Case Digest: 1
Andy, Delfin and Monaliza were employees of Ventures
International Inc., who were dismissed for various infractions
and violation of company rules and regulations, hence they filed a
case for illegal dismissal against the company, represented by
Sung Sik Lee and Evelyn Rayala before the NLRC. The Labor
Arbiter, after hearing, rendered a decision finding the company
liable for illegal dismissal, ordering the reinstatement of the
complainants, and for the company to pay the total amount of
P490,308.00 to the three complainants. The company thus filed a
Notice of Appeal and paid the appeal fee. Instead of filing the
required appeal bond equivalent to the total amount of the
monetary award, the company filed a Motion to Reduce Bond,
citing financial difficulty of the company due to slowdown of
operations, and attached a managers check for P100,000.00. The
NLRC in a Resolution dismissed the appeal, citing that posting
the required appeal bond is mandatory for the perfection of the
appeal, and reduction of the bond is not warranted in the case.
On petition for certiorari to the CA by the company, the appellate
court granted the petition and allowed the relaxation of the rule
on posting of bonds, holding that the company substantially
complied with the rules on appeal because the company filed
their Notice of Appeal and posted the appeal bond in the amount
of P100,000.00, and the company had justified its inability to post
the bond due to a slowdown of tis operations.
The complainants thereafter filed a petition for review on
certiorari with the Supreme Court, assailing the grant of
certiorari by the CA. They argue that the posting of the appeal
bond is not only mandatory but jurisdictional, failure of which
renders the appeal not perfected.
The Issue/s:
Whether the appeal of the company was perfected.
The Courts ruling:
Petitioners, in assailing the appellate courts decision, argue that
posting of an appeal bond in full is not only mandatory but a
jurisdictional requirement that must be complied with in order to
confer jurisdiction upon the NLRC. They posit that the posting of
an insufficient amount of appeal bond, as in this case, resulted to
the non-perfection of the appeal rendering the decision of the
Labor Arbiter final and executory.
Banking on the appellate courts decision, respondents, for their
part, urge the Court to relax the rules on appeal underscoring on
the so-called utmost good faith they demonstrated in filing a
Motion to Reduce Appeal Bond and in posting a cash bond in the
amount of P100,000.00. In justifying their inability to post the
required appeal bond, respondents reasoned that respondent
company is in dire financial condition due to lack of orders from
customers constraining it to temporarily shut down its operations
resulting in significant loss of revenues. Respondents now plea for
the liberal interpretation of the rules so that the case can be
threshed out on the merits, and not on technicality.
1
Time and again we reiterate the established rule that in the
exercise of the Supreme Courts power of review, the Court is not
a trier of facts1 and does not routinely undertake the re-
examination of the evidence presented by the contending parties
during the trial of the case considering that the findings of facts
of labor officials who are deemed to have acquired expertise in
matters within their respective jurisdiction are generally
accorded not only respect, but even finality, and are binding upon
this Court, when supported by substantial evidence.2
The NLRC ruled that no appeal had been perfected on time
because of respondents failure to post the required amount of
appeal bond. As a result of which, the decision of the Labor
Arbiter has attained finality. The Court of Appeals, on the
contrary, allowed the relaxation of the rules and held that
respondents were justified in failing to pay the required appeal
bond. Despite the non-posting of the appeal bond in full, however,
the appellate court deemed that respondents were able to
seasonably perfect their appeal before the NLRC, thereby
directing the NLRC to resolve the case on the merits.
The pertinent rule on the matter is Article 223 of the Labor Code,
as amended, which sets forth the rules on appeal from the Labor
Arbiters monetary award:
ART. 223. Appeal. Decisions, awards, or orders of the Labor
Arbiter are final and executory unless appealed to the
Commission by any or both parties within ten (10) calendar days
from receipt of such decisions, awards, or orders. x x x.
xxxx
In case of a judgment involving a monetary award, an appeal by
the employer may be perfected only upon the posting of a cash or
surety bond issued by a reputable bonding company duly
accredited by the Commission in the amount equivalent to the
monetary award in the judgment appealed from. (Emphases
ours).
Implementing the aforestated provisions of the Labor Code are
the provisions of Rule VI of the 2011 Rules of Procedure of the
NLRC on perfection of appeals which read:
Section. 1. Periods of Appeal. Decisions, awards or orders of the
Labor Arbiter shall be final and executory unless appealed to the
Commission by any or both parties within ten (10) calendar days
from receipt thereof. x x x If the 10th day or the 5th day, as the case
may be, falls on a Saturday, Sunday or holiday, the last day to
perfect the appeal shall be the first working day following such
Saturday, Sunday or holiday.
xxxx
Section 4. Requisites for Perfection of Appeal. (a) The appeal
shall be:
(1
) filed within the reglementary period as provided in Section 1 of
(2 verified by the appellant himself/herself in accordance with Sect

) reduce appeal bond shall be deemed sufficient to perfect an
(3 in the form a of a memorandum of appeal which shall state the grounds relied upon and the arguments in support thereof; the
) relief prayed for; and with a statement of the date when the appellant received the appealed decision, award or order;
(4
) in three (3) legibly typewritten or printed copies; and
(5
) accompanied by:
i) proof of payment of the required appeal fee andislegal
ii) posting of cash or surety bond as providedappellants
iii) proof of service upon the other parties.
xxxx
(b) A mere notice of appeal without complying with the other
requisites aforestated shall not stop the running of the period for
perfecting an appeal.
xxxx
Section 5. Appeal Fee. The appellant shall pay the prevailing
appeal fee and legal research fee to the Regional Arbitration
Branch or Regional Office of origin, and the official receipt of
such payment shall form part of the records of the case.
Section 6. Bond. In case the decision of the Labor Arbiter, or the
Regional Director involves a monetary award, an appeal by the
employer shall be perfected only upon the posting of a bond,
which shall either be in the form of cash deposit or surety bond
equivalent in amount to the monetary award, exclusive of
damages and attorneys fees.
xxxx
The Commission through the Chairman may on justifiable
grounds blacklist a bonding company, notwithstanding its
accreditation by the Supreme Court.
These statutory and regulatory provisions explicitly provide that
an appeal from the Labor Arbiter to the NLRC must be
perfected within ten calendar days from receipt of such decisions,
awards or orders of the Labor Arbiter. In a judgment involving a
monetary award, the appeal shall be perfected only upon (1)
proof of payment of the required appeal fee; (2) posting of a cash
or surety bond issued by a reputable bonding company; and (3)
filing of a memorandum of appeal.3
In McBurnie v. Ganzon,4 we harmonized the provision on appeal
that its procedures are fairly applied to both the petitioner and
the respondent, assuring by such application that neither one or
the other party is unfairly favored. We pronounced that the
posting of a cash or surety bond in an amount equivalent to 10%
2
of the monetary award pending resolution of the motion to
appeal, to wit:
It is in this light that the Court finds it necessary to set a
parameter for the litigants and the NLRCs guidance on the
amount of bond that shall hereafter be filed with a motion for a
bonds reduction. To ensure that the provisions of Section 6, Rule
VI of the NLRC Rules of Procedure that give parties the chance
to seek a reduction of the appeal bond are effectively carried out,
without however defeating the benefits of the bond requirement
in favor of a winning litigant, all motions to reduce bond that are
to be filed with the NLRC shall be accompanied by the posting of
a cash or surety bond equivalent to 10% of the monetary award
that research
subject of the fee;
appeal, which shall provisionally be deemed
the reasonable amount of the bond in the meantime that an
in Section 6motion
of this isRule;
pending
and resolution by the Commission. In
conformity with the NLRC Rules, the monetary award, for the
purpose of computing the necessary appeal bond, shall exclude
damages and attorneys fees. Only after the posting of a bond in
the required percentage shall an appellants period to perfect an
appeal under the NLRC Rules be deemed suspended.
The rule We set in McBurnie was clarified by the Court in Sara
Lee Philippines v. Ermilinda Macatlang5. Considering the
peculiar circumstances in Sara Lee, We determined what is the
reasonable amount of appeal bond. We underscored the fact that
the amount of 10% of the award is not a permissible bond but is
only such amount that shall be deemed reasonable in the
meantime that the appellants motion is pending resolution by the
Commission. The actual reasonable amount yet to be determined
is necessarily a bigger amount. In an effort to strike a balance
between the constitutional obligation of the state to afford
protection to labor on the one hand, and the opportunity afforded
to the employer to appeal on the other, We considered the appeal
bond in the amount of P725M which is equivalent to 25% of the
monetary award sufficient to perfect the appeal, viz.:
We sustain the Court of Appeals in so far as it increases the
amount of the required appeal bond. But we deem it reasonable
to reduce the amount of the appeal bond to P725 Million. This
directive already considers that the award if not illegal, is
extraordinarily huge and that no insurance company would be
willing to issue a bond for such big money. The amount of P725
Million is approximately 25% of the basis above calculated. It is a
balancing of the constitutional obligation of the state to afford
protection to labor which, specific to this case, is assurance that
in case of affirmance of the award, recovery is not negated; and
on the other end of the spectrum, the opportunity of the employer
to appeal.
By reducing the amount of the appeal bond in this case, the
employees would still be assured of at least substantial
compensation, in case a judgment award is affirmed. On the
other hand, management will not be effectively denied of its
statutory privilege of appeal.
In line with Sara Lee and the objective that the appeal on the
merits to be threshed out soonest by the NLRC, the Court holds
that the appeal bond posted by the respondent in the amount of
P100,000.00 which is equivalent to around 20% of the total
amount of monetary bond is sufficient to perfect an appeal. With
the employers demonstrated good faith in filing the motion to
reduce the bond on demonstrable grounds coupled with the
posting of the appeal bond in the requested amount, as well as the
filing of the memorandum of appeal, the right of the employer to
appeal must be upheld. This is in recognition of the importance of
the remedy of appeal, which is an essential part of our judicial
system and the need to ensure that every party litigant is given
the amplest opportunity for the proper and just disposition of his
cause freed from the constraints of technicalities6.
WHEREFORE, premises considered, the petition is DENIED.
The assailed Decision and Resolution of the Court of Appeals are
hereby AFFIRMED.
SO ORDERED.
G.R. No. 182800 April 20, 2015MANILA MINING
CORPORATION, Petitioner, vs. LOWITO AMOR, ET.
AL., Respondents.
Compliance with the requirements for the perfection of an appeal
from the decision of a Labor Arbiter is at issue in this Rule 45
Petition for Review on Certiorari which primarily seeks the
nullification of the 29 November 2007 Decision1 rendered by the then
Twenty-Second Division of the Court of Appeals (CA) in CA-G.R.
SP No. 00609,2the decretal portion of which states:
WHEREFORE, the petition is hereby GRANTED. The Resolutions
of the NLRC dated 25 April 2005 and 30 June 2007, respectively, are
ANNULLED and SET ASIDE. The 25 October 2004 Resolution of
the Labor Arbiter is REINSTATED.
SO ORDERED.3
The facts are not in dispute.
Respondents Lowito Amor, Rollybie Ceredon, Julius Cesar, Ronito
Martinez and Fermin Tabili, Jr. were regular employees of petitioner
Manila Mining Corporation, a domestic corporation which operated a
mining claim in Placer, Surigao del Norte, in pursuit of its business of
large-scale open-pit mining for gold and copper ore. In compliance
with existing environmental laws, petitioner maintained Tailing Pond
No. 7 (TP No. 7), a tailings containment facility required for the
storage of waste materials generated by its mining operations. When
the mine tailings being pumped into TP No. 7 reached the maximum
level in December 2000, petitioner temporarily shut down its mining
operations pending approval of its application to increase said
faciltys capacity by the Department of Environment and Natural
Resources-Environment Management Bureau (DENR-EMB), Butuan
City. Although the DENR-EMB issued a temporary authority on 25
January 2001 for it to be able to continue operating TP No. 7 for
another six (6) months and to increase its capacity, petitioner failed to
secure an extension permit when said temporary authority eventually
lapsed.4
3
On 27 July 2001, petitioner served a notice, informing its employees
and the Department of Labor and Employment Regional Office No.
XII (DOLE) of the temporary suspension of its operations for six
months and the temporary lay-off of two-thirds of its
employees.5 After the lapse of said period, petitioner notified the
DOLE on 11 December 2001 that it was extending the temporary
shutdown of its operations for another six months.6 Adversely
affected by petitioners continued failure to resume its operations,
respondents filed the complaint for constructive dismissal and
monetary claims which was docketed as NLRC Case No. RAB-13-
10-00226-2003 before the Regional Arbitration Branch No. XIII of
the National Labor Relations Commission (NLRC). On 25 October
2004, Executive Labor Arbiter Benjamin E. Pelaez rendered a
Decision holding petitioner liable for constructive dismissal in view
of the suspension of its operations beyond the six-month period
allowed under Article 2867 of the Labor Code of the Philippines.
Finding that the cause of suspension of petitioners business was not
beyond its control,8the Labor Arbiter applied Article 2839 of the same
Code and disposed of the case in the following wise:
WHEREFORE, premises considered, judgment is hereby entered:
1) Declaring [respondents] to have been constructively dismissed
from their employment; and 2) Ordering [petitioner] to pay xxx
[respondents] their separation pay equivalent to one (1) month pay or
to at least one-half (1/2) month pay for every year of service,
whichever is higher, a fraction of at least six (6) months shall be
considered as one whole year, moral damages and exemplary
damages in the amount of Ten Thousand Pesos (P10,000.00) and Five
Thousand Pesos (P5,000.00), respectively, for each of the
[respondents] and attorneys fees equivalent to ten (10%) percent in
the total amount of TWO MILLION ONE HUNDRED THIRTY
EIGHT THOUSAND ONE HUNDRED NINETY & 02/100 PESOS
(P2,138,190.02) ONLY x x x x
All other claims are dismissed for lack of merit.
SO ORDERED.10
Aggrieved, petitioner filed its memorandum of appeal before the
NLRC11 and moved for the reduction of the appeal bond
to P100,000.00, on the ground that its financial losses in the
preceding years had rendered it unable to put up one in cash and/or
surety equivalent to the monetary award.12 In opposition, respondents
moved for the dismissal of the appeal in view of the fact that, despite
receipt of the appealed decision on 24 November 2004, petitioner
mailed their copy of the memorandum of appeal only on 7 February
2005. Respondents also argued that the appeal bond tendered by
petitioner was so grossly disproportionate to monetary award for the
same to be considered substantial compliance with the requirements
for the perfection of an appeal from a Labor Arbiters
decision.13 Without addressing the procedural issues raised by
respondents, however, the NLRC Fifth Division went on to render a
Resolution dated 25 April 2005 in NLRC CA No. M-008433-2005,
reversing the appealed decision and dismissing the complaint for lack
of merit. Finding that the continued suspension of petitioners
operations was due to circumstances beyond its control, the NLRC
ruled that, under Article 283 of the Labor Code, respondents were not
even entitled to separation pay considering the eventual closure of
their employers business due to serious business losses or financial
reverses.14
Unfazed by the denial of their motion for reconsideration in the
NLRCs 30 June 2005 Resolution,15 respondents filed the Rule 65
petition for certiorari which was docketed as CA-G.R. SP No. 00609
before the Mindanao Station of the CA. Insisting that petitioners
memorandum of appeal was filed 65 days after the lapse of
reglementary period for appeal, respondents called attention to the
fact that, as grossly inadequate as it already was vis--vis
the P2,138,190.0216 monetary award adjudicated in their favor, the
check in the sum of P100,000.00 deposited by petitioner by way of
appeal bond was dishonored upon presentment for payment. Aside
from the fact that the Labor Arbiters25 October 2004 Decision had
already attained finality, respondents faulted the NLRC for applying
Article 283 of the Labor Code absent allegation and proof of
compliance with the requirements for the closure of an employers
business due to serious business losses.17 In its comment, on the other
hand, petitioner claimed that, having caused the same to be
immediately funded, the check it issued for the appeal bond had since
been deposited by the NLRC. Insisting that the cessation of its
operations was due to causes beyond its control, petitioner argued
that the subsequent closure of its business due to business losses
exempted it from paying separation pay.18
On 29 November 2007, the CAs then Twenty-Second Division
rendered the herein assailed decision, granting respondents petition
and nullifying the NLRCs 25 April 2005 Resolution. In reinstating
the Labor Arbiters 25 October 2004 Decision, the CA ruled that
petitioner failed to perfect its appeal therefrom considering that the
copy of its 3 December 2004 Memorandum of Appeal intended for
respondents was served the latter by registered mail only on 7
February 2005. Aside from posting an unusually smaller sum as
appeal bond, petitioner was likewise faulted for replenishing the
check it issued only on 1 April 2005 or 24 days before the rendition
of the assailed NLRC Decision. Applying the principle that the right
to appeal is merely a statutory remedy and that the party who seeks to
avail of the same must strictly follow the requirements therefor, the
CA decreed that the Labor Arbiters Decision had already attained
finality and, for said reason, had been placed beyond the NLRCs
power of review.19 Petitioners motion for reconsideration of the
foregoing decision was denied for lack of merit in the CAs 2 May
2008 Resolution,20 hence, this Rule 45 petition for review on
certiorari.21 Petitioner seeks the reversal of the CAs 29 November
2007 Decision and 2 May 2008 Resolution on the following grounds:
THE COURT OF APPEALS GRAVELY ERRED IN RULING THAT
PETITIONERS APPEAL FILED WITH THE NATIONAL LABOR
RELATIONS COMMISSION WAS FATALLY DEFECTIVE [SINCE
IT] HAD FULLY COMPLIED WITH THE REQUIREMENTS OF
THE LABOR CODE FOR PERFECTING AN APPEAL.
THE COURT OF APPEALS COMMITTED A GRAVE ABUSE OF
DISCRETION IN IMMEDIATELY SETTING ASIDE THE
4
DECISION OF THE NLRC WITHOUT REVIEWING THE
MERITS OF THE CASE.
AT THE TIME OF THE PROMULGATION OF THE ASSAILED
DECISION BY THE COURT OFAPPEALS, THE HONORABLE
SUPREME COURT HAD ALREADY AFFIRMED THE FINDING
THAT PETITIONER WAS ALREADY PERMANENTLY CLOSED
DUE TO MASSIVE FINANCIAL LOSSES.22
Time and again, it has been held that the right to appeal is not a
natural right or a part of due process; it is merely a statutory
privilege, and may be exercised only in the manner and in accordance
with the provisions of law.23 A party who seeks to avail of the right
must, therefore, comply with the requirements of the rules, failing
which the right to appeal is invariably lost. 24 Insofar as appeals from
decisions of the Labor Arbiter are concerned, Article 223 of the Labor
Code of the Philippines25 provides that, "(d)ecisions, awards, or
orders of the Labor Arbiter are final and executory unless appealed to
the [NLRC] by any or both parties within ten (10) calendar days from
the receipt of such decisions, awards or orders." In case of a
judgment involving a monetary award, the same provision mandates
that, "an appeal by the employer may be perfected only upon the
posting of a cash or surety bond issued by a reputable bonding
company duly accredited by the [NLRC] in the amount equivalent to
the monetary award in the judgment appealed from." Alongside the
requirement that "the appellant shall furnish a copy of the
memorandum of appeal to the other party," the foregoing requisites
for the perfection of an appeal are reiterated under Sections 1, 4 and
6, Rule VI of the NLRC Rules of Procedure in force at the time
petitioner appealed the Labor Arbiters 25 October 2004 Decision,
viz.:
SECTION 1. PERIODS OF APPEAL. - Decisions, resolutions or
orders of the Labor Arbiter shall be final and executory unless
appealed to the Commission by any or both parties within ten
(10)calendar days from receipt of such decisions, resolutions or
orders of the Labor Arbiter x x x x. If the 10th x x x x day x x x x
falls on a Saturday, Sunday or a holiday, the last day to perfect the
appeal shall be the next working day.
SECTION 4. REQUISITES FOR PERFECTION OF APPEAL. - (a)
The Appeal shall be filed within the reglementary period as provided
in Section 1 of this Rule; shall be verified by appellant himself in
accordance with Section 4, Rule 7 of the Rules of Court, with proof
of payment of the required appeal fee and the posting of a cash or
surety bond as provided in Section 6 of this Rule; shall be
accompanied by memorandum of appeal in three (3) legibly
typewritten copies which shall state the grounds relied upon and the
arguments in support thereof; the relief prayed for; and a statement of
the date when the appellant received the appealed decision, resolution
or order and a certificate of non-forum shopping with proof of service
on the other party of such appeal. A mere notice of appeal without
complying with the other requisites aforestated shall not stop the
running of the period for perfecting an appeal. (Italics supplied)
xxxx
SECTION 6. BOND. - In case the decision of the Labor Arbiter or
the Regional Director involves a monetary award, an appeal by the
employer may be perfected only upon the posting of a cash or surety
bond. The appeal bond shall either be in cash or surety in an amount
equivalent to the monetary award, exclusive of damages and
attorneys fees.
xxxx
No motion to reduce bond shall be entertained except on meritorious
grounds and upon the posting of a bond in a reasonable amount in
relation to the monetary award.
The filing of the motion to reduce bond without compliance with the
requisites in the preceding paragraph shall not stop the running of the
period to perfect an appeal.
Having received the Labor Arbiters Decision on 24 November
2004,26 petitioner had ten (10) calendar days or until 4 December
2004 within which to perfect an appeal. Considering that the latter
date fell on a Saturday, petitioner had until the next working day, 6
December 2004, within which to comply with the requirements for
the perfection of its appeal. Our perusal of the record shows that,
despite bearing the date 3 December 2004, petitioners memorandum
of appeal was subscribed before Notary Public Ronald Rex Recidoro
only on 6 December 2004.27 Without proof as to the actual date of
filing of said pleading being presented by both parties, the CA
discounted the timeliness of its filing in light of the established fact
that the copy thereof intended for respondents was only served by
registered mail on 7 February 2005.28 Since proof of service of the
memorandum on appeal is required for the perfection of an appeal
from the decision of the Labor Arbiter, the CA ruled that
"respondents filed its appeal not earlier than 07 February 200[5],
which is way beyond the ten-day reglementary period to appeal."29
As allegation is not evidence, however, the rule is settled that the
burden of evidence lies with the party who asserts the affirmative of
an issue.30 As the parties claiming the non-perfection of petitioners
appeal, it was, therefore, respondents who had the burden of proving
that said memorandum of appeal was, indeed, filed out of time. By
and of itself, the fact that the copy of memorandum of appeal
intended for respondents was served upon them by registered mail
only on 7 February 2005 does not necessarily mean that petitioners
appeal from the Labor Arbiters decision was filed out of time. On
the principle that justice should not be sacrificed for technicality,31 it
has been ruled that the failure of a party to serve a copy of the
memorandum to the opposing party is not a jurisdictional defect and
does not bar the NLRC from entertaining the appeal. 32 Considering
that such an omission is merely regarded as a formal lapse or an
excusable neglect,33 the CA reversibly erred in ruling that, under the
circumstances, petitioner could not have filed its appeal earlier than 7
February 2005.
The question regarding the appeal bond rises from the record which
shows that, in addition to its memorandum of appeal, petitioner filed
a 6 December 2004 motion for the reduction of the appeal bond on
the ground that the cash equivalent of the monetary award and/or cost
5
of the surety bond have proven to be prohibitive in view of the
tremendous business losses it allegedly sustained. As supposed
measure of its good faith in complying with the Rules, petitioner
attached to its motion Philam Bank Check No. 0000627153, dated 6
December2004, in the amount of P100,000.00 only. As pointed out
by respondents, however, said check was subsequently dishonored
upon presentment for payment for insufficiency of funds. In its 1
April 2005 Ex-Parte Manifestation, petitioner informed the NLRC
that it "only learned belatedly that the same check was dishonored" as
there appeared to be "an inadvertent mix-up as other checks issued
for [its] other obligations were negotiated ahead [thereof], leaving an
insufficient balance in its account." As a consequence, petitioner
claimed that "the deficiency in deposit has been promptly and
immediately replenished as soon as the check's dishonor was
reported" and that the same may already be re-deposited at any of
NLRC's depositary banks.34
The issue that has be devilled labor litigation for long has been
clarified by the ruling in McBurnie v. Ganzon, et al., 35 which built on
and extended the ruling that while it is true that reduction of the
appeal bond has been allowed in meritorious cases36 on the principle
that substantial justice is better served by allowing appeals on the
merits,37it has been ruled that the employer should comply with the
following conditions: (1) the motion to reduce the bond shall be
based on meritorious grounds; and (2) a reasonable amount in
relation to the monetary award is posted by the appellant, otherwise
the filing of the motion to reduce bond shall not stop the running of
the period to perfect an appeal.38
The McBurnie ruling pronounced:
xxx
Furthermore, on the matter of the filing and acceptance of motions to
reduce appeal bond, as provided in Section 6, Rule VI of the 2011
NLRC Rules of Procedure, the Court hereby RESOLVES that
henceforth, the following guidelines shall be observed:
(a) The filing of a motion to reduce appeal bond shall be
entertained by the NLRC subject to the following
conditions: (1) there is meritorious ground; and (2) a bond
in a reasonable amount is posted;
(b) For purposes of compliance with condition no. (2), a
motion shall be accompanied by the posting of a
provisional cash or surety bond equivalent to ten percent
(10), of the monetary award subject of the appeal, exclusive
of damages and attorney's fees;
(c) Compliance with the foregoing conditions shall suffice
to suspend the running of the 10-day reglementary period
to perfect an appeal from the labor arbiter's decision to the
NLRC;
(d) The NLRC retains its authority and duty to resolve the
motion to reduce bond and determine the final amount of
 bond that shall be posted by the appellant, still in
accordance with the standards of meritorious grounds and
reasonable amount; and
(e) In the event that the NLRC denies the motion to reduce
bond, or requires a bond that exceeds the amount of the
provisional bond, the appellant shall be given a fresh period
of ten (10) days from notice of the NLRC order within
which to perfect the appeal by posting the required appeal
bond.39
In this case, we see that with no proof to substantiate its claim,
petitioner moved for a reduction of the appeal bond on the proferred
basis of serious losses and reverses it supposedly sustained in the
years prior to the rendition of the Labor Arbiter's decision.
The first condition may be left for the nonce. As to the second
condition, we may consider that the amount of P100,000.00
supposedly posted was provisional bond sufficient to suspend the
running of the 10-day reglementary period to perfect an appeal from
the Labor Arbiter's decision. That would however not improve
petitioner's position one bit.
Respondent correctly called attention to the fact that the check
submitted by petitioner was dishonored upon presentment for
payment, thereby rendering the tender thereof ineffectual. Although
the NLRC chose not to address the issue of the perfection of the
appeal as well as the reduction of the bond in its Resolution dated 25
April 2005, the record shows that petitioner only manifested its
deposit of the funds for the check 24 days before the resolution of its
appeal or 116 days after its right to appeal the Labor Arbiters
decision had expired. Having filed its motion and memorandum on
the very last day of the reglementary period for appeal, moreover,
petitioner had no one but itself to blame for failing to post the full
amount pending the NLRCs action on its motion for reduction of the
appeal bond. If redundancy be risked it must be emphasized that the
posting of a bond is indispensable to the perfection of an appeal in
cases involving monetary awards from the decision of the Labor
Arbiter. Since it is the posting of a cash or surety bond which confers
jurisdiction upon the NLRC,40 the rule is settled that non-compliance
is fatal and has the effect of rendering the award final and
executory.41
Viewed in the light of the foregoing considerations, the CA cannot be
faulted for no longer discussing the merits of petitioners
case.1avvphi1 Although appeal is an essential part of our judicial
process, it has been held, time and again, that the right thereto is not a
natural right or a part of due process but is merely a statutory
privilege. Thus, the perfection of an appeal in the manner and within
the period prescribed by law is not only mandatory but also
jurisdictional and failure of a party to conform to the rules regarding
appeal will render the judgment final and executory. Once a decision
attains finality, it becomes the law of the case and can no longer be
revised, reviewed, changed or altered. The basic rule of finality of
judgment is grounded on the fundamental principle of public policy
and sound practice that, at the risk of occasional error, the judgment
6
of courts and the award of quasi-judicial agencies must become final
at some definite date fixed by law.42
Without necessarily resulting to a termination of employment, an
employer may at any rate, bona fide suspend the operation of its
business for a period of not exceeding six months under Article 286
of the Labor Code.43 While the employer is, on the one hand, duty
bound to reinstate his employees to their former positions without
loss of seniority rights if the operation of the business is resumed
within six months, employment is deemed terminated where the
suspension exceeds said period.44 Not having resumed its operations
within six months from the time it suspended its operations on 27
July 2001, it necessarily follows that petitioner is liable to pay
respondents separation pay45 computed at one (1) month pay or at
least one-half (1/2) month pay for every year of service, whichever is
higher,46 as well as the damages and attorneys fees adjudicated by
the Labor Arbiter. Without proof of the serious business losses it
allegedly sustained and/or compliance with the reportorial
requirements under Article 283 of the Labor Code, petitioner cannot
expediently plead exemption from said liabilities due to the supposed
financial reverses which led to the eventual closure of its business. It
is essentially required that the alleged losses in business operations
must be proven for, otherwise, said ground for termination would be
susceptible to abuse by scheming employers who might be merely
feigning business losses or reverses in their business ventures in order
to ease out employees.47 The condition of business losses justifying
retrenchment is normally shown by audited financial documents like
yearly balance sheets and profit and loss statements as well as annual
income tax returns48 which were not presented in this case.
Neither can petitioner evade said liabilities on the strength of the 28
July 2005 Decision rendered by the CA's Twenty-Second Division in
CAG.R. SP No. 00072, entitled Rosita Asumen, et al. v. National
Labor Relations Commission, et al., where its employees' claim for
separation pay was denied on account of the subsequent closure of its
business due to serious business losses and financial
reverses.49 Although the employees Rule 45 petition for review on
certiorari had been denied in the 7 February 2007 Resolution issued
by this Court's Second Division in UDK-13776,50 the ruling in said
case can hardly be considered binding on respondents who were not
parties thereto. As for the inequality in benefits which would
supposedly result if the CA's assailed decision and resolution were
not reversed, suffice it to say that this Court had sustained the claim
for .separation pay of petitioner's employees in the case of Manila
Mining Corp Employees Association-Federation of Free Workers
Chapter, et al. v. Manila Mining Corporation, et al. 51 Stare decisis is
inapplicable; the matter of separation pay for petitioner's employees
has been decided case to case.
