BONDS On 30 May 1989, the POEA Administrator issued an Order which,
in its dispositive portion, said:
G.R. No. 90273-75 November 15, 1989
FINMAN GENERAL ASSURANCE CORP., petitioner,
vs.
WILLIAM INOCENCIO, ET AL. AND EDWIN CARDONES,
THE ADMINISTRATOR, PHILIPPINE OVERSEAS AND
EMPLOYMENT ADMINISTRATION, THE SECRETARY
OF LABOR AND EMPLOYMENT, respondents.
David I. Unay, Jr. for petitioner.
RESOLUTION
FELICIANO, J.:
Pan Pacific Overseas Recruiting Services, Inc. ("Pan Pacific") is a
private, fee-charging, recruitment and employment agency. T in
accordance with the requirements of Section 4, Rule II, Book II of
the Rules and Regulations of the Philippine Overseas Employment
Administration (POEA), Pan Pacific posted a surety bond issued
by petitioner Finman General Assurance Corporation ("Finman")
and was granted a license to operate by the POEA.
Private respondents William Inocencio, Perfecto Palero, Jr., Edwin
Cardones and one Edwin Hernandez filed with the POEA separate
complaints against Pan Pacific for violation of Articles 32 and 34
(a) of the Labor Code, as amended and for refund of placement
fees paid to Pan Pacific. The complainants alleged that Pan Pacific
charged and collected such fees from them but did not secure
employment for them.
Acting on the complaints, the POEA Administrator motu
proprio impleaded petitioner Finman as party respondent in its
capacity as surety for Pan Pacific. Separate summonses were
served upon Finman and Pan Pacific. The return of the summons
served on Pan Pacific at its official address registered in the POEA
records, showed that Pan Pacific had moved out therefrom; no
prior notice of transfer or change of address was furnished by Pan
Pacific to the POEA as required under POEA rules. The POEA
considered that constructive service of the complaints had been
effected upon Pan Pacific and proceeded accordingly.
For its part, petitioner Finman filed an answer denying liability and
pleading, by way of special and affirmative defenses, that: (1) the
POEA had no "jurisdiction over surety bonds," that jurisdiction
being vested in the Insurance Commission or the regular courts; (2)
it (Finman) had not violated Articles 32 and 34 (a) of the Labor
Code and complainants' claims had accrued during the suspension
of the principal obligor, Pan Pacific; (3) complainants had no cause
of action against Finman, since it was not privy to the transactions
between them and Pan Pacific and had not received any moneys
from them; and (4) the amounts claimed by complainants had been
paid by them as deposits and not as placement fees.
A hearing was held by the POEA on 14 April 1988, at which time
complainants presented their evidence. Petitioner Finman, though
notified of this hearing, did not appear.
WHEREFORE, premises considered,
respondents are hereby ordered to pay
jointly and severally complainants' claims as
follows:
1. William Inocencio P6,000 .00
2. Perfecto Palero, Sr. P5,500 .00
3. Edwin Cardones P2,000 .00
Respondent agency is ordered to release
Cardones' passport, the expenses or
obtaining the same of which (sic) shall be
deducted from the amount of P2,000.00 as it
appears that it was respondent agency who
applied for the processing thereof. The claim
of Edwin Hernandez is dismissed without
prejudice.
For the established violations respondent
agency is hereby imposed a penalty fine in
the amount of P60,000.00. Further, the ban
earlier imposed upon it is herein reiterated.
SO ORDERED.
Petitioner Finman went on appeal to the Secretary of Labor
insisting that: (1) the POEA had no authority to implead petitioner
as party respondent in the proceedings before the POEA; and that
(2) the POEA had no authority to enforce directly the surety bond
against petitioner. In an Order dated 3 August 1989, the Secretary
of Labor upheld the POEA Order appealed from and denied the
appeal for lack of merit.
Petitioner Finman now comes before this Court on a Petition for
certiorari with prayer for preliminary injunction or temporary
restraining order, raising much the same issues it had already
ventilated before the POEA and the Secretary of Labor. It is
contended once again by petitioner Finman that the POEA had no
authority to implead petitioner in the proceedings commenced by
private respondents: and that the POEA was not authorized to
require, in those same proceedings, petitioner to pay private
respondents' claims for refund against Pan Pacific on the basis of
the surety bond issued by petitioner.
Petitioner's contentions are interrelated and will be dealt with
together. They are, however, quite bereft of merit and must be
rejected.
Petitioner cannot seriously dispute the direct and solidary nature of
its obligations under its own surety bond. Under Section 176 of the
Insurance Code, as amended, the liability of a surety in a surety
bond is joint and several with the principal obligor. Petitioner's
bond was posted by Pan Pacific in compliance with the
requirements of Article 31 of the Labor Code, which states that —
Art. 31. Bonds. — All applicants for license
or authority shall post such cash and surety
bonds as determined by the Secretary of
Labor to guarantee compliance with
1
 prescribed recruitment procedures, rules
and regulations, and terms and, conditions
of employment as appropriate.
The Secretary of Labor shall have the
exclusive power to determine, decide, order
or direct payment from, or application of,
the cash and surety bond for any claim or
injury covered and guaranteed by the bonds.
(Emphasis supplied).
The tenor and scope of petitioner Finman's obligations under the
bond it issued are set out in broad ranging terms by Section 4, Rule
II, Book I of the POEA Rules and Regulations:
Section 4. Payment of Fees and Posting of
Bonds. — Upon approval of the application
by the Minister, the applicant shall pay an
annual license fee of P6,000.00. It shall also
post a cash bond of P100,000.00 and
a surety bond of P150,000.00 from a
bonding company acceptable to the
Administration duly accredited by the Office
of the Insurance Commission. The bonds
shall answer for all valid and legal claims
arising from violations of the conditions for
the grant and use of the license or authority
and contracts of employment. The bonds
shall likewise guarantee compliance with the
provisions of the Labor Code and its
implementing rules and regulations relating
to recruitment and placement, the rules of
the Administration and relevant issuances of
the Ministry and all liabilities which the
Administration may impose. The surety
bonds shall include the condition that notice
of garnishment to the principal is notice to
the surety. 1 (Emphasis supplied).
While petitioner Finman has refrained from attaching a copy of the
bond it had issued to its Petition for Certiorari, there can be no
question that the conditions of the Finman surety bond Pan Pacific
had posted with the POEA include the italicized portions of
Section 4, Rule 11, Book I quoted above. It is settled doctrine that
the conditions of a bond specified and required in the provisions of
the statute or regulation providing for the submission of the bond,
are incorporated or built into all bonds tendered under that statute
or regulation, even though not there set out in printer's ink. 2
In the case at bar, the POEA held, and the Secretary of Labor
affirmed, that Pan Pacific had violated Article 32 of the Labor
Code, as amended
Article 32. Fees to be paid by workers. —
Any person applying with a private fee
charging employment agency for
employment assistance shall not be charged
any fee until he has obtained employment
through its efforts or has actually
commenced employment. Such fee shall be
always covered with the approved receipt
clearly showing the amount paid. The
Secretary of Labor shall promulgate a
schedule of allowable fees. (Emphasis
supplied).
as well as Article 34 (a) of the same Code:
Article 34. Prohibited practices. — It shall
be unlawful for any individual, entity,
licensee, or holder of authority:
(a) To charge or accept, directly or
indirectly, any amount than that specified in
the schedule of allowable fees prescribed by
the Secretary of Labor, or to make a worker
pay any amount greater than actually
received by him as a loan or advance.
(Emphasis supplied)
There is, hence, no question that, both under the Labor Code 3 and
the POEA Rules and Regulations, 4 Pan Pacific had violated at
least one of the conditions for the grant and continued use of the
recruitment license granted to it. There can, similarly, be no
question that the POEA Administrator and the Secretary of Labor
are authorized to require Pan Pacific to refund the placement fees it
had charged private respondents without securing employment for
them and to impose the fine of P60,000.00 upon Pan Pacific.
Article 36 of the Labor Code authorizes the Secretary of Labor "to
restrict and regulate" the recruitment and placement activities of
agencies like Pan Pacific and "to issue orders and promulgate rules
and regulations to carry out the objectives and implement the
provisions of [Title I on "Recruitment and Placement of Workers],"
including of course, Article 32 on "Fees to be paid by workers,"
quoted earlier. Upon the other hand, Section 13 of Rule VI, Book I
of the POEA Rules and Regulations expressly authorize the POEA
Administrator or the Secretary of Labor to impose fines "in
addition to or in lieu of the penalties of suspension or cancellation"
of the violator recruitment agency's license.
If Pan Pacific is liable to private respondents for the refunds
claimed by them and to the POEA for the fine of P60,000.00, and
if petitioner Finman is solidarily liable with Pan Pacific under the
operative terms of the bond, it must follow that Finman is liable
both to the private respondents and to the POEA. Petitioner
Finman asserts, however, that the POEA had no authority to
implead it in the proceedings against Pan Pacific.
We are not persuaded by this assertion. Clearly, petitioner Finman
is a party-in-interest in, certainly a proper party to, the proceedings
private respondents had initiated against Pan Pacific the principal
obligor. Since Pan Pacific had thoughtfully refrained from
notifying the POEA of its new address and from responding to the
complaints, petitioner Finman may well I be regarded as an
indispensable party to the proceedings before the POEA. Whether
Finman was an indepensable or merely a proper party to the
proceedings, we believe and so hold that the POEA could properly
implead it as party respondent either upon the request of the private
respondents or, as it happened, motu propio. Such is the situation
under the Revised Rules of Court 5 and the application thereof,
directly or by analogy, by the POEA can certainly not be regarded
as arbitrary, oppressive or capricious.
The fundamental argument of Finman is that its liability under its
own bond must be determined and enforced, not by the POEA or
the Secretary of Labor, but rather by the Insurance Commission or
by the regular courts. Once more, we are not moved by petitioner's
argument.
There appears nothing so special or unique about the determination
of a surety's liability under its bond as to restrict that determination
to the Office of the Insurance Commissioner and to the regular
2
courts of justice exclusively. The exact opposite is strongly
stressed by the second paragraph of Article 31 of the Labor Code:
Art. 31. Bonds. — ... ...
The secretary of Labor shall have the
exclusive power to determine, decide, order
or direct payment from, or application of,
the cash or surety bond for any claim or
injury covered and guaranteed by the bonds.
(Emphasis supplied)
We believe and so hold that to compel the POEA and private
respondents the beneficiaries of Finman's bond-to go to the
Insurance Commissioner or to a regular court of law to enforce that
bond, would be to collide with the public policy which requires
prompt resolution of claims against private recruitment and
placement agencies. The Court will take judicial notice of the
appealing frequency with which some, perhaps many, of such
agencies have cheated workers avid for overseas employment by,
e.g., collecting placement fees without securing employment for
them at all, extracting exorbitant fees or "kickbacks" from those for
whom employment is actually obtained, abandoning hapless and
unlettered workers to exploitative foreign principals, and so on.
Cash and surety bonds are required by the POEA and its
predecessor agencies from recruitment and employment companies
precisely as a means of ensuring prompt and effective recourse
against such companies when held liable for applicants or workers'
claims. Clearly that public policy will be effectively negated if
POEA and the Department of Labor and Employment were held
powerless to compel a surety company to make good on its
solidary undertaking in the same quasi-judicial proceeding where
the liability of the principal obligor, the recruitment or employment
agency, is determined and fixed and where the surety is given
reasonable opportunity to present any defenses it or the principal
obligor may be entitled to set up. Petitioner surety whose liability
to private respondents and the POEA is neither more nor less than
that of Pan Pacific, is not entitled to another or different procedure
for determination or fixing of that liability than that which Pan
Pacific is entitled and subject to.
WHEREFORE, the Petition for certiorari with prayer for
preliminary injunction or temporary restraining order is hereby
DISMISSED for lack of merit. Costs against petitioner. This
Resolution is immediately executory.
Fernan, C.J., Gutierrez, Jr., Bidin and Cortes, JJ., concur.
Footnotes
Art 35. Suspension and/or Cancellation of License or Authority. —
The Secretary of Labor shall have the power to suspend or cancel
any license or authority to recruit employees for overseas
employment for violation of rules and regulations issued by the
Minister of Labor, the Overseas Employment Development Board,
and the National Seamen Board, or for violations of the provisions
of this and other applicable laws, General Orders and Letters of
Instructions.
Section 1, (d) (2) and (5), Rule II, Book II:
Section 1. Requirements for Issuance of License and Authority. —
Every applicant for license or authority to operate a private
employment agency, private recruitment entity or manning agency
shall submit a written application together with the following
requirements:
xxxxxxxxx
(d) A verified undertaking stating that the applicant:
xxxxxxxxx
(2) shall assume full and complete responsibility for all claims and
liabilities which may arise in connection with the use of license;
xxxxxxxxx
(5) shall assume full and complete responsibility for all acts of its
officials, employees and representatives done in connection with
recruitment and placement.
Also: Section 2, Rule VI, Book II:
Section 2. Grounds for Suspension, Cancellation or Revocation. —
A license or authority shall be cancelled, suspended or revoked on
any of the following grounds, among others:
(a) Imposing or accepting directly or indirectly any amount of
money, goods or services, or any fee or bond in excess of what is
prescribed by the Administration;
xxxxxxxxx
(w) Violation of other pertinent provisions of the Labor Code and
other relevant laws, rules and regulations."
G.R. No. 170139 August 5, 2014
SAMEER OVERSEAS PLACEMENT AGENCY,
INC., Petitioner,
vs.
JOY C. CABILES, Respondent.
DECISION
LEONEN, J.:
This case involves an overseas Filipino worker with shattered
dreams. It is our duty, given the facts and the law, to approximate
justice for her.
We are asked to decide a petition for review1 on certiorari assailing
the Court of Appeals’ decision2 dated June 27, 2005. This decision
partially affirmed the National Labor RelationsCommission’s
resolution dated March 31, 2004,3declaring respondent’s dismissal
illegal, directing petitioner to pay respondent’s three-month salary
equivalent to New Taiwan Dollar (NT$) 46,080.00, and ordering it
to reimburse the NT$3,000.00 withheld from respondent, and pay
her NT$300.00 attorney’s fees.4
3
Petitioner, Sameer Overseas Placement Agency, Inc., is a
recruitment and placement agency.5 Responding to an ad it
published, respondent, Joy C. Cabiles, submitted her application
for a quality control job in Taiwan.6
Joy’s application was accepted.7 Joy was later asked to sign a
oneyear employment contract for a monthly salary of
NT$15,360.00.8 She alleged that Sameer Overseas Agency
required her to pay a placement fee of ₱70,000.00 when she signed
the employment contract.9
In a resolution37 dated March 31, 2004, the National Labor
Relations Commission declared that Joy was illegally
dismissed.38 It reiterated the doctrine that the burden of proof to
show that the dismissal was based on a just or valid cause belongs
to the employer.39 It found that Sameer Overseas Placement
Agency failed to prove that there were just causes for
termination.40 There was no sufficient proofto show that
respondent was inefficient in her work and that she failed to
comply with company requirements.41 Furthermore, procedural
dueprocess was not observed in terminating respondent.42

