The term bonus is defined as:

. . . an amount granted and paid to an employee for his industry and loyalty which contributed to the success of the
employers business and made possible the realization of profits. It is an act of generosity granted by an enlightened
employer to spur the employee to greater efforts for the success of the business and realization of bigger profits. The
granting of a bonus is a management prerogative, something given in addition to what is ordinarily received by or
strictly due the recipient. Thus, a bonus is not a demandable and enforceable obligation, except when it is made part
of the wage, salary or compensation of the employee.
Generally speaking, therefore, a bonus is a gift or reward given voluntarily by an employer outside of an employees
regular compensation for his or her industry and/or contribution to making the employers enterprise successful or
profitable. Sources: Supreme Court (Producers Bank of the Philippines vs. NLRC, G.R. No. 100701, 28 March
2001), Department of Labor and Employment (DOLE).
Good faith is always presumed, and upon him who alleges bad faith on the part of the possessor rests the burden of
proof. (art. 527 Civil Code);
We hold that this finding of the trial court is correct for good faith is always presumed and it is upon him who alleges
the contrary that the burden of proof lies. In Abando v. Lozada, we defined good faith as "refer[ring] to a state of
the mind which is manifested by the acts of the individual concerned. It consists of the honest intention to abstain
from taking an unconscionable and unscrupulous advantage of another. It is the opposite of fraud, and its absence
should be established by convincing evidence." Farolan vs. Solmac Marketing Corp., 195 SCRA 188(1991)
15

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In the same vein, the presumption, disputable though it may be, that an official duty has been regularly
performed applies in favor of the petitioners. Omnia praesumuntur rite et solemniter esse acta. (All things are
presumed to be correctly and solemnly done.) It was private respondent's burden to overcome this juris
tantum presumption.
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firstly, the COA failed to discharge its burden of proving that NHA acted in bad faith ; and
secondly, the exculpatory proof of good faith xxx. ARNOLD

JAMES M. YSIDORO, G.R.

No. 171513
As bad faith is a state of mind, the COA must present evidence of the overt
acts or omissions committed by NHA showing that he deliberately intended to do wrong or
cause damage. However, save from the stated principle of unjust enrichment, no other evidence
was presented to support NHas bad faith in giving bonuses.
As we have held before, bad faith does not simply connote bad judgment or
negligence but imputes a dishonest purpose or some moral obliquity and
conscious doing of a wrong or a breach of a sworn duty through some
motive or intent, or ill-will to partake the nature of fraud. [31] An erroneous
interpretation of a provision of law, absent any showing of some dishonest
or wrongful purpose, does not constitute and does not necessarily amount
to bad faith.[32]
[31]
[32]

1.

Sampiano. v. Indar, A.M. No. RTJ-05-1953, December 21, 2009, 608 SCRA 597, 613.
Cabungcal, et al. v. Cordova, et al., 120 Phil. 567, 572-573, (1964) insofar as it applies mutatis mutandis.

"The business judgment rule is a presumption that in making a business decision, the
directors of a corporation acted on an informed basis, in good faith and in the honest belief that the
action taken was in the best interests of the company.
Sec 23, Corporation Code