WHEREFORE, premises considered, the petition is DENIED for lack
of merit.
SO ORDERED.
G.R. No. 195513 June 22, 2015MARLON BED UY A,
ROSARIO DUMAS* ALEX LEONOZA, RAMILO FAJARDO,
HARLAN LEONOZA, ALVIN ABUYOT, DINDO URSABIA,**
 BERNIE BESONA, ROMEO ONANAD,*** ARMANDO
LIPORADA,**** FRANKFER ODULIO, MARCELO MATA,
ALEX COLOCADO, JOJO PACATANG, RANDY GENODIA
and ISABINO B. ALARMA, JR., Petitioners,****** vs.ACE
PROMOTION AND MARKETING CORPORATION and
GLEN******** HERNANDEZ, Respondents.
Procedural rules should be relaxed if only to serve the ends of justice.
This Petition for Review on Certiorari1 assails the November 30,
2010 Decision2 of the Court of Appeals (CA) in CA-G.R. SP No.
111536 affirming the February 23, 2009 Decision3 and August 4,
2009 Resolution4 of the National Labor Relations Commission
(NLRC), which granted respondents appeal from the April 24, 2008
Decision5 of the Labor Arbiter and ordered the dismissal of
petitioners complaint for illegal dismissal. Likewise assailed is the
February 3, 2011 CA Resolution6 which denied petitioners Motion
for Reconsideration of the said CA Decision.
Antecedent Facts
Respondent Ace Promotion and Marketing Corporation (APMC),
with respondent Glen Hernandez as its President, is a contractor
engaged in the deployment of workers to various companies to
promote the latters products through promotional and merchandising
services. In pursuance of its business, APMC entered into a
Promotional Contract7 with Delfi Marketing, Inc.8 (Delfi) whereby
the former undertook to conduct promotional activities for the latters
confectionery products. For this purpose, APMC employed workers,
including petitioners Marlon Beduya, Rosario Dumas, Alex Leonoza,
Alvin Abuyot, Dindo Ursabia, Bernie Bosona, Romeo Onanad,
Armando Liporada, Frankfer Odulio, Marcelo Mata, Alex Colocado,
Jojo Pacatang, Randy Genodia and Isabino B. Alarma, Jr.
(petitioners), as merchandisers and assigned them to various retail
outlets and supermarkets under fixed-term employment contracts.
The last contracts of employment 9 that petitioners signed were until
January 30, 2007.
In a letter10 dated December 27, 2006, Delfi notified APMC that their
Promotional Contract will expire effective January 31, 2007. On
January 29, 2007, APMC informed petitioners, among other workers,
that their last day of work would be on January 30, 2007.
Proceedings before the Labor Arbiter
Before the Labor Arbiter, three separate complaints 11 for illegal
dismissal and money claims against respondents were filed by
petitioners and by other employees (complainants) w hose
employment was terminated allegedly by reason of the expiration of
APMCs contract with Delfi. The said complaints, docketed as
NLRC-NCR Case No s. 00-02-01022-07, 00-02-0185-07 and 00-03-
02756-07, were consolidated.
In their Position Paper,12 complainants alleged that: they are regular
employees of APMC, having continuously worked in APMC since
1997; they are bona fide members of the Social Security System
7
(SSS) and the companys Home Development Mutual Fund (HDMF);
the expiration of the Promotional Contract between APMC and Delfi
does not automatically result in their dismissal; and, the said
Promotional Contract is still subsisting as new workers were hired as
their replacements. All of the complainants asked for wage
differentials, claiming that part of their wages were unlawfully
withheld unless they sign a waiver and quitclaim in favor of APMC,
while 18 of them additionally prayed for recovery of unpaid ECOLA.
Respondents, on the other hand, countered that AP MC is a legitimate
job contractor that hires employees for a specific job on a contractual
basis. With respect to complainants, respondents claimed that they
were duly apprised of the contractual nature of their employment, its
duration, working hours, basic salaries, and the basic work policies as
stipulated in their contracts of employment. And since complainants
were hired as merchandisers for Delfi, their employment
automatically ended when APMCs Promotional Contract with Delfi
expired. On the complainants allegation of continuous employment,
respondents explained that, indeed, complainants were previously
engaged as merchandisers for a client, Goya, Inc. (Goya). But when
Goyas business interest was sold to Delfi, complainants fixed-term
employment contracts also accordingly expired. They were then
rehired and reassigned to Delfi, again on a fixed-term basis, which
employment was necessarily terminated upon the end of the term. In
view of this, respondents denied liability over complainants money
claims, damages, and attorneys fees.
In a Decision13 dated April 24, 2008, the Labor Arbiter, after finding
no credible evidence to prove that they were employed on a
contractual basis, declared complain ants to have been illegally
dismissed. He found unconvincing APMCs allegation that
complainants employment was terminated due to the expiration of its
contract with Delfi considering that it continued to hire new
employees as replacements for complainants. This, the Labor Arbiter
opined, infringed upon complainants right to security of tenure. On
the other hand, he viewed complainants continuous employment
with APMC for a considerable length of time and the fact that they
are SSS and HDMF members, as indications of their being regular
employees. Thus, he ordered complainants reinstatement or payment
of separation pay, payment of backwages, unpaid wages, ECOLA,
moral and exemplary damages, and attorneys fees. The dispositive
portion of the Labor Arbiters Decision reads:
WHEREFORE, premises all considered, judgment is hereby rendered
finding the dismissal illegal and ordering respondents, as follows:
1. To reinstate complainants to their former position with
full backwages to be reckoned from the date of their
dismissal up to the finality of this decision.
2. In the alternative, to pay them x x x their backwages plus
separation pay equivalent to half month salary for every
year of service if employment is no longer tenable.
3. To pay the named eighteen (18) employees x x x their
unpaid ECOLA for one (1) year.
 4. To pay complainants x x x their unpaid wages for fifteen
(15) days.
5. To pay moral damages in the amount of P10,000.00
each.
6. To pay exemplary damages [in] the [amount]
of P5,000.00 each.
7. To pay attorneys fees equivalent to 10% of the total
monetary award.
The computation of the monetary award as computed by the
Computation Division of this Office is attached hereto and forms part
of this decision.
SO ORDERED.14
Proceedings before the National Labor Relations Commission
Respondents filed a Memorandum of Appeal with Motion for
Reduction of Bond15 with the NLRC. They maintained that
complainants were contractual employees. As such, their contracts of
employment were terminated upon the expiration of APMCs
Promotional Contract with Delfi. Anent their motion for reduction of
appeal bond, respondents contended that the awards granted to
complainants amounting to 6,269,856.89 should be decreased
considering that:
(1) eight complainants did not sign the position paper submitted to
the Labor Arbiter and therefore, the monetary awards given in their
favor should be excluded in the computation of the total award; (2)
nine complainants already withdrew their complaints as shown by
their Affidavits of Desistance;16 (3) assuming that separation pay was
correctly awarded, the computation thereof should start from year
2003 when complainants started working for Goya and not from year
1997 as computed by the Labor Arbiter; and (4) the backwages
should be computed only up to January 31, 2007 or up to the
expiration of the Promotional Contract with Delfi and not until July
31, 2008. Respondents attached a supersede as bond17 in the amount
of 437,210.00 along with their appeal.
In their Opposition with Motion to Dismiss Appeal,18 complainants
prayed for the dismissal of respondents appeal based on
insufficiency of the bond posted. This thus resulted in the non-
perfection of the appeal, and consequently, the Labor Arbiters
Decision had become final and executory.
Without acting on respondents motion for reduction of bond and the
complainants opposition thereto, the NLRC rendered a Decision 19 on
February 23, 2009 finding complainants to be contractual employees
hired for a specific duration. The NLRC noted that complainants
were duly informed at the commencement of their employment that
they were hired for a definite period and for a specific project, i.e.,
Delfi, and that they voluntarily agreed to these and the other terms of
their employment contracts. Hence, when the specific project or
8
undertaking for which they were hired cease d, their employment also
ceased. They were therefore not illegally dismissed. In the ultimate,
the NLRC reversed the Labor Arbiters Decision and dismissed the
complaints for illegal dismissal. It, however, affirmed the awards of
unpaid wages and ECOLA in favor of complainants. Thus:
WHEREFORE, premises considered, judgment is hereby rendered
GRANTING the instant appeal. The Decision of the Labor Arbiter
dated 24 April 2008 is hereby reversed and set aside, and a new one
is issued dismissing the complaint. Respondents-Appellants are,
however, directed to cause the immediate satisfaction of
complainants-appellees unpaid wages for fifteen (15) days and
ECOLA for one (1) year.
SO ORDERED.20
In their Motion for Reconsideration,21 complainants maintained that
the
437,210.00 appeal bond is in sufficient and unreasonable in relation
to the total monetary award of 6,269,856 .89, which should have
warranted the dismissal of respondents appeal. Complainants
likewise pointed out that the NLRC gravely abused its discretion
when it did not re solve respondents motion to reduce bond and their
opposition thereto with motion to dismiss before rendering its
decision granting the appeal. Complainants Motion for
Reconsideration was, however, denied by the NLRC in its
Resolution22 dated August 4, 2009.
Proceedings before the Court of Appeals
Some of the complainants, including petitioners, filed a Petition for
Certiorari23 with the CA. They insisted that the NLRC gravely abused
its discretion in granting respondents appeal despite the latters
failure to perfect the same since the appeal bond filed was grossly
insufficient and inadequate. Consequently, the Labor Arbiters
Decision had already become final and executory.
On November 30, 2010, the CA rendered a Decision24 dismissing the
petition. It found respondents willingness and good faith in
complying with the requirements as sufficient justification to relax
the rule on posting of an appeal bond. Moreover, the CA agreed with
the NLRC in finding that complainants were not illegally dismissed.
The termination of their employment was simply brought about by
the expiration of the fixed period stipulated in their contract s that
they voluntarily signed after the terms thereof were fully explained to
them.
Complainants Motion for Reconsideration25 was denied by the CA in
its Resolution26 of February 3, 2011.
Thus, petitioners, from among all the complainants, are now before
this Court through the present Petition.
Issues
 (a)
WHETHER X X X THE FILING OF APPEAL WITH
MOTION TO REDUCE APPEAL BOND WILL TOLL
THE RUNNING OF THE PERIOD TO PERFECT AN
APPEAL
(b)
WHETHER X X X AN APPEAL BOND IN THE
AMOUNT OF P473,210.00 IS REASONABLE IN
RELATION TO [A POSSIBLE] MONETARY AWARD OF
6,269,856.00
(c)
WHETHER X X X THE DECISION RENDERED BY
THE LABOR ARBITER IS DEEMED FINAL AND
EXECUTORY AS THE APPEAL WAS NOT
PERFECTED
(d)
WHETHER X X X IT IS PROCEDURALLY CORRECT
TO PASS JUDGMENT ON A CASE WHEN THERE IS
STILL A PENDING MOTION TO BE RESOLVED27
For respondents alleged failure to comply with the jurisdictional
requirements on appeal bonds, petitioners maintain that the NLRC
did not acquire jurisdiction over respondents appeal. Moreover, they
claim that the NLRC erred in resolving the merits of the appeal
without first ruling on respondents motion to reduce appeal bond and
their opposition thereto with motion to dismiss.
Our Ruling
The Petition has no merit.
Article 223 of the Labor Code provides:
ART. 223. Appeal. Decisions, awards, or orders of the Labor
Arbiter are final and executory unless appealed to the Commission by
any or both parties within ten (10) calendar days from receipt of such
decisions, awards, or orders.
Such appeal may be entertained only on any of the following
grounds:
(a) If there is prima facie evidence of abuse of discretion on
the part of the Labor Arbiter;
(b) If the decision, order or award was secured through
fraud or coercion, including graft and corruption;
(c) If made purely on questions of law; and
9
(d) If serious errors in the finding of facts are raised which
would cause grave or irreparable damage or injury to the
appellant.
In case of a judgment involving a monetary award, an appeal by the
employer may be perfected only upon the posting of a cash or surety
bond issued by a reputable bonding company duly accredited by the
Commission in the amount equivalent to the monetary award in the
judgment appealed from.
While Sections 4(a) and 6 of Rule VI of the 2005 Revised Rules of
Procedure of the NLRC provide:
SECTION 4. REQUISITES FOR PERFECTION OF APPEAL. (a)
The Appeal shall be: 1) filed within the reglementary period as
provided in Section 1 of this Rule; 2) verified by appellant himself in
accordance with Section 4, Rule 7 of the Rules of Court, as amended;
3) in the form of a memorandum of appeal which shall state the
grounds relied upon and the arguments in support thereof, the relief
prayed for, and with a statement of the date the appellant received the
appealed decision, resolution or order; 4) in three (3) legibly written
or printed copies; and 5) accompanied by i) proof of payment of the
required appeal fee; ii) posting of a cash or surety bond as provided
in Section 6 of this Rule; iii) a certificate of non-forum shopping; and
iv) proof of service upon the other parties.
SECTION 6. BOND. In case the decision of the Labor Arbiter or the
Regional Director involves a monetary award, an appeal by the
employer may be perfected only upon the posting of a bond which
shall either be in the form of cash deposit or surety bond equivalent
in amount to the monetary award, exclusive of damages and
attorneys fees.
No motion to reduce bond shall be entertained except on meritorious
grounds, and only upon the posting of a bond in a reasonable amount
in relation to the monetary award.
The mere filing of a motion to reduce bond without complying with
the requisites in the preceding paragraphs shall not stop the running
of the period to perfect an appeal.
It is thus clear from the foregoing that the filing of supersede as bond
for the perfection of an appeal is mandatory and jurisdictional and
failure to comply with this requirement renders the decision of the
Labor
Arbiter final and executory.28
However, this Court, in many cases,29 has relaxed this stringent
requirement whenever justified. Thus, the rules, specifically Section 6
of Rule VI of the 2005 Revised Rules of Procedure of the NLRC,
allows the reduction of the appeal bond subject to the conditions that:
(1) the motion to reduce the bond shall be based on meritorious
grounds; and (2) a reasonable amount in relation to the monetary
award is posted by the appellant. Otherwise, the filing of a motion to
reduce bond shall not stop the running of the period to perfect an
appeal. Still, the rule that the filing of a motion to reduce bond shall
not stop the running of the period to perfect an appeal is not
absolute.30 The Court may relax the rule under certain exceptional
circumstances which include fundamental consideration of
substantial justice, prevention of miscarriage of justice or of unjust
enrichment and special circumstances of the case combined with its
legal merits, and the amount and the issue involved. 31 Indeed, in
meritorious cases, the Court was propelled to relax the requirements
relating to appeal bonds such as when there are valid issues raised in
the appeal32 and in the absence of any valid claims against the
employer.33
In the case at bench, the Court finds that respondents motion to
reduce appeal bond was predicated on meritorious and justifiable
grounds. First, the fact that eight complainants failed to verify or
affix their signatures on the position paper filed before the Labor
Arbiter merits the exclusion of the monetary awards adjudged to
them. In Martos v. New San Jose Builders, Inc.,34 it was held that the
failure of some of the complainants therein to verify their position
paper submitted before the Labor Arbiter brought about the dismissal
of the complaint as to them who did not verify. The Court went on to
say that their negligence and passive attitude towards the rule on
verification amounted to their refusal to further prosecute their
claims. Second, the withdrawal of seven complainants 35 in this case
likewise warrants the reduction of the monetary award rendered
against respondents. Suffice it to say that the said seven complainants
are bound by the Affidavits of Desistance which are presumed to
have been freely and voluntarily executed by them. Accordingly, they
no longer participated in the subsequent proceedings after having
received their last salaries and due benefits.
Petitioners, however, posit that the amount of the appeal bond posted,
i.e.,
437,210.00, is unreasonable and inadequate vis-a-vis the total
monetary award of 6,269,856.83. What they consider as reasonable
percentage of the total monetary award is at least 30% thereof.
In the recent case of Mcburnie v. Ganzon,36 the Court has set a
provisional percentage of 10% of the monetary award, exclusive of
damages and attorneys fees, as a reasonable amount of bond that an
appellant should post pending resolution by the NLRC of a motion to
reduce bond. It is only after the posting of this bond that an
appellants period to perfect an appeal is suspended. Here, after
deducting from the total monetary award the amount of attorneys
fees and the amounts awarded to those complainants who did not
verify their position papers and those who had withdrawn their
complaints, the total monetary award amounts to only more than 3
million.37 Hence, the appeal bond of 437,210.00 posted by
respondents is in fact even more than 10% of the said total monetary
award. Thus, applying the same parameter set in Mcburnie, the Court
finds the amount of bond posted by respondents in the present case to
be reasonable.
In any event, the Court notes that in Mcburnie, it was held that the
required 10% of the monetary award as appeal bond is merely
provisional given that the NLRC still retains the authority to exercise
10
its full discretion to resolve a motion for the reduction of bond and
determine the final amount of bond that should be posted by an
appellant in accordance with the standards of meritorious grounds
and reasonable amount.38
In consideration of the foregoing, the Court finds no merit in
petitioners contention that the NLRC fa iled to establish its
jurisdictional authority over respondents appeal. Again, the filing of
a motion to reduce bond predicated on meritorious grounds coupled
with the posting of a reasonable amount of cash or surety bond
suffice to suspend the running of the period within which to appeal.
As discussed, respondents in this case have substantially complied
with these requirements and, on account thereof, their appeal from
the Labor Arbiters Decision was timely filed. Clearly, the NLRC was
conferred with jurisdiction over respondents appeal thus placing the
same within the power of the said labor tribunal to review.
With respect to the NLRCs failure to initially ac t upon respondents
motion to reduce bond and petitioners opposition thereto with
motion to dismiss, suffice it to say that the same did not divest the
NLRC of its authority to resolve the appeal on its substantive matters.
After all, the NLRC is not bound by technical rules of procedure and
is allowed to be liberal in the application of its rules in deciding labor
cases.39 Further, the NLRC is mandated to use every and all
reasonable means to ascertain the fact s in each case speedily and
objectively, without regard to technicalities of law or procedure, all in
the interest of due process.40
Coming now to the substantive matters, the Court finds that the CA
correctly affirmed the NLRC Decision which granted respondents
appeal and dismissed the illegal dismissal complaints. As aptly found
by them, petitioners were fixed-term employees whose respective
contracts of employment had already expired. Therefore, there can be
no illegal dismissal to speak of. The following observations made by
the CA were supported by substantial evidence on record, viz:
We find and so rule that private respondents are independent
contractors, and petitioners were deployed to Delfi Foods to render
various services.1wphi1 This was admitted by petitioners during the
proceedings before the labor tribunal. The relationship between the
parties is governed by the Employment Contract which petitioners
voluntarily signed before being deployed at Delfi Foods.
The NLRC extensively quoted the aforesaid contract which primarily
provided that petitioners employment was for a fixed period, that is,
from 1 December 2006 until 30 January 2007. Significantly, no
allegations were made that petitioners were forced or pressure d into
affixing their signatures upon the contract. There is likewise no
concrete proof that private respondents prevailed upon petitioners,
exercising moral dominance over the latter, to accept the conditions
set forth in the said contract. Having accepted the terms thereof,
petitioners were bound by its unequivocal stipulation that their
employment was not permanent, but would expire at the end of the
fixed period.41
WHEREFORE, the Petition is DENIED. The November 30, 2010
Decision and February 3, 2011 Resolution of the Court of Appeals in
CA-G.R. SP No. 111536 are AFFIRMED.
SO ORDERED.
G.R. No. 198587, January 14, 2015SAUDI ARABIAN AIRLINES
(SAUDIA) AND BRENDA J. BETIA, Petitioners, v. MA.
JOPETTE M. REBESENCIO, MONTASSAH B. SACAR-
ADIONG, ROUEN RUTH A. CRISTOBAL AND LORAINE S.
SCHNEIDER-CRUZ, Respondents.
All Filipinos are entitled to the protection of the rights guaranteed in
the Constitution.
This is a Petition for Review on Certiorari with application for the
issuance of a temporary restraining order and/or writ of preliminary
injunction under Rule 45 of the 1997 Rules of Civil Procedure
praying that judgment be rendered reversing and setting aside the
June 16, 2011 Decision1 and September 13, 2011 Resolution2 of the
Court of Appeals in CA-G.R. SP. No. 113006.
Petitioner Saudi Arabian Airlines (Saudia) is a foreign corporation
established and existing under the laws of Jeddah, Kingdom of Saudi
Arabia. It has a Philippine office located at 4/F, Metro House
Building, Sen. Gil J. Puyat Avenue, Makati City.3 In its Petition filed
with this court, Saudia identified itself as
follows:chanroblesvirtuallawlibrary
1. Petitioner SAUDIA is a foreign corporation established and
existing under the Royal Decree No. M/24 of 18.07.1385H
(10.02.1962G) in Jeddah, Kingdom of Saudi Arabia ("KSA"). Its
Philippine Office is located at 4/F Metro House Building, Sen, Gil J.
Puyat Avenue, Makati City (Philippine Office). It may be served with
orders of this Honorable Court through undersigned counsel at 4th and
6th Floors, Citibank Center Bldg., 8741 Paseo de Roxas, Makati
City.4 (Emphasis supplied)
Respondents (complainants before the Labor Arbiter) were recruited
and hired by Saudia as Temporary Flight Attendants with the
accreditation and approval of the Philippine Overseas Employment
Administration.5 After undergoing seminars required by the
Philippine Overseas Employment Administration for deployment
overseas, as well as training modules offered by Saudia (e.g., initial
flight attendant/training course and transition training), and after
working as Temporary Flight Attendants, respondents became
Permanent Flight Attendants. They then entered into Cabin Attendant
contracts with Saudia: Ma. Jopette M. Rebesencio (Ma. Jopette) on
May 16, 1990;6Montassah B. Sacar-Adiong (Montassah) and Rouen
Ruth A. Cristobal (Rouen Ruth) on May 22, 1993;7and Loraine
Schneider-Cruz (Loraine) on August 27, 1995.8
Respondents continued their employment with Saudia until they were
separated from service on various dates in 2006. 9
Respondents contended that the termination of their employment was
illegal. They alleged that the termination was made solely because
they were pregnant.10
11
As respondents alleged, they had informed Saudia of their respective
pregnancies and had gone through the necessary procedures to
process their maternity leaves. Initially, Saudia had given its approval
but later on informed respondents that its management in Jeddah,
Saudi Arabia had disapproved their maternity leaves. In addition, it
required respondents to file their resignation letters. 11
Respondents were told that if they did not resign, Saudia would
terminate them all the same. The threat of termination entailed the
loss of benefits, such as separation pay and ticket discount
entitlements.12
Specifically, Ma. Jopette received a call on October 16, 2006 from
Saudia's Base Manager, Abdulmalik Saddik
(Abdulmalik).13 Montassah was informed personally by Abdulmalik
and a certain Faisal Hussein on October 20, 2006 after being required
to report to the office one (1) month into her maternity leave. 14 Rouen
Ruth was also personally informed by Abdulmalik on October 17,
2006 after being required to report to the office by her Group
Supervisor.15 Loraine received a call on October 12, 2006 from her
Group Supervisor, Dakila Salvador.16
Saudia anchored its disapproval of respondents' maternity leaves and
demand for their resignation on its "Unified Employment Contract
for Female Cabin Attendants" (Unified Contract). 17 Under the Unified
Contract, the employment of a Flight Attendant who becomes
pregnant is rendered void. It provides:chanroblesvirtuallawlibrary
(H) Due to the essential nature of the Air Hostess functions to be
physically fit on board to provide various services required in normal
or emergency cases on both domestic/international flights beside her
role in maintaining continuous safety and security of passengers, and
since she will not be able to maintain the required medical fitness
while at work in case of pregnancy, accordingly, if the Air Hostess
becomes pregnant at any time during the term of this contract, this
shall render her employment contract as void and she will be
terminated due to lack of medical fitness.18 (Emphasis supplied)
In their Comment on the present Petition,19 respondents emphasized
that the Unified Contract took effect on September 23, 2006 (the first
day of Ramadan),20 well after they had filed and had their maternity
leaves approved. Ma. Jopette filed her maternity leave application on
September 5, 2006.21Montassah filed her maternity leave application
on August 29, 2006, and its approval was already indicated in
Saudia's computer system by August 30, 2006.22 Rouen Ruth filed her
maternity leave application on September 13, 2006, 23 and Loraine
filed her maternity leave application on August 22, 2006. 24
Rather than comply and tender resignation letters, respondents filed
separate appeal letters that were all rejected. 25
Despite these initial rejections, respondents each received calls on the
morning of November 6, 2006 from Saudia's office secretary
informing them that their maternity leaves had been approved.
Saudia, however, was quick to renege on its approval. On the evening
of November 6, 2006, respondents again received calls informing
them that it had received notification from Jeddah, Saudi Arabia that
their maternity leaves had been disapproved.26

Faced with the dilemma of resigning or totally losing their benefits,
respondents executed handwritten resignation letters. In Montassah's
and Rouen Ruth's cases, their resignations were executed on Saudia's
blank letterheads that Saudia had provided. These letterheads already
had the word "RESIGNATION" typed on the subject portions of their
headings when these were handed to respondents.27
On November 8, 2007, respondents filed a Complaint against Saudia
and its officers for illegal dismissal and for underpayment of salary,
overtime pay, premium pay for holiday, rest day, premium, service
incentive leave pay, 13th month pay, separation pay, night shift
differentials, medical expense reimbursements, retirement benefits,
illegal deduction, lay-over expense and allowances, moral and
exemplary damages, and attorney's fees.28 The case was initially
assigned to Labor Arbiter Hermino V. Suelo and docketed as NLRC
NCR Case No. 00-11-12342-07.
Saudia assailed the jurisdiction of the Labor Arbiter.29 It claimed that
all the determining points of contact referred to foreign law and
insisted that the Complaint ought to be dismissed on the ground
of forum non conveniens.30 It added that respondents had no cause of
action as they resigned voluntarily.31
On December 12, 2008, Executive Labor Arbiter Fatima Jambaro-
Franco rendered the Decision32dismissing respondents' Complaint.
The dispositive portion of this Decision
reads:chanroblesvirtuallawlibrary
WHEREFORE, premises' considered, judgment is hereby
rendered DISMISSING the instant complaint for lack of
jurisdiction/merit.33cralawlawlibrary
On respondents' appeal, the National Labor Relations Commission's
Sixth Division reversed the ruling of Executive Labor Arbiter
Jambaro-Franco. It explained that "[considering that complainants-
appellants are OFWs, the Labor Arbiters and the NLRC has [sic]
jurisdiction to hear and decide their complaint for illegal
termination."34 On the matter of forum non conveniens, it noted that
there were no special circumstances that warranted its abstention
from exercising jurisdiction.35 On the issue of whether respondents
were validly dismissed, it held that there was nothing on record to
support Saudia's claim that respondents resigned voluntarily.
The dispositive portion of the November 19, 2009 National Labor
Relations Commission Decision36reads:chanroblesvirtuallawlibrary
WHEREFORE, premises considered, judgment is hereby rendered
finding the appeal impressed with merit. The respondents-appellees
are hereby directed to pay complainants-appellants the aggregate
amount of SR614,001.24 corresponding to their backwages and
separation pay plus ten (10%) percent thereof as attorney's fees. The
decision of the Labor Arbiter dated December 12, 2008 is hereby
VACATED and SET ASIDE. Attached is the computation prepared
by this Commission and made an integral part of this
Decision.37cralawlawlibrary
In the Resolution dated February 11, 2010,38 the National Labor
Relations Commission denied petitioners' Motion for
Reconsideration.
12
In the June 16, 2011 Decision,39 the Court of Appeals denied
petitioners' Rule 65 Petition and modified the Decision of the
National Labor Relations Commission with respect to the award of
separation pay and backwages.
The dispositive portion of the Court of Appeals Decision
reads:chanroblesvirtuallawlibrary
WHEREFORE, the instant petition is hereby DENIED. The
Decision dated November 19, 2009 issued by public respondent,
Sixth Division of the National Labor Relations Commission -
National Capital Region is MODIFIED only insofar as the
computation of the award of separation pay and backwages. For
greater clarity, petitioners are ordered to pay private respondents
separation pay which shall be computed from private respondents'
first day of employment up to the finality of this decision, at the rate
of one month per year of service and backwages which shall be
computed from the date the private respondents were illegally
terminated until finality of this decision. Consequently, the ten
percent (10%) attorney's fees shall be based on the total amount of
the award. The assailed Decision is affirmed in all other respects.
The labor arbiter is hereby DIRECTED to make a recomputation
based on the foregoing.40cralawlawlibrary
In the Resolution dated September 13, 2011,41 the Court of Appeals
denied petitioners' Motion for Reconsideration.
Hence, this Appeal was filed.
The issues for resolution are the following:
First, whether the Labor Arbiter and the National Labor Relations
Commission may exercise jurisdiction over Saudi Arabian Airlines
and apply Philippine law in adjudicating the present dispute;
Second, whether respondents' voluntarily resigned or were illegally
terminated; and
Lastly, whether Brenda J. Betia may be held personally liable along
with Saudi Arabian Airlines.chanRoblesvirtualLawlibrary
I
Summons were validly served on Saudia and jurisdiction over it
validly acquired.
There is no doubt that the pleadings and summons were served on
Saudia through its counsel.42Saudia, however, claims that the Labor
Arbiter and the National Labor Relations Commission had no
jurisdiction over it because summons were never served on it but on
"Saudia Manila."43 Referring to itself as "Saudia Jeddah," it claims
that "Saudia Jeddah" and not "Saudia Manila" was the employer of
respondents because:
First, "Saudia Manila" was never a party to the Cabin Attendant
contracts entered into by respondents;
Second, it was "Saudia Jeddah" that provided the funds to pay for
respondents' salaries and benefits; and
Lastly, it was with "Saudia Jeddah" that respondents filed their
resignations.44
Saudia posits that respondents' Complaint was brought against the
wrong party because "Saudia Manila," upon which summons was
served, was never the employer of respondents.45
Saudia is vainly splitting hairs in its effort to absolve itself of liability.