The National Labor Relations Commission did not rule on the

Joy was deployed to work for TaiwanWacoal, Co. Ltd. (Wacoal)
issue of reimbursement of placement fees for lack of
on June 26, 1997.10 She alleged that in her employment contract,
jurisdiction.43 It refused to entertain the issue of the alleged transfer
she agreed to work as quality control for one year.11 In Taiwan, she
of obligations to Pacific.44 It did not acquire jurisdiction over that
was asked to work as a cutter.12
issue because Sameer Overseas Placement Agency failed to appeal
the Labor Arbiter’s decision not to rule on the matter.45
Sameer Overseas Placement Agencyclaims that on July 14, 1997, a
certain Mr. Huwang from Wacoal informedJoy, without prior
The National Labor Relations Commission awarded respondent
notice, that she was terminated and that "she should immediately
only three (3) months worth of salaryin the amount of NT$46,080,
report to their office to get her salary and passport."13 She was
the reimbursement of the NT$3,000 withheld from her, and
asked to "prepare for immediate repatriation."14
attorney’s fees of NT$300.46

Joy claims that she was told that from June 26 to July 14, 1997, she
The Commission denied the agency’s motion for
only earned a total of NT$9,000.15 According to her, Wacoal
reconsideration47 dated May 12, 2004 through a resolution 48 dated
deducted NT$3,000 to cover her plane ticket to Manila.16
July 2, 2004.

On October 15, 1997, Joy filed a complaint17 with the National

Aggrieved by the ruling, Sameer Overseas Placement Agency
Labor Relations Commission against petitioner and Wacoal. She
caused the filing of a petition49 for certiorari with the Court of
claimed that she was illegally dismissed.18 She asked for the return
Appeals assailing the National Labor Relations Commission’s
of her placement fee, the withheld amount for repatriation costs,
resolutions dated March 31, 2004 and July 2, 2004.
payment of her salary for 23 months as well as moral and
exemplary damages.19 She identified Wacoal as Sameer Overseas
Placement Agency’s foreign principal.20 The Court of Appeals50 affirmed the decision of the National Labor
Relations Commission with respect to the finding of illegal
dismissal, Joy’s entitlement to the equivalent of three months
Sameer Overseas Placement Agency alleged that respondent's
worth of salary, reimbursement of withheld repatriation expense,
termination was due to her inefficiency, negligence in her duties,
and attorney’s fees.51 The Court of Appeals remanded the case to
and her "failure to comply with the work requirements [of] her
the National Labor Relations Commission to address the validity of
foreign [employer]."21 The agency also claimed that it did not ask
petitioner's allegations against Pacific.52 The Court of Appeals
for a placement fee of ₱70,000.00.22 As evidence, it
held, thus: Although the public respondent found the dismissal of
showedOfficial Receipt No. 14860 dated June 10, 1997, bearing
the complainant-respondent illegal, we should point out that the
the amount of ₱20,360.00.23 Petitioner added that Wacoal's
NLRC merely awarded her three (3) months backwages or the
accreditation with petitioner had already been transferred to the
amount of NT$46,080.00, which was based upon its finding that
Pacific Manpower & Management Services, Inc. (Pacific) as of
she was dismissed without due process, a finding that we uphold,
August 6, 1997.24 Thus, petitioner asserts that it was already
given petitioner’s lack of worthwhile discussion upon the same in
substituted by Pacific Manpower.25
the proceedings below or before us. Likewise we sustain NLRC’s
finding in regard to the reimbursement of her fare, which is
Pacific Manpower moved for the dismissal of petitioner’s claims squarely based on the law; as well as the award of attorney’s fees.
against it.26 It alleged that there was no employer-employee
relationship between them.27 Therefore, the claims against it were
But we do find it necessary to remand the instant case to the public
outside the jurisdiction of the Labor Arbiter. 28 Pacific Manpower
respondent for further proceedings, for the purpose of addressing
argued that the employment contract should first be presented so
the validity or propriety of petitioner’s third-party complaint
that the employer’s contractual obligations might be identified.29 It
against the transferee agent or the Pacific Manpower &
further denied that it assumed liability for petitioner’s illegal acts.30
Management Services, Inc. and Lea G. Manabat. We should
emphasize that as far as the decision of the NLRC on the claims of
On July 29, 1998, the Labor Arbiter dismissed Joy’s Joy Cabiles, is concerned, the same is hereby affirmed with
complaint.31 Acting Executive Labor Arbiter Pedro C.Ramos ruled finality, and we hold petitioner liable thereon, but without
that her complaint was based on mereallegations.32 The Labor prejudice to further hearings on its third party complaint against
Arbiter found that there was no excess payment of placement fees, Pacific for reimbursement.
based on the official receipt presented by petitioner. 33 The Labor
Arbiter found unnecessary a discussion on petitioner’s transfer of
WHEREFORE, premises considered, the assailed Resolutions are
obligations to Pacific34 and considered the matter immaterial in
hereby partly AFFIRMED in accordance with the foregoing
view of the dismissal of respondent’s complaint.35
discussion, but subject to the caveat embodied inthe last sentence.
No costs.
Joy appealed36 to the National Labor Relations Commission.
SO ORDERED.53

