respondent violated the Migrant Workers Act and the POEA Rules when it failed to deploy him within thirty (30) calendar days without a valid reason. In doing so, it had unilaterally and arbitrarily prevented the consummation of the POEA- approved contract. Since it prevented his deployment without valid basis, said deployment being a condition to the consummation of the POEA contract, the contract is deemed consummated, and therefore he should be awarded actual damages, consisting of the stipulated salary and fixed overtime pay.18 Petitioner adds that since the contract is deemed consummated, he should be considered an employee for all intents and purposes, and thus the labor arbiter and/or the NLRC has jurisdiction to take cognizance of his claims.19 Petitioner additionally claims that he should be considered a regular employee, having worked for five (5) years on board the same vessel owned by the same principal and manned by the same local agent. He argues that respondents act of not deploying him was a scheme designed to prevent him from attaining the status of a regular employee.20

28

Petitioner submits that respondent had no valid and sufficient cause to abandon the employment contract, as it merely relied upon alleged phone calls from his wife and other unnamed callers in arriving at the conclusion that he would jump ship like his brother. He points out that his wife had executed an affidavit21 strongly denying having called respondent, and that the other alleged callers did not even disclose their identities to respondent.22 Thus, it was error for the Court of Appeals to adopt the unfounded conclusion of the NLRC, as the same was not based on substantial evidence.23 On the other hand, respondent argues that the Labor Arbiter has no jurisdiction to award petitioners monetary claims. His employment with respondent did not commence because his deployment was withheld for a valid reason. Consequently, the labor arbiter and/or the NLRC cannot entertain adjudication of petitioners case much less award damages to him. The controversy involves a breach of contractual obligations and as such is cognizable by civil courts.24 On another matter, respondent claims that the second issue posed by petitioner involves a recalibration of facts which is outside the jurisdiction of this Court.25 There is some merit in the petition. There is no question that the parties entered into an employment contract on 3 February 1998, whereby petitioner was contracted by respondent to render services on board "MSV Seaspread" for the consideration of US$515.00 per month for nine (9) months, plus overtime pay. However, respondent failed to deploy petitioner from the port of Manila to Canada. Considering that petitioner was not able to depart from the airport or seaport in the point of hire, the employment contract did not commence, and no employer-employee relationship was created between the parties.26 However, a distinction must be made between the perfection of the employment contract and the commencement of the employer-employee relationship. The perfection of the contract, which in this case coincided with the date of execution thereof, occurred when petitioner and respondent agreed on the object and the cause, as well as the rest of the terms and conditions therein. The commencement of the employer-employee relationship, as earlier discussed, would have taken place had petitioner been actually deployed from the point of hire. Thus, even before the start of any employer-employee relationship, contemporaneous with the perfection of the employment contract was the birth of certain rights and obligations, the breach of which may give rise to a cause of action against the erring party. Thus, if the reverse had happened, that is the seafarer failed or refused to be deployed as agreed upon, he would be liable for damages. Moreover, while the POEA Standard Contract must be recognized and respected, neither the manning agent nor the employer can simply prevent a seafarer from being deployed without a valid reason. Respondents act of preventing petitioner from departing the port of Manila and boarding "MSV Seaspread" constitutes a breach of contract, giving rise to petitioners cause of action. Respondent unilaterally and unreasonably reneged on its obligation to deploy petitioner and must therefore answer for the actual damages he suffered. We take exception to the Court of Appeals conclusion that damages are not recoverable by a worker who was not deployed by his agency. The fact that the POEA Rules27 are silent as to the payment of damages to the affected seafarer does not mean that the seafarer is precluded from claiming the same. The sanctions provided for non-deployment do not end with the suspension or cancellation of license or fine and the return of all documents at no cost to the worker. They do not forfend a seafarer from instituting an action for damages against the employer or agency which has failed to deploy him.

29

The POEA Rules only provide sanctions which the POEA can impose on erring agencies. It does not provide for damages and money claims recoverable by aggrieved employees because it is not the POEA, but the NLRC, which has jurisdiction over such matters. Despite the absence of an employer-employee relationship between petitioner and respondent, the Court rules that the NLRC has jurisdiction over petitioners complaint. The jurisdiction of labor arbiters is not limited to claims arising from employer-employee relationships. Section 10 of R.A. No. 8042 (Migrant Workers Act), provides that: Sec. 10. Money Claims. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages. x x x [Emphasis supplied] Since the present petition involves the employment contract entered into by petitioner for overseas employment, his claims are cognizable by the labor arbiters of the NLRC. Article 2199 of the Civil Code provides that one is entitled to an adequate compensation only for such pecuniary loss suffered by him as he has duly proved. Respondent is thus liable to pay petitioner actual damages in the form of the loss of nine (9) months worth of salary as provided in the contract. He is not, however, entitled to overtime pay. While the contract indicated a fixed overtime pay, it is not a guarantee that he would receive said amount regardless of whether or not he rendered overtime work. Even though petitioner was "prevented without valid reason from rendering regular much less overtime service,"28 the fact remains that there is no certainty that petitioner will perform overtime work had he been allowed to board the vessel. The amount of US$286.00 stipulated in the contract will be paid only if and when the employee rendered overtime work. This has been the tenor of our rulings in the case of Stolt-Nielsen Marine Services (Phils.), Inc. v. National Labor Relations Commission29 where we discussed the matter in this light: The contract provision means that the fixed overtime pay of 30% would be the basis for computing the overtime pay if and when overtime work would be rendered. Simply stated, the rendition of overtime work and the submission of sufficient proof that said work was actually performed are conditions to be satisfied before a seaman could be entitled to overtime pay which should be computed on the basis of 30% of the basic monthly salary. In short, the contract provision guarantees the right to overtime pay but the entitlement to such benefit must first be established. Realistically speaking, a seaman, by the very nature of his job, stays on board a ship or vessel beyond the regular eight-hour work schedule. For the employer to give him overtime pay for the extra hours when he might be sleeping or attending to his personal chores or even just lulling away his time would be extremely unfair and unreasonable.30
The Court also holds that petitioner is entitled to attorneys fees in the concept of damages and expenses of litigation. Attorney's fees are recoverable when the defendant's act or omission has compelled the plaintiff to incur expenses to protect his interest.31 We note that respondents basis for not deploying petitioner is the belief that he will jump ship just like his brother, a mere suspicion that is based on alleged phone calls of several persons whose identities were not even confirmed. Time and again, this Court has upheld management prerogatives so long as they are exercised in good faith for the advancement of the employers interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements. 32 Respondents failure to deploy petitioner is unfounded and unreasonable, forcing petitioner to institute the suit below. The award of attorneys fees is thus warranted.