Other than its bare allegation, there is no basis for concluding that
"Saudia Jeddah" is distinct from "Saudia Manila."
What is clear is Saudia's statement in its own Petition that what it has
is a "Philippine Office . . . located at 4/F Metro House Building, Sen.
Gil J. Puyat Avenue, Makati City."46 Even in the position paper that
Saudia submitted to the Labor Arbiter,47 what Saudia now refers to as
"Saudia Jeddah" was then only referred to as "Saudia Head Office at
Jeddah, KSA,"48 while what Saudia now refers to as "Saudia Manila"
was then only referred to as "Saudia's office in Manila."49
By its own admission, Saudia, while a foreign corporation, has a
Philippine office.
Section 3(d) of Republic Act No.. 7042, otherwise known as the
Foreign Investments Act of 1991, provides the
following:chanroblesvirtuallawlibrary
The phrase "doing business" shall include . . . opening offices,
whether called "liaison" offices or branches; . . . and any other act
or acts that imply a continuity of commercial dealings or
arrangements and contemplate to that extent the performance of acts
or works, or the exercise of some of the functions normally incident
to, and in progressive prosecution of commercial gain or of the
purpose and object of the business organization. (Emphasis supplied)
A plain application of Section 3(d) of the Foreign Investments Act
leads to no other conclusion than that Saudia is a foreign corporation
doing business in the Philippines. As such, Saudia may be sued in the
Philippines and is subject to the jurisdiction of Philippine tribunals.
Moreover, since there is no real distinction between "Saudia Jeddah"
and "Saudia Manila" the latter being nothing more than Saudia's
local office service of summons to Saudia's office in Manila
sufficed to vest jurisdiction over Saudia's person in Philippine
tribunals.chanRoblesvirtualLawlibrary
II
Saudia asserts that Philippine courts and/or tribunals are not in a
position to make an intelligent decision as to the law and the facts.
This is because respondents' Cabin Attendant contracts require the
application of the laws of Saudi Arabia, rather than those of the
Philippines.50 It claims that the difficulty of ascertaining foreign law
calls into operation the principle of forum non conveniens, thereby
rendering improper the exercise of jurisdiction by Philippine
tribunals.51
A choice of law governing the validity of contracts or the
13
interpretation of its provisions dees not necessarily imply forum non
conveniens. Choice of law and forum non conveniens are entirely
different matters.
Choice of law provisions are an offshoot of the fundamental principle
of autonomy of contracts. Article 1306 of the Civil Code firmly
ensconces this:chanroblesvirtuallawlibrary
Article 1306. The contracting parties may establish such stipulations,
clauses, terms and conditions as they may deem convenient, provided
they are not contrary to law, morals, good customs, public order, or
public policy.
In contrast, forum non conveniens is a device akin to the rule against
forum shopping. It is designed to frustrate illicit means for securing
advantages and vexing litigants that would otherwise be possible if
the venue of litigation (or dispute resolution) were left entirely to the
whim of either party.
Contractual choice of law provisions factor into transnational
litigation and dispute resolution in one of or in a combination of four
ways: (1) procedures for settling disputes, e.g., arbitration; (2) forum,
i.e., venue; (3) governing law; and (4) basis for interpretation. Forum
non conveniens relates to, but is not subsumed by, the second of
these.
Likewise, contractual choice of law is not determinative of
jurisdiction. Stipulating on the laws of a given jurisdiction as the
governing law of a contract does not preclude the exercise of
jurisdiction by tribunals elsewhere. The reverse is equally true: The
assumption of jurisdiction by tribunals does not ipso facto mean that
it cannot apply and rule on the basis of the parties' stipulation.
In Hasegawa v. Kitamura:52ChanRoblesVirtualawlibrary
Analytically, jurisdiction and choice of law are two distinct concepts.
Jurisdiction considers whether it is fair to cause a defendant to travel
to this state; choice of law asks the further question whether the
application of a substantive law V'hich will determine the merits of
the case is fair to both parties. The power to exercise jurisdiction does
not automatically give a state constitutional authority to apply forum
law. While jurisdiction and the choice of the lex fori will often,
coincide, the "minimum contacts" for one do not always provide the
necessary "significant contacts" for the other. The question of
whether the law of a state can be applied to a transaction is different
from the question of whether the courts of that state have jurisdiction
to enter a judgment.53cralawlawlibrary
As various dealings, commercial or otherwise, are facilitated by the
progressive ease of communication and travel, persons from various
jurisdictions find themselves transacting with each other. Contracts
involving foreign elements are, however, nothing new. Conflict of
laws situations precipitated by disputes and litigation anchored on
these contracts are not totally novel.
Transnational transactions entail differing laws on the requirements Q
for the validity of the formalities and substantive provisions of
contracts and their interpretation. These transactions inevitably lend
themselves to the possibility of various fora for litigation and dispute
resolution. As observed by an eminent expert on transnational
law:chanroblesvirtuallawlibrary
The more jurisdictions having an interest in, or merely even a point
of contact with, a transaction or relationship, the greater the number Nevertheless, the possibility of parallel litigation in multiple fora
of potential fora for the resolution of disputes arising out of or related along with the host of difficulties it poses is not unique to
to that transaction or relationship. In a world of increased mobility, transnational litigation. It is a difficulty that similarly arises in
where business and personal transactions transcend national disputes well within the bounds of a singe jurisdiction.
boundaries, the jurisdiction of a number of different fora may easily
be invoked in a single or a set of related disputes. 54cralawlawlibrary When parallel litigation arises strictly within the context of a single
jurisdiction, such rules as those on forum shopping, litis pendentia,
Philippine law is definite as to what governs the formal or extrinsic
and res judicata come into operation. Thus, in the Philippines, the
validity of contracts. The first paragraph of Article 17 of the Civil
1997 Rules on Civil Procedure provide for willful and deliberate
Code provides that "[t]he forms and solemnities of contracts . . . shall
forum shopping as a ground not only for summary dismissal with
be governed by the laws of the country in which they are
prejudice but also for citing parties and counsels in direct contempt,
executed"55 (i.e., lex loci celebrationis).
as well as for the imposition of administrative sanctions. 60 Likewise,
the same rules expressly provide that a party may seek the dismissal
In contrast, there is no statutorily established mode of settling conflict
of a Complaint or another pleading asserting a claim on the ground
of laws situations on matters pertaining to substantive content of
"[t]hat there is another action pending between the same parties for
contracts. It has been noted that three (3) modes have emerged:
the same cause," i.e., litis pendentia, or "[t]hat the cause of action is
(1) lex loci contractus or the law of the place of the making; (2) lex
barred by a prior judgment,"61 i.e., res judicata.
loci solutionis or the law of the place of performance; and (3) lex loci
intentionis or the law intended by the parties.56
Forum non conveniens, like the rules of forum shopping, litis
pendentia, and res judicata, is a means of addressing the problem of
Given Saudia's assertions, of particular relevance to resolving the
parallel litigation. While the rules of forum shopping, litis pendentia,
present dispute is lex loci intentionis.
and res judicata are designed to address the problem of parallel
litigation within a single jurisdiction, forum non conveniens is a
An author observed that Spanish jurists and commentators "favor lex
means devised to address parallel litigation arising in multiple
loci intentionis."57 These jurists and commentators proceed from the
jurisdictions.
Civil Code of Spain, which, like our Civil Code, is silent on what
governs the intrinsic validity of contracts, and the same civil law
Forum non conveniens literally translates to "the forum is
traditions from which we draw ours.
inconvenient."62 It is a concept in private international law and was
devised to combat the "less than honorable" reasons and excuses that
In this jurisdiction, this court, in Philippine Export and Foreign Loan
litigants use to secure procedural advantages, annoy and harass
Guarantee v. V.P. Eusebio Construction, Inc.,58 manifested preference
defendants, avoid overcrowded dockets, and select a "friendlier"
for allowing the parties to select the law applicable to their
venue.63 Thus, the doctrine of forum non conveniens addresses the
contract":chanroblesvirtuallawlibrary
same rationale that the rule against forum shopping does, albeit on a
No conflicts rule on essential validity of contracts is expressly
multijurisdictional scale.
provided for in our laws. The rule followed by most legal systems,
however, is that the intrinsic validity of a contract must be governed
Forum non conveniens, like res judicata,64 is a concept originating in
by the lex contractus or "proper law of the contract." This is the law
common law.65 However, unlike the rule on res judicata, as well as
voluntarily agreed upon by the parties (the lex loci voluntatis) or the
those on litis pendentia and forum shopping, forum non
law intended by them either expressly or implicitly (the lex loci
conveniens finds no textual anchor, whether in statute or in
intentionis). The law selected may be implied from such factors as
procedural rules, in our civil law system. Nevertheless, jurisprudence
substantial connection with the transaction, or the nationality or
has applied forum non conveniens as basis for a court to decline its
domicile of the parties. Philippine courts would do well to adopt the
exercise of jurisdiction.66
first and most basic rule in most legal systems, namely, to allow the
parties to select the law applicable to their contract, subject to the
Forum non conveniens is soundly applied not only to address parallel
limitation that it is not against the law, morals, or public policy of the
litigation and undermine a litigant's capacity to vex and secure undue
forum and that the chosen law must bear a substantive relationship
advantages by engaging in forum shopping on an international scale.
to the transaction.59 (Emphasis in the original)
It is also grounded on principles of comity and judicial efficiency.
Saudia asserts that stipulations set in the Cabin Attendant contracts
require the application of the laws of Saudi Arabia. It insists that the Consistent with the principle of comity, a tribunal's desistance in
need to comply with these stipulations calls into operation the exercising jurisdiction on account of forum non conveniens is a
doctrine of forum non conveniens and, in turn, makes it necessary for deferential gesture to the tribunals of another sovereign. It is a
Philippine tribunals to refrain from exercising jurisdiction. measure that prevents the former's having to interfere in affairs which
are better and more competently addressed by the latter.
As mentioned, contractual choice of laws factors into transnational Further, forum non conveniens entails a recognition not only that
litigation in any or a combination of four (4) ways. Moreover, forum tribunals elsewhere are better suited to rule on and resolve a
non conveniens relates to one of these: choosing between multiple controversy, but also, that these tribunals are better positioned to
possible fora. enforce judgments and, ultimately, to dispense justice. Forum non
14
conveniens prevents the embarrassment of an awkward situation
where a tribunal is rendered incompetent in the face of the greater
capability both analytical and practical of a tribunal in another
jurisdiction.
The wisdom of avoiding conflicting and unenforceable judgments is
as much a matter of efficiency and economy as it is a matter of
international courtesy. A court would effectively be neutering itself if
it insists on adjudicating a controversy when it knows full well that it
is in no position to enforce its judgment. Doing so is not only an
exercise in futility; it is an act of frivolity. It clogs the dockets of
a.tribunal and leaves it to waste its efforts on affairs, which, given
transnational exigencies, will be reduced to mere academic, if not
trivial, exercises.
Accordingly, under the doctrine of forum non conveniens, "a court, in
conflicts of law cases, may refuse impositions on its jurisdiction
where it is not the most 'convenient' or available forum and the
parties are not precluded from seeking remedies
elsewhere."67 In Puyat v. Zabarte,68 this court recognized the
following situations as among those that may warrant a court's
desistance from exercising jurisdiction:chanroblesvirtuallawlibrary
1) The belief that the matter can be better tried and decided
elsewhere, either because the main aspects of the case transpired
in a foreign jurisdiction or the material witnesses have their
residence there;
2) The belief that the non-resident plaintiff sought the forum[,] a
practice known as forum shopping[,] merely to secure procedural
advantages or to convey or harass the defendant;
3) The unwillingness to extend local judicial facilities to non
residents or aliens when the docket may already be overcrowded;
4) The inadequacy of the local judicial machinery for effectuating
the right sought to be maintained; and
5) The difficulty of ascertaining foreign law.69
In Bank of America, NT&SA, Bank of America International, Ltd. v.
Court of Appeals,70 this court underscored that a Philippine court may
properly assume jurisdiction over a case if it chooses to do so to the
extent: "(1) that the Philippine Court is one to which the parties may
conveniently resort to; (2) that the Philippine Court is in a position to
make an intelligent decision as to the law and the facts; and (3) that
the Philippine Court has or is likely to have power to enforce its
decision."71
The use of the word "may" (i.e., "may refuse impositions on its
jurisdiction"72) in the decisions shows that the matter of jurisdiction
rests on the sound discretion of a court. Neither the mere invocation
of forum non conveniens nor the averment of foreign elements
operates to automatically divest a court of jurisdiction. Rather, a court
should renounce jurisdiction only "after 'vital facts are established, to
determine whether special circumstances' require the court's
desistance."73 As the propriety of applying forum non conveniens is
contingent on a factual determination, it is, therefore, a matter of
defense.74
The second sentence of Rule 9, Section 1 of the 1997 Rules of Civil
15
Procedure is exclusive in its recital of the grounds for dismissal that
are exempt from the omnibus motion rule: (1) lack of jurisdiction
over the subject matter; (2) litis pendentia; (3) res judicata; and (4)
prescription. Moreover, dismissal on account offorum non
conveniens is a fundamentally discretionary matter. It is, therefore,
not a matter for a defendant to foist upon the court at his or her own
convenience; rather, it must be pleaded at the earliest possible
opportunity.
On the matter of pleading forum non conveniens, we state the rule,
thus: Forum non conveniens must not only be clearly pleaded as a
ground for dismissal; it must be pleaded as such at the earliest
possible opportunity. Otherwise, it shall be deemed waived.
This court notes that in Hasegawa,76 this court stated that forum non
conveniens is not a ground for a motion to dismiss. The factual
ambience of this case however does not squarely raise the viability of
this doctrine. Until the opportunity comes to review the use of
motions to dismiss for parallel litigation, Hasegawa remains existing
doctrine.
Consistent with forum non conveniens as fundamentally a factual
matter, it is imperative that it proceed from & factually established
basis. It would be improper to dismiss an action pursuant to forum
non conveniens based merely on a perceived, likely, or hypothetical
multiplicity of fora. Thus, a defendant must also plead and show that
a prior suit has, in fact, been brought in another jurisdiction.
The existence of a prior suit makes real the vexation engendered by
duplicitous litigation, the embarrassment of intruding into the affairs
of another sovereign, and the squandering of judicial efforts in
resolving a dispute already lodged and better resolved elsewhere. As
has been noted:chanroblesvirtuallawlibrary
A case will not be stayed o dismissed on [forum] non
conveniens grounds unless the plaintiff is shown to have an available
alternative forum elsewhere. On this, the moving party bears the
burden of proof.
A number of factors affect the assessment of an alternative forum's
adequacy. The statute of limitations abroad may have run, of the
foreign court may lack either subject matter or personal jurisdiction
over the defendant. . . . Occasionally, doubts will be raised as to the
integrity or impartiality of the foreign court (based, for example, on
suspicions of corruption or bias in favor of local nationals), as to the
fairness of its judicial procedures, or as to is operational efficiency
(due, for example, to lack of resources, congestion and delay, or
interfering circumstances such as a civil unrest). In one noted case, [it
was found] that delays of 'up to a quarter of a century' rendered the
foreign forum... inadequate for these purposes.77cralawlawlibrary
We deem it more appropriate and in the greater interest of prudence
that a defendant not only allege supposed dangerous tendencies in
litigating in this jurisdiction; the defendant must also show that such
danger is real and present in that litigation or dispute resolution has
commenced in another jurisdiction and that a foreign tribunal has
chosen to exercise jurisdiction.
III

Forum non conveniens finds no application and does not operate to
divest Philippine tribunals of jurisdiction and to require the
application of foreign law.
Saudia invokes forum non conveniens to supposedly effectuate the
stipulations of the Cabin Attendant contracts that require the
application of the laws of Saudi Arabia.
Forum non conveniens relates to forum, not to the choice of
governing law. Thai forum non conveniens may ultimately result in
the application of foreign law is merely an incident of its application.
In this strict sense, forum non conveniens is not applicable. It is not
the primarily pivotal consideration in this case.
In any case, even a further consideration of the applicability of forum
non conveniens on the incidental matter of the law governing
respondents' relation with Saudia leads to the conclusion that it is
improper for Philippine tribunals to divest themselves of jurisdiction.
Any evaluation of the propriety of contracting parties' choice of a
forum and'its incidents must grapple with two (2) considerations:
first, the availability and adequacy of recourse to a foreign tribunal;
and second, the question of where, as between the forum court and a
foreign court, the balance of interests inhering in a dispute weighs
more heavily.
The first is a pragmatic matter. It relates to the viability of ceding
jurisdiction to a foreign tribunal and can be resolved by juxtaposing
the competencies and practical circumstances of the tribunals in
alternative fora. Exigencies, like the statute of limitations, capacity to
enforce orders and judgments, access to records, requirements for the
acquisition of jurisdiction, and even questions relating to the integrity
of foreign courts, may render undesirable or even totally unfeasible
recourse to a foreign court. As mentioned, we consider it in the
greater interest of prudence that a defendant show, in pleading forum
non conveniens, that litigation has commenced in another jurisdiction
and that a foieign tribunal has, in fact, chosen to exercise jurisdiction.
Two (2) factors weigh into a court's appraisal of the balance of
interests inhering in a dispute: first, the vinculum which the parties
and their relation have to a given jurisdiction; and second, the public
interest that must animate a tribunal, in its capacity as an agent of the
sovereign, in choosing to assume or decline jurisdiction. The first is
more concerned with the parties, their personal circumstances, and
private interests; the second concerns itself with the state and the
greater social order.
In considering the vinculum, a court must look into the
preponderance of linkages which the parties and their transaction
may have to either jurisdiction. In this respect, factors, such as the
parties' respective nationalities and places of negotiation, execution,
performance, engagement or deployment, come into play.
In considering public interest, a court proceeds with a consciousness
that it is an organ of the state. It must, thus, determine if the interests
of the sovereign (which acts through it) are outweighed by those of
the alternative jurisdiction. In this respect, the court delves into a
16
consideration of public policy. Should it find that public interest
weighs more heavily in favor of its assumption of jurisdiction, it
should proceed in adjudicating the dispute, any doubt or .contrary
view arising from the preponderance of linkages notwithstanding.
Our law on contracts recognizes the validity of contractual choice of
law provisions. Where such provisions exist, Philippine tribunals,
acting as the forum court, generally defer to the parties' articulated
choice.
This is consistent with the fundamental principle of autonomy of
contracts. Article 1306 of the Civ:l Code expressly provides that
"[t]he contracting parties may establish 'such stipulations, clauses,
terms and conditions as they may deem convenient."78 Nevertheless,
while a Philippine tribunal (acting as the forum court) is called upon
to respect the parties' choice of governing law, such respect must not
be so permissive as to lose sight of considerations of law, morals,
good customs, public order, or public policy that underlie the contract
central to the controversy.
Specifically with respect to public policy, in Pakistan International
Airlines Corporation v. Ople,79 this court explained
that:chanroblesvirtuallawlibrary
counter-balancing the principle of autonomy of contracting parties is
the equally general rule that provisions of applicable law,
especially provisions relating to matters affected with public policy,
are deemed written inta the contract. Put a little differently, the
governing principle is that parties may not contract away applicable
provisions of law especially peremptory provisions dealing with
matters heavily impressed with public interest. 80 (Emphasis supplied)
Article II, Section 14 of the 1987 Constitution provides that "[t]he
State ... shall ensure the fundamental equality before the law of
women and men." Contrasted with Article II, Section 1 of the 1987
Constitution's statement that "[n]o person shall ... be denied the equal
protection of the laws," Article II, Section 14 exhorts the State to
"ensure." This does not only mean that the Philippines shall not
countenance nor lend legal recognition and approbation to measures
that discriminate on the basis of one's being male or female. It
imposes an obligation to actively engage in securing the fundamental
equality of men and women.
The Convention on the Elimination of all Forms of Discrimination
against Women (CEDAW), signed and ratified by the Philippines on
July 15, 1980, and on August 5, 1981, respectively,81 is part of the
law of the land. In view of the widespread signing and ratification of,
as well as adherence (in practice) to it by states, it may even be said
that many provisions of the CEDAW may have become customary
international law. The CEDAW gives effect to the Constitution's
policy statement in Article II, Section 14. Article I of the CEDAW
defines "discrimination against women"
as:chanroblesvirtuallawlibrary
any distinction, exclusion or restriction made on the basis of sex
which has the effect or purpose of impairing or nullifying the
recognition, enjoyment or exercise by women, irrespective of their
marital status, on a basis of equality of men and women, of human
rights and fundamental freedoms in the political, economic, social,
cultural, civil or any other field.82cralawlawlibrary
The constitutional exhortation to ensure fundamental equality, as
illumined by its enabling law, the CEDAW, must inform and animate
all the actions of all personalities acting on behalf of the State. It is,
therefore, the bounden duty of this court, in rendering judgment on
the disputes brought before it, to ensure that no discrimination is
heaped upon women on the mere basis of their being women. This is
a point so basic and central that all our discussions and
pronouncements regardless of whatever averments there may be
of foreign law must proceed from this premise.
So informed and animated, we emphasize the glaringly
discriminatory nature of Saudia's policy. As argued by respondents,
Saudia's policy entails the termination of employment of flight
attendants who become pregnant. At the risk of stating the
obvious, pregnancy is an occurrence that pertains specifically to
women. Saudia's policy excludes from and restricts employment on
the basis of no other consideration but sex.
We do not lose sight of the reality that pregnancy does present
physical limitations that may render difficult the performance of
functions associated with being a flight attendant. Nevertheless, it
would be the height of iniquity to view pregnancy as a disability so
permanent and immutable that, it must entail the termination of one's
employment. It is clear to us that any individual, regardless of gender,
may be subject to exigencies that limit the performance of functions.
However, we fail to appreciate how pregnancy could be such an
impairing occurrence that it leaves no other recourse but the complete
termination of the means through which a woman earns a living.
Apart from the constitutional policy on the fundamental equality
before the law of men and women, it is settled that contracts relating
to labor and employment are impressed with public interest. Article
1700 of the Civil Code provides that "[t]he relation between capital
and labor are not merely contractual. They are so impressed with
public interest that labor contracts must yield to the common good."
Consistent with this, this court's pronouncements in Pakistan
International Airlines Corporation83 are clear and
unmistakable:chanroblesvirtuallawlibrary
Petitioner PIA cannot take refuge in paragraph 10 of its employment
agreement which specifies, firstly, the law of Pakistan as the
applicable law of the agreement, and, secondly, lays the venue for
settlement of any dispute arising out of or in connection with the
agreement "only [in] courts of Karachi, Pakistan". The first clause of
paragraph 10 cannot be invoked to prevent the application of
Philippine labor laws and'regulations to the subject matter of this
case, i.e., the employer-employee relationship between petitioner PIA
and private respondents. We have already pointed out that the
relationship is much affected with public interest and that the
otherwise applicable Philippine laws and regulations cannot be
rendered illusory by the parties agreeing upon some other law to
govern their relationship. . . . Under these circumstances, paragraph
10 of the employment agreement cannot be given effect so as to oust
Philippine agencies and courts of the jurisdiction vested upon them
by Philippine law.84 (Emphasis supplied)
As the present dispute relates to (what the respondents allege to be)
the illegal termination of respondents' employment, this case is
17
immutably a matter of public interest and public policy. Consistent
with clear pronouncements in law and jurisprudence, Philippine laws
properly find application in and govern this case. 'Moreover, as this
premise for Saudia's insistence on the application forum non
conveniens has been shattered, it follows that Philippine tribunals
may properly assume jurisdiction over the present controversy.
Philippine jurisprudence provides ample illustrations of when a
court's renunciation of jurisdiction on account of forum non
conveniens is proper or improper.'
In Philsec Investment Corporation v. Court of Appeals,85 this court
noted that the trial court failed to consider that one of the plaintiffs
was a domestic corporation, that one of the defendants was a Filipino,
and that it was the extinguishment of the latter's debt that was the
object of the transaction subject of the litigation. Thus, this court
held, among others, that the trial court's refusal to assume jurisdiction
was not justified by forum non conveniens and remanded the case to
the trial court.
In Raytheon International, Inc. v. Rouzie, Jr.,86 this court sustained the
trial court's assumption of jurisdiction considering that the trial court
could properly enforce judgment on the petitioner which was a
foreign corporation licensed to do business in the Philippines.
In Pioneer International, Ltd. v. Guadiz, Jr.,87 this court found no
reason to disturb the trial court's assumption of jurisdiction over a
case in which, as noted by the trial court, "it is more convenient to
hear and decide the case in the Philippines because Todaro [the
plaintiff] resides in the Philippines and the contract allegedly
breached involve[d] employment in the Philippines."88
In Pacific Consultants International Asia, Inc. v. Schonfeld,89 this
court held that the fact that the complainant in an illegal dismissal
case was a Canadian citizen and a repatriate did not warrant the
application of forum non conveniens considering that: (1) the Labor
Code does not include forum non conveniens as a ground for the
dismissal of a complaint for illegal dismissal; (2) the propriety of
dismissing a case based on forum non conveniens requires a factual
determination; and (3) the requisites for assumption of jurisdiction as
laid out in Bank of America, NT&SA90 were all satisfied.
In contrast, this court ruled in The Manila Hotel Corp. v. National
Labor Relations Commission91 that the National Labor Relations Q
Commission was a seriously inconvenient forum. In that case, private
respondent Marcelo G. Santos was working in the Sultanate of Oman
when he received a letter from Palace Hotel recruiting him for
employment in Beijing, China. Santos accepted the offer.
Subsequently, however, he was released from employment
supposedly due to business reverses arising from political upheavals
in China (i.e., the Tiananmen Square incidents of 1989). Santos later
filed a Complaint for illegal dismissal impleading Palace Hotel's
General Manager, Mr. Gerhard Schmidt, the Manila Hotel
International Company Ltd. (which was, responsible for training
Palace Hotel's personnel and staff), and the Manila Hotel Corporation
(which owned 50% of Manila Hotel International Company Ltd.'s
capital stock).
In ruling against the National Labor Relations Commission's exercise
of jurisdiction, this court noted that the main aspects of the case
transpired in two (2) foreign jurisdictions, Oman and China, and that
the case involved purely foreign elements. Specifically, Santos was
directly hired by a foreign employer through correspondence sent to
Oman. Also, the proper defendants were neither Philippine nationals
nor engaged in business in the Philippines, while the main witnesses
were not residents of the Philippines. Likewise, this court noted that
the National Labor Relations Commission was in no position to
conduct the following: first, determine the law governing the
employment contract, as it was entered into in foreign soil; second,
determine the facts, as Santos' employment was terminated in
Beijing; and third, enforce its judgment, since Santos' employer,
Palace Hotel, was incorporated under the laws of China and was not
even served with summons.
Contrary to Manila Hotel, the case now before us does not entail a
preponderance of linkages that favor a foreign jurisdiction.
Here, the circumstances of the parties and their relation do not
approximate the circumstances enumerated in Puyat,92 which this
court recognized as possibly justifying the desistance of Philippine
tribunals from exercising jurisdiction.
First, there is no basis for concluding that the case can be more
conveniently tried elsewhere. As established earlier, Saudia is doing
business in the Philippines. For their part, all four (4) respondents are
Filipino citizens maintaining residence in the Philippines and, apart
from their previous employment with Saudia, have no other
connection to the Kingdom of Saudi Arabia. It would even be to
respondents' inconvenience if this case were to be tried elsewhere.
Second, the records are bereft of any indication that respondents filed
their Complaint in an effort to engage in forum shopping or to vex
and inconvenience Saudia.
Third, there is no indication of "unwillingness to extend local judicial
facilities to non-residents or aliens."93 That Saudia has managed to
bring the present controversy all the way to this court proves this.
Fourth, it cannot be said that the local judicial machinery is
inadequate for effectuating the right sought to be maintained.
Summons was properly served on Saudia and jurisdiction over its
person was validly acquired.
Lastly, there is not even room for considering foreign law. Philippine
law properly governs the present dispute.
As the question of applicable law has been settled, the supposed
difficulty of ascertaining foreign law (which requires the application
of forum non conveniens) provides no insurmountable inconvenience
or special circumstance that will justify depriving Philippine tribunals
of jurisdiction.
Even if we were to assume, for the sake of discussion, that it is the
laws of Saudi Arabia which should apply, it does not follow that
Philippine tribunals should refrain from exercising jurisdiction. To.
recall our pronouncements in Puyat,94 as well as in Bank of America,
NT&SA,95 it is not so much the mere applicability of foreign law
18
which calls into operation forum non conveniens. Rather, what
justifies a court's desistance from exercising jurisdiction is
"[t]he difficulty of ascertaining foreign law"96 or the inability of a
"Philippine Court to make an intelligent decision as to the law[.]" 97
Consistent with lex loci intentionis, to the extent that it is proper and
practicable (i.e., "to make an intelligent decision"98), Philippine
tribunals may apply the foreign law selected by the parties. In fact,
(albeit without meaning to make a pronouncement on the accuracy
and reliability of respondents' citation) in this case, respondents
themselves have made averments as to the laws of Saudi Arabia. In
their Comment, respondents write:chanroblesvirtuallawlibrary
Under the Labor Laws of Saudi Arabia and the Philippines[,] it is
illegal and unlawful to terminate the employment of any woman by
virtue of pregnancy. The law in Saudi Arabia is even more harsh and
strict [sic] in that no employer can terminate the employment of a
female worker or give her a warning of the same while on Maternity
Leave, the specific provision of Saudi Labor Laws on the matter is
hereto quoted as follows:chanroblesvirtuallawlibrary
"An employer may not terminate the employment of a female worker
or give her a warning of the same while on maternity leave." (Article
155, Labor Law of the Kingdom of Saudi Arabia, Royal Decree No.