4
Dissatisfied, Sameer Overseas Placement Agency filed this
petition.54
We are asked to determine whether the Court of Appeals erred
when it affirmed the ruling of the National Labor Relations
Commission finding respondent illegally dismissed and awarding
her three months’ worth of salary, the reimbursement of the cost
ofher repatriation, and attorney’s fees despite the alleged existence
of just causes of termination.
Petitioner reiterates that there was just cause for termination
because there was a finding of Wacoal that respondent was
inefficient in her work.55
Therefore, it claims that respondent’s dismissal was valid.56
Petitioner also reiterates that since Wacoal’s accreditation was
validly transferred to Pacific at the time respondent filed her
complaint, it should be Pacific that should now assume
responsibility for Wacoal’s contractual obligations to the workers
originally recruited by petitioner.57
Sameer Overseas Placement Agency’spetition is without merit. We
find for respondent.
I ....
Sameer Overseas Placement Agency failed to show that there was
just cause for causing Joy’s dismissal. The employer, Wacoal, also
failed to accord her due process of law.
Indeed, employers have the prerogative to impose productivity and
quality standards at work.58 They may also impose reasonable rules
to ensure that the employees comply with these standards.59 Failure
to comply may be a just cause for their dismissal.60 Certainly,
employers cannot be compelled to retain the services of
anemployee who is guilty of acts that are inimical to the interest of
the employer.61 While the law acknowledges the plight and
vulnerability of workers, it does not "authorize the oppression or
self-destruction of the employer."62 Management prerogative is
recognized in law and in our jurisprudence.
This prerogative, however, should not be abused. It is "tempered
with the employee’s right to security of tenure."63Workers are
entitled to substantive and procedural due process before
termination. They may not be removed from employment without
a validor just cause as determined by law and without going
through the proper procedure.
Security of tenure for labor is guaranteed by our Constitution.64
Employees are not stripped of their security of tenure when they
move to work in a different jurisdiction. With respect to the rights
of overseas Filipino workers, we follow the principle of lex loci
contractus.Thus, in Triple Eight Integrated Services, Inc. v.
NLRC,65 this court noted:
Petitioner likewise attempts to sidestep the medical certificate
requirement by contending that since Osdana was working in Saudi
Arabia, her employment was subject to the laws of the host
country. Apparently, petitioner hopes tomake it appear that the
labor laws of Saudi Arabia do not require any certification by a
competent public health authority in the dismissal of employees
due to illness.
Again, petitioner’s argument is without merit.
First, established is the rule that lex loci contractus (the law of the
place where the contract is made) governs in this jurisdiction.
There is no question that the contract of employment in this case
was perfected here in the Philippines. Therefore, the Labor Code,
its implementing rules and regulations, and other laws affecting
labor apply in this case.Furthermore, settled is the rule that the
courts of the forum will not enforce any foreign claim obnoxious to
the forum’s public policy. Herein the Philippines, employment
agreements are more than contractual in nature. The Constitution
itself, in Article XIII, Section 3, guarantees the special protection
of workers, to wit:
The State shall afford full protection to labor, local and overseas,
organized and unorganized, and promote full employment and
equality of employment opportunities for all.
It shall guarantee the rights of all workers to selforganization,
collective bargaining and negotiations, and peaceful concerted
activities, including the right to strike in accordance with law.
They shall be entitled to security of tenure, humane conditions of
work, and a living wage. Theyshall also participate in policy and
decision-making processes affecting their rights and benefits as
may be provided by law.
This public policy should be borne in mind in this case because to
allow foreign employers to determine for and by themselves
whether an overseas contract worker may be dismissed on the
ground of illness would encourage illegal or arbitrary
pretermination of employment contracts.66 (Emphasis supplied,
citation omitted)
Even with respect to fundamental procedural rights, this court
emphasized in PCL Shipping Philippines, Inc. v. NLRC, 67 to wit:
Petitioners admit that they did notinform private respondent in
writing of the charges against him and that they failed to conduct a
formal investigation to give him opportunity to air his side.
However, petitioners contend that the twin requirements ofnotice
and hearing applies strictly only when the employment is within
the Philippines and that these need not be strictly observed in cases
of international maritime or overseas employment.
The Court does not agree. The provisions of the Constitution as
well as the Labor Code which afford protection to labor apply to
Filipino employees whether working within the Philippines or
abroad. Moreover, the principle of lex loci contractus (the law of
the place where the contract is made) governs in this jurisdiction.
In the present case, it is not disputed that the Contract of
Employment entered into by and between petitioners and private
respondent was executed here in the Philippines with the approval
of the Philippine Overseas Employment Administration (POEA).
Hence, the Labor Code together with its implementing rules and
regulations and other laws affecting labor apply in this
case.68 (Emphasis supplied, citations omitted)
By our laws, overseas Filipino workers (OFWs) may only be
terminated for a just or authorized cause and after compliance with
procedural due process requirements.
Article 282 of the Labor Code enumerates the just causes of
termination by the employer. Thus:
5
Art. 282. Termination by employer. An employer may terminate an
employment for any of the following causes:
(a) Serious misconduct or willful disobedience by the
employee of the lawful orders of his employer or
representative in connection with his work;
(b) Gross and habitual neglect by the employee of his
duties;
(c) Fraud or willful breach by the employee of the trust
reposed in him by his employer or duly authorized
representative;
(d) Commission of a crime or offense by the employee
against the person of his employer or any immediate
member of his family or his duly authorized
representatives; and
(e) Other causes analogous to the foregoing.
Petitioner’s allegation that respondentwas inefficient in her work
and negligent in her duties69 may, therefore, constitute a just cause
for termination under Article 282(b), but only if petitioner was able
to prove it.
The burden of proving that there is just cause for termination is on
the employer. "The employer must affirmatively show rationally
adequate evidence that the dismissal was for a justifiable
cause."70 Failure to show that there was valid or just cause for
termination would necessarily mean that the dismissal was
illegal.71
To show that dismissal resulting from inefficiency in work is valid,
it must be shown that: 1) the employer has set standards of conduct
and workmanship against which the employee will be judged; 2)
the standards of conduct and workmanship must have been
communicated tothe employee; and 3) the communication was
made at a reasonable time prior to the employee’s performance
assessment.
This is similar to the law and jurisprudence on probationary
employees, which allow termination ofthe employee only when
there is "just cause or when [the probationary employee] fails to
qualify as a regular employee in accordance with reasonable
standards made known by the employer to the employee at the time
of his [or her] engagement."72
However, we do not see why the application of that ruling should
be limited to probationary employment. That rule is basic to the
idea of security of tenure and due process, which are guaranteed to
all employees, whether their employment is probationary or
regular.
The pre-determined standards that the employer sets are the bases
for determining the probationary employee’s fitness, propriety,
efficiency, and qualifications as a regular employee. Due process
requires that the probationary employee be informed of such
standards at the time of his or her engagement so he or she can
adjusthis or her character or workmanship accordingly. Proper
adjustment to fit the standards upon which the employee’s
qualifications will be evaluated will increase one’s chances of
being positively assessed for regularization by his or her employer.
Assessing an employee’s work performance does not stop after
regularization. The employer, on a regular basis, determines if an
employee is still qualified and efficient, based on work standards.
Based on that determination, and after complying with the due
process requirements of notice and hearing, the employer may
exercise its management prerogative of terminating the employee
found unqualified.
The regular employee must constantlyattempt to prove to his or her
employer that he or she meets all the standards for employment.
This time, however, the standards to be met are set for the purpose
of retaining employment or promotion. The employee cannot be
expected to meet any standard of character or workmanship if such
standards were not communicated to him or her. Courts should
remain vigilant on allegations of the employer’s failure to
communicatework standards that would govern one’s employment
"if [these are] to discharge in good faith [their] duty to
adjudicate."73
In this case, petitioner merely alleged that respondent failed to
comply with her foreign employer’s work requirements and was
inefficient in her work.74 No evidence was shown to support such
allegations. Petitioner did not even bother to specify what
requirements were not met, what efficiency standards were
violated, or what particular acts of respondent constituted
inefficiency.
There was also no showing that respondent was sufficiently
informed of the standards against which her work efficiency and
performance were judged. The parties’ conflict as to the position
held by respondent showed that even the matter as basic as the job
title was not clear.
The bare allegations of petitioner are not sufficient to support a
claim that there is just cause for termination. There is no proof that
respondent was legally terminated.
Petitioner failed to comply with
the due process requirements
Respondent’s dismissal less than one year from hiring and her
repatriation on the same day show not onlyfailure on the partof
petitioner to comply with the requirement of the existence of just
cause for termination. They patently show that the employersdid
not comply with the due process requirement.
A valid dismissal requires both a valid cause and adherence to the
valid procedure of dismissal.75 The employer is required to give the
charged employee at least two written notices before
termination.76 One of the written notices must inform the employee
of the particular acts that may cause his or her dismissal.77 The
other notice must "[inform] the employee of the employer’s
decision."78 Aside from the notice requirement, the employee must
also be given "an opportunity to be heard."79
Petitioner failed to comply with the twin notices and hearing
requirements. Respondent started working on June 26, 1997. She
was told that she was terminated on July 14, 1997 effective on the
same day and barely a month from her first workday. She was also
repatriated on the same day that she was informed of her
termination. The abruptness of the termination negated any finding
that she was properly notified and given the opportunity to be
heard. Her constitutional right to due process of law was violated.
II
6
Respondent Joy Cabiles, having been illegally dismissed, is
entitled to her salary for the unexpired portion ofthe employment
contract that was violated together with attorney’s fees and
reimbursement of amounts withheld from her salary.
Section 10 of Republic Act No. 8042,otherwise known as the
Migrant Workers and Overseas Filipinos Act of1995, states
thatoverseas workers who were terminated without just, valid, or
authorized cause "shall be entitled to the full reimbursement of his
placement fee with interest of twelve (12%) per annum, plus his
salaries for the unexpired portion of his employment contract or for
three (3) months for every year of the unexpired term, whichever is
less."
Sec. 10. MONEY CLAIMS. – Notwithstanding any provision of
law to the contrary, the Labor Arbiters of the National Labor
Relations Commission (NLRC) shall have the original and
exclusive jurisdiction to hear and decide, within ninety (90)
calendar days after filing of the complaint, the claims arising out of
an employer-employee relationship or by virtue of any law or
contract involving Filipino workers for overseas deployment
including claims for actual, moral, exemplary and other forms of
damages.
The liability of the principal/employer and the
recruitment/placement agency for any and all claims under this
section shall be joint and several. This provisions [sic] shall be
incorporated in the contract for overseas employment and shall be
a condition precedent for its approval. The performance bond to be
filed by the recruitment/placementagency, as provided by law,
shall be answerable for all money claims or damages that may be
awarded to the workers. If the recruitment/placement agency is a
juridical being, the corporate officers and directors and partners as
the case may be, shall themselves be jointly and solidarily liable
with the corporation orpartnership for the aforesaid claims and
damages.
Such liabilities shall continue during the entire period or duration
of the employment contract and shall not be affected by any
substitution, amendment or modification made locally or in a
foreign country of the said contract.
Any compromise/amicable settlement or voluntary agreement on
money claims inclusive of damages under this section shall be paid
within four (4) months from the approval of the settlement by the
appropriate authority.
In case of termination of overseas employment without just, valid
or authorized cause as defined by law or contract, the workers shall
be entitled to the full reimbursement of his placement fee with
interest of twelve (12%) per annum, plus his salaries for the
unexpired portion of his employment contract or for three (3)
months for every year of the unexpired term, whichever is less.
....
(Emphasis supplied)
Section 15 of Republic Act No. 8042 states that "repatriation of the
worker and the transport of his [or her] personal belongings shall
be the primary responsibility of the agency which recruited or
deployed the worker overseas." The exception is when
"termination of employment is due solely to the fault of the
worker,"80 which as we have established, is not the case. It reads:
SEC. 15. REPATRIATION OF WORKERS; EMERGENCY
REPATRIATION FUND. – The repatriation of the worker and the
transport of his personal belongings shall be the primary
responsibility of the agency which recruited or deployed the
worker overseas. All costs attendant to repatriation shall be borne
by or charged to the agency concerned and/or its principal.
Likewise, the repatriation of remains and transport of the personal
belongings of a deceased worker and all costs attendant thereto
shall be borne by the principal and/or local agency. However, in
cases where the termination of employment is due solely to the
fault of the worker, the principal/employer or agency shall not in
any manner be responsible for the repatriation of the former and/or
his belongings.
....
The Labor Code81 also entitles the employee to 10% of the amount
of withheld wages as attorney’s feeswhen the withholding is
unlawful.
The Court of Appeals affirmedthe National Labor Relations
Commission’s decision to award respondent NT$46,080.00 or the
threemonth equivalent of her salary, attorney’s fees of NT$300.00,
and the reimbursement of the withheld NT$3,000.00 salary, which
answered for her repatriation.
We uphold the finding that respondent is entitled to all of these
awards. The award of the three-month equivalent of respondent’s
salary should, however, be increased to the amount equivalent to
the unexpired term of the employment contract.
In Serrano v. Gallant Maritime Services, Inc. and Marlow
Navigation Co., Inc.,82 this court ruled that the clause "or for three
(3) months for every year of the unexpired term, whichever is
less"83 is unconstitutional for violating the equal protection clause
and substantive due process.84
A statute or provision which was declared unconstitutional is not a
law. It "confers no rights; it imposes no duties; it affords no
protection; it creates no office; it is inoperative as if it has not been
passed at all."85
We are aware that the clause "or for three (3) months for every
year of the unexpired term, whichever is less"was reinstated in
Republic Act No. 8042 upon promulgation of Republic Act No.
10022 in 2010. Section 7 of Republic Act No. 10022 provides:
Section 7.Section 10 of Republic Act No. 8042, as amended, is
hereby amended to read as follows:
SEC. 10. Money Claims.– Notwithstanding any provision of law to
the contrary, the Labor Arbiters of the National Labor Relations
Commission (NLRC) shall have the original and exclusive
jurisdiction to hear and decide, within ninety (90) calendar days
after the filing of the complaint, the claims arising out of an
employer-employee relationship or by virtue of any law or contract
involving Filipino workers for overseas deployment including
claims for actual, moral, exemplary and other forms of damage.
Consistent with this mandate, the NLRC shall endeavor to update
and keep abreast with the developments in the global services
industry.
The liability of the principal/employer and the
recruitment/placement agency for any and all claims under this
section shall be joint and several. This provision shall be
incorporated in the contract for overseas employment and shall be
7
a condition precedent for its approval. The performance bond to de
[sic] filed by the recruitment/placement agency, as provided by
law, shall be answerable for all money claims or damages that may
be awarded to the workers. If the recruitment/placement agency is
a juridical being, the corporate officers and directors and partners
as the case may be, shall themselves be jointly and solidarily liable
with the corporation or partnership for the aforesaid claims and
damages.
Such liabilities shall continue during the entire period or duration
of the employment contract and shall not be affected by any
substitution, amendment or modification made locally or in a
foreign country of the said contract.
Any compromise/amicable settlement or voluntary agreement on
money claims inclusive of damages under this section shall be paid
within thirty (30) days from approval of the settlement by the
appropriate authority.
In case of termination of overseas employment without just, valid
or authorized cause as defined by law or contract, or any
unauthorized deductions from the migrant worker’s salary, the
worker shall be entitled to the full reimbursement if [sic] his
placement fee and the deductions made with interest at twelve
percent (12%) per annum, plus his salaries for the unexpired
portion of his employment contract or for three (3) months for
every year of the unexpired term, whichever is less.
In case of a final and executory judgement against a foreign
employer/principal, it shall be automatically disqualified, without
further proceedings, from participating in the Philippine Overseas
Employment Program and from recruiting and hiring Filipino
workers until and unless it fully satisfies the judgement award.
Noncompliance with the mandatory periods for resolutions of case
providedunder this section shall subject the responsible officials to
any or all of the following penalties:
(a) The salary of any such official who fails to render
his decision or resolution within the prescribed period
shall be, or caused to be, withheld until the said official
complies therewith;
(b) Suspension for not more than ninety (90) days; or
(c) Dismissal from the service with disqualification to
hold any appointive public office for five (5) years.
Provided, however,That the penalties herein provided shall be
without prejudice to any liability which any such official may have
incured [sic] under other existing laws or rules and regulations as a
consequence of violating the provisions of this paragraph.
(Emphasis supplied)
Republic Act No. 10022 was promulgated on March 8, 2010. This
means that the reinstatement of the clause in Republic Act No.
8042 was not yet in effect at the time of respondent’s termination
from work in 1997.86 Republic Act No. 8042 before it was
amended byRepublic Act No. 10022 governs this case.
When a law is passed, this court awaits an actual case that clearly
raises adversarial positions in their proper context before
considering a prayer to declare it as unconstitutional.
However, we are confronted with a unique situation. The law
passed incorporates the exact clause already declared as
unconstitutional, without any perceived substantial change in the
circumstances.
This may cause confusion on the part of the National Labor
Relations Commission and the Court of Appeals.At minimum, the
existence of Republic Act No. 10022 may delay the execution of
the judgment in this case, further frustrating remedies to assuage
the wrong done to petitioner.
Hence, there is a necessity to decide this constitutional issue.
Moreover, this court is possessed with the constitutional duty to
"[p]romulgate rules concerning the protection and enforcement of
constitutional rights."87 When cases become mootand academic,
we do not hesitate to provide for guidance to bench and bar in
situations where the same violations are capable of repetition but
will evade review. This is analogous to cases where there are
millions of Filipinos working abroad who are bound to suffer from
the lack of protection because of the restoration of an identical
clause in a provision previously declared as unconstitutional.
In the hierarchy of laws, the Constitution is supreme. No branch or
office of the government may exercise its powers in any manner
inconsistent with the Constitution, regardless of the existence of
any law that supports such exercise. The Constitution cannot be
trumped by any other law. All laws must be read in light of the
Constitution. Any law that is inconsistent with it is a nullity.
Thus, when a law or a provision of law is null because it is
inconsistent with the Constitution,the nullity cannot be cured by
reincorporation or reenactment of the same or a similar law or
provision. A law or provision of law that was already declared
unconstitutional remains as such unless circumstances have
sochanged as to warrant a reverse conclusion.
We are not convinced by the pleadings submitted by the parties
that the situation has so changed so as to cause us to reverse
binding precedent.
Likewise, there are special reasons of judicial efficiency and
economy that attend to these cases. The new law puts our overseas
workers in the same vulnerable position as they were prior to
Serrano. Failure to reiterate the very ratio decidendi of that case