30 However, moral damages cannot be awarded in this case. While respondents failure to deploy petitioner seems baseless and unreasonable, we cannot qualify such action as being tainted with bad faith, or done deliberately to defeat petitioners rights, as to justify the award of moral damages. At most, respondent was being overzealous in protecting its interest when it became too hasty in making its conclusion that petitioner will jump ship like his brother.

We likewise do not see respondents failure to deploy petitioner as an act designed to prevent the latter from attaining the status of a regular employee. Even if petitioner was able to depart the port of Manila, he still cannot be considered a regular employee, regardless of his previous contracts of employment with respondent. In Millares v. National Labor Relations Commission,33 the Court ruled that seafarers are considered contractual employees and cannot be considered as regular employees under the Labor Code. Their employment is governed by the contracts they sign every time they are rehired and their employment is terminated when the contract expires. The exigencies of their work necessitates that they be employed on a contractual basis.34
WHEREFORE, petition is GRANTED IN PART. The Decision dated 16 October 2003 and the Resolution dated 19 February 2004 of the Court of Appeals are REVERSED and SET ASIDE. The Decision of Labor Arbiter Teresita D. Castillon-Lora dated 29 January 1999 is REINSTATED with the MODIFICATION that respondent CF Sharp Crew Management, Inc. is ordered to pay actual or compensatory damages in the amount of US$4,635.00

representing salary for nine (9) months as stated in the contract, and attorneys fees at the reasonable rate of 10% of the recoverable amount. SO ORDERED.

31

G.R. No. 77828 February 8, 1989 EASTERN SHIPPING LINES, INC. petitioner, vs.

PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION, SECRETARY OF LABOR AND EMPLOYMENT, HEARING OFFICER CHERYL AMPIL and MA. LOURDES A. ZARAGOZA, respondents.

FELICIANO, J.: This Petition for certiorari and Prohibition seeks to set aside the Decision dated 19 March 1987 of the public respondent Philippine Overseas Employment Administration (POEA), in POEA Case No. L-86-01-026. The pertinent facts follow: Manuel Zaragoza had been an employee of petitioner Eastern Shipping Lines, Inc. ("Eastern") for several years, having served as engineer on board several of Eastern's vessels since 1973. At the time of his death on 18 September 1983, Manuel Zaragoza was in Kakogawa, Japan serving as Chief Engineer of the M/V Eastern Meteor, a vessel then owned by Freesia Shipping Company S.A. and chartered by Eastern. A Death Certificate 1 issued by Dr. Masayuki Inoue of the Kakogawa Hospital stated that Zaragoza's death had been caused by "myocardial infarction." On 17 December 1985, Manuel Zaragoza's widow, private respondent Ma. Lourdes A. Zaragoza, filed with the public respondent POEA a formal Complaint 2 (docketed as POEA Case No. L-86-01026) against Eastern, after the latter allegedly had refused to act favorably on the widow's claim for gratuity arising from the death of her husband. Mrs. Zaragoza alleged that the M/V Eastern Meteor having been registered with the Ministerio de Hacienda y Tesoro of the Republic of Panama at the time of her husband's death, she was entitled to receive from Eastern death benefits in the amount of P100,000.00 as provided under Memorandum Circular No. 71 issued on 18 November 1981 by the former National Seamen Board. Moral damages or P50,000.00 and attorney's fees were likewise sought by the widow.

32 In its Answer, 3 Eastern alleged, among other things, that no cause of ac ' petition existed against it as the company had already paid Mrs. Zaragoza a cash benefit of P12,000.00 for the death of her husband and an amount of P5,000.00 for funeral expenses. Eastern further denied having incurred any additional liability under NSB Memorandum Circular No. 71, alleging that "[the M/V Eastern Meteor] had been then also considered a vessel of the Philippine registry." Eastern assailed the jurisdiction of the POEA over the complaint, asserting that the company "is not engaged in overseas employment even as [it] admits that [its] vessels are ocean-going vessels." On 19 March 1987, public respondent POEA rendered a Decision 4 requiring petitioner to pay to private respondent Mrs. Zaragoza P88,000.00 as the unpaid balance of her deceased husband's death benefits, and dismissing the claim for moral damages for want of jurisdiction. From this judgment, Eastern came directly to this Court. We issued a Temporary Restraining Order on 8 April 1987. 5 A preliminary point was raised by the Solicitor General in his Comment 6 on the Petition, that Eastern had failed to exhaust administrative remedies in this case i.e., that petitioner Company did not interpose an appeal with the National Labor Relations Commission before coming to this Court on certiorari. Inasmuch, however, as the petition at bar raises questions essentially legal in nature, we do not consider the same as having been prematurely filed with this Court. 7 We address first the issue of jurisdiction. Petitioner Company does not deny that Manuel Zaragoza was its employee at the time of his death on 18 September 1983. Petitioner would contend, however, that the company had neither been nor acted as an "overseas employer" of Manuel Zaragoza, and that the latter had never been its "overseas employee." Hence, petitioner concludes, private respondent's claim for death benefits should have been filed with the Social Security System, not with the POEA. The argument does not persuade. Applicable here and petitioner admits this in its Petition is Executive Order No. 797 (promulgated 1 May 1982), which abolished the former National Seamen Board and created in its place the present Philippine Overseas Employment Administration. Section 4 (a) of Executive Order No. 797 expressly provides that the POEA "shall have original and exclusive jurisdiction over all cases, including money claims, involving employer-employee relations arising out of or by virtue of any law or contract involving Filipino workers for overseas employment, including seamen. " This provision is clarified substantially in the Rules and Regulations on Overseas Employment issued by the POEA, Section 1 (d), Rule 1, Book VI of which provides that "claims for death, disability and other benefits arising out of [overseas] employment" fall within the POEA's original and exclusive jurisdiction. The following definitions contained in Section 1, Rule II, Book I of said POEA Rules and Regulations are also useful: g. Contract Worker-means any person working or who has worked overseas under a valid employment contract and shall include seamen. xxx xxx xxx x. Overseas Employment-means employment of a worker outside the Philippines, including employment on board vessels plying international waters, covered by a valid employment contract. xxx xxx xxx