M/51.)99cralawlawlibrary
All told, the considerations for assumption of jurisdiction by
Philippine tribunals as outlined in Bank of America, NT&SA100 have
been satisfied. First, all the parties are based in the Philippines and all
the material incidents transpired in this jurisdiction. Thus, the parties
may conveniently seek relief from Philippine tribunals. Second,
Philippine tribunals are in a position to make an intelligent decision
as to the law and the facts. Third, Philippine tribunals are in a
position to enforce their decisions. There is no compelling basis for
ceding jurisdiction to a foreign tribunal. Quite the contrary, the
immense public policy considerations attendant to this case behoove
Philippine tribunals to not shy away from their duty to rule on the
case.chanRoblesvirtualLawlibrary
IV
Respondents were illegally terminated.
In Bilbao v. Saudi Arabian Airlines,101 this court defined voluntary
resignation as "the voluntary act of an employee who is in a situation
where one believes that personal reasons cannot be sacrificed in favor
of the exigency of the service, and one has no other choice but to
dissociate oneself from employment. It is a formal pronouncement or
relinquishment of an office, with the intention of relinquishing the
office accompanied by the act of relinquishment."102 Thus, essential
to the act of resignation is voluntariness. It must be the result of an
employee's exercise of his or her own will.
In the same case of Bilbao, this court advanced a means for
determining whether an employee resigned
voluntarily:chanroblesvirtuallawlibrary
As the intent to relinquish must concur with the overt act of
relinquishment, the acts of the employee before and after the alleged
resignation must be considered in determining whether he or she, in
fact, intended, to sever his or her employment.103(Emphasis supplied)
On the other hand, constructive dismissal has been defined as
"cessation of work because 'continued employment is rendered
impossible, unreasonable or unlikely, as an offer involving a
demotion in rank or a diminution in pay' and other benefits."104
In Penaflor v. Outdoor Clothing Manufacturing
Corporation,105 constructive dismissal has been described as
tantamount to "involuntarily [sic] resignation due to the harsh,
hostile, and unfavorable conditions set by the employer."106 In the
same case, it was noted that "[t]he gauge for constructive dismissal is
whether a reasonable person in the employee's position would feel
compelled to give up his employment under the prevailing
circumstances."107
Applying the cited standards on resignation and constructive
dismissal, it is clear that respondents were constructively dismissed.
Hence, their termination was illegal.
The termination of respondents' employment happened when they
were pregnant and expecting to incur costs on account of child
delivery and infant rearing. As noted by the Court of Appeals,
pregnancy is a time when they need employment to sustain their
families.108 Indeed, it goes against normal and reasonable human
behavior to abandon one's livelihood in a time of great financial need.
It is clear that respondents intended to remain employed with Saudia.
All they did was avail of their maternity leaves. Evidently, the very
nature of a maternity leave means that a pregnant employee will not
report for work only temporarily and that she will resume the
performance of her duties as soon as the leave allowance expires.
It is also clear that respondents exerted all efforts to' remain
employed with Saudia. Each of them repeatedly filed appeal letters
(as much as five [5] letters in the case of Rebesencio 109) asking
Saudia to reconsider the ultimatum that they resign or be terminated
along with the forfeiture of their benefits. Some of them even went to
Saudia's office to personally seek reconsideration. 110
Respondents also adduced a copy of the "Unified Employment
Contract for Female Cabin Attendants."111 This contract deemed void
the employment of a flight attendant who becomes pregnant and
threatened termination due to lack of medical fitness. 112 The threat of
termination (and the forfeiture of benefits that it entailed) is enough
to compel a reasonable person in respondents' position to give up his
or her employment.
Saudia draws attention to how respondents' resignation letters were
supposedly made in their own handwriting. This minutia fails to
surmount all the other indications negating any voluntariness on
respondents' part. If at all, these same resignation letters are proof of
how any supposed resignation did not arise from respondents' own
initiative. As earlier pointed out, respondents' resignations were
executed on Saudia's blank letterheads that Saudia had provided.
These letterheads already had the word "RESIGNATION" typed on
the subject portion of their respective headings when these were
handed to respondents.113ChanRoblesVirtualawlibrary
"In termination cases, the burden of proving just or valid cause for
19
dismissing an employee rests on the employer."114 In this case, Saudia
makes much of how respondents supposedly completed their exit
interviews, executed quitclaims, received their separation pay, and
took more than a year to file their Complaint.115 If at all, however,
these circumstances prove only the fact of their occurrence, nothing
more. The voluntariness of respondents' departure from Saudia is non
sequitur.
Mere compliance with standard procedures or processes, such as the
completion of their exit interviews, neither negates compulsion nor
indicates voluntariness.
As with respondent's resignation letters, their exit interview forms
even support their claim of illegal dismissal and militates against
Saudia's arguments. These exit interview forms, as reproduced by
Saudia in its own Petition, confirms the unfavorable conditions as
regards respondents' maternity leaves. Ma. Jopette's and Loraine's
exit interview forms are particularly
telling:chanroblesvirtuallawlibrary
a. From Ma. Jopette's exit interview form:
3. In what respects has the job met or failed to meet your
expectations?
THE SUDDEN TWIST OF DECISION REGARDING THE
MATERNITY LEAVE.116
b. From Loraine's exit interview form:
1. What are your main reasons for leaving Saudia? What company
are you joining?
xxx xxx xxx
Others
CHANGING POLICIES REGARDING MATERNITY LEAVE
(PREGNANCY)117
As to respondents' quitclaims, in Phil. Employ Services and
Resources, Inc. v. Paramio,118 this court noted that "[i]f (a) there is
clear proof that the waiver was wangled from an unsuspecting or
gullible person; or (b) the terms of the settlement are unconscionable,
and on their face invalid, such quitclaims must be struck down as
invalid or illegal."119 Respondents executed their quitclaims after
having been unfairly given an ultimatum to resign or be terminated
(and forfeit their benefits).chanRoblesvirtualLawlibrary
V
Having been illegally and unjustly dismissed, respondents are entitled
to full backwages and benefits from the time of their termination until
the finality of this Decision. They are likewise entitled to separation
pay in the amount of one (1) month's salary for every year of service
until the fmality of this Decision, with a fraction of a year of at least
six (6) months being counted as one (1) whole year.
Moreover, "[m]oral damages are awarded in termination cases where
the employee's dismissal was attended by bad faith, malice or fraud,
or where it constitutes an act oppressive to labor, or where it was
done in a manner contrary to morals, good customs or public
policy."120 In this case, Saudia terminated respondents' employment in
a manner that is patently discriminatory and running afoul of the
public interest that underlies employer-employee relationships. As
such, respondents are entitled to moral damages.
To provide an "example or correction for the public good"121 as
against such discriminatory and callous schemes, respondents are
likewise entitled to exemplary damages.
In a long line of cases, this court awarded exemplary damages to
illegally dismissed employees whose "dismissal[s were] effected in a
wanton, oppressive or malevolent manner."122 This court has awarded
exemplary damages to employees who were terminated on such
frivolous, arbitrary, and unjust grounds as membership in or
involvement with labor unions,123 injuries sustained in the course of
employment,124 development of a medical condition due to the
employer's own violation of the employment contract, 125 and lodging
of a Complaint against the employer.126 Exemplary damages were
also awarded to employees who were deemed illegally dismissed by
an employer in an attempt to evade compliance with statutorily
established employee benefits.127 Likewise, employees dismissed for
supposedly just causes, but in violation of due process requirements,
were awarded exemplary damages.128
These examples pale in comparison to the present controversy.
Stripped of all unnecessary complexities, respondents were dismissed
for no other reason than simply that they were pregnant. This is as
wanton, oppressive, and tainted with bad faith as any reason for
termination of employment can be. This is no ordinary case of illegal
dismissal. This is a case of manifest gender discrimination. It is an
affront not only to our statutes and policies on employees' security of
tenure, but more so, to the Constitution's dictum of fundamental
equality between men and women.129
The award of exemplary damages is, therefore, warranted, not only to
remind employers of the need to adhere to the requirements of
procedural and substantive due process in termination of
employment, but more importantly, to demonstrate that gender
discrimination should in no case be countenanced.
Having been compelled to litigate to seek reliefs for their illegal and
unjust dismissal, respondents are likewise entitled to attorney's fees
in the amount of 10% of the total monetary award.130
VI
Petitioner Brenda J. Betia may not be held liable.
A corporation has a personality separate and distinct from those of
the persons composing it. Thus, as a rule, corporate directors and
officers are not liable for the illegal termination of a corporation's
employees. It is only when they acted in bad faith or with malice that
they become solidarity liable with the corporation. 131
In Ever Electrical Manufacturing, Inc. (EEMI) v. Samahang
20
Manggagawa ng Ever Electrical,132 this court clarified that "[b]ad
faith does not connote bad judgment or negligence; it imports a
dishonest purpose or some moral obliquity and conscious doing of
wrong; it means breach of a known duty through some motive or
interest or ill will; it partakes of the nature of fraud."133
Respondents have not produced proof to show that Brenda J. Betia
acted in bad faith or with malice as regards their termination. Thus,
she may not be held solidarity liable with Saudia.cralawred
WHEREFORE, with the MODIFICATIONS that first, petitioner
Brenda J. Betia is not solidarity liable with petitioner Saudi Arabian
Airlines, and second, that petitioner Saudi Arabian Airlines is liable
for moral and exemplary damages. The June 16, 2011 Decision and
the September 13, 2011 Resolution of the Court of Appeals in CA-
G.R. SP. No. 113006 are hereby AFFIRMED in all other respects.
Accordingly, petitioner Saudi Arabian Airlines is ordered to pay
respondents:
(1) Full backwages and all other benefits computed from the
respective dates in which each of the respondents were illegally
terminated until the finality of this Decision;
(2) Separation pay computed from the respective dates in which each
of the respondents commenced employment until the finality of
this Decision at the rate of one (1) month's salary for every year of
service, with a fraction of a year of at least six (6) months being
counted as one (1) whole year;
(3) Moral damages in the amount of P100,000.00 per respondent;
(4) Exemplary damages in the amount of P200,000.00 per
respondent; and
(5) Attorney's fees equivalent to 10% of the total award.
Interest of 6% per annum shall likewise be imposed on the total
judgment award from the finality of this Decision until full
satisfaction thereof.
This case is REMANDED to the Labor Arbiter to make a detailed
computation of the amounts due to respondents which petitioner
Saudi Arabian Airlines should pay without delay.
SO ORDERED.chanroblesvirtuallawlibrary
G.R. No. 202961, February 04, 2015EMER MILAN, RANDY
MASANGKAY, WILFREDO JAVIER, RONALDO DAVID,
BONIFACIO MATUNDAN, NORA MENDOZA, ET
AL., Petitioners, v. NATIONAL LABOR RELATIONS
COMMISSION, SOLID MILLS, INC., AND/OR PHILIP
ANG, Respondents.
An employer is allowed to withhold terminal pay and benefits
pending the employees return of its properties.
Petitioners are respondent Solid Mills, Inc.s (Solid Mills)
employees.1 They are represented by the National Federation of
Labor Unions (NAFLU), their collective bargaining
agent.2chanroblesvirtuallawlibrary
As Solid Mills employees, petitioners and their families were
allowed to occupy SMI Village, a property owned by Solid Mills. 3
According to Solid Mills, this was [o]ut of liberality and for the
convenience of its employees . . . [and] on the condition that the
employees . . . would vacate the premises anytime the Company
deems fit.4chanroblesvirtuallawlibrary
In September 2003, petitioners were informed that effective October
10, 2003, Solid Mills would cease its operations due to serious
business losses.5 NAFLU recognized Solid Mills closure due to
serious business losses in the memorandum of agreement dated
September 1, 2003.6 The memorandum of agreement provided for
Solid Mills grant of separation pay less accountabilities, accrued sick
leave benefits, vacation leave benefits, and 13th month pay to the
employees.7 Pertinent portions of the agreement
provide:chanRoblesvirtualLawlibrary
WHEREAS, the COMPANY has incurred substantial financial losses
and is currently experiencing further severe financial
losses;chanrobleslaw
WHEREAS, in view of such irreversible financial losses,
the COMPANY will cease its operations on October 10,
2003;chanrobleslaw
WHEREAS, all employees of the COMPANY on account of
irreversible financial losses, will be dismissed from employment
effective October 10, 2003;chanrobleslaw
In view thereof, the parties agree as
follows:chanRoblesvirtualLawlibrary
1. That UNION acknowledges that
the COMPANY is experiencing severe financial
losses and as a consequence of which,
management is constrained to cease the
companys operations.
2. The UNION acknowledges that under Article
283 of the Labor Code, separation pay is granted
to employees who are dismissed due to closures
or cessation of operations NOT DUE to serious
business losses.
3. The UNION acknowledges that in view of the
serious business losses the Company has been
experiencing as seen in their audited financial
statements, employees ARE NOT granted
separation benefits under the law.
4. The COMPANY, by way of goodwill and in the
spirit of generosity agrees to grant financial
assistance less accountabilities to members of
21
the Union based on length of service to be
computed as follows: (Italics in this paragraph
supplied)
Number of days - 12.625 for every year of
service
5. In view of the above, the members of the UNION
will receive such financial assistance on an equal
monthly installments basis based on the
following schedule:chanRoblesvirtualLawlibrary
First Check due on January 5, 2004 and every
5th of the month thereafter until December 5,
2004.
6. The COMPANY commits to pay any accrued
benefits the Union members are entitled to,
specifically those arising from sick and vacation
leave benefits and 13th month pay, less
accountabilities based on the following
schedule:chanRoblesvirtualLawlibrary
One Time Cash Payment to be distributed
anywhere from. . . .
....
7. The foregoing agreement is entered into with full
knowledge by the parties of their rights under the
law and they hereby bind themselves not to
conduct any concerted action of whatsoever kind,
otherwise the grant of financial assistance as
discussed above will be withheld.8 (Emphasis in
the original)
Solid Mills filed its Department of Labor and Employment
termination report on September 2, 2003.9chanroblesvirtuallawlibrary
Later, Solid Mills, through Alfredo Jingco, sent to petitioners
individual notices to vacate SMI Village.10chanroblesvirtuallawlibrary
Petitioners were no longer allowed to report for work by October 10,
2003.11 They were required to sign a memorandum of agreement
with release and quitclaim before their vacation and sick leave
benefits, 13th month pay, and separation pay would be released. 12
Employees who signed the memorandum of agreement were
considered to have agreed to vacate SMI Village, and to the
demolition of the constructed houses inside as condition for the
release of their termination benefits and separation pay.13 Petitioners
refused to sign the documents and demanded to be paid their benefits
and separation pay.14chanroblesvirtuallawlibrary
Hence, petitioners filed complaints before the Labor Arbiter for
alleged non-payment of separation pay, accrued sick and vacation
leaves, and 13th month pay.15 They argued that their accrued benefits
and separation pay should not be withheld because their payment is
based on company policy and practice.16 Moreover, the 13th month
pay is based on law, specifically, Presidential Decree No. 851. 17
Their possession of Solid Mills property is not an accountability that
is subject to clearance procedures.18 They had already turned over to
Solid Mills their uniforms and equipment when Solid Mills ceased
operations.19chanroblesvirtuallawlibrary
On the other hand, Solid Mills argued that petitioners complaint was
premature because they had not vacated its
property.20chanroblesvirtuallawlibrary
The Labor Arbiter ruled in favor of petitioners.21 According to the
Labor Arbiter, Solid Mills illegally withheld petitioners benefits and
separation pay.22 Petitioners right to the payment of their benefits
and separation pay was vested by law and contract. 23 The
memorandum of agreement dated September 1, 2003 stated no
condition to the effect that petitioners must vacate Solid Mills
property before their benefits could be given to them. 24 Petitioners
possession should not be construed as petitioners accountabilities
that must be cleared first before the release of benefits. 25 Their
possession is not by virtue of any employer-employee
relationship.26 It is a civil issue, which is outside the jurisdiction of
the Labor Arbiter.27chanroblesvirtuallawlibrary
The dispositive portion of the Labor Arbiters decision
reads:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, judgment is
entered ORDERING respondents SOLID MILLS,
INC. and/or PHILIP ANG (President), in solido to pay the
remaining 21 complainants:chanRoblesvirtualLawlibrary
1) 19 of which, namely EMER MILAN, RAMON MASANGKAY,
ALFREDO JAVIER, RONALDO DAVID, BONIFACIO
MATUNDAN, NORA MENDOZA, MYRNA IGCAS, RAUL DE
LAS ALAS, RENATO ESTOLANO, REX S. DIMAFELIX,
MAURA MILAN, JESSICA BAYBAYON, ALFREDO MENDOZA,
ROBERTO IGCAS, ISMAEL MATA, CARLITO DAMIAN,
TEODORA MAHILOM, MARILOU LINGA, RENATO LINGA
their separation pay of 12.625 days pay per year of service, pro-rated
13th month pay for 2003 and accrued vacation and sick leaves, plus
12% interest p.a. from date of filing of the lead case/judicial demand
on 12/08/03 until actual payment and/or finality;chanrobleslaw
2) the remaining 2 of which, complainants CLEOPATRA
ZACARIAS, as she already received on 12/19/03 her accrued 13th
month pay for 2003, accrued VL/SL total amount of P15,435.16,
likewise, complainant Jerry L. Sesma as he already received his
accrued 13th month pay for 2003, SL/VL in the total amount of
P10,974.97, shall be paid only their separation pay of 12.625 days
pay per year of service but also with 12% interest p.a. from date of
filing of the lead case/judicial demand on 12/08/03 until actual
payment and/or finality, which computation as of date, amount to as
shown in the attached computation sheet.
3) Nine (9) individual complaints viz., of Maria Agojo, Joey Suarez,
Ronaldo Vergara, Ronnie Vergara, Antonio R. Dulo, Sr., Bryan D.
22
Durano, Silverio P. Durano, Sr., Elizabeth Duarte and Purificacion
Malabanan are DISMISSED WITH PREJUDICE due to amicable
settlement, whereas, that of [RONIE ARANAS], [EMILITO
NAVARRO], [NONILON PASCO], [GENOVEVA PASCO],
[OLIMPIO A. PASCO] are DISMISSED WITHOUT
PREJUDICE, for lack of interest and/or failure to prosecute.
The Computation and Examination unit is directed to cause the
computation of the award in Pars. 2 and 3 above.28 (Emphasis in the
original)
Solid Mills appealed to the National Labor Relations Commission. 29
It prayed for, among others, the dismissal of the complaints against it
and the reversal of the Labor Arbiters
decision.30chanroblesvirtuallawlibrary
The National Labor Relations Commission affirmed paragraph 3 of
the Labor Arbiters dispositive portion, but reversed paragraphs 1 and
2. Thus:chanRoblesvirtualLawlibrary
WHEREFORE, the Decision of Labor Arbiter Renaldo O. Hernandez
dated 10/17/05 is AFFIRMED in so far as par. 3 thereof is concerned
but modified in that paragraphs 1 and 2 thereof are REVERSED and
SET ASIDE. Accordingly, the following complainants, namely: Emir
Milan, Ramon Masangkay, Alfredo Javier, Ronaldo David, Bonifacio
Matundan, Nora Mendoza, Myrna Igcas, Raul De Las Alas, Renato
Estolano, Rex S. Dimaf[e]lix, Maura Milan, Jessica Baybayon,
Alfredo Mendoza, Roberto Igcas, Cleopatra Zacarias and Jerry L.
Sesmas monetary claims in the form of separation pay, accrued 13th
month pay for 2003, accrued vacation and sick leave pays are held in
abeyance pending compliance of their accountabilities to respondent
company by turning over the subject lots they respectively occupy at
SMI Village Sucat Muntinlupa City, Metro Manila to herein
respondent company.31
The National Labor Relations Commission noted that complainants
Marilou Linga, Renato Linga, Ismael Mata, and Carlito Damian were
already paid their respective separation pays and benefits. 32
Meanwhile, Teodora Mahilom already retired long before Solid
Mills closure.33 She was already given her retirement
benefits.34chanroblesvirtuallawlibrary
The National Labor Relations Commission ruled that because of
petitioners failure to vacate Solid Mills property, Solid Mills was
justified in withholding their benefits and separation pay.35 Solid
Mills granted the petitioners the privilege to occupy its property on
account of petitioners employment.36 It had the prerogative to
terminate such privilege.37 The termination of Solid Mills and
petitioners employer-employee relationship made it incumbent upon
petitioners to turn over the property to Solid
Mills.38chanroblesvirtuallawlibrary
Petitioners filed a motion for partial reconsideration on October 18,
2010,39 but this was denied in the November 30, 2010
resolution.40chanroblesvirtuallawlibrary
Petitioners, thus, filed a petition for certiorari41 before the Court of
Appeals to assail the National Labor Relations Commission decision
of August 31, 2010 and resolution of November 30,
2010.42chanroblesvirtuallawlibrary
On January 31, 2012, the Court of Appeals issued a decision
dismissing petitioners petition,43thus:chanRoblesvirtualLawlibrary
WHEREFORE, the petition is hereby ordered DISMISSED.44
The Court of Appeals ruled that Solid Mills act of allowing its
employees to make temporary dwellings in its property was a
liberality on its part. It may be revoked any time at its discretion. 45
As a consequence of Solid Mills closure and the resulting
termination of petitioners, the employer-employee relationship
between them ceased to exist. There was no more reason for them to
stay in Solid Mills property.46 Moreover, the memorandum of
agreement between Solid Mills and the union representing petitioners
provided that Solid Mills payment of employees benefits should be
less accountabilities.47chanroblesvirtuallawlibrary
On petitioners claim that there was no evidence that Teodora
Mahilom already received her retirement pay, the Court of Appeals
ruled that her complaint filed before the Labor Arbiter did not include
a claim for retirement pay. The issue was also raised for the first time
on appeal, which is not allowed.48 In any case, she already retired
before Solid Mills ceased its operations.49chanroblesvirtuallawlibrary
The Court of Appeals agreed with the National Labor Relations
Commissions deletion of interest since it found that Solid Mills act
of withholding payment of benefits and separation pay was proper.
Petitioners terminal benefits and pay were withheld because of
petitioners failure to vacate Solid Mills
property.50chanroblesvirtuallawlibrary
Finally, the Court of Appeals noted that Carlito Damian already
received his separation pay and benefits.51 Hence, he should no
longer be awarded these claims.52chanroblesvirtuallawlibrary
In the resolution promulgated on July 16, 2012, the Court of Appeals
denied petitioners motion for
reconsideration.53chanroblesvirtuallawlibrary
Petitioners raise in this petition the following
errors:chanRoblesvirtualLawlibrary
I this issue.61 It is independent from the issue of payment of
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
COMMITTED REVERSIBLE ERROR WHEN IT RULED THAT
PAYMENT OF THE MONETARY CLAIMS OF PETITIONERS
SHOULD BE HELD IN ABEYANCE PENDING COMPLIANCE
OF THEIR ACCOUNTABILITIES TO RESPONDENT SOLID
MILLS BY TURNING OVER THE SUBJECT LOTS THEY
RESPECTIVELY OCCUPY AT SMI VILLAGE, SUCAT,
MUNTINLUPA CITY.
II
23
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
COMMITTED REVERSIBLE ERROR WHEN IT UPHELD THE
RULING OF THE NLRC DELETING THE INTEREST OF 12%
PER ANNUM IMPOSED BY THE HONORABLE LABOR
ARBITER HERNANDEZ ON THE AMOUNT DUE FROM THE
DATE OF FILING OF THE LEAD CASE/JUDICIAL DEMAND
ON DECEMBER 8, 2003 UNTIL ACTUAL PAYMENT AND/OR
FINALITY.
III
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
COMMITTED REVERSIBLE ERROR WHEN IT UPHELD THE
RULING OF THE NLRC DENYING THE CLAIM OF TEODORA
MAHILOM FOR PAYMENT OF RETIREMENT BENEFITS
DESPITE LACK OF ANY EVIDENCE THAT SHE RECEIVED
THE SAME.
IV
WHETHER OR NOT PETITIONER CARLITO DAMIAN IS
ENTITLED TO HIS MONETARY BENEFITS FROM
RESPONDENT SOLID MILLS.54
Petitioners argue that respondent Solid Mills and NAFLUs
memorandum of agreement has no provision stating that benefits
shall be paid only upon return of the possession of respondent Solid
Mills property.55 It only provides that the benefits shall be less
accountabilities, which should not be interpreted to include such
possession.56 The fact that majority of NAFLUs members were not
occupants of respondent Solid Mills property is evidence that
possession of the property was not contemplated in the agreement. 57
Accountabilities should be interpreted to refer only to
accountabilities that were incurred by petitioners while they were
performing their duties as employees at the worksite. 58 Moreover,
applicable laws, company practice, or policies do not provide that
13th month pay, and sick and vacation leave pay benefits, may be
withheld pending satisfaction of liabilities by the
employee.59chanroblesvirtuallawlibrary
Petitioners also point out that the National Labor Relations
Commission and the Court of Appeals have no jurisdiction to declare
that petitioners act of withholding possession of respondent Solid
Mills property is illegal.60 The regular courts have jurisdiction over
petitioners monetary benefits.62chanroblesvirtuallawlibrary
For these reasons, and because, according to petitioners, the amount
of monetary award is no longer in question, petitioners are entitled to
12% interest per annum.63chanroblesvirtuallawlibrary
Petitioners also argue that Teodora Mahilom and Carlito Damian are
entitled to their claims. They insist that Teodora Mahilom did not
receive her retirement benefits and that Carlito Damian did not
receive his separation benefits.64chanroblesvirtuallawlibrary
Respondents Solid Mills and Philip Ang, in their joint comment, absence of stenographic notes, the following cases involving workers,
argue that petitioners failure to turn over respondent Solid Mills whether agricultural or non-agricultural:chanRoblesvirtualLawlibrary
property constituted an unsatisfied accountability for which reason
petitioners benefits could rightfully be withheld.65 The term 1. Unfair labor practice cases;
accountability should be given its natural and ordinary meaning. 66
Thus, it should be interpreted as a state of being liable or 2. Termination disputes;
responsible, or obligation.67 Petitioners differentiation between
accountabilities incurred while performing jobs at the worksite and
3. If accompanied with a claim for reinstatement,
accountabilities incurred outside the worksite is baseless because the
those cases that workers may file involving
agreement with NAFLU merely stated accountabilities, without
wages, rates of pay, hours of work and other
qualification.68chanroblesvirtuallawlibrary
terms and conditions of employment;
On the removal of the award of 12% interest per annum, respondents
argue that such removal was proper since respondent Solid Mills was 4. Claims for actual, moral, exemplary and other
justified in withholding the monetary forms of damages arising from the employer-
claims.69chanroblesvirtuallawlibrary employee relations;

Respondents argue that Teodora Mahilom had no more cause of
action for retirement benefits claim.70 She had already retired more
than a decade before Solid Mills closure. She also already received
her retirement benefits in 1991.71 Teodora Mahiloms claim was also
not included in the complaint filed before the Labor Arbiter. It was
improper to raise this claim for the first time on appeal. In any case,
Teodora Mahiloms claim was asserted long after the three-year
prescriptive period provided in Article 291 of the Labor
Code.72chanroblesvirtuallawlibrary
Lastly, according to respondents, it would be unjust if Carlito Damian
would be allowed to receive monetary benefits again, which he,
admittedly, already received from Solid
Mills.73chanroblesvirtuallawlibrary
I
5. Cases arising from any violation of Article 264 of
this Code, including questions involving the
legality of strikes and lockouts; and
6. Except claims for Employees Compensation,
Social Security, Medicare and maternity benefits,
all other claims, arising from employer-employee
relations including those of persons in domestic
or household service, involving an amount
exceeding five thousand pesos (P5,000.00),
regardless of whether accompanied with a claim
for reinstatement.
(2) The Commission shall have exclusive appellate jurisdiction over
all cases decided by Labor Arbiters. (Emphasis supplied)

Petitioners claim that they have the right to the immediate release of
their benefits as employees separated from respondent Solid Mills is
The National Labor Relations
a question arising from the employer-employee relationship between
Commission may preliminarily
the parties.
determine issues related to rights
arising from an employer-employee
Claims arising from an employer-employee relationship are not
relationship
limited to claims by an employee. Employers may also have claims
against the employee, which arise from the same relationship.
The National Labor Relations Commission has jurisdiction to
determine, preliminarily, the parties rights over a property, when it is
In Baez v. Valdevilla,74 this court ruled that Article 217 of the Labor
necessary to determine an issue related to rights or claims arising
Code also applies to employers claim for damages, which arises
from an employer-employee relationship.
from or is connected with the labor issue.
Thus:chanRoblesvirtualLawlibrary
Article 217 provides that the Labor Arbiter, in his or her original
jurisdiction, and the National Labor Relations Commission, in its
Whereas this Court in a number of occasions had applied the
appellate jurisdiction, may determine issues involving claims arising
jurisdictional provisions of Article 217 to claims for damages filed by
from employer-employee relations.
employees, we hold that by the designating clause arising from the
Thus:chanRoblesvirtualLawlibrary
employer-employee relations Article 217 should apply with equal
force to the claim of an employer for actual damages against its
ART. 217. JURISDICTION OF LABOR ARBITERS AND THE
dismissed employee, where the basis for the claim arises from or is
COMMISSION. (1) Except as otherwise provided under this Code,
necessarily connected with the fact of termination, and should be
the Labor Arbiters shall have original and exclusive jurisdiction to
entered as a counterclaim in the illegal dismissal case. 75
hear and decide within thirty (30) calendar days after the submission
of the case by the parties for decision without extension, even in the
Baez was cited in Domondon v. National Labor Relations
24
Commission.76 One of the issues in Domondon is whether the Labor
Arbiter has jurisdiction to decide an issue on the transfer of
ownership of a vehicle assigned to the employee. It was argued that
only regular courts have jurisdiction to decide the
issue.77chanroblesvirtuallawlibrary
This court ruled that since the transfer of ownership of the vehicle to
the employee was connected to his separation from the employer and
arose from the employer-employee relationship of the parties, the
employers claim fell within the Labor Arbiters
jurisdiction.78chanroblesvirtuallawlibrary
As a general rule, therefore, a claim only needs to be sufficiently
connected to the labor issue raised and must arise from an employer-
employee relationship for the labor tribunals to have jurisdiction.