will result in the same untold economic hardships that our reading
of the Constitution intended to avoid. Obviously, we cannot
countenance added expenses for further litigation thatwill reduce
their hardearned wages as well as add to the indignity of having
been deprived of the protection of our laws simply because our
precedents have not been followed. There is no constitutional
doctrine that causes injustice in the face of empty procedural
niceties. Constitutional interpretation is complex, but it is never
unreasonable.
Thus, in a resolution88 dated October 22, 2013, we ordered the
parties and the Office of the Solicitor General to comment on the
constitutionality of the reinstated clause in Republic Act No.
10022.
In its comment,89 petitioner argued that the clause was
constitutional.90 The legislators intended a balance between the
employers’ and the employees’ rights by not unduly burdening the
local recruitment agency.91 Petitioner is also of the view that the
clause was already declared as constitutional in Serrano.92
8
The Office of the Solicitor General also argued that the clause was
valid and constitutional.93 However, since the parties never raised
the issue of the constitutionality of the clause asreinstated in
Republic Act No. 10022, its contention is that it is beyond judicial
review.94
On the other hand, respondentargued that the clause was
unconstitutional because it infringed on workers’ right to
contract.95
We observe that the reinstated clause, this time as provided in
Republic Act. No. 10022, violates the constitutional rights to equal
protection and due process.96 Petitioner as well as the Solicitor
General have failed to show any compelling changein the
circumstances that would warrant us to revisit the precedent.
We reiterate our finding in Serrano v. Gallant Maritime that
limiting wages that should be recovered by anillegally dismissed
overseas worker to three months is both a violation of due process
and the equal protection clauses of the Constitution.
Equal protection of the law is a guarantee that persons under like
circumstances and falling within the same class are treated alike, in
terms of "privileges conferred and liabilities enforced."97 It is a
guarantee against "undue favor and individual or class privilege, as
well as hostile discrimination or the oppression of inequality."98
In creating laws, the legislature has the power "to make
distinctions and classifications."99
In exercising such power, it has a wide discretion.100
The equal protection clause does not infringe on this legislative
power.101 A law is void on this basis, only if classifications are
made arbitrarily.102 There is no violation of the equal protection
clause if the law applies equally to persons within the same class
and if there are reasonable grounds for distinguishing between
those falling within the class and those who do not fall within the
class.103 A law that does not violate the equal protection clause
prescribesa reasonable classification.104
A reasonable classification "(1) must rest on substantial
distinctions; (2) must be germane to the purposes of the law; (3)
must not be limited to existing conditions only; and (4) must apply
equally to all members of the same class."105
The reinstated clause does not satisfy the requirement of
reasonable classification.
In Serrano, we identified the classifications made by the reinstated
clause. It distinguished between fixed-period overseas workers and
fixedperiod local workers.106 It also distinguished between
overseas workers with employment contracts of less than one year
and overseas workers with employment contracts of at least one
year.107 Within the class of overseas workers with at least one-year
employment contracts, there was a distinction between those with
at least a year left in their contracts and those with less than a year
left in their contracts when they were illegally dismissed.108
The Congress’ classification may be subjected to judicial review.
In Serrano, there is a "legislative classification which
impermissibly interferes with the exercise of a fundamental right or
operates to the peculiar disadvantage of a suspect class."109
Under the Constitution, labor is afforded special
protection.110 Thus, this court in Serrano, "[i]mbued with the same
sense of ‘obligation to afford protection to labor,’ . . . employ[ed]
the standard of strict judicial scrutiny, for it perceive[d] in the
subject clause a suspect classification prejudicial to OFWs."111
We also noted in Serranothat before the passage of Republic Act
No. 8042, the money claims of illegally terminated overseas and
local workers with fixed-term employment werecomputed in the
same manner.112 Their money claims were computed based onthe
"unexpired portions of their contracts."113 The adoption of the
reinstated clause in Republic Act No. 8042 subjected the money
claims of illegally dismissed overseas workers with an unexpired
term of at least a year to a cap of three months worth of their
salary.114 There was no such limitation on the money claims of
illegally terminated local workers with fixed-term employment.115
We observed that illegally dismissed overseas workers whose
employment contracts had a term of less than one year were
granted the amount equivalent to the unexpired portion of their
employment contracts.116 Meanwhile, illegally dismissed overseas
workers with employment terms of at least a year were granted a
cap equivalent to three months of their salary for the unexpired
portions of their contracts.117
Observing the terminologies used inthe clause, we also found that
"the subject clause creates a sub-layer of discrimination among
OFWs whose contract periods are for more than one year: those
who are illegally dismissed with less than one year left in their
contracts shall be entitled to their salaries for the entire unexpired
portion thereof, while those who are illegally dismissed with one
year or more remaining in their contracts shall be covered by the
reinstated clause, and their monetary benefits limited to their
salaries for three months only."118
We do not need strict scrutiny to conclude that these classifications
do not rest on any real or substantial distinctions that would justify
different treatments in terms of the computation of money claims
resulting from illegal termination.
Overseas workers regardless of their classifications are entitled to
security of tenure, at least for the period agreed upon in their
contracts. This means that they cannot be dismissed before the end
of their contract terms without due process. If they were illegally
dismissed, the workers’ right to security of tenure is violated.
The rights violated when, say, a fixed-period local worker is
illegally terminated are neither greater than norless than the rights
violated when a fixed-period overseas worker is illegally
terminated. It is state policy to protect the rights of workers
withoutqualification as to the place of employment.119 In both
cases, the workers are deprived of their expected salary, which
they could have earned had they not been illegally dismissed. For
both workers, this deprivation translates to economic insecurity
and disparity.120 The same is true for the distinctions between
overseas workers with an employment contract of less than one
year and overseas workers with at least one year of employment
contract, and between overseas workers with at least a year left in
their contracts and overseas workers with less than a year left in
their contracts when they were illegally dismissed.
For this reason, we cannot subscribe to the argument that
"[overseas workers] are contractual employeeswho can never
acquire regular employment status, unlike local
workers"121 because it already justifies differentiated treatment in
122
terms ofthe computation of money claims.
9
Likewise, the jurisdictional and enforcement issues on overseas
workers’ money claims do not justify a differentiated treatment in
the computation of their money claims.123 If anything, these issues
justify an equal, if not greater protection and assistance to overseas
workers who generally are more prone to exploitation given their
physical distance from our government.
We also find that the classificationsare not relevant to the purpose
of the law, which is to "establish a higher standard of protection
and promotion of the welfare of migrant workers, their families
and overseas Filipinos in distress, and for other
purposes."124 Further, we find specious the argument that reducing
the liability of placement agencies "redounds to the benefit of the
[overseas] workers."125
Putting a cap on the money claims of certain overseas workers
does not increase the standard of protection afforded to them. On
the other hand, foreign employers are more incentivizedby the
reinstated clause to enter into contracts of at least a year because it
gives them more flexibility to violate our overseas workers’ rights.
Their liability for arbitrarily terminating overseas workers is
decreased at the expense of the workers whose rights they violated.
Meanwhile, these overseas workers who are impressed with an
expectation of a stable job overseas for the longer contract period
disregard other opportunities only to be terminated earlier. They
are left with claims that are less than what others in the same
situation would receive. The reinstated clause, therefore, creates a
situation where the law meant to protect them makes violation of
rights easier and simply benign to the violator.
As Justice Brion said in his concurring opinion in Serrano:
Section 10 of R.A. No. 8042 affects these well-laid rules and
measures, and in fact provides a hidden twist affecting the
principal/employer’s liability. While intended as an incentive
accruing to recruitment/manning agencies, the law, as worded,
simply limits the OFWs’ recovery in wrongfuldismissal situations.
Thus, it redounds to the benefit of whoever may be liable,
including the principal/employer – the direct employer primarily
liable for the wrongful dismissal. In this sense, Section 10 – read as
a grant of incentives to recruitment/manning agencies – oversteps
what it aims to do by effectively limiting what is otherwise the full
liability of the foreign principals/employers. Section 10, in short,
really operates to benefit the wrong party and allows that party,
without justifiable reason, to mitigate its liability for wrongful
dismissals. Because of this hidden twist, the limitation ofliability
under Section 10 cannot be an "appropriate" incentive, to borrow
the term that R.A. No. 8042 itself uses to describe the incentive it
envisions under its purpose clause.
What worsens the situation is the chosen mode of granting the
incentive: instead of a grant that, to encourage greater efforts at
recruitment, is directly related to extra efforts undertaken, the law
simply limits their liability for the wrongful dismissals of already
deployed OFWs. This is effectively a legally-imposed partial
condonation of their liability to OFWs, justified solely by the law’s
intent to encourage greater deployment efforts. Thus, the
incentive,from a more practical and realistic view, is really part of
a scheme to sell Filipino overseas labor at a bargain for purposes
solely of attracting the market. . . .
The so-called incentive is rendered particularly odious by its effect
on the OFWs — the benefits accruing to the recruitment/manning
agencies and their principals are takenfrom the pockets of the
OFWs to whom the full salaries for the unexpired portion of the
contract rightfully belong. Thus, the principals/employers and the
recruitment/manning agencies even profit from their violation of
the security of tenure that an employment contract embodies.
Conversely, lesser protection is afforded the OFW, not only
because of the lessened recovery afforded him or her by operation
of law, but also because this same lessened recovery renders a
wrongful dismissal easier and less onerous to undertake; the lesser
cost of dismissing a Filipino will always bea consideration a
foreign employer will take into account in termination of
employment decisions. . . .126
Further, "[t]here can never be a justification for any form of
government action that alleviates the burden of one sector, but
imposes the same burden on another sector, especially when the
favored sector is composed of private businesses suchas placement
agencies, while the disadvantaged sector is composed ofOFWs
whose protection no less than the Constitution commands. The
idea thatprivate business interest can be elevated to the level of a
compelling state interest is odious."127
Along the same line, we held that the reinstated clause violates due
process rights. It is arbitrary as it deprives overseas workers of
their monetary claims without any discernable valid purpose.128
Respondent Joy Cabiles is entitled to her salary for the unexpired
portion of her contract, in accordance with Section 10 of Republic
Act No. 8042. The award of the three-month equivalence of
respondent’s salary must be modified accordingly. Since she
started working on June 26, 1997 and was terminated on July 14,
1997, respondent is entitled to her salary from July 15, 1997 to
June 25, 1998. "To rule otherwise would be iniquitous to petitioner
and other OFWs, and would,in effect, send a wrong signal that
principals/employers and recruitment/manning agencies may
violate an OFW’s security of tenure which an employment contract
embodies and actually profit from such violation based on an
unconstitutional provision of law."129
III
On the interest rate, the Bangko Sentral ng Pilipinas Circular No.
799 of June 21, 2013, which revised the interest rate for loan or
forbearance from 12% to 6% in the absence of stipulation,applies
in this case. The pertinent portions of Circular No. 799, Series of
2013, read: The Monetary Board, in its Resolution No. 796 dated
16 May 2013, approved the following revisions governing the rate
of interest in the absence of stipulation in loan contracts, thereby
amending Section 2 of Circular No. 905, Series of 1982:
Section 1. The rate of interest for the loan or forbearance of any
money, goods or credits and the rate allowed in judgments, in the
absence of an express contract as to such rateof interest, shall be
six percent (6%) per annum.
Section 2. In view of the above, Subsection X305.1 of the Manual
of Regulations for Banks and Sections 4305Q.1, 4305S.3 and
4303P.1 of the Manual of Regulations for Non-Bank Financial
Institutions are hereby amended accordingly.
This Circular shall take effect on 1 July 2013.
Through the able ponencia of Justice Diosdado Peralta, we laid
down the guidelines in computing legal interest in Nacar v. Gallery
Frames:130
II. With regard particularly to an award of interest in the concept of
actual and compensatory damages, the rate of interest, as well as
the accrual thereof, is imposed, as follows:
10
 1. When the obligation is breached, and it consists in
the payment of a sum of money, i.e., a loan or
forbearance of money, the interest due should be that
which may have been stipulated in writing.
Furthermore, the interest due shall itself earn legal
interest from the time it is judicially demanded. In the
absence of stipulation, the rate of interest shall be 6%
per annum to be computed from default, i.e., from
judicial or extrajudicial demand under and subject to
the provisions of Article 1169 of the Civil Code.
2. When an obligation, not constituting a loan or
forbearance of money, is breached, an interest on the
amount of damages awarded may be imposed at the
discretion of the court at the rate of 6% per annum. No
interest, however, shall be adjudged on unliquidated
claims or damages, except when or until the demand
can be established with reasonable certainty.
Accordingly, where the demand is established with
reasonable certainty, the interest shall begin to run from
the time the claim is made judicially or extrajudicially
(Art. 1169, Civil Code), but when such certainty cannot
be so reasonably established at the time the demand is
made, the interest shall begin to run only from the date
the judgment of the court is made (at which time the
quantification of damages may be deemed to have been
reasonably ascertained). The actual base for the
computation of legal interest shall, in any case, be on
the amount finally adjudged. 3. When the judgment of
the court awarding a sum of money becomes final and
executory, the rate of legal interest, whether the case
falls under paragraph 1 or paragraph 2, above, shall be
6% per annum from such finality until its satisfaction,
this interim period being deemed to be by then an
equivalent to a forbearance of credit.
And, in addition to the above, judgments that have become final
and executory prior to July 1, 2013, shall not be disturbed and shall
continue to be implemented applying the rate of interest fixed
therein.131
Circular No. 799 is applicable only in loans and forbearance of
money, goods, or credits, and in judgments when there is no
stipulation on the applicable interest rate. Further, it is only
applicable if the judgment did not become final and executory
before July 1, 2013.132
We add that Circular No. 799 is not applicable when there is a law
that states otherwise. While the Bangko Sentral ng Pilipinas has the
power to set or limit interest rates,133 these interest rates do not
apply when the law provides that a different interest rate shall be
applied. "[A] Central Bank Circular cannot repeal a law. Only a
law can repeal another law."134
For example, Section 10 of Republic Act No. 8042 provides that
unlawfully terminated overseas workers are entitled to the
reimbursement of his or her placement fee with an interest of 12%
per annum. Since Bangko Sentral ng Pilipinas circulars
cannotrepeal Republic Act No. 8042, the issuance of Circular No.
799 does not have the effect of changing the interest on awards for
reimbursement of placement fees from 12% to 6%. This is despite
Section 1 of Circular No. 799, which provides that the 6% interest
rate applies even to judgments.
Moreover, laws are deemed incorporated in contracts. "The
contracting parties need not repeat them. They do not even have to
be referred to. Every contract, thus, contains not only what has
been explicitly stipulated, but the statutory provisions that have
any bearing on the matter."135 There is, therefore, an implied
stipulation in contracts between the placement agency and the
overseasworker that in case the overseas worker is adjudged as
entitled to reimbursement of his or her placement fees, the amount
shall be subject to a 12% interest per annum. This implied
stipulation has the effect of removing awards for reimbursement of
placement fees from Circular No. 799’s coverage.
The same cannot be said for awardsof salary for the unexpired
portion of the employment contract under Republic Act No. 8042.
These awards are covered by Circular No. 799 because the law
does not provide for a specific interest rate that should apply.
In sum, if judgment did not become final and executory before July
1, 2013 and there was no stipulation in the contract providing for a
different interest rate, other money claims under Section 10 of
Republic Act No. 8042 shall be subject to the 6% interest per
annum in accordance with Circular No. 799.
This means that respondent is also entitled to an interest of 6% per
annum on her money claims from the finality of this judgment.
IV
Finally, we clarify the liabilities ofWacoal as principal and
petitioner as the employment agency that facilitated respondent’s
overseas employment.
Section 10 of the Migrant Workers and Overseas Filipinos Act of
1995 provides that the foreign employer and the local employment
agency are jointly and severally liable for money claims including
claims arising out of an employer-employee relationship and/or
damages. This section also provides that the performance bond
filed by the local agency shall be answerable for such money
claims or damages if they were awarded to the employee.
This provision is in line with the state’s policy of affording
protection to labor and alleviating workers’ plight.136
In overseas employment, the filing of money claims against the
foreign employer is attended by practical and legal
complications.1âwphi1 The distance of the foreign employer
alonemakes it difficult for an overseas worker to reach it and make
it liable for violations of the Labor Code. There are also possible
conflict of laws, jurisdictional issues, and procedural rules that may
be raised to frustrate an overseas worker’sattempt to advance his or
her claims.
It may be argued, for instance, that the foreign employer must be
impleaded in the complaint as an indispensable party without
which no final determination can be had of an action.137
The provision on joint and several liability in the Migrant Workers
and Overseas Filipinos Act of 1995 assures overseas workers that
their rights will not be frustrated with these complications. The
fundamental effect of joint and several liability is that "each of the
debtors is liable for the entire obligation."138 A final determination
may, therefore, be achieved even if only oneof the joint and several
debtors are impleaded in an action. Hence, in the case of overseas
employment, either the local agency or the foreign employer may
be sued for all claims arising from the foreign employer’s labor
law violations. This way, the overseas workers are assured that
someone — the foreign employer’s local agent — may be made to
11
answer for violationsthat the foreign employer may have
committed.
The Migrant Workers and Overseas Filipinos Act of 1995 ensures
that overseas workers have recourse in law despite the
circumstances of their employment. By providing that the liability
of the foreign employer may be "enforced to the full
extent"139 against the local agent,the overseas worker is assured of
immediate and sufficientpayment of what is due them.140
Corollary to the assurance of immediate recourse in law, the
provision on joint and several liability in the Migrant Workers and
Overseas Filipinos Act of 1995 shifts the burden of going after the
foreign employer from the overseas worker to the local
employment agency. However, it must be emphasized that the
local agency that is held to answer for the overseas worker’s
money claims is not leftwithout remedy. The law does not preclude
it from going after the foreign employer for reimbursement of
whatever payment it has made to the employee to answer for the
money claims against the foreign employer.
heartbreak of families left behind daily. They would count the
minutes, hours, days, months, and years yearning to see their sons
and daughters. We all know of the joy and sadness when they
come home to see them all grown up and, being so, they remember
what their work has cost them. Twitter accounts, Facetime, and
many other gadgets and online applications will never substitute
for their lost physical presence.
Unknown to them, they keep our economy afloat through the ebb
and flow of political and economic crises. They are our true
diplomats, they who show the world the resilience, patience, and
creativity of our people. Indeed, we are a people who contribute
much to the provision of material creations of this world.
This government loses its soul if we fail to ensure decent treatment
for all Filipinos. We default by limiting the contractual wages that
should be paid to our workers when their contracts are breached by
the foreign employers. While we sit, this court will ensure that our
laws will reward our overseas workers with what they deserve:
their dignity.