33 (Emphasis supplied) We note that the statute and the relevant regulations refer to employment of Filipino workers overseas, i.e., outside the Philippines. The statute and regulations do not limit their coverage to non-Filipino employers. Filipinos working overseas share the same risks and burdens whether their employers be Filipino or foreign. Neither party disputes that Manuel Zaragoza, at the time of his death, was covered by an existing contract of employment with Eastern and that the deceased was at that time employed as a seaman (Chief Engineer) on board the M/V Eastern Meteor, which vessel-then chartered by Eastern-was engaged in plying ocean routes, outside Philippine waters and which, at the time of Zaragoza's demise, was berthed in a foreign port (Japan). In addition, the record shows that Eastern submitted its shipping articles to public respondent POEA for processing, formalization and approval, 8 apparently in recognition of POEA!s regulatory authority over overseas employment under Executive Order No. 797. While not in itself conclusive proof of employment by Eastern of people overseas, nevertheless, this latter circumstance strongly suggests that Eastern must have regarded itself as engaged in such employment, otherwise, it would not have found it necessary or useful to submit its shipping articles to the POEA. We hold that the complaint of private respondent widow of Manuel Zaragoza falls well within the original and exclusive jurisdiction of public respondent POEA. 9 We come to the issue regarding the amount of death benefits for which Eastern may be held liable to private respondent. In assessing such amount, the POEA relied upon Memorandum Circular No. 71 (effective 1 December 1981) issued by the now defunct National Seamen Board (NSB): SECTION D. COMPENSATION AND BENEFITS DURING THE, TERM OF THE CONTRACT. 1. In case of total and permanent disability or death of the seaman during the term of his contract, the company II pay the ,seaman or his beneficial the amount of: P100,000.00-for masters and Chief Engineers 75,000.00 - for other officers 50,000.00 - for ratings over and above the benefits which are provided for abd are the liabilities of the Philippine government under the Philippine laws. Provided that when the employment of a seaman is also covered by a collective bargaining agreement or death/disability insurance which provides for higher benefits than those enumerated above, in which case, the seaman or his heirs/beneficiaries may elect under what scheme he is they are claiming. Recovery under one scheme is a bar to any farther recovery; except where there is a clear showing in the collective bargaining agreement and/or death/disability insurance that benefits provided for in the collective bargaining agreement and death/disability insurance are separate and distinct from the abovementioned benefits. The exact amount of insurance that each seaman is covered under this contract are as stipulated in Column J of Appendix 2 of this contract. In addition to the above, the expenses for hospitalization of the seaman shall be borne by the employer.

34 2. In lieu of paragraph 1 above, the liability of [an] employer of a Philippine registered vessel (except foreign- owned vessels bareboat-chartered to a Philippine shipping company) shall be governed by existing Philippine Laws over and above the benefits granted [under] Philippine laws on social security and employees' compensation benefits provided that the Philippine registered vessel and any vessel bareboat- chartered to a Philippine Shipping Company shall be manned by full Filipino crews. (Emphasis and brackets supplied). It is the argument of Eastern here that NSB Memorandum Circular No. 71 collides with the public law principle of non-delegation of legislative power. Eastern also argues that assuming the validity of the Circular, its provisions (specifically paragraph 1) do not cover Eastern. These arguments again do not persuade. Concerning the alleged unconstitutionality of NSB Memorandum Circular No. 71, Article 20 of the Labor Code before its repeal by Executive Order No. 797, provided in salient part: Art. 20. National Seamen Board.-A National Seamen Board is hereby created which shall develop and maintain a comprehensive program for Filipino seamen employed overseas. It shall have the power and duty: xxx xxx xxx 2. To regulate and supervise the activities of agents or representatives of shipping companies in the hiring of seamen for overseas employment; and secure the best possible terms of employment for contract seamen workers and secure compliance therewith; xxx xxx xxx. (Emphasis supplied) The question of validity of the delegation of quasi-legislative power in favor of NSB's successor, respondent POEA, embodied in the article quoted above, was addressed and resolved in the affirmative by the Court in Eastern Shipping Lines, Inc. v. Philippine Overseas Employment Administration, et al. 10 On the authority of this case, we hold that NSB Memorandum Circular No. 71 was issued in a valid exercise by the NSB of its "power and duty ... [to] secure the best possible terms of employment for contract seamen workers and [to] secure compliance therewith." We consider next petitioner's argument that it is not covered by the provisions of NSB Memorandum Circular No. 71. Eastern submitted in evidence Certificate of Philippine Register Nos. ICGD-78-0428 dated 28 December 1978 11 and ICGD-84-0288 dated 7 August 1984 12 to show that this M/V Eastern Meteor was registered with the Philippine Coast Guard in 1978 and again in 1984. Eastern further maintained that M/V Eastern Meteor had always been fully manned by a Philippine crew. The record also shows, however, that this vessel was at the same time also registered in the Republic of Panama as evidenced by the Patente Permanente de Navegacion Servicio Internacional Nos. 7708-77 (dated 31 March 1977) 13 and 770877-A (dated 27 February 1987). 14 Petitioner had in fact paid taxes to the Panamanian government in 1978, 1979 1981, 1982 and 1983, 15 presumably because the M/V Eastern Meteor was during those years operating under a valid Panamanian navigation license. It, therefore, appears that at the time of the death of Manuel Zaragoza, the Eastern Meteor was both foreign-owned and foreignregistered on one hand and upon the other band, simultaneously registered in the Philippines.