In this case, respondent Solid Mills claims that its properties are in
petitioners possession by virtue of their status as its employees.
Respondent Solid Mills allowed petitioners to use its property as an
act of liberality. Put in other words, it would not have allowed
petitioners to use its property had they not been its employees. The
return of its properties in petitioners possession by virtue of their
status as employees is an issue that must be resolved to determine
whether benefits can be released immediately. The issue raised by
the employer is, therefore, connected to petitioners claim for benefits
and is sufficiently intertwined with the parties employer-employee
relationship. Thus, it is properly within the labor tribunals
jurisdiction.
II
Institution of clearance procedures
has legal bases
Requiring clearance before the release of last payments to the
employee is a standard procedure among employers, whether public
or private. Clearance procedures are instituted to ensure that the
properties, real or personal, belonging to the employer but are in the
possession of the separated employee, are returned to the employer
before the employees departure.
As a general rule, employers are prohibited from withholding wages
from employees. The Labor Code
provides:chanRoblesvirtualLawlibrary
Art. 116. Withholding of wages and kickbacks prohibited. It shall
be unlawful for any person, directly or indirectly, to withhold any
amount from the wages of a worker or induce him to give up any part
of his wages by force, stealth, intimidation, threat or by any other
means whatsoever without the workers consent.
The Labor Code also prohibits the elimination or diminution of
benefits. Thus:chanRoblesvirtualLawlibrary
25
Art. 100. Prohibition against elimination or diminution of
benefits. Nothing in this Book shall be construed to eliminate or in
any way diminish supplements, or other employee benefits being
enjoyed at the time of promulgation of this Code.
However, our law supports the employers institution of clearance
procedures before the release of wages. As an exception to the
general rule that wages may not be withheld and benefits may not be
diminished, the Labor Code provides:chanRoblesvirtualLawlibrary
Art. 113. Wage deduction. No employer, in his own behalf or in
behalf of any person, shall make any deduction from the wages of his
employees, except:chanRoblesvirtualLawlibrary
1. In cases where the worker is insured with his consent by the
employer, and the deduction is to recompense the employer for the
amount paid by him as premium on the insurance;chanrobleslaw
2. For union dues, in cases where the right of the worker or his union
to check-off has been recognized by the employer or authorized in
writing by the individual worker concerned; and
3. In cases where the employer is authorized by law or regulations
issued by the Secretary of Labor and Employment. (Emphasis
supplied)
The Civil Code provides that the employer is authorized to withhold
wages for debts due:chanRoblesvirtualLawlibrary
Article 1706. Withholding of the wages, except for a debt due, shall
not be made by the employer.cralawred
Debt in this case refers to any obligation due from the employee to
the employer. It includes any accountability that the employee may
have to the employer. There is no reason to limit its scope to
uniforms and equipment, as petitioners would argue.
More importantly, respondent Solid Mills and NAFLU, the union
representing petitioners, agreed that the release of petitioners
benefits shall be less accountabilities.
Accountability, in its ordinary sense, means obligation or debt. The
ordinary meaning of the term accountability does not limit the
definition of accountability to those incurred in the worksite. As long
as the debt or obligation was incurred by virtue of the employer-
employee relationship, generally, it shall be included in the
employees accountabilities that are subject to clearance procedures.
It may be true that not all employees enjoyed the privilege of staying
in respondent Solid Mills property. However, this alone does not
imply that this privilege when enjoyed was not a result of the
employer-employee relationship. Those who did avail of the
privilege were employees of respondent Solid Mills. Petitioners
possession should, therefore, be included in the term
accountability.
Accountabilities of employees are personal. They need not be
uniform among all employees in order to be included in
accountabilities incurred by virtue of an employer-employee
relationship.
Petitioners do not categorically deny respondent Solid Mills
ownership of the property, and they do not claim superior right to it.
What can be gathered from the findings of the Labor Arbiter,
National Labor Relations Commission, and the Court of Appeals is
that respondent Solid Mills allowed the use of its property for the
benefit of petitioners as its employees. Petitioners were merely
allowed to possess and use it out of respondent Solid Mills
liberality. The employer may, therefore, demand the property at
will.79chanroblesvirtuallawlibrary
The return of the propertys possession became an obligation or
liability on the part of the employees when the employer-employee
relationship ceased. Thus, respondent Solid Mills has the right to
withhold petitioners wages and benefits because of this existing debt
or liability. In Solas v. Power and Telephone Supply Phils., Inc., et
al., this court recognized this right of the employer when it ruled that
the employee in that case was not constructively dismissed. 80
Thus:chanRoblesvirtualLawlibrary
There was valid reason for respondents withholding of petitioners
salary for the month of February 2000. Petitioner does not deny that
he is indebted to his employer in the amount of around P95,000.00.
Respondents explained that petitioners salary for the period of
February 1-15, 2000 was applied as partial payment for his debt and
for withholding taxes on his income; while for the period of February
15-28, 2000, petitioner was already on absence without leave, hence,
was not entitled to any pay.81
The law does not sanction a situation where employees who do not
even assert any claim over the employers property are allowed to
take all the benefits out of their employment while they
simultaneously withhold possession of their employers property for
no rightful reason.
Withholding of payment by the employer does not mean that the
employer may renege on its obligation to pay employees their wages,
termination payments, and due benefits. The employees benefits are
also not being reduced. It is only subjected to the condition that the
employees return properties properly belonging to the employer.
This is only consistent with the equitable principle that no one shall
be unjustly enriched or benefited at the expense of
another.82chanroblesvirtuallawlibrary
For these reasons, we cannot hold that petitioners are entitled to
interest of their withheld separation benefits. These benefits were
properly withheld by respondent Solid Mills because of their refusal
to return its property.
III
Mahilom and Damian are not
26
entitled to the benefits claimed
Teodora Mahilom is not entitled to separation benefits.
Both the National Labor Relations Commission and the Court of
Appeals found that Teodora Mahilom already retired long before
respondent Solid Mills closure. They found that she already
received her retirement benefits. We have no reason to disturb this
finding. This court is not a trier of facts. Findings of the National
Labor Relations Commission, especially when affirmed by the Court
of Appeals, are binding upon this court.83chanroblesvirtuallawlibrary
Moreover, Teodora Mahiloms claim for retirement benefits was not
included in her complaint filed before the Labor Arbiter. Hence, it
may not be raised in the appeal.
Similarly, the National Labor Relations Commission and the Court of
Appeals found that Carlito Damian already received his terminal
benefits. Hence, he may no longer claim terminal benefits.
The fact that respondent Solid Mills has not yet demolished Carlito
Damians house in SMI Village is not evidence that he did not receive
his benefits. Both the National Labor Relations Commission and the
Court of Appeals found that he executed an affidavit stating that he
already received the benefits.
Absent any showing that the National Labor Relations Commission
and the Court of Appeals misconstrued these facts, we will not
reverse these findings.
Our laws provide for a clear preference for labor. This is in
recognition of the asymmetrical power of those with capital when
they are left to negotiate with their workers without the standards and
protection of law. In cases such as these, the collective bargaining
unit of workers are able to get more benefits and in exchange, the
owners are able to continue with the program of cutting their losses
or wind down their operations due to serious business losses. The
company in this case did all that was required by law.
The preferential treatment given by our law to labor, however, is not
a license for abuse.84 It is not a signal to commit acts of unfairness
that will unreasonably infringe on the property rights of the
company. Both labor and employer have social utility, and the law is
not so biased that it does not find a middle ground to give each their
due.
Clearly, in this case, it is for the workers to return their housing in
exchange for the release of their benefits. This is what they agreed
upon. It is what is fair in the premises.
WHEREFORE, the petition is DENIED. The Court of Appeals
decision is AFFIRMED.
G.R. No. 195109, February 04, 2015ANDY D. BALITE, DELFIN
M. ANZALDO AND MONALIZA DL. BIHASA, Petitioners, v. SS
VENTURES INTERNATIONAL, INC., SUNG SIK LEE AND
EVELYN RAYALA , Respondents.
This is a Petition for Review on Certiorari pursuant to Rule 45 of the
Revised Rules of Court, assailing the 18 June 2010
Decision1 rendered by the Tenth Division of the Court of Appeals in
CA-G.R. SP No. 109589. In its assailed decision, the appellate court
reversed the Resolution of the National Labor Relations Commission
(NLRC) which denied the Motion to Reduce Appeal Bond filed by
respondents SS Ventures International, Inc., Sung Sik Lee and Evelyn
Rayala
In a Resolution2 dated 30 December 2010, the appellate court refused
to reconsider its earlier decision.
The Facts
Respondent SS Ventures International, Inc. is a domestic corporation
duly engaged in the business of manufacturing footwear products for
local sales and export abroad. It is represented in this action by
respondents Sung Sik Lee and Evelyn Rayala. Petitioners Andy
Balite (Balite), Monaliza Bihasa (Bihasa) and Delfin Anzaldo
(Anzaldo) were regular employees of the respondent company until
their employments were severed for violation of various company
policies.
For his part, Balite was issued a Show Cause Memorandum by the
respondent company on 4 August 2005 charging him with the
following infractions: (1) making false reports, malicious and
fraudulent statements and rumor-mongering against the company; (2)
threatening and intimidating co-workers; (3) refusing to cooperate in
the conduct of investigation; and (4) gross negligence in the care and
use of the company property resulting in the damage of the finished
products. After respondent found Balites explanation insufficient, he
was dismissed from employment, through a Notice of Termination on
6 September 2005.
Bihasa, on the other hand, was charged with absence without leave on
two occasions and with improper behavior, stubbornness, arrogance
and uncooperative attitude towards superiors and employees. Bihasa
was likewise terminated from the service on 5 May 2006 after her
explanation in an administrative investigation was found
unsatisfactory by the respondent company.
Anzaldo was also dismissed from employment after purportedly
giving him due process. The records of the infractions he committed
as well as the date of his termination, however, are not borne by the
records.
Consequently, the three employees charged respondents with illegal
dismissal and recovery of backwages, 13th month pay and attorneys
fees before the Labor Arbiter.
In refuting the allegations of the petitioners, respondents averred that
petitioners were separated from employment for just causes and after
affording them procedural due process of law.
On 30 December 2007, the Labor Arbiter rendered a Decision3 in
favor of petitioners and held that respondents are liable for illegal
dismissal for failing to comply with the procedural and substantive
27
requirements in terminating employment. The decretal portion of the
Labor Arbiter Decision reads:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, [petitioners] are hereby found
to have been illegally dismissed even as respondents are held liable
therefore.
Consequently, respondent corporation is hereby ordered to reinstate
[petitioners] to their former positions without loss of seniority rights
and other privileges with backwages initially computed at this time
and reflected below.
The reinstatement aspect of this decision is immediately executory
and thus respondents are hereby required to submit a report of
compliance therewith within ten (10) days from receipt thereof.
Respondent corporation is likewise ordered to pay [petitioners] their
13th month pay and 10% attorneys fees.
13th month Attorneys
Backwages
pay fees
1. Andy P P
P162,969.04
Balite 17,511.00 18,048.00
2. Delfin
158,299.44 17,511.00 17,511.00
Anzaldo
3.
Monaliz 116,506.62 17,511.00 13,401.75
a Bihasa
All other claims are dismissed for lack of factual or legal basis. 4
Aggrieved, respondents interposed an appeal by filing a Notice of
Appeal and paying the corresponding appeal fee. However, instead of
filing the required appeal bond equivalent to the total amount of the
monetary award which is P490,308.00, respondents filed a Motion to
Reduce the Appeal Bond to P100,000.00 and appended therein a
managers check bearing the said amount. Respondents cited
financial difficulty as justification for their inability to post the appeal
bond in full owing to the partial shutdown of respondent companys
operations.
In a Resolution5 dated 27 November 2008, the NLRC dismissed the
appeal filed by the respondents for non-perfection. The NLRC ruled
that posting of an appeal bond equivalent to the monetary award is
indispensable for the perfection of the appeal and the reduction of the
appeal bond, absent any showing of meritorious ground to justify the
same, is not warranted in the instant case.
Similarly ill-fated was respondents Motion for Reconsideration
which was denied by the NLRC in a Resolution6 dated 30 April 2009.
On certiorari, the Court of Appeals reversed the NLRC Decision and
allowed the relaxation of the rule on posting of the appeal bond.
According to the appellate court, there was substantial compliance
with the rules for the perfection of an appeal because respondents
seasonably filed their Memorandum of Appeal and posted an appeal
bond in the amount of P100,000.00. While the amount of the appeal
bond posted was not equivalent to the monetary award, the Court of
Appeals ruled that respondents were able to sufficiently prove their
incapability to post the required amount of bond.7The Court of the required appeal bond. Despite the non-posting of the appeal bond
Appeals disposed in this wise:chanRoblesvirtualLawlibrary in full, however, the appellate court deemed that respondents were
WHEREFORE, premises considered, finding grave abuse of able to seasonably perfect their appeal before the NLRC, thereby
discretion on the part of the [NLRC], the instant petition directing the NLRC to resolve the case on the merits.
is GRANTED. The [NLRCs] Resolutions dated November 27, 2008
and April 30, 2009, respectively, are hereby SET ASIDE. [The The pertinent rule on the matter is Article 223 of the Labor Code, as
NLRC] is hereby directed to decide petitioners appeal on the merits. 8 amended, which sets forth the rules on appeal from the Labor
Arbiters monetary award:chanRoblesvirtualLawlibrary
In a Resolution9 dated 30 December 2010, the Court of Appeals
ART. 223. Appeal. Decisions, awards, or orders of the Labor
refused to reconsider its earlier decision.
Arbiter are final and executory unless appealed to the Commission by
any or both parties within ten (10) calendar days from receipt of such
Petitioners are now before this Court via this instant Petition for
decisions, awards, or orders. x x x.
Review on Certiorari10 praying that the Court of Appeals Decision
and Resolution be reversed and set aside on the ground
xxxx
that:chanRoblesvirtualLawlibrary
WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS
In case of a judgment involving a monetary award, an appeal by the
COMMITTED A GRAVE ABUSE OF DISCRETION
employer may be perfected only upon the posting of a cash or
AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION
surety bond issued by a reputable bonding company duly accredited
WHEN IT REVERSED THE RESOLUTION OF THE NLRC
by the Commission in the amount equivalent to the monetary award
DISMISSING RESPONDENTS APPEAL FOR NON-
in the judgment appealed from. (Emphases ours).cralawred
PERFECTION THEREOF.11
Implementing the aforestated provisions of the Labor Code are the
The Courts Ruling
provisions of Rule VI of the 2011 Rules of Procedure of the NLRC
on perfection of appeals which read:chanRoblesvirtualLawlibrary
Petitioners, in assailing the appellate courts decision, argue that
Section. 1. Periods of Appeal. - Decisions, awards or orders of the
posting of an appeal bond in full is not only mandatory but a
Labor Arbiter shall be final and executory unless appealed to the
jurisdictional requirement that must be complied with in order to
Commission by any or both parties within ten (10) calendar days
confer jurisdiction upon the NLRC. They posit that the posting of an
from receipt thereof. x x x If the 10th day or the 5th day, as the case
insufficient amount of appeal bond, as in this case, resulted to the
may be, falls on a Saturday, Sunday or holiday, the last day to perfect
non-perfection of the appeal rendering the decision of the Labor
the appeal shall be the first working day following such Saturday,
Arbiter final and executory.
Sunday or holiday.
Banking on the appellate courts decision, respondents, for their part,
xxxx
urge the Court to relax the rules on appeal underscoring on the so-
called utmost good faith they demonstrated in filing a Motion to
Section 4. Requisites for Perfection of Appeal. (a) The appeal shall
Reduce Appeal Bond and in posting a cash bond in the amount of
be:chanRoblesvirtualLawlibrary
P100,000.00. In justifying their inability to post the required appeal
bond, respondents reasoned that respondent company is in dire
(1) filed within the reglementary period as provided in Section 1 of
financial condition due to lack of orders from customers constraining
this Rule;
it to temporarily shut down its operations resulting in significant loss
(2) verified by the appellant himself/herself in accordance with
of revenues. Respondents now plea for the liberal interpretation of
Section 4, Rule 7 of the Rules of Court ,as amended;
the rules so that the case can be threshed out on the merits, and not on (3) in the form a of a memorandum of appeal which shall state the
technicality. grounds relied upon and the arguments in support thereof; the
relief prayed for; and with a statement of the date when the
Time and again we reiterate the established rule that in the exercise of appellant received the appealed decision, award or order;
the Supreme Courts power of review, the Court is not a trier of (4) in three (3) legibly typewritten or printed copies; and
facts12 and does not routinely undertake the re-examination of the (5) accompanied by:
evidence presented by the contending parties during the trial of the i) proof of payment of the required appeal fee and legal research
case considering that the findings of facts of labor officials who are fee;
deemed to have acquired expertise in matters within their respective ii) posting of cash or surety bond as provided in Section 6 of this
jurisdiction are generally accorded not only respect, but even finality, Rule; and
and are binding upon this Court, when supported by substantial iii) proof of service upon the other parties.
evidence.13chanroblesvirtuallawlibrary
xxxx
The NLRC ruled that no appeal had been perfected on time because
(b) A mere notice of appeal without complying with the other
of respondents failure to post the required amount of appeal bond. As
requisites aforestated shall not stop the running of the period for
a result of which, the decision of the Labor Arbiter has attained
perfecting an appeal.
finality. The Court of Appeals, on the contrary, allowed the relaxation
of the rules and held that respondents were justified in failing to pay
28
xxxx
Section 5. Appeal Fee. - The appellant shall pay the prevailing appeal
fee and legal research fee to the Regional Arbitration Branch or
Regional Office of origin, and the official receipt of such payment
shall form part of the records of the case.
Section 6. Bond. - In case the decision of the Labor Arbiter, or the
Regional Director involves a monetary award, an appeal by the
employer shall be perfected only upon the posting of a bond,
which shall either be in the form of cash deposit or surety bond
equivalent in amount to the monetary award, exclusive of damages
and attorneys fees.
xxxx
The Commission through the Chairman may on justifiable grounds
blacklist a bonding company, notwithstanding its accreditation by the
Supreme Court.cralawred
These statutory and regulatory provisions explicitly provide that an
appeal from the Labor Arbiter to the NLRC must be perfected within
ten calendar days from receipt of such decisions, awards or
orders of the Labor Arbiter. In a judgment involving a monetary
award, the appeal shall be perfected only upon (1) proof of payment
of the required appeal fee; (2) posting of a cash or surety bond
issued by a reputable bonding company; and (3) filing of a
memorandum of appeal.14chanroblesvirtuallawlibrary
In McBurnie v. Ganzon,15 we harmonized the provision on appeal that
its procedures are fairly applied to both the petitioner and the
respondent, assuring by such application that neither one or the other
party is unfairly favored. We pronounced that the posting of a cash or
surety bond in an amount equivalent to 10% of the monetary award
pending resolution of the motion to reduce appeal bond shall be
deemed sufficient to perfect an appeal, to
wit:chanRoblesvirtualLawlibrary
It is in this light that the Court finds it necessary to set a parameter
for the litigants and the NLRCs guidance on the amount of bond
that shall hereafter be filed with a motion for a bonds reduction. To
ensure that the provisions of Section 6, Rule VI of the NLRC Rules
of Procedure that give parties the chance to seek a reduction of the
appeal bond are effectively carried out, without however defeating
the benefits of the bond requirement in favor of a winning litigant, all
motions to reduce bond that are to be filed with the NLRC shall be
accompanied by the posting of a cash or surety bond equivalent to
10% of the monetary award that is subject of the appeal, which shall
provisionally be deemed the reasonable amount of the bond in the
meantime that an appellants motion is pending resolution by the
Commission. In conformity with the NLRC Rules, the monetary
award, for the purpose of computing the necessary appeal bond, shall
exclude damages and attorneys fees. Only after the posting of a bond
in the required percentage shall an appellants period to perfect an
appeal under the NLRC Rules be deemed suspended.cralawred
The rule We set in McBurnie was clarified by the Court in Sara Lee
Philippines v. Ermilinda Macatlang.16 Considering the peculiar
circumstances in Sara Lee, We determined what is the reasonable
amount of appeal bond. We underscored the fact that the amount of
29
10% of the award is not a permissible bond but is only such amount
that shall be deemed reasonable in the meantime that the appellants
motion is pending resolution by the Commission. The actual
reasonable amount yet to be determined is necessarily a bigger
amount. In an effort to strike a balance between the constitutional
obligation of the state to afford protection to labor on the one hand,
and the opportunity afforded to the employer to appeal on the other,
We considered the appeal bond in the amount of P725M which is
equivalent to 25% of the monetary award sufficient to perfect the
appeal, viz.:chanRoblesvirtualLawlibrary
We sustain the Court of Appeals in so far as it increases the amount
of the required appeal bond. But we deem it reasonable to reduce the
amount of the appeal bond to P725 Million. This directive already
considers that the award if not illegal, is extraordinarily huge and that
no insurance company would be willing to issue a bond for such big
money. The amount of P725 Million is approximately 25% of the
basis above calculated. It is a balancing of the constitutional
obligation of the state to afford protection to labor which, specific to
this case, is assurance that in case of affirmance of the award,
recovery is not negated; and on the other end of the spectrum, the
opportunity of the employer to appeal.
By reducing the amount of the appeal bond in this case, the
employees would still be assured of at least substantial compensation,
in case a judgment award is affirmed. On the other hand,
management will not be effectively denied of its statutory privilege of
appeal.cralawred
In line with Sara Lee and the objective that the appeal on the merits
to be threshed out soonest by the NLRC, the Court holds that the
appeal bond posted by the respondent in the amount of P100,000.00
which is equivalent to around 20% of the total amount of monetary
bond is sufficient to perfect an appeal. With the employers
demonstrated good faith in filing the motion to reduce the bond on
demonstrable grounds coupled with the posting of the appeal bond in
the requested amount, as well as the filing of the memorandum of
appeal, the right of the employer to appeal must be upheld. This is in
recognition of the importance of the remedy of appeal, which is an
essential part of our judicial system and the need to ensure that every
party litigant is given the amplest opportunity for the proper and just
disposition of his cause freed from the constraints of
technicalities.17chanroblesvirtuallawlibrary
WHEREFORE, premises considered, the petition is DENIED. The
assailed Decision and Resolution of the Court of Appeals are
hereby AFFIRMED.
G.R. No. 206612, August 17, 2015TOYOTA ALABANG,
INC., Petitioner, v. EDWIN GAMES, Respondent.
Remaining at bench is the Motion for Reconsideration1 of petitioner
Toyota Alabang, Inc. We had unanimously denied2 its Petition for
Review on Certiorari with Urgent Prayer for Injunctive Relief, 3which
sought the nullity of the Court of Appeals (CA) Decision and
Resolution.4 The CA affirmed the Resolutions5 of the National Labor
Relations Commission (NLRC) dismissing petitioner's appeal for
non-perfection and for lack of merit. In effect, the NLRC sustained
the ruling6 of the labor arbiter (LA) finding that petitioner had
illegally dismissed respondent Edwin Games (Games).
In gist, the antecedent facts are as follows:LawlibraryofCRAlaw
Games, who worked as a foreman for petitioner, allegedly stole its
vehicle lubricants. Subsequently, it charged him with qualified theft
before the trial court. Two years thereafter, or on 24 August 2007,
Games filed a Complainant for illegal dismissal, nonpayment of
benefits, and damages against petitioner. The latter, through counsel,
failed to file its Position Paper on the date set on 15 November 2007.
Several resettings of the hearings ensued. During the 21 December
2007 hearing, petitioner manifested that it had failed to file its
Position Paper because its handling lawyer was no longer connected
with the company. Then, in the hearing of 11 January 2008, petitioner
failed to appear and even reneged on submitting its pleading.
Accordingly, on 25 January 2008, the case was declared submitted
for decision.
On 5 February 2008, the LA ruled against petitioner and ordered the
latter to pay Games P535,553.07 for his separation pay, back wages,
service incentive leave pay and attorney's fees resulting from his
illegal dismissal. Petitioner no longer filed a motion for
reconsideration. As a result, the LA's ruling became final and
executory.
The LA issued a Writ of Execution, which petitioner sought to quash.
It prayed that the proceedings be reopened, explaining that it had
failed to present evidence because of its counsel's negligence in filing
the appropriate pleadings. The LA denied the claims of petitioner.
Aggrieved, the latter appealed before the NLRC.
The appeal of petitioner was denied due course because it had failed
to show proof of its security deposit for the appeal bond under
Section 6, Rule VI of the 2005 NLRC Rules of Procedure. According
to the NLRC, the bonding company's mere declaration in the
Certification of Security Deposit that the bond was fully secured 7 was
not tantamount to a faithful compliance with the rule, because there
must first be an accompanying assignment of the employer's bank
deposit.
On the merits, the NLRC dismissed the case on the basis of the rule
that no appeal may be taken from an order of execution of a final
judgment.8 For the NLRC, petitioner's failure to appeal the LA
Decision already made the ruling final and executory.
Petitioner elevated the case to the CA via a Petition for Certiorari, but
the action was dismissed. Firstly, the CA ruled that the NLRC did not
gravely abuse its discretion in denying the appeal, given that
petitioner had failed to comply faithfully with the bond requirement.
Secondly, it echoed the ruling of the NLRC that a final judgment is
no longer appealable. Thirdly, the CA found that petitioner's own
negligence had caused it to lose its right to appeal.
Aggrieved, petitioner filed a Petition for Review on Certiorari with
Urgent Prayer for Injunctive Relief before this Court. It disputed the
finding that it did not show proof of its security deposit for the appeal
30
bond. It also insisted that its counsel's gross negligence justified the
reopening of the proceedings below.
By way of a minute Resolution, this Court denied the petition
considering that the allegations, issues and arguments raised by
petitioner failed to sufficiently show that the CA had committed any
reversible error in the challenged decision and resolution as to
warrant the exercise of this Court's discretionary appellate
jurisdiction. Hence, the instant Motion for Reconsideration.
The determinative issues in this case remain the same. This Court is
tasked to review, on reconsideration, whether or not the CA
committed a reversible error in refusing to reopen the proceedings
below.
RULING OF THE COURT
To recall, the LA's decision finding that petitioner illegally dismissed
respondent was already final and executory because of petitioner's
failure to file a timely appeal. Therefore, the labor dispute between
the parties should have been considered a closed case by then, and no
longer subject to appeal. At that point, Games should have already
reaped the benefits of a favorable judgment. Still, petitioner sought
the reopening of the case, which the tribunals a quo denied.
This Court maintains that the CA correctly refused to reopen the
proceedings below. The reopening of a case is an extraordinary
remedy,9 which, if abused, can make a complete farce of a duly
promulgated decision that has long become final and executory.
Hence, there must be good cause on the movant's part before it can be
granted.
In this case, petitioner itself was negligent in advancing its case. As
found by the appellate court, petitioner was present during the
mandatory conference hearing in which the latter was informed by
the LA of the need to file a Position Paper on 15 November 2007.
However, petitioner not only reneged on the submission of its
Position Paper, but even failed to move for the filing of the pleading
at any point before the LA resolved the case on 5 February 2008.
Moreover, petitioner had failed to exhibit diligence when it did not
attend the hearing on 11 January 2008, or any of the proceedings
thereafter, despite its manifestation that it no longer had any legal
representative. Given the instances of negligence by petitioner itself,
the Court finds that the CA justly refused to reopen the case in the
former's favor. Definitely, petitioner cannot now be allowed to claim
denial of due process when it was petitioner who was less than
vigilant of its rights.10redarclaw
At this stage of appellate review, Justice Lucas P. Bersamin dissents
and votes to remand the case to the LA for the reception of
petitioner's evidence. He posits three reasons as
follows:LawlibraryofCRAlaw
First, he states that the NLRC gravely abused its discretion in
requiring petitioner to post an appeal bond, because this requirement
does not cover an appeal from a decision of the LA denying a motion
to quash a writ of execution.

Second, he writes that in any event, the NLRC erred in requiring
petitioner to accompany the appeal bond with proof of a security
deposit or collateral securing the bond. He bases this point on the fact
that the bonding company has already issued a Certificate of Security
Deposit declaring that the appeal bond was fully secured by a
security deposit equivalent to the judgment award.
Third, he advances the opinion that there may be merit in the Rule 45
petition filed by petitioner. He cites that it had a just cause to dismiss
respondent after he had allegedly stolen its vehicle lubricants.
Before discussing these points, it is apropos to elucidate that this
Court must be faithful to the framework of resolving labor cases on
appellate review before this Court. Universal Robina Sugar Milling
Corporation v. Acibo aptly explains:11redarclaw
This Court's power of review in a Rule 45 pet1t1on is limited to
resolving matters pertaining to any perceived legal errors, which the
CA may have committed in issuing the assailed decision. In
reviewing the legal correctness of the CA's Rule 65 decision in a
labor case, we examine the CA decision in the context that it
determined, i.e., the presence or absence of grave abuse of
discretion in the NLRC decision before it and not on the basis of
whether the NLRC decision on the merits of the case was
correct. In other words, we have to be keenly aware that the CA
undertook a Rule 65 review, not a review on appeal, of the NLRC
decision challenged before it. (Emphasis supplied)
Based on the foregoing, the task at hand involves a determination of
whether or not the CA gravely erred in finding that the NLRC did not
exceed its jurisdiction in refusing to grant petitioner's entreaty to
reopen the case. In other words, as long as the exercise of discretion
below is based on well founded factual and legal bases,12 no abuse
of discretion amounting to lack or excess of jurisdiction can be
imputed, and we are then justified to deny due course both to the
Rule 45 petition and the concomitant Motion for Reconsideration.
The tribunals below gave overwhelming justifications for their
rulings. In contrast, the first point espoused in the dissenting opinion
has no basis. The paraphrased proposition that "an appeal bond is not
required in appeals from decisions of the LA denying a motion to
quash a writ of execution" lacks any citation sourced from a statute or
case law. Article 223 of the Labor Code and Section 6, Rule VI of the
2011 NLRC Rules of Procedure, uniformly state
thus:LawlibraryofCRAlaw
In case the decision of the Labor Arbiter or the Regional
Director involves a monetary award, an appeal by the employer
may be perfected only upon the posting of a bond, which shall either
be in the form of cash deposit or surety bond equivalent in amount to
the monetary award, exclusive of damages and attorney's fees.