A further implication of making localagencies jointly and severally Inevitably, their dignity is ours as weil.
liable with the foreign employer is thatan additional layer of
protection is afforded to overseas workers. Local agencies, which
WHEREFORE, the petition is DENIED. The decision of the Court
are businesses by nature, are inoculated with interest in being
of Appeals is AFFIRMED with modification. Petitioner Sameer
always on the lookout against foreign employers that tend to
Overseas Placement Agency is ORDERED to pay respondent Joy
violate labor law. Lest they risk their reputation or finances, local
C. Cabiles the amount equivalent to her salary for the unexpired
agenciesmust already have mechanisms for guarding against
portion of her employment contract at an interest of 6% per annum
unscrupulous foreign employers even at the level prior to overseas
from the finality of this judgment. Petitioner is also ORDERED to
employment applications.
reimburse respondent the withheld NT$3,000.00 salary and pay
respondent attorney's fees of NT$300.00 at an interest of 6% per
With the present state of the pleadings, it is not possible to annum from the finality of this judgment.
determine whether there was indeed a transfer of obligations from
petitioner to Pacific. This should not be an obstacle for the
The clause, "or for three (3) months for every year of the unexpired
respondent overseas worker to proceed with the enforcement of
term, whichever is less" in Section 7 of Republic Act No. 10022
this judgment. Petitioner is possessed with the resources to
amending Section 10 of Republic Act No. 8042 is declared
determine the proper legal remedies to enforce its rights against
unconstitutional and, therefore, null and void.
Pacific, if any.