35 Interpreting Section D of Memorandum Circular No. 71, it appears clear that paragraph 1 covers Philippine seamen working in foreign-registered ships while paragraph 2 applies to Philippine seamen working on Philippine-registered vessels. The parenthetical phrase "except foreignowned vessels bareboat-chartered to a Philippine shipping company" in paragraph 2 precisely covers the situation of the Eastern Meteor, that is, a foreign-owned vessel registered in a foreign country (Panama), with a second registration in the Philippines; such a vessel is excepted from coverage by paragraph 2, and hence covered by paragraph 1 instead. If the MN Eastern Meteor had been registered only in Panama, there would have been no question that it was covered by paragraph 1 of NSB Memorandum Circular No. 71. It is well- known that foreign-owned and foreign-registered vessels have frequently also secured Philippine registration where the interest or convenience of the owners dictated such second or dual registration. The effect of the parenthetical phrase in paragraph 2 is, as already indicated, to bring such dual-registered vessel within the scope not of paragraph 2, but of paragraph 1. The fact that POEA Memorandum Circular No. 6 (Series of 1986) in upgrading death benefits (P250,000.00 for master and chief engineers) specified that such upgraded benefits "shall be applicable to all Filipino seamen on board any ocean-going vessel provided the cause of action occurs on March 1, 1986 and thereafter" suggests to us the correctness of our above reading of NSB Memorandum Circular No. 71. The underlying regulatory policy, as we see it, is that Filipino seamen working on oceangoing vessels should receive the same wages and benefits, without regard to the nationality or nationalities of the vessels on which they serve. We hold that the POEA correctly held private respondent Mrs. Zaragoza entitled to the benefits given to Philippine seamen under the provisions of Section D. paragraph 1 of NSB Memorandum Circular No. 71, i.e. (1) P100,000.00 death benefit, and in addition, (2) death and related benefits provided under applicable ordinary laws of the Philippines administered by the Social Security System. WHEREFORE, the Petition for certiorari is DISMISSED and the Decision of the POEA in POEA Case No. L-86-01-026 is hereby AFFIRMED. The Temporary Restraining Order of 8 April 1987 is hereby LIFTED. SO ORDERED. CADALIN VS POEA Borrowing Statute Ex: Sec. 48, Rule on Civil Procedure if by the laws of the State or country where the cause of action arose the action is barred, it is also barred in the Philippines. Facts: Cadalin et al. are Filipino workers recruited by Asia Intl Builders Co. (AIBC), a domestic recruitment corporation, for employment in Bahrain to work for Brown & Root Intl Inc. (BRII) which is a foreign corporation with headquarters in Texas. Plaintiff instituted a class suit with the POEA for money claims arising from the unexpired portion of their employment contract which was prematurely terminated. They worked in Bahrain for BRII and they filed the suit after 1 yr. from the termination of their employment contract. As provided by Art. 156 of the Amiri Decree aka as the Labor Law of the Private Sector of Bahrain: a claim arising out of a contract of employment shall not be actionable after the lapse of 1 year from the date of the expiry of the contract, it appears that their suit has prescribed.

36

Plaintiff contends that the prescription period should be 10 years as provided by Art. 1144 of the Civil Code as their claim arise from a violation of a contract. The POEA Administrator holds that the 10 year period of prescription should be applied but the NLRC provides a different view asserting that Art 291 of the Labor Code of the Phils with a 3 years prescription period should be applied. The Solicitor General expressed his personal point of view that the 1 yr period provided by the Amiri Decree should be applied. Ruling: The Supreme Court held that as a general rule a foreign procedural law will not be applied in our country as we must adopt our own procedural laws. EXCEPTION: Philippines may adopt foreign procedural law under the Borrowing Statute such as Sec. 48 of the Civil Procedure Rule stating if by the laws of the State or country where the cause of action arose the action is barred, it is also barred in the Philippines. Thus, Bahrain law must be applied. However, the court contends that Bahrains law on prescription cannot be applied because the court will not enforce any foreign claim that is obnoxious to the forums public policy and the 1 yr. rule on prescription is against public policy on labor as enshrined in the Phils. Constitution. The court ruled that the prescription period applicable to the case should be Art 291 of the Labor Code of the Phils with a 3 years prescription period since the claim arose from labor employment. case digest, Philippine law, jurisprudence, SCRA CADALIN vs POEA ADMINISTRATOR 238 SCRA 721, CONFLICT OF LAWS

CADALIN VS POEA G.R. No. L-104776, Dec. 5, 1994

GENERAL RULE: A foreign procedural law will not be applied in the forum. EXCEPTION: When the country of the forum has a "borrowing statute," the country of the forum will apply the foreign statute of limitations. EXCEPTION TO THE EXCEPTION: The court of the forum will not enforce any foreign claim obnoxious to the forum's public policy.

FACTS: Cadalin et al. are overseas contract workers recruited by respondent-appellant AIBC for its accredited foreign principal, Brown & Root, on various dates from 1975 to 1983. As such, they

37 were all deployed at various projects in several countries in the Middle East as well as in Southeast Asia, in Indonesia and Malaysia. The case arose when their overseas employment contracts were terminated even before their expiration. Under Bahrain law, where some of the complainants were deployed, the prescriptive period for claims arising out of a contract of employment is one year. ISSUE:

Whether it is the Bahrain law on prescription of action based on the Amiri Decree No. 23 of 1976 or a Philippine law on prescription that shall be the governing law HELD: As a general rule, a foreign procedural law will not be applied in the forum. Procedural matters, such as service of process, joinder of actions, period and requisites for appeal, and so forth, are governed by teh laws of the forum. This is true even if the action is based upon a foreign substantive law. A law on prescription of actions is sui generis in Conflict of Laws in the sense that it may be viewed either as procedural or substantive, depending on the characterization given such a law. However, the characterization of a statute into a procedural or substantive law becomes irrelevant when the country of the forum has a borrowing statute. Said statute has the practical effect of treating the foreign statute of limitation as one of substance. A borrowing statute directs the state of the forum to apply the foreign statute of limitations to the pending claims based on a foreign law. While there are several kinds of borrowing statutes, one form provides that an action barred by the laws of the place where it accrued, will not be enforced in the forum even though the local statute has not run against it. Section 48 of our Code of Civil Procedure is of this kind. Said Section provides: If by the laws of the state or country where the cause of action arose, the action is barred, it is also barred in the Philippine Islands. In the light of the 1987 Constitution, however, Section 48 cannot be enforced ex propio vigore insofar as it ordains the application in this jurisdiction of Section 156 of the Amiri Decree No. 23 of 1976. The courts of the forum will not enforce any foreign claims obnoxious to the forums public policy. To enforce the one-year prescriptive period of the Amiri Decree No. 23 of 1976 as regards the claims in question would contravene the public policy on the protection to labor.

[G.R. No. 74495. July 11, 1996] DUMEZ COMPANY and TRANS-ORIENT ENGINEERS, INC., petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and VERONICO EBILANE, respondents.