(Emphasis supplied)
Evidently, the above rules do not limit the appeal bond requirement
only to certain kinds of rulings of the LA. Rather, these rules
generally state that in case the ruling of the LA involves a monetary
31
award, an employer's appeal may be perfected only upon the posting
of a bond. Therefore, absent any qualifying terms, 13 so long as the
decision of the LA involves a monetary award, as in this case, 14 that
ruling can only be appealed after the employer posts a bond.
Clearly, this construction is but proper considering the avowed
purpose of appeal bonds demanded by the law from employers in
labor cases. This matter was discussed by the Court in Computer
Innovations Center v. NLRC,15 to wit:LawlibraryofCRAlaw
As earlier stated, the underlying purpose of the appeal bond is to
ensure that the employee has properties on which he or she can
execute upon in the event of a final, providential award. The non
payment or woefully insufficient payment of the appeal bond by the
employer frustrates these ends. Respondent Cario alleges in
his Comment before this Court that petitioner Quilos and his wife
have since gone abroad, and wonders aloud whether he still would be
able to collect his monetary award considering the circumstances.
Petitioners, in their Reply and Memorandum, do not aver otherwise.
Indeed, such eventuality appears plausible considering that Quilos
himself did not personally verify the petition, and had in fact
executed a Special Power of Attorney in favor of his counsel, Atty.
Bernabe B. Alabastro, authorizing the filing of cases in his name. ft
does not necessarily follow that the absence of Quilos from this
country precludes the execution of the award due Cario. However, if
the absence of Quilos from this country proves to render impossible
the execution of judgment in favor of Cario, then the latter's victory
may sadly be rendered pyrrhic. The appeal bond requirement
precisely aims to prevent empty or inconsequential victories by the
laborer, and it is hoped that herein petitioners' refusal to post the
appropriate legal appeal bond does not frustrate the ends of justice in
this case. (Emphasis supplied)
If we are to construe otherwise, then an aggrieved party may simply
seek the quashal of a writ of execution, instead of going through the
normal modes of appeal, to altogether avoid paying for an appeal
bond. This ruse will then circumvent the requirement of both labor
rules and jurisprudence16to post an appeal bond before contesting the
LA's grant of monetary award. Hence, the first point is not only
incorrect, but also dangerous.
The second point likewise fails to justify the grant of petitioner's
Motion for Reconsideration. This point refers to the proper
construction of Section 6, Rule VI of the 2011 NLRC Rules of
Procedure, which demands that an appeal bond must be accompanied
by a "proof of security deposit or collateral securing the bond."
According to the NLRC and the CA, the bonding company's mere
declaration in the Certification of Security Deposit that the bond is
fully secured17 is not tantamount to a faithful compliance with the
rule, because there must first be an accompanying assignment of the
employer's bank deposit. On the other hand, the dissent sees this
declaration as an act that satisfies Section 6, Rule VI of the 2011
NLRC Rules of Procedure. For this reason, he opines that the NLRC
should have entertained the appeal of petitioner.
Notwithstanding this issue, the NLRC has given a well-founded
reason for refusing to entertain petitioner's appeal, namely, no appeal
may be taken from an order of execution of a final and executory
judgment.
An appeal is not a matter of right, but is a mere statutory privilege. It
may be availed of only in the manner provided by law and the
rules.18 Thus, a party who seeks to elevate an action must comply
with the requirements of the 2011 NLRC Rules of Procedure as
regards the period, grounds, venue, fees, bonds, and other requisites
for a proper appeal before the NLRC; and in Section 6, Rule VI, the
aforesaid rules prohibit appeals from final and executory decisions of
the Labor Arbiter.
In this case, petitioner elevated to the NLRC an already final and
executory decision of the LA. To recall, after petitioner learned of its
former counsel's negligence in filing a Position Paper before the LA,
it nonetheless failed to file a motion reconsideration to question the
ruling of the LA that it illegally dismissed Games. At that point, the
Decision was already final and executory, so the LA dutifully issued a
Writ of Execution. Petitioner sought the quashal of the writ of
execution and the reopening of its case only at that stage; and only
after it was rebuffed by the LA did petitioner appeal before the
NLRC. Based on the timeline, therefore, the LA's adverse Decision
had become final and executory even prior to petitioner's appeal
before the NLRC contesting the denial of the Motion to Quash the
Writ of Execution. Consequently, the NLRC dismissed the appeal
based on its clear prohibition under Section 5, Rule V of the 2011
NLRC Rules of Procedure.19redarclaw
The NLRC's reasoning that no appeal may be taken from an order of
execution of a final and executory judgment is also rooted in case
law. Jurisprudence dictates that a final and executory decision of the
LA can no longer be reversed or modified.20 After all, just as a losing
party has the right to file an appeal within the prescribed period, so
does the winning party have the correlative right to enjoy the finality
of the resolution of the case.21 On this basis, theCA did not grievously
err when it concluded that the ruling of the NLRC denying
petitioner's appeal was not baseless, arbitrary, whimsical, or
despotic.22redarclaw
Finally, as regards the third point pertaining to the advancement of
the merits23 of the case, it may no longer be properly considered by
this Court. To adjudicate on the merits of the instant appeal would
require the reopening of the whole case, a step that all the tribunals
below - the LA, the NLRC, and the CA- have already refused to take.
As correctly ruled by the CA, the reopening of a case is, by default,
not allowed merely on the ground that the counsel has been negligent
in taking the required steps to protect the interest of the client, such as
timely filing a pleading, appearing during hearings, and perfecting
appeals.24 An exception arises only when there is good cause and
excusable negligence on the client's part.25redarclaw
Both the explanation of the CA and the records undeniably show no
good cause or excusable negligence on the part of the client -
petitioner Toyota Alabang, Inc. given the totality of the instances of
the latter's own negligence in these proceedings, viz: (1) despite being
informed, during the mandatory conference hearing, of the necessity
32
to file a Position Paper, petitioner reneged on its duty to timely
submit its Position Paper to the LA on 15 November 2007; (2) after
manifesting that it no longer had a counsel, petitioner was still absent
on 11 January 2008, the date when it could still have submitted its
belated Position Paper; (3) thereafter, it altogether absented itself
from all the proceedings before the LA; (4) at no point before the
LA's resolution of the case on 5 February 2008 did petitioner file a
Position Paper; and (5) after allowing the LA Decision to attain
finality as a result of its non-submission of an appeal or a motion for
reconsideration, petitioner belatedly sought the quasha1 of the
execution of the LA Decision granting compensation to respondent.
Despite the overwhelming lapses mentioned above, the dissent
maintains that petitioner cannot be considered negligent by any
measure. According to the dissent, petitioner could not be faulted for
failing to file a position paper because the filing of pleadings has
been entrusted to its counsel. For the dissent, "given the nature and
extent of its business and operations, the petitioner could not be
expected to supervise and monitor all the cases it had entrusted to its
lawyer." But, this stance is baseless as can be seen by the lack of
legal citation in the dissent.
More importantly, this Court cannot give special treatment to
petitioner. In our past cases, this Court already held that the failure of
the counsel to file the required position papers before the LA is not a
ground to declare that petitioner had been deprived of due process;
and is not a cause to conclude that the proceedings a quo had been
null and void.26 In Building Care Corporation v. Macaraeg,27 this
Court thoroughly explained that:LawlibraryofCRAlaw
It is, however, an oft-repeated ruling that the negligence and mistakes
of counsel bind the client. A departure from this rule would bring
about never-ending suits, so long as lawyers could allege their own
fault or negligence to support the client's case and obtain remedies
and reliefs already lost by the operation of law. The only exception
would be, where the lawyer's gross negligence would result in the
grave injustice of depriving his client of the due process of law. In
this case, there was no such deprivation of due process. Respondent
was able to fully present and argue her case before the Labor Arbiter.
She was accorded the opportunity to be heard.
We have consistently held that the requirements of due process are
satisfied when the parties are given the opportunity to submit position
papers wherein they are supposed to attach all the documents that
would prove their claim in case it be decided that no hearing should
be conducted or was necessary.28 Here, petitioner, despite being given
several chances to pass its position paper, did not at all comply.
Worse, petitioner also had other instances of negligence.
Consequently, this Court cannot redo the whole proceedings of the
Labor Arbiter who had already afforded due process to the former.
Given the foregoing reasons, juxtaposed with the high threshold for
resolving appellate reviews in labor cases before this Court, we rule
for the denial of petitioner's Motion for Reconsideration.
WHEREFORE, the Petition for Review with Urgent Prayer for
Injunctive Relief filed by Toyota Alabang, Inc.
is DENIED with FINALITY. No further pleadings shall be 2010.9 Petitioners motion for reconsideration was denied by the CA
entertained in this case. Let an Entry of Judgment be issued in due in its Resolution10 dated March 26, 2013. Petitioners no longer
course. appealed to this Court.11chanroblesvirtuallawlibrary

SO ORDERED.cralawlawlibrary Hilongo then filed a motion for entry of judgment and a motion for
clarification of Decision/Resolution praying that the CAs March 26,
G.R. No. 215630, March 09, 2015METROGUARDS SECURITY 2013 Resolution be clarified and interpreted to include the amount of
AGENCY CORPORATION (FORMERLY KNOWN AS the award as stated in the Labor Arbiters Decision dated April 30,
BEEGUARDS CORPORATION) AND MS. MILAGROS T. 2010 and additional award computed from May 1, 2010 to March 26,
CHAN, Petitioners, v. ALBERTO N. HILONGO, Respondent. 2013, or the date the CA denied petitioners motion for
reconsideration.12chanroblesvirtuallawlibrary
Before us is a petition for review of the Decision1 dated July 22, 2014
and Resolution2 dated November 18, 2014 of the Court of Appeals In its Resolution13 dated June 11, 2013, the CA granted the motion for
(CA) in CA-G.R. SP No. 134501. entry of judgment and noted Hilongos motion for clarification of
Decision/Resolution. The CA held that when an appellate court
The facts follow:chanRoblesvirtualLawlibrary affirms the Labor Arbiters ruling, it is understood that awards due to
the illegally dismissed employee shall be recomputed in order to
In his Decision3 dated April 30, 2010 in NLRC NCR-10-14411-09, account for the period of time that has lapsed from the rendition of
entitled Alberto Hilongo v. Bee Guards Corp./Milagros Chan, the the Labor Arbiters decision up to its finality. The CA quoted this
Labor Arbiter ruled that herein respondent Alberto N. Hilongo was Courts ruling in Session Delights Ice Cream and Fast Foods v. Court
illegally dismissed, to wit:chanRoblesvirtualLawlibrary of Appeals,14 and Gonzales v. Solid Cement
WHEREFORE, premises considered, judgment is rendered finding Corporation15:chanRoblesvirtualLawlibrary
the dismissal of complainant [Hilongo] as illegal and ordering the Consistent with what we discussed above, we hold that under the
respondents [herein petitioners] to pay complainant [Hilongo] his terms of the decision under execution, no essential change is made by
backwages from the date of dismissal to the date of this decision and a re-computation as this step is a necessary consequence that flows
separation pay of one month pay per year of service, plus 10% from the nature of the illegality of dismissal declared in that decision.
thereof as attorneys fees as all hereunder A re-computation (or an original computation, if no previous
computed:chanRoblesvirtualLawlibrary computation has been made) is a part of the law specifically, Article
279 of the Labor Code and the established jurisprudence on this
I. Backwages:
provision that is read into the decision. By the nature of an illegal
A. Basic Salary dismissal case, the reliefs continue to add on until full satisfaction, as
expressed under Article 279 of the Labor Code. The re-computation
9/5/09 4/30/09 (sic) = of the consequences of illegal dismissal upon execution of the
7.83 decision does not constitute an alteration or amendment of the final
P382 x 26 x 7.83 P77,767.56 decision being implemented. The illegal dismissal ruling stands; only
the computation of monetary consequences of this dismissal is
B. 13th Month Pay
affected and this is not a violation of the principle of immutability of
P77,767.56/12 6,480.63 final judgments.16
After the corresponding entry of judgment was issued on June 11,
C. Service Incentive Leave 1,246.27 P85,494.46
2013, the case was remanded to the Labor Arbiter. On July 9, 2013,
II. Separation Pay respondent Hilongo filed a motion for issuance of writ of execution
alleging that the June 11, 2013 CA Resolution had confirmed that the
10/25/01 4/30/10 = 7 yrs. P 69,524.00 amount of P170,520.31 awarded by the Labor Arbiter is not
P382 x 26 x 7 years P155,018.46 sufficient, and that there is a need to compute additional monetary
awards reckoned from May 1, 2010 up to April 26, 2013 or the date
III. 10% Attorneys fees 15,501.85 Hilongo presumed as the date of finality of the
P170,520.31
decision.17chanroblesvirtuallawlibrary
SO ORDERED.4
On appeal, the National Labor Relations Commission (NLRC) In an Order18 dated October 29, 2013, the Labor Arbiter directed the
reversed the ruling of the Labor Arbiter in its Decision 5 dated issuance of a writ of execution and ruled that the award of
September 30, 2010 and Resolution dated November 23, P170,520.31 as stated in the Labor Arbiters Decision dated April 30,
2010.6chanroblesvirtuallawlibrary 2010 prevails.

Aggrieved, Hilongo filed a petition for certiorari before the CA, Hilongo filed a petition for extraordinary remedy before the NLRC
docketed as CA-G.R. SP No. 117891.7In its Decision8 dated which dismissed the petition in its Decision19 dated November 29,
September 7, 2012, the CA reversed the NLRC decision and 2013. The NLRC also denied Hilongos motion for reconsideration in
reinstated the Labor Arbiters Decision dated April 30, its Resolution20 dated January 16, 2014.

33

Hence, Hilongo filed a petition for certiorari before the CA.
In the assailed Decision dated July 22, 2014, the CA granted
Hilongos petition and set aside the NLRC Decision dated November
29, 2013 and Resolution dated January 16, 2014. The CA ordered the
Labor Arbiter to re-compute Hilongos monetary awards, to
wit:chanRoblesvirtualLawlibrary
WHEREFORE, in view of the foregoing, the petition
is GRANTED. The Decision dated November 29, 2013 and
Resolution dated January 16, 2014 of public respondent National
Labor Relations Commission, Second Division, in NLRC LER N[o].
11-322-13/NLRC LAC N[o]. 07-001-485-10 (NLRC NCR-10-14411-
09) are hereby REVERSED and SET ASIDE.
The case is hereby REMANDED to the Labor Arbiter for the RE-
COMPUTATION of the total monetary benefits due to petitioner
[Hilongo]. The Labor Arbiter is further DIRECTED to incorporate
the following in the re-computation:chanRoblesvirtualLawlibrary
(1) Additional backwages and separation pay from May 1, 2010 to
June 11, 2013, or the date when the April 30, 2010 Decision of Labor
Arbiter Macam became final and executory;chanrobleslaw
(2) Interest of twelve percent (12%) per annum of the total monetary
awards, computed from June 11, 2013 to June 30, 2013 and six
percent x x x (6%) per annum from July 1, 2013 until their full
satisfaction.
21
SO ORDERED.
The CA held that it is already settled that the computation of the
monetary awards due to the illegally dismissed employee must
continue to run until the final termination of the case on appeal. The
CA ruled that the Labor Arbiter should have been guided by the CA
Resolution dated June 11, 2013 which had clarified that a re-
computation of Hilongos award is necessary.22 The CA also ruled
that the re-computation of the monetary awards is a necessary
consequence that flows from the nature of the illegality of Hilongos
dismissal. The CA further noted that since the Labor Arbiters
Decision dated April 30, 2010 had ordered the payment of separation
pay, in lieu of reinstatement, the finality of said decision on June 11,
2013 effectively declares that Hilongos employment relationship
with petitioners has ended on said date. Hence, separation pay and
back wages must be computed up to that point to account for the time
the illegally dismissed employee should have been paid his salary and
benefit entitlements.23chanroblesvirtuallawlibrary
Hence, this petition.
The issue for our consideration is whether the CA erred in ordering
the re-computation of Hilongos monetary awards.
We rule in the negative.
The issue is not novel. In Nacar v. Gallery Frames,24 we have held
that:chanRoblesvirtualLawlibrary
34
x x x no essential change is made by a recomputation as this step is a
necessary consequence that flows from the nature of the illegality of
dismissal declared by the Labor Arbiter in that decision. A
recomputation (or an original computation, if no previous
computation has been made) is a part of the law specifically, Article
279 of the Labor Code and the established jurisprudence on this
provision that is read into the decision. By the nature of an illegal
dismissal case, the reliefs continue to add up until full satisfaction, as
expressed under Article 279 of the Labor Code. The recomputation of
the consequences of illegal dismissal upon execution of the decision
does not constitute an alteration or amendment of the final decision
being implemented. The illegal dismissal ruling stands; only the
computation of monetary consequences of this dismissal is affected,
and this is not a violation of the principle of immutability of final
judgments.cralawred
Nacar reiterated the Courts ruling in the earlier cases of Session
Delights and Gonzales.
We thus cannot agree with petitioners contention that a decision that
has acquired finality becomes immutable and unalterable. 25 The re-
computation of the consequences of illegal dismissal upon execution
of the decision does not constitute an alteration or amendment of the
final decision being implemented. The illegal dismissal ruling stands;
only the computation of monetary consequences of this dismissal is
affected, and this is not a violation of the principle of immutability of
final judgments.
Likewise without merit is petitioners contention that [i]t may very
well be argued that the NLRCs final decision reversing the Labor
Arbiter is in fact the final decision that effectively declared the
employment relationship between Hilongo and [petitioners] as ended
on which date the computation of the separation pay and backwages
awarded by the Labor Arbiter ultimately ceased. 26 We note that the
CA, in its Decision dated September 7, 2012, had reversed the NLRC
Decision dated September 30, 2010 and Resolution dated November
23, 2010, and reinstated the Labor Arbiters Decision dated April 30,
2010. Thus, petitioners cannot claim that the NLRC decision which
was set aside with finality is the NLRCs final decision and the
final decision that effectively declared the employment relationship
between the parties as ended.
Said CA Decision dated September 7, 2012 became final and
executory on April 26, 2013.27 Thus, the April 30, 2010 Decision of
the Labor Arbiter which ordered the payment of separation pay in
lieu of reinstatement, effectively ended the employment relationship
of the parties on April 26, 2013, the date the CA decision became
final. Since the Labor Arbiters computation of Hilongos monetary
award was up to the date of his April 30, 2010 Decision only, the CA
properly decreed the computation of additional back wages and
separation pay.
However, the CA incorrectly concluded that the April 30, 2010
Decision of the Labor Arbiter became final on June 11,
2013,28 contrary to its own finding that it became final and executory
on April 26, 2013.29 This led to its erroneous computation of the
additional back wages and separation pay of Hilongo, as well as
reckoning the date of the 12% legal interest. Following the teaching
of Nacar v. Gallery Frames30 that the computation of the monetary
consequences (back wages and separation pay) of the illegal
dismissal decision should be reckoned from its finality, the additional
back wages and separation pay of Hilongo should be computed from
May 1, 2010 to April 26, 2013. Further, the payment of legal interest
of 12% per annum should also be from April 26, 2013 up to June 30,
2013. Thereafter, in accordance with Bangko Sentral ng Pilipinas
Monetary Boards Circular No. 799,31 series of 2013, the legal
interest computed from July 1, 2013 until the monetary awards were
fully satisfied will be 6% per annum.
WHEREFORE, we DENY the instant petition and AFFIRM with
MODIFICATION the Decision dated July 22, 2014 and Resolution
dated November 18, 2014 of the Court of Appeals in CA-G.R. SP No.
134501. The dispositive portion of the Decision dated July 22, 2014
of the Court of Appeals in CA-G.R. SP No. 134501 shall read as
follows:chanRoblesvirtualLawlibrary
WHEREFORE, in view of the foregoing, the petition
is GRANTED. The Decision dated November 29, 2013 and
Resolution dated January 16, 2014 of public respondent National
Labor Relations Commission, Second Division, in NLRC LER N[o].
11-322-13/NLRC LAC N[o]. 07-001-485-10 (NLRC NCR-10-14411-
09) are hereby REVERSED and SET ASIDE.
The case is hereby REMANDED to the Labor Arbiter for the RE-
COMPUTATION of the total monetary benefits due to petitioner
[Hilongo]. The Labor Arbiter is further DIRECTED to incorporate
the following in the re-computation:chanRoblesvirtualLawlibrary
(1) Additional backwages and separation pay from May 1, 2010
to April 26, 2013, or the date when the April 30, 2010 Decision of
Labor Arbiter Macam became final and executory;chanrobleslaw
(2) Interest of twelve percent (12%) per annum of the total monetary
awards, computed from April 26, 2013 to June 30, 2013 and six
percent x x x (6%) per annum from July 1, 2013 until their full
satisfaction.
SO ORDERED.
G.R. No. 209383, March 11, 2015SEACREST MARITIME
MANAGEMENT, INC., ROLANDO B. MAGCALE, AND
SEALION SHIPPING LIMITED UNITED
KINGDOM, Petitioners, v. MAURICIO G. PICAR, JR., Respondent.
This is a petition for review under Rule 45 of the Rules of Court
assailing the May 2, 2013 Decision1and the September 9, 2013
Resolution2 of the Court of Appeals (CA) in CA-G.R. SP No. 124763,
which dismissed, for being moot and academic, the petition
for certiorari filed under Rule 65 questioning the decision of the
National Labor Relations Commission (NLRC), in a case for
disability benefits.chanroblesvirtuallawlibrary
The Antecedents
Respondent Mauricio Picar, Jr. (Picar) was employed by petitioner
Sealion Shipping Limited United Kingdom through its local
manning agent Seacrest Maritime Management, Inc. (petitioners), as
35
Chief Cook continuously for several contracts from April 2005 until
his last employment contract in 2010, on board the vessel, MV Toisa
Paladin. The last contract was for a fixed duration of three (3)
months which commenced on September 5, 2010 with a basic salary
of US$630.00 exclusive of overtime pay and other
benefits.3cralawred
On September 24, 2010, Picar experienced high fever, chilling,
lumbar back pain, and difficulty in urinating accompanied with
blood. He was referred for medical treatment to the Maritime
Medical Center PTE, Ltd in Singapore (MMC). He was diagnosed
with Urinary Tract Infection (UTI) and Renal Calculus. After his
check-up, he was required to go back to the vessel and take a rest.
On September 28, 2010, he was brought back to MMC where he was
confined until October 1, 2010. On October 2, 2010, he was
repatriated.4cralawred
Upon his arrival in Manila, Picar was referred to Dr. Natalio G.
Alegre (Dr. Alegre) at St. Lukes Medical Center (SLMC). On
October 21, 2010, he underwent sonography of his kidneys and
urinary bladder, which showed renal cyst on his right kidney;
calyceal lithiasis, right; and normal urinary bladder; slightly
enlarged prostate gland was noted. Dr. Alegre repeatedly
recommended that he undergo extracorporeal shockwave lithotripsy
for the dissolution of his right kidney stone.5cralawred
On February 23, 2011, Picar consulted Dr. Efren R. Vicaldo (Dr.
Vicaldo) who also diagnosed him to be suffering from Right Renal
Calculus, Essential Hypertension. Dr. Vicaldo considered his illness
as work aggravated/related and declared him unfit to resume work as
a seafarer in any capacity.6cralawred
Picar then filed a complaint for permanent disability compensation,
balance of sick wages, reimbursement of medical expenses, moral
and exemplary damages, and attorneys fees.
On June 22, 2011, the Labor Arbiter (LA) rendered judgment7 in favor
of Picar. The LA found that his illness was work-related and that the
nature of his work as a chief cook contributed to the aggravation of
his condition. The dispositive portion of the decision
reads:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, judgment is hereby rendered
ordering respondents to pay jointly and severally the complainant his
permanent disability compensation in the sum of US$60,000.00,
balance of sick wages in the sum of US$1,890.00, moral damages in
the sum of P200,000.00, exemplary damages in the sum of
P200,000.00, and ten percent (10%) of the judgment award as
attorneys fees.
All other claims are dismissed for lack of merit.
SO ORDERED.8cralawred
cralawlawlibrary
On appeal, the NLRC affirmed in toto the decision of the LA.9 The
NLRC ruled that Picars disability was permanent as he was totally
unable to perform his job for more than 120 days from his
repatriation. In support of its ruling, it cited the case of Remigio v.
NLRC10 where it was held that if an employee was unable to perform
his customary job for more than 120 days and did not come within
the coverage of Rule X of the Amended Rules on Employees
Compensability (which, in more detailed manner, describes what
constitutes temporary total disability), then the said employee
undoubtedly suffered from permanent total disability regardless of
whether or not he lost the use of any part of his body.
Aggrieved, petitioners elevated the matter to the CA.
In the meantime, Picar moved for the execution of the LA decision.
On July 3, 2012, the LA issued a Writ of Execution for the
enforcement and full satisfaction of its decision. Consequently,
petitioners paid the judgment award as evidenced by the Satisfaction
of Judgment pursuant to a Writ of Execution with Acknowledgment
Receipt executed by the NLRC-NCR Sheriff on August 13,
2012.11cralawred
In its assailed Decision, dated May 2, 2013, the CA dismissed the
petition. Citing the case of Career Philippines Ship Management,
Inc. v. Madjus,12 the CA ruled that the payment by petitioners of the
judgment award constituted an amicable settlement that had rendered
the petition moot and academic. The dispositive portion of the
decision reads:chanRoblesvirtualLawlibrary
WHEREFORE, in light of the foregoing considerations, the instant
petition is DISMISSED for having become MOOT AND
ACADEMIC.13cralawlawlibrary
Petitioners filed a motion for reconsideration of the said decision, but
it was denied in the CA Resolution, dated September 9, 2013.
Hence, this petition.chanroblesvirtuallawlibrary
Issues and Arguments
For resolution is the sole issue of whether the CA committed
reversible error in dismissing the petition for having become moot
and academic.
Petitioners contend that the settlement of the judgment award was by
virtue of a writ of execution duly issued and was effected specifically
without prejudice to further recourse before the CA. There was
nothing voluntary about the satisfaction of the judgment award made
in strict and compulsory compliance with Rule XI, Section 8 of the
2011 NLRC Rules of Procedure. The terms of the settlement were
fair to both the employer and the employee. Hence, the ruling
in Career Philippines, relied upon by the CA, was inapplicable.
On April 14, 2014, Picar filed his Comment14 wherein he stresses that
the CA committed no error in dismissing the petition. He asserts that
the voluntary satisfaction by petitioners of the full judgment award
rendered the said petition moot and was a clear indication that
petitioners believed on the merits and judiciousness of the award for
disability compensation.
36
Petitioners fault the CA for dismissing outright the petition for being
moot and academic instead of resolving the same on its merits.
The Courts Ruling
As correctly argued by petitioners, the petition for certiorari before
the CA was not rendered moot and academic by their satisfaction of
the judgment award in compliance with the writ of execution issued
by the LA The CA cited Career Philippines, but it finds no
application here. Career Philippines was resolved on equitable
considerations. In the said case, while petitioner employer had the
luxury of having other remedies available to it such as its petition
for certiorari pending before the CA and an eventual appeal to this
Court, respondent seafarer could no longer pursue other claims,
including for interests that may accrue during the pendency of the
case. Thus, it was held that the LA and the CA could not be faulted
for interpreting petitioners "conditional settlement" to be tantamount
to an amicable settlement of the case resulting in the mootness of the
petition for certiorari.
In this case, no such document was executed between the parties.
The payment of the judgment award without prejudice by petitioners
required no obligations whatsoever on the part of Picar.
The case of Leonis Navigation v. Villamater(Leonis Navigation)15 is
more in point, where the Court
explained:chanRoblesvirtualLawlibrary
Petitioners never moved for a reconsideration of this Order regarding
the voluntariness of their payment to Sonia, as well as the dismissal
with prejudice and the concomitant termination of the case.
However, petitioners argued that the finality of the case did not
render the petition for certiorari before the CA moot and
academic. On this point, we agree with petitioners.
In the landmark case of St. Martin Funeral Home v. NLRC,16 we ruled
that judicial review of decisions of the NLRC is sought via a petition
for certiorari under Rule 65 of the Rules of Court, and the petition
should be filed before the CA, following the strict observance of the
hierarchy of courts. Under Rule 65, Section 4,17 petitioners are
allowed sixty (60) days from notice of the assailed order or resolution
within which to file the petition. Thus, although the petition was not
filed within the 10-day period, petitioners seasonably filed their
petition for certiorari before the CA within the 60-day reglementary
period under Rule 65.
Further, a petition for certiorari does not normally include an inquiry
into the correctness of its evaluation of the evidence. Errors of
judgment, as distinguished from errors of jurisdiction, are not within
the province of a special civil action for certiorari, which is merely
confined to issues of jurisdiction or grave abuse of discretion. It is,
thus, incumbent upon petitioners to satisfactorily establish that the
NLRC acted capriciously and whimsically in order that the
extraordinary writ of certiorari will lie. By grave abuse of discretion
is meant such capricious and whimsical exercise of judgment as is
equivalent to lack of jurisdiction, and it must be shown that the
discretion was exercised arbitrarily or despotically.18 (Emphasis
supplied)
cralawlawlibrary
Adhering to the pronouncement in Leonis Navigation, the Court,
in Philippine Transmarine Carriers, Inc. v. Legaspi
(Transmarine),19 held that the satisfaction of the monetary award by
the employer did not render the petition for certiorari moot before
the CA. In Transmarine, pursuant to a writ of execution issued, the
employer ship-owner/manning agency and the complaining seafarer
agreed to a settlement of the judgment award. It was, however,
stipulated that the settlement shall be without prejudice to the
pending petition for certiorari filed by the employer before the CA.