SO ORDERED.
V

Many times, this court has spoken on what Filipinos may

encounter as they travel into the farthest and mostdifficult reaches
of our planet to provide for their families. In Prieto v. NLRC:141
The Court is not unaware of the many abuses suffered by our
overseas workers in the foreign land where they have ventured,
usually with heavy hearts, in pursuit of a more fulfilling future.
Breach of contract, maltreatment, rape, insufficient nourishment,
sub-human lodgings, insults and other forms of debasement, are
only a few of the inhumane acts towhich they are subjected by
their foreign employers, who probably feel they can do as they
please in their own country. Whilethese workers may indeed have
relatively little defense against exploitation while they are abroad,
that disadvantage must not continue to burden them when they
return to their own territory to voice their muted complaint. There
is no reason why, in their very own land, the protection of our own
laws cannot be extended to them in full measure for the redress of
their grievances.142
Footnotes
Rep. Act. No. 8042 (1995), sec. 15.
Article 111. Attorney’s Fees – (a) In cases of unlawful
withholding of wages, the culpable party may be assessed
attorney’s fees equivalent to ten percent of the amount of wages
recovered.
CONST., art. VIII, sec. 5(5).
CONST., art. III, sec. 1. No person shall be deprived of life,
liberty, or property without due process of law, nor shall any
person be denied the equal protection of the laws.
CONST., art. XIII, sec. 3.

But it seems that we have not said enough.

Rep. Act. No. 8042 (1995); See alsoRep. Act No. 10022 (2010).
We face a diaspora of Filipinos. Their travails and their heroism
can be told a million times over; each of their stories as real as any RULES OF COURT, Rule 3, sec. 7.
other. Overseas Filipino workers brave alien cultures and the

12
 FEES PAID BY WORKERS/ CHARGEABLE TO
EMPLOYERS
G.R. No. L-79436-50 January 17, 1990
EASTERN ASSURANCE & SURETY
CORPORATION, petitioner,
vs.
SECRETARY OF LABOR, PHILIPPINE OVERSEAS
EMPLOYMENT ADMINISTRATION, ELVIRA VENTURA,
ESTER TRANGUILLAN, et al., respondents.
Tanjuatco, Oreta, Tanjuatco, Berenguer & San Vicente for
petitioner.
NARVASA, J.:
In connection with the application with the Philippine Overseas
Employment Administration (POEA) of J & B Manpower
Specialist, Inc. for a license to engage in business as a recruitment
agency, a surety bond was filed on January 2, 1985 by the
applicant and the Eastern Assurance and Surety Corporation,
herein petitioner, in virtue of which they both held themselves —
. . . firmly bound unto (said) Philippine Overseas
Employment Administration, Ministry of Labor in the
penal sum of PESOS ONE HUNDRED FIFTY
THOUSAND ONLY . . . (Pl50,000.00) for the payment
of which will and truly to be made, . . . (they bound
themselves, their) heirs, executors, administrators,
successors and assigns, jointly and severally . .
The bond stipulated that:
a) it was "conditioned upon the true and faithful performance and
observance of the . . . principal (J & B Manpower Specialist, Inc.)
of its duties and obligations in accordance with all the rules and
regulations promulgated by the Ministry of Labor Philippine
Overseas Employment Administration and with the terms and
conditions stipulated in the License;
b) the liability of the . . . Surety (petitioner) shall in no case exceed
the sum of PESOS ONE HUNDRED FIFTY THOUSAND
(P150,000.00) ONLY, PHILIPPINE CURRENCY; 1
c) notice to the Principal is also a notice to the Surety; and
d) LIABILITY of the surety . . . shall expire on JANUARY 02,
1986 and this bond shall be automatically cancelled ten (10) days
after its expiration and the surety shall not be liable for any claim
not discovered and presented to it in writing within said period of .
. . from expiration and the obligee hereby expressly waives the
rights to file any court action against the Surety after termination of
said period of . . . . above cited. 2
As narrated by respondent Secretary of Labor, the facts are as
follows: 3
From June 1983 to December 1985 . . . thirty three (33)
. . . (persons) applied for overseas employment with . . .
(J & B). In consideration of promised deployment,
complainants paid respondent various amounts for
various fees. Most of' the receipts issued were sighed by
Mrs. Baby Bundalian, Executive Vice-President of . . .
(J & B).
Because of non-deployment . . . (the applicants) filed
separate complaints with the Licensing and Regulation
Office of POEA against . . . (J & B) for violation of
Articles 32 and 34 (a) of the Labor Code between the
months of April to October 1985.
Despite summons/notices of hearing,, . . . (J & B) failed
to file Answer nor appear in the hearings conducted.
In its separate Answer, . . . EASCO essentially
disclaimed liability on the ground that the claims were
not expressly covered by the bond, that POEA had no
jurisdiction to order forfeiture of the bond, that some of
the claims were paid beyond or prior to the period of
effectivity of the bond.
On September 8, 1986, the POEA Administrator issued
the Order in favor of complainants ruling thus:
After careful evaluation, we find that the
receipts and testimonies of complainants, in
the absence of controverting evidence
substantially establish that respondent
charged and collected fees from them in
amounts exceeding what is prescribed by
this Administration. Complainants' non-
deployment strongly indicates that there was
no employment obtained for them. Hence,
violation of Articles 32 and 34 (a) of the
Labor Code, as amended, is established
against respondent. The claims of
complainants having arose (arisen) out of
acts of the principal covered under the surety
(bond), the respondent surety is equally
liable therefor.
Except for complainants Ramos, Samson, de Leon and
Rizada, whose claims were transacted prior to the
effectivity of the bond, . . . EASCO was declared jointly
and severally liable with . . . (J & B) to twenty-nine (29)
complainants.
(The dispositive portion of the POEA Administrator's
Order also contained the following statement and
direction, viz.:
Respondent was suspended on May 23,
1985, June 26, 1985 and January 17, 1986
all for illegal exaction. Considering its track
record of illegal exaction activities and
considering further the gross violation of
recruitment rules and regulations established
against it in the instant cases, and the
expiration of its license on February 15,
1985, it is hereby forever banned from
participation in the overseas employment
program. It is ordered to cease and desist
from further engaging in recruitment
13
 activities otherwise it shall be prosecuted for
illegal recruitment.')
(J & B filed a motion for reconsideration). On
December 19, 1986, the then deputy Minister of Labor
and Employment denied the . . . Motion for
Reconsideration for lack of merit and affirmed the
findings in the Order of the POEA Administrator
finding no reversible error therein.
On appeal by EASCO — J & B having as aforestated taken no part
in the proceeding despite due service of summons — the judgment
was modified by the Secretary of Labor, by Order dated July 1,
1987, disposing as follows: 4
WHEREFORE, in view of the foregoing, the
Resolution of the then Deputy Minister of Labor dated
December 19, 1986 affirming the Order of the POEA
Administrator dated September 8, 1986 is hereby
MODIFIED. Respondent J & B Manpower Specialist is
directed to refund all thirty-three (33) complainants as
listed in the Order of September 8, 1986 in the amounts
listed thereto with the modification that complainants
Lucena Cabasal and Felix Rivero are both entitled only
to P15,980 and not P15,980 each. Respondent Eastern
Assurance and Surety Corporation is hereby found
jointly and severally liable with respondent J & B
Manpower Specialist to refund nineteen (19)
complainants in the modified amounts . . . (particularly
specified).
The other findings in the Order of the POEA
Administrator dated September 8, 1986 affirmed in the
Resolution of the then Deputy Minister . . . are also
hereby AFFIRMED. This Order is FINAL. No further
Motion for Reconsideration hereof shall be entertained.
It is noteworthy that EASCO's liability for the refund, jointly and
severally with its principal, was limited to 19 named complainants
(in contrast to verdicts of the POEA and the Deputy Minister
which both ordered payment to no less than 33 complainants) and
was correspondingly reduced from P308,751.75 and US $
400.00 5 to the aggregate amount of P 140,817.75. 6
The special civil action of certiorari at bar was thereafter instituted
by EASCO 7 praying for the nullification of the POEA
Administrator's Order of September 8, 1986, the Resolution of the
Deputy Minister of Labor of' December 19, 1986, and the Order of
the Secretary of Labor of July 1, 1987, It theorizes that:
1) the POEA had no jurisdiction over the claims for
refund filed by non-employees;
2) neither did the Secretary of Labor have jurisdiction
of the claims;
3) assuming they had jurisdiction, both the POEA and
Secretary of Labor also committed legal errors and
acted with grave abuse of discretion when they ruled
that petitioner is liable on the claims.
EASCO contends that the POEA had no "adjudicatory jurisdiction"
over the monetary claims in question because the same "did not
arise from employer-employee relations." Invoked in support of
the argument is Section 4 (a) of EO 797 providing in part 8 that the
POEA has —
. . . original and exclusive jurisdiction over all cases,
including money claims, involving employer-employee
relations arising out of or by virtue of any law or
contract involving Filipino workers for overseas
employment including seamen . . .
The complaints are however for violation of Articles 32 and 34 a)
of the Labor Code. Article 32 and paragraph (a) of Article 34 read
as follows:
Art. 32. Fees to be paid by workers.—Any person
applying with a private fee-charging employment
agency for employment assistance shall not be charged
any fee until he has obtained employment through its
efforts or has actually commenced employment. Such
fee shall be always covered with the approved receipt
clearly showing the amount paid. The Secretary of
Labor shall promulgate a schedule of allowable fees.
Art. 34. Prohibited practices.—It shall be unlawful for
any individual, entity, licensee, or holder of authority:
a) To charge or accept, directly or indirectly, any
amount greater than that specified in the schedule of
allowable fees prescribed by the Secretary of Labor, or
to make a worker pay any amount greater than actually
received by him as a loan or advance; . . .
The penalties of suspension and cancellation of license or authority
are prescribed for violations of the above quoted provisions,
among others. And the Secretary of Labor has the power under
Section 35 of the law to apply these sanctions, as well as the
authority, conferred by Section 36, not only, to "restrict and
regulate the recruitment and placement activities of all agencies,"
but also to "promulgate rules and regulations to carry out the
objectives and implement the provisions" governing said activities.
Pursuant to this rule-making power thus granted, the Secretary of
Labor gave the POEA 9 "on its own initiative or upon filing of a
complaint or report or upon request for investigation by any
aggrieved person, . . . (authority to) conduct the necessary
proceedings for the suspension or cancellation of the license or
authority of any agency or entity" for certain enumerated offenses
including —
1) the imposition or acceptance, directly or indirectly, of any
amount of money, goods or services, or any fee or bond in excess
of what is prescribed by the Administration, and
2) any other violation of pertinent provisions of the Labor Code
and other relevant laws, rules and regulations. 10
The Administrator was also given the power to "order
the dismissal of the case or the suspension of the license
or authority of the respondent agency or contractor or
recommend to the Minister the cancellation thereof." 11
Implicit in these powers is the award of appropriate relief to the
victims of the offenses committed by the respondent agency or
contractor, specially the refund or reimbursement of such fees as
may have been fraudulently or otherwise illegally collected, or
such money, goods or services imposed and accepted in excess of
what is licitly prescribed. It would be illogical and absurd to limit
14
the sanction on an offending recruitment agency or contractor to
suspension or cancellation of its license, without the concomitant
obligation to repair the injury caused to its victims. It would result
either in rewarding unlawful acts, as it would leave the victims
without recourse, or in compelling the latter to litigate in another
forum, giving rise to that multiplicity of actions or proceedings
which the law abhors.
Even more untenable is EASCO's next argument that the recruiter
and its victims are in pari delicto — the former for having required
payment, and the latter for having voluntarily paid, "prohibited
recruitment fees" — and therefore, said victims are barred from
obtaining relief. The sophistical, if not callous, character of the
argument is evident upon the most cursory reading thereof; it
merits no consideration whatever.
So, too, EASCO's claim that it had not been properly served with
summons as regards a few of the complaints must be rejected, the
issue being factual, and the Court having been cited to no grave
error invalidating the respondent Secretary's conclusion that
summons had indeed been duly served.
Finally, EASCO's half-hearted argument that its liability should be
limited to the maximum amount set in its surety bond, i.e.,
P150,000.00, is palpably without merit, since the aggregate
liability imposed on it, P140,817.75, supra, does not in fact exceed
that limit.
WHEREFORE, the petition is DISMISSED for lack of merit, and
this decision is declared to be immediately executory. Costs
against petitioner.