38 DECISION HERMOSISIMA, JR., J.: Before us is a petition for certiorari assailing the Decisioni[1] of the National Labor Relations Commission (hereafter, NLRC)ii[2] in an illegal dismissal case iii[3] involving an overseas contract worker who contracted a debilitating illness while rendering services under a subsisting job contract in Riyadh, Saudi Arabia. The assailed Decision affirmed the award iv[4] by the Workers' Assistance and Adjudication Office of the Philippine Overseas Employment Administration (hereafter POEA) in favor of private respondent in the amount of U.S.$1,110.00 or its peso equivalent as and for his medical compensation benefits. The facts of the case are not in dispute: On May 21, 1982, petitioner Dumez Company, a French company, through petitioner TransOrient Engineers, Inc., a corporation organized and existing under the laws of the Philippines, engaged the services of private respondent Veronico Ebilane as carpenter for one of its projects in the Middle East, with Riyadh, Saudi Arabia, as his place of actual employment. The parties executed and signed a one-year overseas employment agreement embodying the terms and conditions of private respondent's employment. Private respondent commenced performance of said contract on July 3, 1982. On August 31, 1982, while at the job site, private respondent was suddenly seized by abdominal pain and rushed to the Riyadh Central Hospital were appendectomy was performed on him. During his confinement, he developed right-sided weakness and numbness and difficulty of speaking which was found to have been caused by Atrial Fibrillation and CVA embolism. In a letter dated September 22, 1982, petitioners formally terminated private respondent's employment effective September 29, 1982, up to which time petitioners paid private respondent his salaries under his employment contract. Thereafter, on October 13, 1982, private respondent was repatriated to Manila. On November 23, 1982, private respondent filed a complaint for illegal dismissal against petitioners. Such complaint was filed with the Workers' Assistance and Adjudication Office of the POEA. Private respondent asseverates that he bad been terminated pursuant to the provision of Section 1 (d) of the employment agreement which refers to termination of an employee who is unqualified. He maintains that such ground for termination did not exist in his case and, thus, his dismissal was without cause.v[5] On January 24, 1984, the POEA Administrator rendered the assailed Decision ordering petitioners to pay private respondent medical compensation benefits in the amount of U.S.$1,110.00 or its peso equivalent. Notwithstanding an explicit finding made in the assailed Decision that "there can be no dispute that complainant could be terminated for medical reasons," still petitioners were found to have failed to perform its obligation to give private respondent his "daily allowance for each day of work disability, including holidays." vi[6] Believing that the POEA Administrator erred in finding them liable for private respondent's medical compensation benefits, petitioners appealed to the NLRC. In a Resolution vii[7] promulgated on March 25, 1986, the NLRC affirmed in toto the assailed Decision and dismissed the appeal for lack of merit.

39 Petitioners thus came to this Court on a petition for certiorariviii[8] seeking the voiding of the Resolution of the NLRC. In the meantime, petitioners prayed that a temporary restraining order be issued to enjoin the POEA from enforcing the assailed Resolution. As prayed for, we issued a temporary restraining order enjoining the POEA and the NLRC from enforcing the assailed Resolution.ix[9] On November 17, 1986, the Solicitor General filed a Comment "as his own, considering that he is unable to agree with the position adopted by public respondent National Labor Relations Commission."x[10] The Solicitor General does not dispute private complainant's entitlement, under Saudi Arabia law, to medical benefits corresponding to the period of his physical incapacity. It is his position, however, that while payment of said medical benefits is explicitly mandated by the Social Insurance Law of Saudi Arabia, x x x the same law x x x is equally explicit that the liability decreed therein devolves at the General Organization's expense, and not on the employer of the private respondent. xi[11] Significantly, neither the private nor the public respondent has filed any pleading to refute the aforementioned postulate of the Solicitor General. Understandably, the sole error attributed to the NLRC and the POEA is that there is no legal basis to require petitioners to pay private respondent medical compensation benefits equal to 75% of his salaries for four (4) months. Petitioners are correct. The POEA Administrator, in finding petitioners liable to private respondent for medical benefits accruing to the latter under the Social Insurance Law of Saudi Arabia, took judicial notice of the said law. To this extent, the POEA Administrator's actuations are legally defensible. We have earlier ruled in Norse Management Co. (PTE) vs. National Seamen Board xii[12] that evidence is usually a matter of procedure of which a mere quasi-judicial body is not strict about. Although in a long line of cases, we have ruled that a foreign law, being a matter of evidence must be alleged and proved, in order to be recognized and applied in a particular controversy involving conflicts of laws, jurisprudence on this matter was not meant to apply to cases before administrative or quasi-judicial bodies in the light of the well-settled rule that administrative and quasi-judicial bodies are not bound strictly by technical rules. xiii[13] Nonetheless, only to this extent were the acts of the POEA Administrator amply supported by the law. Her actual application thereof, however, is starkly erroneous. Section 6(a) of the Overseas Employment Agreement entered into and signed by the private parties herein, provides that "Workmen's Compensation insurance benefits will be provided within the limits of the compensation law of the host country." xiv[14] That compensation for disability was to be provided in accordance with the law of the host country, Saudi Arabia, is a necessary consequence of the compulsory coverage under the General Organization for Social Insurance Law of Saudi Arabia (hereafter, GOSI Law of Saudi Arabia), upon all workers, regardless of nationality, sex or age, who render their services within the territory of Saudi Arabia by virtue of a labor contract. Article 49 of the GOSI Law of Saudi Arabia provides that the General Organization shall pay to the beneficiaries the insurance compensation, the employer being under no obligation to pay any allowance to the insured or to his heirs unless the injury has been intentionally caused by

40 the employer or the injury has occurred by reason of the latter's gross error or failure to abide by the GOSI Law or the rules relating to occupational health and safety. xv[15] Under the GOSI Law of Saudi Arabia as pleaded by petitioners clearly the obligation to pay medical benefits as compensation for work-related injury or illness, devolves upon the General Organization and not upon petitioners. Furthermore, after taking judicial notice of the GOSI Law of Saudi Arabia, the POEA Administrator considered the said law as one of a similar nature as that of our own compensation laws. Thus, in awarding the medical benefits to private respondent, she rationalized the same by quoting Article 166 of the Labor Code of the Philippines which provides that "the State shall promote and develop a tax-exempt employees' compensation program whereby employees x x x in the event of work-connected disability or death, may promptly secure adequate income benefit and medical or related benefits." Indeed, we may postulate further that the policies underlying our compensation laws and the GOSI Law of Saudi Arabia being similar, the nature thereof could not be so dissimilar. Suffice it to say that our own compensation program imposes on the employer nothing more than the obligation to remit monthly premiums to the State Insurance Fund and it is the latter, not the employer, on which is laid the burden of compensating the employee for any disability; in fact, once the employer pays his share to the fund, all obligation on his part to his employees is ended. xvi[16] No showing at all has there been that petitioners had failed to comply with its obligations as employer under the GOSI Law of Saudi Arabia. WHEREFORE, the petition for certiorari is GRANTED. The decisions of the POEA Administrator and of the NLRC are hereby ANNULLED and SET ASIDE. No pronouncement as to costs. SO ORDERED.