It was further agreed that, in the event that the petition would be
granted and the judgment award would be eventually reversed,
whether in full or partially, the seafarer shall return all amounts in
excess of what he would be entitled to and the employer shall be
allowed to file the necessary motion for the return or restitution of the
amount unjustly paid. The parties covenants, as well as the
acknowledgment by the seafarer of receipt in full of the judgment
award, were embodied in a receipt of the judgment award with
undertaking. The CA, upon being informed of the settlement,
dismissed the petition for certiorari for being moot and academic. In
support of the dismissal, the CA also relied on Career Philippines. In
reversing and setting aside the order of dismissal issued by the CA,
the Court in Transmarine wrote:chanRoblesvirtualLawlibrary
In Career Philippines, believing that the execution of the LA Decision
was imminent after its petition for injunctive relief was denied, the
employer filed before the LA a pleading embodying a conditional
satisfaction of judgment before the CA and, accordingly, paid the
employee the monetary award in the LA decision. In the said
pleading, the employer stated that the conditional satisfaction of the
judgment award was without prejudice to its pending appeal before
the CA and that it was being made only to prevent the imminent
execution.
The CA later dismissed the employers petition for being moot and
academic, noting that the decision of the LA had attained finality with
the satisfaction of the judgment award. This Court affirmed the ruling
of the CA, interpreting the "conditional settlement" to be tantamount
to an amicable settlement of the case resulting in the mootness of the
petition for certiorari, considering (i) that the employee could no
longer pursue other claims, and (ii) that the employer could not have
been compelled to immediately pay because it had filed an appeal
bond to ensure payment to the employee.
Stated differently, the Court ruled against the employer because the
conditional satisfaction of judgment signed by the parties was highly
prejudicial to the employee. The agreement stated that the payment of
the monetary award was without prejudice to the right of the
employer to file a petition for certiorari and appeal, while the
employee agreed that she would no longer file any complaint or
prosecute any suit of action against the employer after receiving the
payment.chanrobleslaw
xxxx
37
In the present case, the Receipt of the Judgment Award with
Undertaking was fair to both the employer and the employee. As in
Leonis Navigation, the said agreement stipulated that respondent
should return the amount to petitioner if the petition
for certiorari would be granted but without prejudice to respondents
right to appeal. The agreement, thus, provided available remedies to
both parties.
It is clear that petitioner paid respondent subject to the terms and
conditions stated in the Receipt of the Judgment Award with
Undertaking. Both parties signed the agreement. Respondent neither
refuted the agreement nor claimed that he was forced to sign it
against his will. Therefore, the petition for certiorari was not
rendered moot despite petitioners satisfaction of the judgment
award, as the respondent had obliged himself to return the payment if
the petition would be granted.20cralawred
cralawlawlibrary
Verily in this case, petitioners satisfied the judgment award in strict
compliance with a duly issued writ of execution and pursuant to
terms fair to both parties. Thus, the equitable ruling in Career
Philippines would certainly be unfair to petitioners in this case as
they still have a remedy under the rules. The CA, therefore, was in
error in dismissing the petition for being moot and academic.
WHEREFORE, the petition is GRANTED. The May 2, 2013
Decision and the September 9, 2013 Resolution of the Court of
Appeals in CA-G.R. SP No. 124763 are REVERSED and SET
ASIDE. The case is ordered REMANDED to the Court of Appeals
for decision on the merits.
SO ORDERED.cralawlawlibrary
G.R. No. 190828, March 16, 2015ONOFRE V. MONTERO,
EDGARDO N. ESTRAERO, RENING P. PADRE, GABRIEL
A. MADERA, HERMINIO T. TACLA, NELSON C. VILORIA,
DEMETRIO Q. PAJARILLO, ALFREDO R. AGANON,
REYNALDO AVILA, ALBERT T. RUIZ, NESTOR Y. YAGO,
HARTY M. TUPASI, AGUSTIN R. AVILA, JR. OR MARCOS R.
AVILA, BONIFACIO B. GAANO, JOSELITO D. CUENTA,
JONAS P. ESTILONG, DOMINADOR C. CANARIA, GENARO
C. RONDARIS, HERARDO M. DULAY, FRANKLIN A.
RAVINA, JR., AND RUBEN C.
CABELLO, Petitioners, v. TIMES TRANSPORTATION CO.,
INC., AND SANTIAGO RONDARIS, MENCORP TRANSPORT
SYSTEMS, INC., VIRGINIA R. MENDOZA AND REYNALDO
MENDOZA, Respondents.
This appeal by petition for review1 seeks to annul and set aside the
Decision2 dated August 28, 2009 and Resolution3 dated December 11,
2009 of the Court of Appeals (CA) in CA-G.R. SP No. 106260,
which affirmed the Decision4dated March 31, 2008 of the National
Labor Relations Commission (NLRC) in NLRC CA No. 046325-05
(08), and its Resolution5 dated September 5, 2008, denying the
petitioners Motion for Reconsideration. The NLRC decision vacated
and set aside the Decision6 dated June 29, 2005 of the Labor Arbiter
(LA) on the ground that the consolidated complaints for illegal
dismissal, unfair labor practice and money claims have already
prescribed.
The Facts
Respondent Times Transportation Co., Inc., (TTCI) is a company
engaged in the business of land transportation for passengers and
goods serving the Ilocos Region to Metro Manila route. TTCI
employed the herein 21 petitioners as bus drivers, conductors,
mechanics, welders, security guards and utility personnel, namely:
Onofre V. Montero (Montero), Edgardo N. Estraero (Estraero),
Rening P. Padre (Padre), Gabriel A. Madera (Madera), Herminio T.
Tacla, Nelson C. Viloria, Demetrio Q. Pajarillo (Pajarillo), Alfredo R.
Aganon (Aganon), Reynaldo Avila (Avila), Albert T. Ruiz, Nestor Y.
Yago (Yago), Harty M. Tupasi (Tupasi), Agustin R. Avila, Jr. (Avila,
Jr.), Bonifacio B. Gaano (Gaano), Joselito D. Cuenta (Cuenta), Jonas
P. Estilong (Estilong), Dominador C. Canaria (Canaria), Genaro C.
Rondaris (Genaro), Herardo M. Dulay (Dulay), Franklin A. Ravina,
Jr. (Ravina), and Ruben C. Cabello (Cabello)
(petitioners).7chanroblesvirtuallawlibrary
Sometime in 1995, the rank-and-file employees of TTCI formed a
union named as Times Employees Union (TEU) which was later
certified as the sole and exclusive bargaining unit within
TTCI.8chanroblesvirtuallawlibrary
In March 1997, members of TEU went on strike; but when former
Labor Secretary Leonardo A. Quisimbing assumed jurisdiction over
the labor dispute and certified the same for compulsory arbitration, a
return-to-work Order dated March 10, 1997 was issued which ended
the strike and enjoined the parties from committing any other act that
may intensify the situation.9chanroblesvirtuallawlibrary
On August 23, 1997, TTCI Board of Directors approved a resolution
confirming the authority given to respondent Santiago Rondaris
(Santiago), TTCI President and Chairman of the Board of Directors,
to gradually dispose the assets of the TTCI as a result of its unabated
increase of the cost of operations and losses for the last two years.
TTCI also adopted a company-wide retrenchment program, which
will take effect on October 1, 1997, where Santiago was given the
authority to determine the number of excess employees who would
be the subject of retrenchment.10chanroblesvirtuallawlibrary
The sale of 25 buses of TTCI, as well as the Certificates of Public
Convenience for the operation of the buses, were likewise approved
and subsequently transferred to respondent Mencorp Transport
Systems, Inc., (MENCORP) by virtue of a Deed of Sale dated
December 12, 1997. Thereafter, several union members received
notices that they were being retrenched effective 30 days from
September 16, 1997.11chanroblesvirtuallawlibrary
For a second time, on October 17, 1997, TEU declared a strike
against TTCI, but the latter merely reiterated the earlier return-to-
work order of the Labor Secretary. For disregarding the said return-
to-work order, Santiago issued two notices of termination dated
38
October 26, 199712 terminating some 106 workers and a revised list
dated November 24, 199713 increasing the number of dismissed
employees to 119, for participating in the illegal
strike.14chanroblesvirtuallawlibrary
On December 4, 1997, Santiago served to the Department of Labor
and Employment Regional Office I a notice that TTCI would be
closing its operations due to heavy business
losses.15chanroblesvirtuallawlibrary
On May 14, 1998, petitioners Estraero, Pajarillo, Padre, Avila, Avila,
Jr., Tupasi, Cuenta, Dulay, Yago, and Aganon filed several complaints
against TTCI and MENCORP before the NLRC. The complaints
were thereafter consolidated under the case entitled Malana v.
TTCI docketed as NLRC RAB-I-01-1007.16 However, this case was
withdrawn on March 4, 1999 upon motion by the TEUs counsel
which was given due course on March 22,
1999.17chanroblesvirtuallawlibrary
Four years later, several complaints for unfair labor practice, illegal
dismissal with money claims, damages and attorneys fees were filed
against TTCI, Santiago, MENCORP and its General Manager
Virginia Mendoza, including the latters husband Reynaldo Mendoza
(collectively called the respondents), before the LA from June to July
2002.18 Accordingly, these complaints were consolidated.
In response, TTCI asserted that the petitioners cause of action had
already been barred by prescription because the complaints were filed
only in June 2002 or after almost five years from the date of their
dismissal. MENCORP, on the other hand, raised the defense of lack
of employer-employee relationship since it never engaged the
services of the petitioners when TTCI sold to them its buses and the
Certificates of Public Convenience.19chanroblesvirtuallawlibrary
On June 9, 2005, the LA rendered a Decision dismissing the
petitioners claim for unfair labor practice and money claims on the
ground of prescription. However, with regard to the issue of illegal
dismissal, only the complaints of Montero, Ravina, Cabello, Genaro,
Madera, Gaano, Arsenio Donato and Estilong were dismissed for
having been barred by prescription.20chanroblesvirtuallawlibrary
The LA found that petitioners Estraero, Pajarillo, Aganon, Padre,
Dulay, Cuenta, Canaria, Yago, Avila and Avila, Jr. were illegally
dismissed and were awarded their separation pay and backwages.
According to the LA, the complaints of these 10 petitioners were
timely filed in June 2002 because the eight-month period during
which their cases were pending should be excluded from the four-
year prescriptive period.21chanroblesvirtuallawlibrary
Disagreeing with the LA decision, all parties interposed an appeal
before the NLRC. However, said appeals have both been denied for
non-perfection, particularly for failure of the petitioners to verify
their appeal, and for failure of the respondent to post the required
cash or surety bond. In a Decision22 dated March 31, 2008, the NLRC
vacated and set aside the findings of the LA, upon finding that the
petitioners complaints had already been barred by prescription. The
dispositive part of which reads:chanRoblesvirtualLawlibrary
WHEREFORE, IN VIEW OF THE FOREGOING, the decision
appealed from is hereby VACATED and SET ASIDE, and the
complaints dismissed on ground of prescription.
SO ORDERED.23
The NLRC observed that the LA had ignored the rule on prescription,
and chose to be selective in awarding relief to the 10 complainants by
stating in his decision that the period during which the labor cases
were pending should be deducted from the period of prescription.
According to the NLRC:chanRoblesvirtualLawlibrary
We have thoroughly examined the records and find no justification
for the [LA] to rule that the pendency of the cases has worked in
favor of the complainants to whom he awarded separation pay and
backwages. The [LA] has not at all indicated in his decision when the
eight (8)[-]month period of pendency he alluded to commenced and
when it ended. As a matter of fact, these cases took almost three (3)
years from filing of the complaints to the rendition of the appealed
decision.24
The NLRC added that the application of the principle of prescription
should not be done on a selective basis, especially when the dates of
accrual of the causes of action and the filing of the complaints readily
show that prescription has set in.25chanroblesvirtuallawlibrary
The petitioners filed a motion for reconsideration26 dated May 16,
2008, but it was denied.27 Hence, they filed a petition for
certiorari28 before the CA.
On August 28, 2009, the CA Decision dismissed the petition.29 In
sustaining the NLRC decision, the appellate court
ratiocinated:chanRoblesvirtualLawlibrary
Here, the illegal dismissal case was filed only in June 2002 or for
more than four (4) years and seven (7) months from the time
petitioners received the notices of their dismissal in November and
October 1997. Clearly, the four-year prescriptive period has already
elapsed.
Moreover, there is likewise no merit in petitioners contention that the
period when they filed a complaint on May 14, 1998 but withdrawn
on March 30, 1998 should be excluded from the computation of the
four-year prescriptive [period] for illegal dismissal cases. The
prescriptive period continues even after the withdrawal of the case as
though no action has been filed at all. This was clarified in the case
of Intercontinental Broadcasting Corporation vs. Panganiban,
where the Supreme Court held that although the commencement of
an action stops the running of the statute of prescription or
limitations, its dismissal or voluntary abandonment by plaintiff leaves
the parties in exactly the same position as though no action had been
commenced at all. x x x.30
Aggrieved by the foregoing disquisition, the petitioners moved for
reconsideration31 but it was denied by the CA.32 Hence, the present
petition for review on certiorari.33chanroblesvirtuallawlibrary
The Issue
The main issue in this case is whether or not the petitioners
complaints for illegal dismissal have already prescribed.
39
Ruling of the Court
The petition is bereft of merit.
It should be emphasized at the outset that as a rule, this Court is not
a trier of facts and this applies with greater force in labor cases.
Hence, factual findings of quasi-judicial bodies like the NLRC,
particularly when they coincide with those of the [LA] and if
supported by substantial evidence, are accorded respect and even
finality by this Court. But where the findings of the NLRC and the
[LA] are contradictory, as in the present case, this Court may delve
into the records and examine for itself the questioned
findings.34chanroblesvirtuallawlibrary
Nevertheless, the Court has thoroughly reviewed the records in this
case and finds that the NLRC did not commit any grave abuse of its
discretion amounting to lack or in excess of jurisdiction in rendering
its decision in favor of the respondents. The CA acted in accord with
the evidence on record and case law when it dismissed the petition
and affirmed the assailed decision and resolution of the NLRC.
In the case at bar, October 26, 1997 and November 24, 1997 appear
on record to be the dates when the petitioners employment were
terminated by TTCI. The antecedent facts that gave rise to the
petitioners dismissal from employment are not disputed in this case.
There is no question about the fact that the petitioners complaints for
unfair labor practice and money claims have already prescribed. The
petitioners however argue that their complaints for illegal dismissal
were duly filed within the four-year prescriptive period since the
period during which their cases were pending should be deducted
from the period of prescription. On the other hand, the respondents
insist that said complaints have already prescribed. Hence, the pivotal
question in resolving the issues hinges on the resolution of whether
the period during which the petitioners cases were pending should be
excluded from the period of prescription.
Settled is the rule that when one is arbitrarily and unjustly deprived of
his job or means of livelihood, the action instituted to contest the
legality of ones dismissal from employment constitutes, in essence,
an action predicated upon an injury to the rights of the plaintiff, as
contemplated under Article 114635 of the New Civil Code, which
must be brought within four years.36chanroblesvirtuallawlibrary
The petitioners contend that the period when they filed a labor case
on May 14, 1998 but withdrawn on March 22, 1999 should be
excluded from the computation of the four-year prescriptive period
for illegal dismissal cases. However, the Court had already ruled that
the prescriptive period continues even after the withdrawal of the
case as though no action has been filed at all. The applicability of
Article 115537of the Civil Code in labor cases was upheld in the case
of Intercontinental Broadcasting Corporation v. Panganiban38 where
the Court held that although the commencement of a civil action
stops the running of the statute of prescription or limitations, its
dismissal or voluntary abandonment by plaintiff leaves the parties in
exactly the same position as though no action had been commenced
at all.39chanroblesvirtuallawlibrary
In like manner, while the filing of the complaint for illegal dismissal
before the LA interrupted the running of the prescriptive period, its
voluntary withdrawal left the petitioners in exactly the same position
as though no complaint had been filed at all. The withdrawal of their
complaint effectively erased the tolling of the reglementary period.
A prudent review of the antecedents of the claim reveals that it has in
fact prescribed due to the petitioners withdrawal of their labor case
docketed as NLRC RAB-I-01-1007.40 Hence, while the filing of the
said case could have interrupted the running of the four-year
prescriptive period, the voluntary withdrawal of the petitioners
effectively cancelled the tolling of the prescriptive period within
which to file their illegal dismissal case, leaving them in exactly the
same position as though no labor case had been filed at all. The
running of the four-year prescriptive period not having been
interrupted by the filing of NLRC RAB-I-01-1007, the petitioners
cause of action had already prescribed in four years after their
cessation of employment on October 26, 1997 and November 24,
1997. Consequently, when the petitioners filed their complaint for
illegal dismissal, separation pay, retirement benefits, and damages in
2002, their claim, clearly, had already been barred by
prescription.41chanroblesvirtuallawlibrary
Sadly, the petitioners have no one but themselves to blame for their
own predicament. By their own allegations in their respective
complaints, they have barred their remedy and extinguished their
right of action. Although the Constitution is committed to the policy
of social justice and the protection of the working class, it does not
necessary follow that every labor dispute will be automatically
decided in favor of labor. The management also has its own rights.
Out of concern for the less privileged in life, this Court, has more
often than not inclined, to uphold the cause of the worker in his
conflict with the employer. Such leaning, however, does not blind the
Court to the rule that justice is in every case for the deserving, to be
dispensed in the light of the established facts and applicable law and
doctrine.42chanroblesvirtuallawlibrary
WHEREFORE, the Decision dated August 28, 2009 and Resolution
dated December 11, 2009 of the Court of Appeals in CA-G.R. SP No.
106260 are AFFIRMED.
SO ORDERED.
G.R. No. 204646, April 15, 2015SMART COMMUNICATIONS,
INC., NAPOLEON L. NAZARENO, AND RICARDO P.
ISLA,*Petitioners, v. JOSE LENI Z. SOLIDUM, Respondent.
The Case
This is a petition1 for review on certiorari under Rule 45 of the Rules
of Court. Petitioners Smart Communications, Inc. (Smart), Napoleon
L. Nazareno and Ricardo P. Isla (Isla) challenge the Court of Appeals
3 July 2012 Amended Decision2 and 23 November 2012
Resolution3 in CA-G.R. SP No. 115794, affirming the National Labor
Relations Commissions (NLRC) 30 July 2010 Resolution.4
The Facts
40
On 26 April 2004, Smart hired respondent Jose Leni Z. Solidum
(Solidum) as Department Head for Smart Buddy Activation. Smart
Buddy Activation is under the Product Marketing Group which is
headed by Isla. On 21 September 2005, Isla gave Solidum a
memorandum5 informing him of alleged acts of dishonesty, directing
him to explain why his employment should not be terminated, and
placing him under preventive suspension without pay for 30 days.
On 28 September 2005, Solidum submitted his written
explanation6 in response to the 21 September 2005 notice.
On 22 October 2005, Isla gave Solidum a memorandum7 dated 21
October 2005 informing him of a modified set of alleged acts of
dishonesty, directing him to explain why his employment should not
be terminated, extending his preventive suspension by 10 days, and
inviting him to the administrative investigation scheduled on 26
October 2005.
On 11 November 2005, Isla gave Solidum a memorandum8 dated 9
November 2005 terminating his employment for fraud or willful
breach of trust, falsification, misrepresentation, conflict of interest,
serious misconduct and dishonesty-related offenses.9
Solidum filed against Smart a complaint 10 for illegal dismissal, illegal
suspension, non-payment of salaries, actual, moral and exemplary
damages, and attorneys fees.
In his 3 July 2006 Decision,11 the Labor Arbiter found that Solidums
preventive suspension and dismissal were illegal and that he was
entitled to full back wages, moral and exemplary damages, and
attorneys fees. The dispositive portion of the Decision stated:
WHEREFORE, premises all considered, judgment is hereby rendered
in favor of complainant and against respondents, as follows:
1. Declaring the 20-day extended preventive suspension of
complainant from October 22, 2005 to November 10, 2005 illegal
and tantamount to constructive dismissal, and ordering respondents to
jointly and severally pay complainant his corresponding salaries,
benefits, privileges, allowances and other incentives/bonuses during
the period from October 22 to November 10, 2005, in the amount of
P236,061.94;
2. Ordering respondents to jointly and severally pay the
complainants unpaid salaries, benefits, privileges, allowances, and
other benefits/bonuses during the 30-day preventive suspension, in
the amount of P365,896.00;
3. Declaring the dismissal of complainant effective November 11,
2005 as illegal, and ordering respondents to reinstate the complainant
to his former position, immediately upon receipt of this decision,
either physically or in the payroll, at the option of the former, and
failure to exercise their option within ten (10) days hereof, shall place
the complainant on payroll reinstatement, with payment of accrued
salaries, allowances, benefits/incentives and bonuses;
4. Ordering respondents to jointly and severally pay complainant his
full backwages, inclusive of all benefits bonuses, privileges,
incentives, allowances or their money equivalents, from date of
dismissal on November 11, 2005 until actual reinstatement, partially
computed as follows:
a. Backwages and benefits - P2,903,561.79
b. Quarterly performance bonus - P935,640.00
c. Monthly Gas allowance - P90,693.00
d. Monthly Rice allowance - P9,000.00
e. Monthly drivers allowance - P68,175.00
f. 13th month pay (pro-rata) - P265,569.68
g. Unpaid accumulated leaves - P472,123.87
2004 & 2005
h. Smart incentive entitlement - P7,370,250.00[;]
5. Ordering respondents to jointly and severally pay complainant for
the foregone opportunity of pursuing studies in the United Kingdom
under the British Chevening Scholarship Award, in the sum of
20,189.00 British pounds or Peso 1,982,727.37[; and]
6. Ordering respondents to jointly and severally pay complainant
moral damages in the amount of P2 million, exemplary damages in
the amount of P2 million, and attorneys fees equivalent to 10% of
the judgment award.
SO ORDERED.12
On 25 July 2006, Smart appealed to the NLRC. On 13 November
2006, the Labor Arbiter issued a writ of execution ordering the sheriff
to collect from petitioners P1,440,667.93, representing Solidums
accrued salaries, allowances, benefits, incentives and bonuses from
21 July to 20 October 2006. On 15 August and 25 October 2007, 11
February, 28 April, 23 July and 11 November 2008, and 22 January
2009, the Labor Arbiter issued seven other alias writs of execution
ordering the sheriff to collect from petitioners Solidums accrued
salaries, allowances, benefits, incentives and bonuses.
In its 26 January 2009 Resolution,13 the NLRC reversed the Labor
Arbiters 3 July 2006 Decision and dismissed for lack of merit
Solidums complaint. Solidum filed a motion14 for reconsideration
dated 9 February 2009.
On 4 May 2009, Solidum filed with the Labor Arbiter an ex-parte
motion15 praying that an alias writ of execution be issued directing
the sheriff to collect from petitioners P1,440,667.93, representing
Solidums accrued salaries, allowances, benefits, incentives and
bonuses from 21 January to 20 April 2009.
In its 29 May 2009 Decision,16 the NLRC denied for lack of merit
Solidums 9 February 2009 motion for reconsideration.
The Labor Arbiters Ruling
In his 29 July 2009 Order,17 the Labor Arbiter denied for lack of merit
Solidums ex-parte motion praying that an alias writ of execution be
issued directing the sheriff to collect from petitioners P1,440,667.93,
representing Solidums accrued salaries, allowances, benefits,
incentives and bonuses from 21 January to 20 April 2009. The Labor
Arbiter held that:
41
In the instant case, the NLRC promulgated its Decision dated January
26, 2009 reversing this Offices Decision dated July 03, 2006. Also,
the NLRC in its Decision dated May 29, 2009 denied the
complainants motion for reconsideration of its Decision dated
January 26, 2009. This Office is mindful of the fact that the NLRC is
tasked with the review of decisions promulgated by this Office, as
such, it is a higher tribunal as contemplated by law.
Verily, the recent decision of the NLRC reversing the Decision of this
Office prevents any future issuance of any writ of execution on the
reinstatement aspect in line with Gracia, et al. vs. Philippine Airlines,
Inc. and International Container Terminal Services vs. NLRC. 18
Solidum appealed to the NLRC.
The NLRCs Ruling
In its 31 May 2010 Decision,19 the NLRC reversed the Labor
Arbiters 29 July 2009 Order. The NLRC held that:
In the case at bar, records show that respondents appealed from the
Labor Arbiters Decision to the Commission on July 25, 2006. The
Commission resolved respondents appeal on January 26, 2009,
reversing the Decision of the Labor Arbiter dated July 3, 2006.
Notably, there is no showing in the records that respondents
reinstated complainant to his former position. Hence, pursuant to
Article 223 of the Labor Code, as amended, relative to the
reinstatement aspect of the Labor Arbiters Decision, respondents are
obligated to pay complainants salaries and benefits, computed from
July 13, 2006, when respondents received a copy of the Labor
Arbiters Decision which, among others, ordered the reinstatement of
complainant, up to the date of finality of the Commissions resolution
reversing the Labor Arbiters Decision, which, for this purpose, is
reckoned on May 29, 2009, when the Commission denied
complainants Motion for Reconsideration.
Indeed, common sense dictates that complainants entitlement to
reinstatement salaries/wages and benefits, emanating from the Labor
Arbiters order of reinstatement, presupposes that said order of
reinstatement is still enforceable. Here, the Labor Arbiters order of
reinstatement dated July 3, 2006 was no longer enforceable as of May
29, 2009 when the Commissions resolution reversing the Labor
Arbiters order of reinstatement is deemed to have become final as
hereinabove discussed. Patently then, complainant is no longer
entitled to reinstatement salaries/wages and benefits after May 29,
2009.
Significantly, the Order of the Labor Arbiter being appealed from by
complainant, denied the latters motion for issuance of alias writ of
execution for the collection of his reinstatement salaries and benefits
for the period covering January 21, 2009 to April 20, 2009. The
Labor Arbiter thus committed serious error in denying complainants
motion with respect to his reinstatement salaries and benefits as he is
entitled to the same for the period starting July 13, 2006 to May 29,
2009.20
Solidum filed a motion21 for partial reconsideration. Petitioners filed
a motion22 for reconsideration. In its 30 July 2010 Resolution, the
NLRC granted Solidums motion for partial reconsideration and
denied for lack of merit petitioners motion for reconsideration. The
NLRC held that:
Our Entry of Judgment dated June 01, 2010 clearly states that the
Decision promulgated by this Commission on May 29, 2009 had
become final and executory on August 10, 2009. Thus, We so hold
that the date of finality of Our Decision reversing the Labor Arbiters
Decision dated July 3, 2006 is August 10, 2009, and the computation
of complainants reinstatement or accrued salaries/wages and other
benefits should be up to August 10, 2009.
Anent respondents Motion for Reconsideration, We find the same
unmeritorious.23
Petitoners appealed to the Court of Appeals.
In his alias writ24 of execution dated 22 October 2010, the Labor
Arbiter ordered the sheriff to collect from petitioners P1,440,667.93,
representing Solidums accrued salaries, allowances, benefits,
incentives and bonuses from 21 January to 20 April 2009.
The Court of Appeals Ruling
In its 25 January 2011 Decision,25 the Court of Appeals granted
petitioners petition for certiorari, prohibition and mandamus with
prayer for the issuance of a writ of preliminary injunction and/or
temporary restraining order and set aside the NLRCs 31 May 2010
Decision and 30 July 2010 Resolution. The Court of Appeals held
that:
The order of the Labor Arbiter denying Private Respondents ex-parte
motion for issuance of Alias Writ of Execution is not a final order as
there was something else to be done, namely, the resolution of his
Complaint for Illegal Dismissal against Petitioners on the merits.
The subject Order of the Labor Arbiter did not put an end to the
issues of illegal suspension and illegal dismissal, and, thus, partakes
the nature of an interlocutory order. It is jurisprudential that an
interlocutory order is not appealable until after the rendition of the
judgment on the merits for a contrary rule would delay the
administration of justice and unduly burden the courts. Being
interlocutory in nature, the subject Order could not have been validly
appealed.
Moreover, as correctly argued by the Petitioners, an appeal from an
interlocutory order is a prohibited pleading under Section 4 of the
2005 Revised Rules of Procedure of the NLRC. Consequently, the
Labor Arbiters order being interlocutory and unappealable, Public
Respondent NLRC has no jurisdiction to rule on the appeal except to
dismiss the same. The assailed Decision and the Resolution,
rendered in excess of the Public Respondent NLRCs jurisdiction, are
therefore null.
Besides and more importantly, records show that the Decision, dated
May 29, 2009, of the NLRC in the Illegal Dismissal Case which
effectively denied Private Respondents Complaint for Illegal
42
Dismissal against Petitioners already attained finality on June 1,
2010. Indeed, an Entry of Judgment was accordingly made. Clearly,
Private Respondent can neither pray nor cause this Court to grant his
Ex-parte Motion for Issuance of Writ of Execution to reinstate him
since his dismissal by Petitioners was finally ruled to be legal; hence,
the denial of his complaint for lack of merit. Ruling on Private
Respondents Ex-parte motion shall also have an effect of reviewing
a final judgment which the law and the court abhor. It bears to stress
that when a final judgment becomes executory, it thereby becomes
immutable and unalterable.26
Solidum filed a motion27 for reconsideration.
In his alias writ28 of execution dated 18 May 2011, the Labor Arbiter
ordered the sheriff to collect from petitioners P1,440,667.93,
representing Solidums accrued salaries, allowances, benefits,
incentives and bonuses from 21 April to 20 July 2009. Petitioners
filed with the Court of Appeals a motion 29 to order Solidum to return
P2,881,335.86, representing the total amount under the 22 October
2010 and 18 May 2011 alias writs of execution.