The Court is intrigued by EASCO's reiteration of its argument that

SO ORDERED.
it should not be held liable for claims which accrued prior to or
after the effectivity of its bond, considering that the respondent
Secretary had conceded the validity of part of said argument, at Cruz, Gancayco, Griño-Aquino and Medialdea, JJ., concur.
least. The Secretary ruled that EASCO's "contention that it should
not be held liable for claims/payments made to respondent agency
before the effectivity of the surety bond on January 2, 1985 is well Footnotes
taken." According to the Secretary: 12
1 This limitation is stated no less than three (3) times in the surety
. . . A close examination of the records reveal(s) that bond.
respondent EASCO is not jointly and severally liable
with respondent agency to refund complainants Lucena 2 The blanks were not filed up by the parties.
Cabasal, Felix Rivero, Romulo del Rosario, Rogelio
Banzuela, Josefina Ogatis, Francisco Sorato, Sonny
Quiazon, Josefina Dictado, Mario del Guzman and 5 Rollo, pp. 41-42 being pp. 1 and 2 of the Resolution of the
Rogelio Mercado (10 in all). These complainants paid Deputy Minister dated Dec. 19, 1986, in which are enumerated the
respondent agency in 1984, or before the effectivity of complainants entitled to refund the amounts individually due to
the bond on January 2, 1985 as evidence by the reciept them.
and their testimonies.
6 The list of complainants entitled to refund and the amounts
The related argument, that it is also not liable for claims filed after respectively due them are set forth at pages 10 and 11 of the Order
the expiry (on January 2, 1986) of the period stipulated in the of the respondent Secretary: Rollo, pp. 54-55.
surety bond for the filing of claims against the bond, must however
be rejected, as the Secretary did. The Court discerns no grave 7 Id., pp. 9-34. The petition is dated September 12, 1987.
abuse of discretion in the Secretary's statement of his reasons for
doing so, to wit:
9 Sec. 3 of Rule VI, Book II of the New Rules on Overseas
Employment
. . . While it may be true that respondent EASCO
received notice of their claims after the ten (10) day
expiration period from cancellation or after January 12, PROHIBITED PRACTICES, LIABILITY
1986 as provided in the surety bond, records show that .
. . EASCO's principal, respondent agency, was notified/
summoned prior to the expiration period or before G.R. No. 98273 October 28, 1991
January 12, 1986. Respondent agency received
summons on July 24, 1985 with respect to claims of CLARITA V. CRUZ, petitioner,
complainants Penarroyo, dela Cruz and Canti. It also vs.
received summons on November 26, 1985 with respect NATIONAL LABOR RELATIONS COMMISSION (NLRC),
to Giovanni Garbillons' claim. Respondent agency was PHILIPPINE OVERSEAS EMPLOYMENT
likewise considered constructively notified of the ADMINISTRATION (POEA), EMS MANPOWER &
claims of complainants Calayag, Danuco Domingo and PLACEMENT SERVICE (PHIL.), ABDUL KARIM AL
Campena on October 6, 1985. In this connection, it may YAHYA, and TRAVELLERS INSURANCE, respondents.
be stressed that the surety bond provides that notice to
the principal is notice to the surety. Besides, it has been
held that the contract of a compensated surety like Public Attorney's Office for petitioner.
respondent EASCO is to be interpreted liberally in the
interest of the promises and beneficiaries rather than Manuel T. Collado for private respondent.
strictly in favor of the surety (Acoustics Inc. v.
American Surety, 74 Nev-6, 320 P2d. 626, 74 Am. Jur.
2d).

15
CRUZ, J.: Alvarado who assisted her was not really a lawyer but only a
helper in the Overseas Workers Welfare Administration. Atty.
Biolena, on the other hand, merely acknowledged the document.
Clarita V. Cruz** went abroad pursuant to an employment contract
Moreover, when she signed the affidavit, she was under the
that she hoped would improve her future. Although a high school
impression when she was agreeing to settle only her claim for one
graduate, she agreed to work as a domestic helper in Kuwait in
month unpaid vacation leave, as the wording of the receipt she
consideration of an attractive salary and vacation leave benefits she
issued on the same date showed, to wit:
could not expect to earn in this country. But her foreign adventure
proved to be a bitter disappointment. On March 18,1988, after
completing her two-year engagement, she was back home in the June 21, 1988
Philippines with her dead dreams and an angry grievance.
Receipt
On March 23,1988, she filed a complaint against EMS Manpower
and Placement Services (Phil.) and its foreign principal, Abdul
This is to certify that I received the amount of P2,400.00 from
Karim Al Yahya, for underpayment of her salary and non-payment
EMS Manpower & Placement Services in settlement of 1 month
of her vacation leave. She also claimed that she was charged a
unpaid vacation leave.
placement fee of P7,000.00 instead of the legal maximum of only
P5,000.00. She alleged that her foreign employer treated her as a
slave and required her to work 18 hours a day. She was beaten up (Sgd.) CLARITA V. CRUZ
and suffered facial deformity, head trauma and decreased sensation
in the right portion of her body. On top of all this, she was paid
only $120 per month and her total salaries were given to her only IN THE PRESENCE OF:
three hours before her flight back to Manila. This was after the
plane she was supposed to take had left and she had to stay in the (Sgd.) O.G. ALVARADO
airport for 24 hours before her employer finally heard her pleas and
delivered her passport and ticket to her.
OWWA Legal Dept.

In its answer and position paper, the private respondent raised the
principal defense of settlement as evidenced by the Affidavit of
Desistance executed by the complainant on June 21, 1988. In this
document, she declared inter aliathat —
xxx xxx xxx
2. Thereafter going thoroughly over the facts of the case
by reconciling our records, we came to discover that it
was only a plain case of misunderstanding on our part,
and that we have already settled our differences;
3. That I am no longer interested in further continuance
of the above case against EMS Manpower & Placement
Services either criminal, civil or administrative or
whatever nature as I hereby desist now and hereafter;
For its part, the private respondent argues that the petitioner is
bound by her Affidavit of Desistance, which she freely and
knowingly executed. After all, she was not an ignorant and
illiterate person but a high school graduate who understood what
she was signing. The due execution of the instrument must also be
sustained on the basis of the presumptions of regularity of official
functions and of good faith.
Significantly, neither the private respondent nor the Solicitor
General refuted the petitioner's submission that the person who
allegedly assisted her in the execution of the Affidavit of
Desistance and explained to her its content and meaning was not a
lawyer but a mere employee in the OWWA. His status was merely
assumed but not established by the respondents although it was
directly questioned. The comments of the public and private
respondents did not meet this challenge squarely.