Pacific Asia Overseas Shipping vs NLRC and Rances

Labor Standards Delay in Filing Appeal (Employer) Foreign Judgments Cannot Be Enforced by POEA

Pacific Asia is an overseas employment agency that provided Rances work abroad. Rances was engaged by Gulf-East Ship Management a Radio Operator but due to insubordination he was dismissed our months later. According to Rances he sued Gulf-East in Dubai and the Gulf-East compromised with him that instead of paying him $9k+ theyll just pay him $5.5k plus his fare going home to the Philippines plus if in case Rances wife does not agree with the amount of the allowance being sent to her via Pacific Asia, Rances is entitled to have $1.5k more from pacific Asia. Back in the Philippines, Rances was sued by Pacific Asia for acts unbecoming of a marine officer (due in part to his insubordination to Pacific Asias client). Rances filed a counterclaim for the $1.5k as his wife did not agree with the monthly allowance sent by Pacific Asia to her. POEA ruled in favor of Pacific Asia but did not rule on Rances counterclaim. Rances then filed a separate case for his $1.5k claim. Rances produced the original copy of the Dubai court decision awarding him the compromised amount of $5.5k. The said court decision was in Arabic but it came with an English translation. It also came with a certification from a certain Mohd Bin Saleh who was purportedly an Honorary Consul for the Philippines. This time he won. Pacific Asia appealed but its appeal was one day late after the reglementary period. POEA denied the appeal. NLRC likewise denied the appeal. ISSUE: Whether or not Pacific Asia can be allowed to appeal. HELD: Yes. The delay was due to an excusable mistake. Apparently, there was a mistake in the filing of the appeal when the new messenger honestly thought that the appeal was supposed to be filed in NLRC Intramuros but actually it was supposed to be in POEA Ortigas (that happened to be the last day as well, and when he was advised to go to Ortigas, offices were already closed). Also, on the merits; POEA has no jurisdiction to enforce foreign judgments. Its the regular courts that have jurisdiction. The POEA is not a court; it is an administrative agency exercising, inter alia, adjudicatory or quasi-judicial functions. Further, Rances is not suing on the strength of an employeremployee relationship between him and Gulf-East, but rather on the strength of a Foreign judgment. And, even if the POEA has jurisdiction over the matter, it cannot take in evidence the alleged original copy o the court decision from Dubai as it was not properly authenticated pursuant to the Rules of Court (Sect 25, 26 Rule 132). The translation was also not duly authenticated. And an honorary consul is not authorized to make authentication of foreign public records.

[G.R. No. 114132. November 14, 1996] FE M. ALINDAO, petitioner, vs. HON. FELICISIMO O. JOSON, in his capacity as the Administrator, Philippine Overseas Employment Administration; PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION, and HISHAM GENERAL SERVICES CONTRACTOR, respondents. DECISION DAVIDE, JR., J.: In this petition for certiorari, prohibition and mandamus under Rule 65 of the Rules of Court, petitioner Fe M. Alindao seeks to set aside the 10 February 1994 Order of respondent Philippine Overseas Employment Administration (POEA) Administrator Felicisimo O. Joson in POEA Case No. (L) 89-08703, which reversed the 28 November 1990 Order, for having been issued with grave abuse of discretion. The material facts leading to the instant petition are not disputed. Petitioner applied, was interviewed and qualified for employment in Saudi Arabia as a laboratory aide, for a term of one year and with a monthly salary of US$370.00, through private respondent Hisham General Services Contractor (hereinafter Hisham).[1] She paid Hisham P15,000.00 as a placement fee, but no receipt was issued. She did not insist on a receipt as she saw her name written in a logbook to record the transaction and Hisham assured her of employment by presenting her passport already stamped with a visa and her plane ticket. Petitioner left for Saudi Arabia on 9 March 1988. Upon arrival, she was met by a representative of her employer, the Dahem Clinic. She was told she would stay at Alcobar until needed. Two weeks later, the petitioners employer brought her to his residence and was made to work as a domestic helper. Her employer did not treat her well and paid her only 660 Saudi riyals. The unfair working conditions prompted the petitioner to ask that she be sent home, but she was merely returned to Alcobar. She worked for only a month and six days. From there, she worked at several residences until she saved enough money to return home. She arrived in the Philippines on 7 July 1989, and filed with the POEA a complaint against Hisham for breach of contract, violation of the terms and conditions of its authority as a service contractor, and violation of the following provisions of the Labor Code: Article 32 (requiring issuances of receipts for fees paid), Article 34 (a) (prohibiting one from charging an amount greater than that specified in the schedule of allowable fees), and Article 34(b) (prohibiting one from furnishing false information in relation to recruitment or employment [misrepresentation]).[2] The case was docketed as POEA Case No. (L) 89-08-703. A request for verification revealed that Hishams license as a service contractor was to expire on 7 March 1991.[3]

After appropriate proceedings, POEA Administrator Jose N. Sarmiento handed down on 28 November 1990 in POEA Case No. (L) 89-08-703: (a) a Decision on the petitioners money claims; and (b) an Order pertaining to the administrative aspect (recruitment) of the case. The dispositive portion of the Decision reads as follows: In view of the foregoing, respondent Hisham General Services Contractor is hereby ordered to pay complainant the following: 1. 2. US$3,120 or its peso equivalent based on the current rate of exchange representing the total salary differentials for 12 months at US$260.00 a month. P20,603.00 refund of the plane ticket.