In its 3 July 2012 Amended Decision, the Court of Appeals partly
granted Solidums motion for reconsideration and denied petitioners
motion to order the return of P2,881,335.86. The Court of Appeals
held that:
[T]here was a wrong appreciation of fact relative to the date of
finality of judgment. The true date when the May 29, 2009 NLRC
decision became final and executory was on August 10, 2009 and not
on June 1, 2010. (Rollo, page 1895) Conformably with the
foregoing, the involved portion of our ruling which is the subject of
the discussion at hand is hereby modified by changing the stated date
therein from June 1, 2010 to August 10, 2009.
xxxx
On the last issue for consideration refund of monetary award, We
find necessary to quote the following pronouncement of the High
Court:
xxxx
The Court reaffirms the prevailing principle that even if the order of
reinstatement of the Labor Arbiter is reversed on appeal, it is
obligatory on the part of the employer to reinstate and pay the wages
of the dismissed employee during the period of appeal until reversal
by the higher court. (Juanito A. Garcia vs. Philippine Airlines, Inc.,
G.R. No. 164856, January 20, 2009)
In view thereof, no refund will thus be permitted by this Court. 30
Petitioners filed a motion31 for partial reconsideration with motion to
order the return of P2,881,335.86. In its 23 November 2012
Resolution, the Court of Appeals held that:
The move to reconsider the January 26, 2009 decision of the NLRC
was denied on May 29, 2009. Thereafter, an Entry of Judgment was
issued which provides in particular the following: this is to certify
that on May 29, 2009, a DECISION was rendered x x x and that the
same has, pursuant to Rules of the Commission, became [sic] final
and executory on Aug. 10, 2009. (Rollo, p. 1895) It appears
therefore that the situation contemplated in the last paragraph of the
Section 14 had been the case here. In view of this, We find no cogent
reason to reverse our earlier ruling that August 10, 2009 is the true
date of finality of subject decision.
xxxx
In the light, however, of our earlier discussion on the true date of
finality of judgment, we cannot order the return of the amounts
released by way of the 8th and 9th Alias Writ of Execution. The
wages, allowances, incentives/benefits and bonuses received through
the said writs covered the period from January 21, 2009 to July 20,
2009, thus, the latter is not required to reimburse the same due to the
fact that one is entitled to such amounts until the day that the
reinstatement order was reversed with finality (which in this case
falls on August 10, 2009). (See Juanito A. Garcia vs. Philippine
Airlines, Inc. G.R. No. 164856, January 20, 2009)32
Hence, the present petition.
The Issues
Petitioners raised as issues that the Court of Appeals erred in ruling
that (1) the NLRCs 29 May 2009 Decision became final and
executory on 10 August 2009, and (2) Solidum was entitled to
P2,881,335.86, representing the total amount under the 22 October
2010 and 18 May 2011 alias writs of execution.
The Courts Ruling
The petition is unmeritorious.
The NLRCs 29 May 2009 Decision became final and executory on
10 August 2009 as shown on the entry of judgment.33 The entry of
judgment states:
This is to certify that on May 29, 2009, a DECISION was rendered in
the above-entitled case, the dispositive portion of which reads as
follows:
WHERFORE, premises considered, complainants motion for
reconsideration, as well as respondents motion for injunction are
hereby both DENIED for lack of merit. Accordingly, Our January
26, 2009 Resolution is hereby REITERATED.
SO ORDERED.
and that the same has pursuant to the Rules of the Commission,
become final and executory on Aug. 10, 2009 and is hereby
recorded in the Book of Entries of Judgments.
Quezon City, Philippines, June 01, 2010.34 (Boldfacing supplied)
Moreover, the certification35 issued by the NLRC states that the
43
NLRCs 29 May 2009 Decision became final and executory on 10
August 2009:
This is to certify that the Decision in NLRC Case No. 00-11-09564-
05/NLRC CA No. 049875-06, entitled: Jose Leni Z. Solidum vs.
Smart Communications, Inc., Napoleon L. Nazareno, and/or Ricky P.
Isla, was promulgated on 29 May 2009; the same was mailed on 11
June 2009 and in the absence of return cards, the decision had
become final and executory on 10 August 2009, (after sixty (60)
calendar days from the date of mailing), and had been recorded in the
Book of Entries of Judgment, pursuant to Rule VII Section 14 of the
2005 Revised Rules of Procedure of the NLRC which provides: The
Executive Clerk or Deputy Executive Clerk shall consider the
decision, resolution or order as final and executory after sixty (60)
calendar days from date of mailing in the absence of return cards,
certifications from the post office, or other proof of service to
parties.36 (Boldfacing supplied)
Since the NLRCs 29 May 2009 Decision became final and executory
on 10 August 2009, Solidum is entitled to P2,881,335.86,
representing his accrued salaries, allowances, benefits, incentives and
bonuses for the period 21 January to 20 July 2009.
In Bago v. NLRC,37 the Court held that employees are entitled to their
accrued salaries, allowances, benefits, incentives and bonuses until
the NLRCs reversal of the labor arbiters order of reinstatement
becomes final and executory, as shown on the entry of judgment.
The Court held that:
Finally, on Arlyns claim that respondents unilaterally withheld her
payroll reinstatement after the NLRC reversed on September 27,
2004 the Labor Arbiters decision, Article 223, paragraph 6 of the
Labor Code provides that the decision of the NLRC on appeals from
decisions of the Labor Arbiter shall become final and executory after
ten (10) calendar days from receipt thereof by the parties. The 2002
New Rules of Procedure of the NLRC provided:
RULE VII
xxxx
SECTION 14. FINALITY OF DECISION OF THE COMMISSION
AND ENTRY OF JUDGMENT. (a) Finality of the Decisions,
Resolutions or Orders of the Commission. Except as provided in
Rule XI, Section 9, the decisions, resolutions or orders of the
Commission/Division shall become executory after ten (10) calendar
days from receipt of the same.
(b) Entry of Judgment. Upon the expiration of the ten (10)
calendar day period provided in paragraph (a) of this section, the
decision/resolution/order shall, as far as practicable, be entered in a
book of entries of judgment.
(c) Allowance for Delay of Mail in the Issuance of Entries of
Judgment. In issuing entries of judgment, the Executive Clerk of
Court or the Deputy Executive Clerk, in the absence of a return card
or certification from the post office concerned, shall determine the
finality of the decision by making allowance for delay of mail,
computed sixty (60) calendar days from the date of mailing of the
decision, resolution or order.
That the Court of Appeals may take cognizance of and resolve a
petition for certiorari for the nullification of the decisions of the
NLRC on jurisdictional and due process considerations does not
affect the statutory finality of the NLRC Decision. The 2002 New
Rules of Procedure of the NLRC so provided:
RULE VIII
xxxx
SECTION 6. EFFECT OF FILING OF PETITION
FOR CERTIORARI ON EXECUTION. A petition for certiorari
with the Court of Appeals or the Supreme Court shall not stay the
execution of the assailed decision unless a temporary restraining
order is issued by the Court of Appeals or the Supreme Court.
In the case at bar, Arlyn received the September 27, 2004 NLRC
decision on October 25, 2004, and the January 31, 2005 NLRC
Resolution denying her Motion for Reconsideration on February 23,
2005. There is no showing that the Court of Appeals issued a
temporary restraining order to enjoin the execution of the NLRC
decision, as affirmed by its Resolution of January 31, 2005.
If above-quoted paragraph (a) of Section 14 of Rule VII of the
2002 NLRC New Rules of Procedure were followed, the decision
of the NLRC would have become final and executory on March 7,
2005, ten (10) calendar days from February 25, 2005. The
NLRC, however, issued on June 16, 2005 a Notice of Entry of
Judgment stating that the NLRC Resolution of January 31, 2005
became final and executory on April 16, 2005, apparently
following the above-quoted last paragraph of Section 14 of Rule
VII. No objection having been raised by any of the parties to the
declaration in the Notice of Entry of Judgment of the date of
finality of the NLRC January 31, 2005 Resolution, Arlyns
payroll reinstatement ended on April 16, 2005. x x x
WHEREFORE, the petition is, in light of the foregoing discussions,
DENIED and the questioned decision of the court a quo is
AFFIRMED with MODIFICATION in that respondent Standard
Insurance, Co., Inc. is ordered to pay the salaries due petitioner,
Arlyn Bago, from the time her payroll reinstatement was
withheld after the promulgation on September 27, 2004 of the
decision of the National Labor Relations Commission until April
16, 2005 when it became final and executory.38 (Boldfacing
supplied)
WHEREFORE, the petition is DENIED. The Court of Appeals 3
July 2012 Amended Decision and 23 November 2012 Resolution in
CA-G.R. SP No. 115794 are AFFIRMED.
SO ORDERED.
44
G.R. No. 205575, July 22, 2015VISAYAN ELECTRIC
COMPANY EMPLOYEES UNION-ALU-TUCP AND
CASMERO MAHILUM, Petitioners, v. VISAYAN ELECTRIC
COMPANY, INC. (VECO), Respondent.
Assailed in this petition for review on certiorari1 are the Resolutions
dated September 25, 20122 and December 19, 20123 of the Court of
Appeals (CA) in CA-GR. SP No. 06329, which dismissed
the certiorari petition filed by petitioners Visayan Electric Company
Employees Union-ALU-TUCP (the Union) and Casmero Mahilum
(Mahilum; collectively petitioners) against the Decision 4 dated June
30, 2011 of the National Labor Relations Commission (NLRC) in
NLRC CC(V)-12-000003-10 (NCMB-RBVII-NS-10-12-10) for
failure of their new counsel to show cause why
their certiorari petition should not be dismissed for having been filed
beyond the reglementary period.
The Facts
Respondent Visayan Electric Company, Inc. (VECO) is a corporation
engaged in the supply and distribution of electricity in Cebu City and
its neighboring cities, municipalities, and barangays. 5 The Union is
the exclusive bargaining agent of VECO's rank-and-file employees,
and Mahilum was the Union's president from October 2007 until his
termination from employment on October 28, 2010.6redarclaw
It was claimed that, before Mahilum was elected as union officer, he
was transferred from VECO's Public Relations Section to its
Administrative Services Section without any specific work. When he
was elected as union secretary, he was transferred to the Line
Services Department as its Customer Service Representative. 7 At the
time of his election as union president, VECO management allegedly:
(a) terminated active union members without going through the
grievance machinery procedure prescribed under the Collective
Bargaining Agreement8 (CBA); (b) refused to implement the profit-
sharing scheme provided under the same CBA9; (c) took back the
motorbikes issued to active union members; and (d) revised the
electricity privilege10 granted to VECO's employees.11redarclaw
Thus, on May 1, 2009, union members marched on the streets of
Cebu City to protest VECO's refusal to comply with the political and
economic provisions of the CBA. Mahilum and other union officers
were interviewed by the media, and they handed out a
document12 containing their grievances against VECO, the gist of
which came out in local newspapers.13 Following said incident,
Mahilum was allegedly demoted as warehouse staff to isolate him
and restrict his movements. Other union officers were transferred to
positions that will keep them away from the general union
membership.14redarclaw
On May 8, 2009, Mahilum was issued a Notice to Explain 15 why he
should not be terminated from service due to loss of trust and
confidence, as well as in violating the Company Code of Discipline,
for causing the publication of what VECO deemed as a libelous
article. The other union officers likewise received similar notices 16 for
them to explain their actions, which they justified 17 as merely an
expression of their collective sentiments against the treatment of
VECO's management towards them.18redarclaw

On May 20, 2009, the union officers were notified19 of the
administrative investigation to be conducted relative to the charges
against them. During the scheduled investigation, the Union's counsel
initially raised its objection to the proceedings and insisted that the
investigation should be conducted through the grievance machinery
procedure, as provided in the CBA.20 However, upon the agreement
to proceed with the investigation of the Union Vice President, Renato
Gregorio M. Gimenez (Gimenez), through his own counsel, Mahilum
and the other union officers likewise agreed to proceed with the
aforesaid investigation, with Gimenez's counsel representing the
Union.21redarclaw
Prior to the said investigation, the Union filed on May 18, 2009, a
Notice of Strike22 with the National Conciliation and Mediation
Board (NCMB) against VECO, which facilitated a series of
conferences that yielded a Memorandum of Agreement 23 (MOA)
signed by the parties on August 7, 2009.24 The parties likewise put to
rest the critical issue of electricity privilege and agreed before the
NCMB on a conversion rate of said privilege to basic pay. Moreover,
the administrative investigation on the alleged libelous publication
was deferred until after the CBA renegotiation. 25redarclaw
However, even before the conclusion of the CBA renegotiation 26 on
June 28, 2010, several complaints for libel were filed against
Mahilum and the other union officers by VECO's Executive Vice
President and Chief Operating Officer Jaime Jose Y. Aboitiz. 27 The
administrative hearing on the charges against Mahilum resumed with
due notice to the latter, but he protested the same, referring to it as
"moro-moro" or "kangaroo" and insisting that the investigation
should follow the grievance machinery procedure under the
CBA.28 Nonetheless, VECO's management carried on with its
investigation and, on the basis of the findings thereof, issued a
notice29 terminating Mahilum from employment on October 28,
2010.30redarclaw
On even date, the Union filed another Notice of Strike 31 with the
NCMB against VECO on the grounds of unfair labor practice,
specifically union busting for the dismissal and/or suspension of its
union president and officers, refusal to bargain collectively, as well as
non-observance of the grievance procedure in their CBA. 32 To avert
any work stoppage that will prejudice VECO's power distribution
activity, the Secretary of Labor intervened and issued an
Order33 dated November 10, 2010 certifying the labor dispute to the
NLRC for compulsory arbitration.34 Consequently, the strike was
enjoined; Mahilum was ordered reinstated in the payroll; and the
parties were directed to refrain from committing any act that would
exacerbate the situation.35redarclaw
The NLRC Ruling
After submission of the respective position papers36 of both parties,
the NLRC Seventh Division rendered Decision37 on June 30, 2011
dismissing the charge of unfair labor practice against VECO for lack
of merit, and declaring Mahilum's dismissal from employment as
legal.
The NLRC found VECO to have acted within the bounds of law
45
when it administratively investigated the suspended or terminated
employees and union officers/members, instead of subjecting their
respective cases to the grievance machinery procedure provided in
the CBA.38 In resolving apparently conflicting provisions in the CBA,
the NLRC applied the specific provision found in Section 13 of
Article XIV that disciplinary actions shall be governed by the rules
and regulations promulgated by the company. Since the
administrative investigations conducted by VECO were found to
have complied with procedural due process requirements, there was
no unfair labor practice to speak of.39redarclaw
On the matter of Mahilum's dismissal and the filing of criminal cases
against the union officers, the NLRC found no substantial evidence to
prove the imputation of union busting. Similarly unsubstantiated
were the allegations of fraud and deceit in hiring and contracting out
services for functions performed by union members, and declaring
certain positions confidential and transferring union members to other
positions without prior discussions, thereby allegedly interfering with
their right to self-organization and reducing union
membership.40redarclaw
The issue on VECO's alleged modification of the electricity privilege,
which the Union claimed as violative of the CBA, was declared
mooted by the MOA entered into between the parties, with the
assistance of the NCMB, providing for, inter alia, electricity
privilege conversion to basic pay. This was subsequently incorporated
in the Renegotiated CBA dated June 28, 2010.41redarclaw
Finally, the NLRC ruled that Mahilum was terminated for a just and
valid cause under Article 282 (c) of the Labor Code, i.e., fraud or
willful breach of trust by the employee of the trust reposed in him by
his employer or duly authorized representative, when he, together
with some other union officers, caused the publication of a document
which was deemed to have dishonored and blackened the memory of
former corporate officer Luis Alfonso Y. Aboitiz, besmirched VECO's
name and reputation, and exposed the latter to public hatred,
9ontempt, and ridicule.42redarclaw
Aggrieved, petitioners filed a motion for reconsideration 43 from the
foregoing NLRC Decision, which was denied in a Resolution44 dated
July 29, 2011. They received said Resolution on August 18,
2011.45redarclaw
On October 18, 2011, petitioners elevated their case to the CA
on certiorari petition,46 docketed as CA-G.R. SP No. 06329, imputing
grave abuse of discretion amounting to lack or excess of jurisdiction
on the part of the NLRC.
On February 29, 2012, the CA issued a Resolution47 directing
petitioners to show cause why the certiorari petition should not be
dismissed for having been filed "one day behind the reglementary
period."48redarclaw
On March 13, 2012, Atty. Jonas V. Asis (Atty. Asis) from the Seno
Mendoza & Associates Law Offices filed in behalf of petitioners a
Manifestation/Explanation49 claiming that "there was unintended
error/mistake in the computation of the period,"50 and that there was
no prejudice caused to VECO by the "unintended one-day late filing
of the petition."51redarclaw
The CA Ruling
On September 25, 2012, the CA issued the assailed September 25,
2012 Resolution52 pointing out that on March 7, 2012, petitioners had
filed a Manifestation53 that they had terminated the services of Atty.
Asis and the Seno Mendoza & Associates as their counsel in this
case, and have contracted the services of Atty. Remigio D. Saladero,
Jr. (Atty. Saladero) as their new counsel. Consequently, the CA
deemed as not filed the Manifestation/Explanation filed by Atty. Asis,
and dismissed the certiorari petition for failure of Atty. Saladero to
comply with the Resolution dated February 29, 2012.
The motion for reconsideration54 filed by Atty. Saladero imploring the
CA to consider the Manifestation/Explanation filed by Atty. Asis
despite the fact that he was no longer petitioners' counsel of record
was denied in a Resolution55 dated December 19, 2012 for lack of
merit.
The Issue
Undeterred, petitioners are now before the Court maintaining that the
CA erred in dismissing the certiorari petition on account of the one-
day delay in its filing despite the serious errors committed by the
NLRC in absolving VECO from the charge of unfair labor practice
and illegal dismissal of Mahilum.
The Court's Ruling
The petition is not impressed with merit.
Under Section 4, Rule 65 of the 1997 Rules of Civil
Procedure, certiorari should be filed "not later than sixty (60)
days from notice of the judgment, order or resolution" sought to be
assailed. The provisions on reglementary periods are strictly applied,
indispensable as they are to the prevention of needless delays, and are
necessary to the orderly and speedy discharge of judicial business.
The timeliness of filing a pleading is a jurisdictional caveat that even
this Court cannot trifle with.56redarclaw
The Union admittedly57 received on August 18, 2011 the NLRC's July
29, 2011 Resolution, which denied their motion for reconsideration of
the NLRC's June 30, 2011 Decision. Therefore, the 60-day period
within which to file a petition for certiorari ended on October 17,
2011. But the certiorari petition was filed one day after, or on
October 18, 2011. Thus, petitioners' failure to file said petition within
the required 60-day period rendered the NLRC's Decision and
Resolution impervious to any attack through a Rule 65 petition
for certiorari, and no court can exercise jurisdiction to review the
same.58redarclaw
Petitioners adamantly insist, however, that the "one-day delay
occasioned by an honest mistake in the computation of dates should
have been overlooked by the CA in favor of substantial
justice."59Their former counsel, Atty. Asis, allegedly thought in good
faith that the month of August has thirty (30) days, and that sixty (60)
46
days from August 18, 2011 is October 18, 2011.60redarclaw
The Court is not convinced.
First. The fact that the delay in the filing of the petition
for certiorari was only one day is not a legal justification for non-
compliance with the rule requiring that it be filed not later than sixty
(60) days from notice of the assailed judgment, order or resolution.
The Court cannot subscribe to the theory that the ends of justice
would be better subserved by allowing a petition for certiorari filed
only one-day late. When the law fixes sixty (60) days, it cannot be
taken to mean also sixty-one (61) days, as the Court had previously
declared in this wise:LawlibraryofCRAlaw
ChanRoblesVirtualawlibrary
[W]hen the law fixes thirty days [or sixty days as in the present case],
we cannot take it to mean also thirty-one days. If that deadline could
be stretched to thirty-one days in one case, what would prevent its
being further stretched to thirty-two days in another case, and so on,
step by step, until the original line is forgotten or buried in the
growing confusion resulting from the alterations? That is intolerable.
We cannot fix a period with the solemnity of a statute and disregard it
like a joke. If law is founded on reason, whim and fancy should play
no part in its application.61
Second. While it is always in the power of the Court to suspend its
own rules, or to except a particular case from its operation, 62 the
liberality with which equity jurisdiction is exercised must always be
anchored on the basic consideration that the same must be warranted
by the circumstances obtaining in the case. 63 However, there is no
showing herein of any exceptional circumstance that may rationalize
a digression from the rule on timeliness of petitions.
Moreover, petitioners failed to satisfactorily show that the refusal of
VECO to follow the grievance machinery procedure under Section 4,
Article XVII of the CBA in the suspension and termination from
employment of the other union officers and members constituted
unfair labor practice.
True, it is a fundamental doctrine in labor law that the CBA is the law
between the parties and they are obliged to comply with its
provisions. If the provisions of the CBA seem clear and
unambiguous, the literal meaning of their stipulations shall control.
However, as in this case, when general and specific provisions of the
CBA are inconsistent, the specific provision shall be paramount to
and govern the general provision.64redarclaw
Section 4, Article XVII of the CBA states that "(a)ny difference of
opinion, controversy, dispute problem or complaint arising from
CompanyUnion or Company-Worker relations concerning the
interpretation or application of this Agreement or regarding any
matter affecting Company Union or Company-Worker relations shall
be considered a grievance."65 On the other hand, under Section 13,
Article XIV, "(t)he Company agrees that henceforth there shall be a
fair and uniform application of its rules and regulations. It is
understood that disciplinary actions imposed on employee or laborer
shall be governed by the rules and regulations promulgated by the
Company as well as those provided for by existing laws on the
matter."66redarclaw

The Court is in accord with the ratiocination of the NLRC that the
sweeping statement "any matter affecting Company-Union or
Company Worker relations shall be considered a grievance" under
Section 4, Article XVII is general, as opposed to Section 13, Article
XIV of the CBA, which is specific, as it precisely refers to "what
governs employee disciplinary actions."67 Thus, the NLRC correctly
ruled that VECO acted within the bounds of law when it proceeded
with its administrative investigation of the charges against other
union officers and members.
This is consistent with jurisprudential rulings supporting an
employer's free reign and "wide latitude of discretion to regulate all
aspects of employment, including the prerogative to instill
discipline in its employees and to impose penalties, including
dismissal, upon erring employees. This is management prerogative,
where the free will of management to conduct its own affairs to
achieve its purpose takes form. The only criterion to guide the
exercise of its management prerogative is that the policies, rules[,]
and regulations on work-related activities of the employees must
always be fair and reasonable[,] and the corresponding penalties,
when prescribed, are commensurate to the offense involved and to the
degree of the infraction."68 The Labor Code does not excuse
employees from complying with valid company policies and
reasonable regulations for their governance and guidance. 69redarclaw
Delving now into the merits of Mahilum's dismissal, the Court holds
that the two requisites for a valid dismissal from employment have
been met, namely: (1) it must be for a just or authorized cause; and
(2) the employee must be afforded due process.70redarclaw
VECO anchored its termination of Mahilum on Article 282 (c) of the
Labor Code and Articles 5.1 and 4.471 of VECO's Company Code of
Discipline, which read as follows:LawlibraryofCRAlaw
Article 282 (c) of tile Labor Code:LawlibraryofCRAlaw
ChanRoblesVirtualawlibrary
Art. 282. Termination By Employer. - An employer may terminate an
employment for any of the following causes:LawlibraryofCRAlaw
xxxx
(c) fraud or willful breach of trust by the employee of the trust
reposed in him by his employer or duly authorized representative;
Company Code of Discipline:LawlibraryofCRAlaw
ChanRoblesVirtualawlibrary
Art. 5.1 Every employee shall uphold company trust and confidence
as well as the trust relationship between the company and its
customers/suppliers.
Art. 4.4 Every employee shall willfully respect the honor or person of
his immediate superior and/or department head or company officers.
VECO found the following "Press Release", 72 which Mahilum,
together with other union officers, caused to be published, as libelous
for dishonoring and blackening the memory of then corporate officer
Luis Alfonso Y. Aboitiz, as well as for maliciously impeaching and
besmirching the company's name and
47
reputation:LawlibraryofCRAlaw
ChanRoblesVirtualawlibrary
VECEU-ALU President, Casmero A. Mahilum, said that since 2004
up to present the new VECO Management under the administration
of the Aboitizes unceasingly attack the local Union by continuously
limit (sic) its membership and diminish (sic) and/or abolish (sic)
worker's benefits and privileges stipulated in the CBA. x x x.
Through clever use of psychological warfare, intimidation, deception,
divide and rule tactic and taking great advantage of the weakness of
the Union especially of the leadership during that time, the [new]
Management under the late Alfonso Y. Aboitiz was able to secure a
Memorandum of Agreement (MOA) signed by the Union and
Management representatives and ratified by the General Membership
that gave Management more flexibility in dealing with labor. x x x.
xxxx
The [l]ocal Union wrote a letter to Mr. Aboitiz expressing full support
of his campaign for energy conservation x x x. But Mr. Aboitiz was
too hard and too arrogant to deal with. x x x.
x x x. We, therefore, ask the general public to understand our plight
and support our actions. We also urge everyone to oppose any
electricity rate increase filed by VECO and NAPOCOR at the Energy
Regulatory Commission (ERC). Any rate increase in the electricity
will only worsen the already burdened public and further increase
profits for the Aboitizes. The entire Union membership are one with
you in condemning such increase and brazen connivance of VECO
and NAPOCOR to justify increases in electricity rate.
x x x x73
The Court has consistently held that "x x x loss of trust and
confidence must be based on willful breach of the trust reposed in the
employee by his employer. Such breach is willful if it is done
intentionally, knowingly, and purposely, without justifiable excuse, as
distinguished from an act done carelessly, thoughtlessly, heedlessly or
inadvertently. Moreover, it must be based on substantial evidence and
not on the employer's whims or caprices or suspicions[,] otherwise,
the employee would eternally remain at the mercy of the employer. x
x x. And, in order to constitute a just cause for dismissal, the act
complained of must be work-related and show that the employee
concerned is unfit to continue working for the employer. In addition,
loss of confidence x x x is premised on the fact that the employee
concerned holds a position of responsibility, trust, and confidence or
that the employee concerned is entrusted with confidence with
respect to delicate matters, such as handling or care and protection of
the property and assets of the employer. The betrayal of this trust is
the essence of the offense for which an employee is
penalized."74redarclaw
Mahilum's attempt to rationalize his act as part of his "moral, legal or
social duty x x x to make known his legitimate perception"75 against
VECO does not, in any way, detract from the indubitable fact that he
intentionally, knowingly, and purposely caused the aforequoted
"disparaging publication." Neither can he hide behind the claim that
the press release was simply "an expression of a valid
grievance."76 As the NLRC aptly pointed out, "(i)nstead of him and
the rest of the union officers bringing their sentiments and/or
grievances against the management to the proper forum, they
intentionally, knowingly and purposefully breached their employer's
trust, by issuing x x x derogatory statements and causing their
publication, apparently, to incite public condemnation against the
latter."77 It bears noting that, while petitioners harp on the refusal of
VECO to follow the grievance machinery procedure under the CBA,
they conveniently forgot that they themselves shunned the very
procedure to which they now hang by a thread.
Moreover, the Court is unmoved by Mahilum's insistence that there
was nothing in his position which called for management's trust and
confidence in him.78 The NLRC, whose findings of facts and
conclusions are generally accorded not only great weight and respect
but even with finality, correctly held that, as Customer Service
Representative, Mahilum occupied a position of responsibility
especially in dealing with VECO's clients. 79 His duties and
responsibilities included: (1) accepting pertinent documents and
processing electrical service applications; (2) verifying authenticity
of documents submitted; (3) interviewing customer-applicant on
applications, complaints, and requests; (4) preparing job assignment
of service inspectors; (5) filing all service orders of inspectors; (6)
assessing and accepting bill deposits; (7) preparing and facilitating
signing of Metered Service Contract; (8) issuing service order for
meter-related activities; (9) verifying existing account of customer-
applicant and approving account clearances; (10) accepting payment
of bills from customer-applicant for account clearances; and (11)
processing payment arrangements of customers.80 His performance
was measured according to how he: (1) handled customers'
transactions; (2) made decisions in processing customers' applications
and payment arrangements; and (3) maintained posture at all times in
handling customers' transactions even wi.th angry
customers.81redarclaw
It is clear from the foregoing that Mahilum was not an ordinary rank
and-file employee. His job entailed the observance of proper
company procedures relating to processing and determination of
electrical service applications culminating in the signing of service
contracts, which constitutes the very lifeblood of VECO's existence.
He was further entrusted with handling the accounts of customers and
accepting payments from them. Not only that, it was his duty to
address customer complaints and requests. Being a frontliner of
48
VECO, with the most consistent and direct interaction with
customers, Mahilum's job involved a high degree of responsibility
requiring a substantial amount of trust and confidence on the part of
his employer, i.e., VECO.
However, with the derogatory statements issued by Mahilum that
were intended to incite, not just public condemnation of VECO, but
antagonism and obstruction against rate increases in electricity that it
may be allowed, by law, to fix, there can be no dispute that VECO,
indeed, had lost its trust and confidence in Mahilum and his ability to
perform his tasks with utmost efficiency and loyalty expected of an
employee entrusted to handle customers and funds. Settled is the rule
that an employer cannot be compelled to retain an employee who is
guilty of acts inimical to the interests of the employer. A company has
the right to dismiss its employee if only as a measure of self-
protection.82redarclaw
Thus, Mahilum was terminated for a just and valid cause. Moreover,
as declared by the NLRC, VECO complied with the procedural due
process requirements of furnishing Mahilum with two written notices
before the termination of employment can be effected. On May 8,
2009,83 Mahilum was apprised of the particular acts for which his
termination was sought; and, after due investigation, he was given a
Notice of Decision84 on October 28, 2010 informing him of his
dismissal from service.
The fact that Mahilum served the company for a considerable period
of time will not help his cause. It is well to emphasize that the longer
an employee stays in the service of the company, the greater is his
responsibility for knowledge and compliance with the norms of
conduct and the code of discipline in the company.85redarclaw
As a final word, while it is the state's responsibility to afford
protection to labor, this policy should not be used as an instrument to
oppress management and capital. In resolving disputes between labor
and capital, fairness and justice should always prevail. Social justice
does not mandate that every dispute should be automatically decided
in favor of labor. Justice is to be granted to the deserving and
dispensed in the light of the established facts and the applicable law
and doctrine.86redarclaw