Lopez v.

Alturas
G.R. Nos. 166809
April 22, 2008.
Sec 1, Article III
Facts:
Petitioner Quirico Lopez was hired by respondent Alturas Group of Companies in 1997
as truck driver. In November 2007, he was dismissed after he was allegedly caught by
respondents security guard in the act of attempting to smuggle out of the company premises 60
kilos of scrap iron. When questioned, petitioner allegedly admitted to Gerardo Luega, the
security guard, that he was taking out the scrap iron consisting to make axes.
Petitioner, in compliance with the Show Cause Notice dated December 5, 2007 issued by
respondent companys Human Resource Department Manager, denied the allegations by a
handwritten explanation written in the Visayan dialect. Finding petitioners explanation
unsatisfactory, respondent company terminated his employment by Notice of Termination
effective December 14, 2007 on the grounds of loss of trust and confidence, and of violation of
company rules and regulations. In issuing the notice, respondent company also took into account
the result of an investigation showing that petitioner had been smuggling out its cartons which he
had sold, in conspiracy with Maritess Alaba.
In response, petitioner filed a complaint against respondent company for illegal dismissal
and underpayment of wages. He claimed that the smuggling charge against him was fabricated
to justify his illegal dismissal. The labor arbiter dismissed the petitioners complaint saying that
the latters dismissal was justified given that he held a position of trust and confidence. It was
also held that the respondent paid the correct wages contrary to the claims of the petitioner.
On appeal to the NLRC, it was ruled that the respondents evidence did not suffice to
warrant the termination of the petitioner. The NLRC went on to hold that the petitioner should
have been afforded, or at least advised of the right to counsel. Respondent company then filed a
Motion for Reconsideration but it was denied. Thereafter, it filed an appeal to the CA.
The CA reversed the ruling of the NLRC saying that the petitioners dismissal is justified
since the alleged act of smuggling out the scrap iron has been sufficiently established through the
affidavits of Patrocinio Borja and Zalde Tare, supervisor and junior supervisor, respectively, of
its Supermarket Motorpool. However, it was also held that that due process was not observed
when respondent company failed to give him a chance to defend his side in a proper hearing. The
company then was ordered to pay nominal damages of P30,000.
ISSUES:
1) Whether or not petitioner Lopez was illegally dismissed.
2) Whether or not the manner of petitioner Lopezs dismissal was violative of his right to
procedural due process.
HELD:
a) NO
Lopez was not illegally dismissed since respondent companys loss of trust and confidence
arising from petitioners smuggling out of the scrap iron constituted just cause for terminating his
services. The case of Cruz v. Court of Appeals has laid down the basis of loss of trust and
confidence namely (1) willful breach of the trust reposed in the employee by the employer (2)

based on substantial evidence (3) act is work related (4) employee holds a position of
responsibility (5) employee is concerned with delicate matters like handling or care and
protection of the property and assets of the employer. Respondent companys charge against
petitioner was amply proven by substantial evidence consisting of the affidavits of various
employees of respondent.
Preparedby:MarianneCarmelAgunoy

b) NO
Contrary to the findings of the CA, the court held that Lopez was NOT deprived of his right
to procedural due process. Procedural due process has been defined as giving an opportunity to
be heard before judgment is rendered. The case of Perez v. Philippine Telegraph and Telephone
Company has shed the light to the proper proceeding for termination cases:
After receiving the first notice apprising him of the charges against him, the
employee may submit a written explanation (which may be in the form of a letter,
memorandum, affidavit or position paper) and offer evidence in support thereof, like
relevant company records (such as his 201 file and daily time records) and the sworn
statements of his witnesses. For this purpose, he may prepare his explanation personally
or with the assistance of a representative or counsel. He may also ask the employer to
provide him copy of records material to his defense. His written explanation may
also include a request that a formal hearing or conference be held. In such a case, the
conduct of a formal hearing or conference becomes mandatory, just as it is where there
exist substantial evidentiary disputes or where company rules or practice requires an
actual hearing as part of employment pretermination procedure.

Petitioner was given the opportunity to explain his side when he was informed of the charge
against him and required to submit his written explanation with which he complied. The Court
has held that there is no violation of due process even if no hearing was conducted, where the
party was given a chance to explain his side of the controversy. Also, the right to counsel and the
assistance of one in investigations involving termination cases is neither indispensable nor
mandatory, except when the employee himself requests for one or that he manifests that he wants
a formal hearing on the charges against him. In petitioners case, there is no showing that he
requested for a formal hearing to be conducted or that he be assisted by counsel.
Thus, petition is DENIED and the CAs order for the payment of damages is nullified.

Preparedby:MarianneCarmelAgunoy