SO ORDERED.[4] The dispositive portion of the Order reads: WHEREFORE, premises considered, respondent Hisham General Services is hereby ordered to refund complainant the amount of P13,500.00 representing the excess amount of her placement fee. (as Hisham was licensed merely as a service contractor, it was authorized only to recruit workers for its own employment abroad and to charge a maximum of P1,500.00 as documentation expenses. Further, respondent is hereby ordered suspended for two (2) months or pay a penalty fine of P20,000.00 for illegal exaction, and an additional penalty of suspension for two (2) months or fine of P20,000.00 for misrepresentation. It is understood that the penalty of suspension shall be cumulatively served. SO ORDERED.[5] On 27 December 1990, Hisham appealed the Decision to the National Labor Relations Commission (NLRC),[6] which docketed the appeal as NLRC NCR CA 00150291, and filed a motion for reconsideration of the Order with the POEA.[7] In its resolution of 30 July 1992,[8] the NLRC affirmed in toto the challenged Decision. Hishams motion to reconsider[9] the NLRC resolution was denied by the NLRC in its resolution of 17 February 1993.[10] The NLRC resolution became final and executory on 4 April 1993 and the corresponding entry of judgment was made on 18 May 1993.[11] On 22 April 1993, the petitioner filed with the POEA a motion for execution of the Decision on the money claims,[12] which Hisham opposed on 29 April 1993 on the ground that Dahem Clinic was already accredited with another agency.[13] On 10 September 1993, the POEA granted the petitioners motion[14] and on 7 October 1993, it issued a writ of execution[15] which was, however, for execution of both the Decision on the money claims and the Order in the administrative aspect of the case. On 14 October 1993, Hisham then filed a motion for clarification and/or modification of the writ of execution, asserting that the Order in the administrative case could not be enforced as the motion for

reconsideration of the Order was still pending with the POEA and remained unresolved.[16] On 10 February 1994, respondent POEA Administrator Felicisimo O. Joson issued the Order subject of this petition, the pertinent portions of which read as follows: Complainant failed to establish or even show the details of how, when, and where and to whom she paid the amount of P15,000.00. [W]e subscribe to the Jurisprudence on this matter that mere general allegations of payment of excessive placement fees cannot be given merit as the charge of illegal exaction is considered a grave offense which could cause the suspension or cancellation of the agencys license and should be proven and substantiated by clear, credible and competent evidence which is not obtaining in the case at bar. We likewise find unmeritorious the charge of misrepresentation under Article 34 (b) of the Labor Code, as amended. We understand that complainant worked beyond the term of her employment contract which was sixteen (16) months while she was hired for twelve (12) months. We find it improbable that if there was really a violation of the contract, complainant could not have waited for the expiration of said contract much more extended her stay with her employer. Complainants allegations are contrary to the normal reaction of a person who was aggrieved. Taking into consideration her applied position as a laboratory aide which calls for a higher educational qualification than a domestic helper, she could have well asserted her rights and availed of the remedy if not immediately but within a reasonable length of time. We noted that the alleged change of complainants position was without the knowledge and consent of respondent agency. It was shown that respondent never knew or learned that complainant had a complaint not until after the filing of the instant case. Based from the foregoing circumstances respondents liability is limited if there is substantial evidence that it has committed representation in the processing of complainant which is not obtaining in this case. WHEREFORE, in the light of the foregoing premises, we find the Motion for Reconsideration meritorious and this case is hereby ordered dismissed.[17] Respondent Joson took cognizance of Hishams Motion for Reconsideration of the 28 November 1990 Order because it was filed prior to the effectivity of the 1991 POEA Rules and Regulations; hence, it was governed by the 198[5] POEA Rules and Regulations. On 16 March 1994, the petitioner filed this petition for Certiorari, Prohibition and Mandamus, with prayer for Temporary Restraining Order and/or Writ of Preliminary Injunction, Damages, and Disbarment with this Court. In the main, the petitioner asserts most strongly that the 28 November 1990 Decision had become final and executory, thus respondent Josons 10 February 1994 Order which had the effect of modifying the said decision, was issued with grave abuse of discretion. She maintains that respondent Joson should have applied the 1991 POEA Rules and Regulations, for, being rules of procedure, they may be applied retroactively. She further contends that Hishams appeal of the money claims case carried with it the appeal of the recruitment case, as the POEA could not have disposed of one without disposing of the other; moreover, citing Nual vs. Court of Appeals,[18] a final and executory judgment may not be modified even if the modification was meant to correct what was perceived to be erroneous conclusions of fact. As to the propriety of this petition, despite the absence of a motion for reconsideration, the petitioner alleges inadequacy of an appeal or a motion for reconsideration, and the patent nullity of the 10 February 1994 Order. She concludes with a prayer for

the reversal of the questioned order, immediate execution of the 28 November 1990 Decision, an award of P100,00.00 as exemplary damages, and the disbarment of respondent Joson for professional misconduct.[19] On 28 July 1994, the Office of the Solicitor General filed its Comment contending that the 28 November 1990 Order imposing administrative disciplinary sanctions for violations not arising from an employer-employee relationship was immediately executory and inappealable pursuant to Section 6 (Inappealable Disciplinary Cases), Rule V (Appeal), Book VI (Adjudication Rules) and Section 3 (Imposition of Administrative Sanctions Immediately Executory), Rule VI, Book VI (Adjudication Rules) of the 1985 POEA Rules and Regulations. Moreover, while a motion for reconsideration was not expressly prohibited, no provision in the said Rules and Regulations allowed such a motion. Further, even disregarding jurisdictional infirmities, what stands unrebutted is that Hisham committed misrepresentation, breach of contract and illegal exaction. The Office of the Solicitor General continues that under the circumstances, it would have been impossible to require the petitioner to produce a receipt and unreasonable to expect her to have lodged a complaint against Hisham at an earlier time. It then recommends that the petitioners complaint for disbarment be referred to the Integrated Bar of the Philippines for investigation and appropriate action and that the POEA be granted a new period within which to file its Comment.[20] On 3 January 1995, Hisham filed its Comment and admitted the final and executory nature of the Decision on the money claims. However, it points to Section 1, Rule IV, Book VI and Rule V, Book VII of the 1991 POEA Rules and Regulations as support for its thesis that the administrative aspect of the case could not have been deemed final and executory. Hisham then questions the propriety of the petition in light of the non-observance of the rule on exhaustion of administrative remedies, which mandates that the questioned Order should have been first appealed to the Office of the Secretary of the Department of Labor and Employment and the Office of the President, with resort to this Court on pure questions of law.[21] On 9 March 1995, the POEA filed its Comment wherein it rejects the applicability of the provisions of the 1985 POEA Rules and Regulations cited by the Solicitor General, as such pertain to disciplinary cases against overseas contract workers, not to agencies. It contends that the applicable provision is Section 18, Rule VI, Book II of the 1985 POEA Rules and Regulations.[22] Moreover, in accordance with POEA Office Order No. 3, Adjudication Office, Series of 1991,[23] it was the POEA Adjudication Office which was empowered to resolve all Motions for Reconsideration filed prior to the effectivity of the 1991 POEA Rules and Regulations. Finally, the POEA claimed that the dispositive portion of the questioned Order dismissing the case merely referred to the recruitment violation and did not include the complaint for money claims.[24] We gave due course to the petition and required the parties to submit their respective memoranda. Hisham and the POEA adopted their respective Comments as their Memoranda, while the petitioner filed her Memorandum on 23 August 1996. The petition must be granted. We first assess the propriety of this special civil action under Rule 65 of the Rules of Court. The petitioner has explained why she forthwith availed of this remedy without first filing a motion to reconsider the assailed order of 10 February 1994. Evidently, she anticipated the invocation of the doctrines requiring the filing of such motion for reconsideration[25] and the exhaustion of

administrative remedies.[26] We rule in her favor. The petition involves a pure question of law and the challenged order is void for want of jurisdiction on the part of respondent Joson. It has been held that the requirement of a motion for reconsideration may be dispensed with in the following instances: (1) when the issue raised is one purely of law; (2) where public interest is involved; (3) in cases of urgency; and (4) where special circumstances warrant immediate or more direct action.[27] On the other hand, among the accepted exceptions to the rule on exhaustion of administrative remedies are: (1) where the question in dispute is purely a legal one; and (2) where the controverted act is patently illegal or was performed without jurisdiction or in excess of jurisdiction.[28] We likewise agree with the petitioner that the 1991 POEA Rules and Regulations should be given retroactive application. The position taken by respondent Joson on this issue is tenuous. The said Rules and Regulations, not affecting substantive rights, are clearly procedural in nature. It is settled that procedural laws may be given retroactive effect, there being no vested rights in rules of procedure. [29] We have recognized an exception to the rule that where a court has already obtained and is exercising jurisdiction over a controversy, its jurisdiction to proceed to the final determination of the case is not affected by new legislation transferring jurisdiction over such proceedings to another tribunal. This exception is when the change in jurisdiction is curative in character.[30] Thus, this Court gave retroactive effect to P.D. No. 1691 which substantially re-enacted Article 217 of the Labor Code after the latter was amended by P.D. No. 1367 by, inter alia, removing from the enumeration of cases falling under the exclusive jurisdiction of Labor Arbiters money claims arising from employer-employee relations.[31] If this were so, then it is with more reason that the provision of the 1991 POEA Rules and Regulations vesting upon the Secretary of Labor jurisdiction over motions for reconsideration (to be treated as petitions for review) should be given retroactive effect, not only because it is a rule of procedure, but also because it is remedial or curative since the 1985 POEA Rules and Regulations is unclear as to the agency which shall resolve such motions. Section 18, Rule VI of Book II of the latter merely states that a motion for reconsideration of an order of suspension or an appeal to the Minister (Secretary) from an order cancelling a license or authority may be entertained only when filed with the LRO within ten (10) working days from service of the order or decision. Office Order No. 3, Series of 1991, dated 14 November 1991 and issued by POEA Adjudication Office Director Jaime P. Jimenez, ordering all Hearing Officers of the Adjudication Office to resolve on or before the end of November 1991 all pending motions for reconsideration filed prior to the effectivity of the 1991 POEA Rules and Regulations provided no authority for respondent Joson to resolve on 10 February 1994 Hishams motion to reconsider the Order of 20 November 1990. We now examine the pertinent provisions of the 1991 POEA Rules and Regulations. Book VI is entitled Recruitment Violation and Related Cases, while Rule IV (Review) thereof provides the procedure and mechanisms of an appeal from an order of the POEA in recruitment violation cases. Section 1 of Rule IV vests exclusive jurisdiction to review the said cases upon the Secretary of Labor and Employment, while Sections 2 and 3 of Rule IV declare: Section 2. When to File. -- Petitions for review shall be filed within ten (10) calendar days from receipt of the Order by the parties. All Motions for Reconsideration shall be treated as a petition for review. Section 3. Effects of Filing a Petition for Review. -- The filing of a petition for review shall not automatically stay the execution of the order of suspension unless restrained by the

Secretary. It is thus clear that under the 1991 POEA Rules and Regulations, Hishams Motion for the Reconsideration of the Order of 28 November 1990 on the administrative aspect of the case (recruitment, etc.) was to be treated as a petition for review which should have been resolved by the Secretary of Labor and Employment. We agree, however, with the POEA that the questioned Order of 10 February 1994, taken in its entirety, only pertains to the 28 November 1990 Order on the Administrative aspect (recruitment) of the case. Any vague reference to the subject or merits of the Decision of 28 November 1990 cannot modify nor amend the Decision which had long become final and already the subject of a writ of execution. Such reference is, at worst, merely imprecise statements which cannot alter the final character of the Decision. Even Hisham, in its Comment to the petition, explicitly admits that: The case filed with the NLRC became final and executory and subject of a writ of execution and petitioner at this point in time was able to claim and receive the entire amount of said claim ...[32] Aside from this statement, however, the record before this Court is bereft of evidence tending to show that the writ of execution as regards the money claims case has indeed been implemented to any extent. WHEREFORE, the instant petition is GRANTED. The challenged Order of 10 February 1994 of respondent POEA Administrator Felicisimo O. Joson in POEA Case No. (L) 89-08-703 is hereby SET ASIDE. The public respondent Philippine Overseas Employment Administration is hereby DIRECTED to transmit the record of the said case to the Secretary of Labor and Employment for the prompt disposition, under the 1991 POEA Rules and Regulations, of the Motion for Reconsideration of the POEA Order of 28 November 1990 on the administrative aspect (recruitment) of the case, and ORDERED to implement with reasonable dispatch the Writ of Execution of 7 October 1993 for the execution of the Decision of 28 November 1990 on the money claims. Costs against the private respondent. SO ORDERED.

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