4. That I am executing this affidavit of desistance to
attest to the truth of the foregoing facts and
circumstances and for the purpose of asking the
dismissal of my said complaint against EMS Manpower
& Placement Services.
On the basis of this affidavit, the Philippine Overseas Employment
Administration (POEA) dismissed her complaint in a decision
dated May 16, 1989. This was affirmed by the National Labor
Relations Commission (NLRC) in its resolution dated December
28, 1990, reconsideration of which was denied on February 21,
1991.
The petition now before us faults the POEA and the NLRC with
grave abuse of discretion for having upheld the Affidavit of
Desistance. Cruz rejects the settlement as having been obtained
from her under duress and false pretenses and insists on her
original claim for the balance of her salaries and vacation- leave
pay at the agreed rate of P250.00 per month.
It is no less noteworthy that the receipt the petitioner issued on the
same day was only for "P2,400.00 . . . in settlement of 1 month
unpaid vacation." This clearly shows that she was not waiving the
rest of her demands in exchange for that measly amount (which did
not even really represent the commutable value of the 1 month
vacation leave at the rate of $250.00). In fact, the total claim of the
petitioner is for P88,840.00, itemized as follows:
a) P84,240.00, representing the salary differentials of
$130 for 24 months (US $3,120.00 x P27.00).
b) P2,600.00, representing the balance of her vacation
leave pay.
c) P2,000.00, representing her excess placement fee.
In Principe v. Philippine-Singapore Transport Service, Inc., 1 this
Court held:

Her contention is that she was inveigled into signing the Affidavit
of Desistance without the assistance of counsel. The "Attorney"

16
 Even assuming for the sake of argument that the
quitclaim had foreclosed petitioner's right over the
death benefits of her husband, the fact that the
consideration given in exchange thereof was very much
less than the amount petitioner is claiming renders the
quitclaim null and void for being contrary to public
policy. The State must be firm in affording protection to
labor. The quitclaim wherein the consideration is
scandalously low and inequitable cannot be an obstacle
to petitioner's pursuing her legitimate claim. Equity
dictates that the compromise agreement should be
voided in this instance. (Emphasis supplied.)
The following guidelines were likewise set in Periquet v. NLRC: 2
Not all waivers and quitclaims are invalid as against
public policy. If the agreement was voluntarily entered
into and represents a reasonable settlement, it is binding
on the parties and may not later be disowned simply
because of a change of mind. It is only where there is
clear proof that the waiver was wangled from an
unsuspecting or gullible person, or the terms of
settlement are unconscionable on its face, that the law
will step in to annul the questionable
transaction. (Emphasis supplied.)
The Court is convinced that the petitioner was not fully aware of
the import and consequences of the Affidavit of Desistance when
she executed it, allegedly with the assistance of counsel. Except for
the disputable presumptions invoked by the private respondent,
such assistance has not been established against the petitioner's
allegation that the "Attorney" Alvarado who supposedly counseled
her was not even a lawyer. Indeed, even assuming that such
assistance had been duly given, there is still the question of the
intrinsic validity of the quitclaim in view of the gross disparity
between the amount of the settlement and the petitioner's original
claim. It is difficult to believe that the petitioner would agree to
waive her total claim of P88,840.00 for the unseemly settlement of
only P2,400.00. And even if she did, the waiver would still be null
and void as violative of public policy.
It remains to state that, contrary to the contention of the private
respondent in the proceedings below that it has no privity of
contract with the petitioner, we have held in a long line of cases
that the local recruiter is solidarily liable with the foreign principal
for all damages sustained by the overseas worker in connection
with his contract of employment. Such liability is provided for in
Section 1, Rule II, Book II, of the POEA Rules and Regulations,
which we have consistently sustained.
This decision demonstrates once again the tenderness of the Court
toward the worker subjected to the lawless exploitation and
impositions of his employer. The protection of our overseas
workers is especially necessary because of the inconveniences and
even risks they have to undergo in their quest for a better life in a
foreign land away from their loved ones and their own
government.
The domestic helper is particularly susceptible to abuse because
she usually works only by herself in a private household unlike
other workers employed in an open business concern who are able
to share and discuss their problems and bear or solve them
together. The domestic helper is denied that comfort. She has no
companions in her misery. She usually broods alone. There is no
one to turn to for help. That is why we must carefully listen to her
when she is finally able to complain against those who would rob
her of her just rewards and even of her dignity as a human being.
WHEREFORE, the resolutions of the NLRC dated December 28,
1990, and February 21, 1991, are SET ASIDE, and the Affidavit of
Desistance is DECLARED null and void. POEA Case No. 88-03-
255 is REMANDED to the POEA for further proceedings and
expeditious resolution.
SO ORDERED.
Narvasa, Griño-Aquino and Medialdea, JJ., concur.
SUSPENSION AND/OR CANCELLATION OF LICENSE OR
AUTHORITY
G.R. No. 109583 September 5, 1997
TRANS ACTION OVERSEAS CORPORATION, petitioner,
vs.
THE HONORABLE SECRETARY OF LABOR, ROSELLE
CASTIGADOR, JOSEFINA MAMON, JENELYN CASA,
PEACHY LANIOG, VERDELINA BELGIRA, ELMA
FLORES, RAMONA LITURCO, GRACE SABANDO,
GLORIA PALMA, AVELYN ALVAREZ, CANDELARIA
NONO, NITA BUSTAMANTE, CYNTHIA ARANDILLO,
SANDIE AGUILAR, DIGNA PANAGUITON, VERONICA
BAYOGOS, JULIANITA ARANADOR, LEONORA
CABALLERO, NANCY BOLIVAR, NIMFA BUCOL, ZITA
GALINDO, ESTELITA BIOCOS, MARJORIE MACATE,
RUBY SEPULVIDA, ROSALIE SONDIA, NORA
MAQUILING, PAULINA CORDERO, LENIROSE
ABANGAN, SELFA PALMA, ANTONIA NAVARRO, ELSIE
PENARUBIA, IRMA SOBREQUIL, SONY JAMUAT,
CLETA MAYO, respondents.
ROMERO, J.:
The issue presented in the case at bar is whether or not the
Secretary of Labor and Employment has jurisdiction to cancel or
revoke the license of a private fee-charging employment agency.
From July 24 to September 9, 1987, petitioner Trans Action
Overseas Corporation, a private fee-charging employment agency,
scoured Iloilo City for possible recruits for alleged job vacancies in
Hongkong. Private respondents sought employment as domestic
helpers through petitioner's employees, Luzviminda Aragon, Ben
Hur Domincil and his wife Cecille. The applicants paid placement
fees ranging from P1,000.00 to P14,000.00, but petitioner failed to
deploy them. Their demands for refund proved unavailing; thus,
they were constrained to institute complaints against petitioner for
violation of Articles 32 and 34(a) 1 of the Labor Code, as amended.
Petitioner denied having received the amounts allegedly collected
from respondents, and averred that Aragon, whose only duty was
to pre-screen and interview applicants, and the spouses Domincil
were not authorized to collect fees from the applicants.
17
Accordingly, it cannot be held liable for the money claimed by 14. Sandie Aguilar
respondents. Petitioner maintains that it even warned respondents 3,000.00
not to give any money to unauthorized individuals.
15. Digna Panaguiton
POEA Regional Extension Unit Coordinator Edgar Somes testified 2,500.00
that although he was aware that petitioner collected fees from
respondents, the latter insisted that they be allowed to make the
16. Veronica Bayogos
payments on the assumption that it could hasten their deployment
2,000.00
abroad. He added that Mrs. Honorata Manliclic, a representative of
petitioner tasked to oversee the conduct of the interviews, told him
that she was leaving behind presigned receipts to Aragon as she 17. Sony Jamuat
cannot stay in Iloilo City for the screening of the applicants. 4,500.00
Manliclic, however, denied this version and argued that it was
Somes who instructed her to leave the receipts behind as it was
perfectly alright to collect fees. 18. Irma Sobrequil
2,000.00

On April 5, 1991, then Labor Undersecretary Nieves R. Confesor

rendered the assailed order, the dispositive portion of which reads: 19. Elsie Penarubia
2,000.00

WHEREFORE, respondents are hereby

ordered to pay, jointly and severally, the 20. Antonia Navarro
following claims: 2,000.00

1. Rosele Castigador 21. Selfa Palma

P14,000.00 3,000.00

2. Josefina Mamon 22. Lenirose Abangan

3,000.00 13,300.00

3. Jenelyn Casa 23. Paulina Cordero

3,000.00 1,400.00

4. Peachy Laniog 24. Nora Maquiling

13,500.00 2,000.00

5. Verdelina Belgira 25. Rosalie Sondia

2,000.00 2,000.00

6. Elma Flores 26. Ruby Sepulvida

2,500.00 3,500.00

7. Ramona Liturco 27. Marjorie Macate

1,500.00
2,500.00

8. Grace Sabando 28. Estelita Biocos

3,000.00
3,500.00

9. Gloria Palma 29. Zita Galindo

3,500.00
1,500.00

10. Avelyn Alvarez 30. Nimfa Bucol

1,000.00
1,500.00

11. Candelaria Nono 31. Nancy Bolivar

2,000.00
1,000.00

12. Nita Bustamante 32. Leonora Caballero

13,900.00
5,000.00

13. Cynthia Arandillo 33. Julianita Aranador

14,000.00
1,000.00

18
 The complaints of Ma. Luz Alingasa, Nimfa
Perez, and Cleta Mayo are hereby dismissed
in view of their desistance.
The following complaints are hereby
dismissed for failure to appear/prosecute:
1. Jiyasmin Bantillo 6.
Edna Salvante
2. Rosa de Luna
Senail 7. Thelma
Beltiar
3. Elnor Bandojo 8.
Cynthia Cepe
4. Teresa Caldeo 9.
Rosie Pavillon
5. Virginia
Castroverde
The complaints filed by the following are
hereby dismissed for lack of evidence:
1. Aleth Palomaria 5.
Mary Ann Beboso
2. Emely Padrones 6.
Josefina Tejero
3. Marybeth Aparri 7.
Bernadita Aprong
4. Lenia Biona 8. Joji
Lull
Respondent agency is liable for twenty eight
(28) counts of violation of Article 32 and
five (5) counts of Article 34 (a) with a
corresponding suspension in the aggregate
period of sixty six (66) months. Considering
however, that under the schedule of
penalties, any suspension amounting to a
period of 12 months merits the imposition of
the penalty of cancellation, the license of
respondent TRANS ACTION OVERSEAS
CORPORATION to participate in the
overseas placement and recruitment of
workers is hereby ordered CANCELLED,
effective immediately.
SO ORDERED.2 (Emphasis supplied)
On April 29, 1991, petitioner filed its Motion for Temporary
Lifting of Order of Cancellation alleging, among other things, that
to deny it the authority to engage in placement and recruitment
activities would jeopardize not only its contractual relations with
its foreign principals, but also the welfare, interests, and livelihood
of recruited workers scheduled to leave for their respective
assignments. Finally, it manifested its willingness to post a bond to
insure payment of the claims to be awarded, should its appeal or
motion be denied.
Finding the motion to be well taken, Undersecretary Confesor
provisionally lifted the cancellation of petitioner's license pending
resolution of its Motion for Reconsideration filed on May 6, 1991.
On January 30, 1992, however, petitioner's motion for
reconsideration was eventually denied for lack of merit, and the
April 5, 1991, order revoking its license was reinstated.
Petitioner contends that Secretary; Confesor acted with grave
abuse of discretion in rendering the assailed orders on alternative
grounds, viz.: (1) it is the Philippine Overseas Employment
Administration (POEA) which has the exclusive and original
jurisdiction to hear and decide illegal recruitment cases, including
the authority to cancel recruitment licenses, or (2) the cancellation
order based on the 1987 POEA Schedule of Penalties is not valid
for non-compliance with the Revised Administrative Code of 1987
regarding its registration with the U.P. Law Center.
Under Executive Order No. 7973 (E.O. No. 797) and Executive
Order No. 247 (E.O. No. 247),4 the POEA was established and
mandated to assume the functions of the Overseas Employment
Development Board (OEDB), the National Seamen Board (NSB),
and the overseas employment function of the Bureau of
Employment Services (BES). Petitioner theorizes that when POEA
absorbed the powers of these agencies, Article 35 of the Labor
Code, as amended, was rendered ineffective.
The power to suspend or cancel any license or authority to recruit
employees for overseas employment is vested upon the Secretary
of Labor and Employment. Article 35 of the Labor Code, as
amended, which provides:
Art. 5. Suspension and/or Cancellation of
License or Authority — The Minister of
Labor shall have the power to suspend or
cancel any license or authority to recruit
employees for overseas employment for
violation of rules and regulations issued by
the Ministry of Labor, the Overseas
Employment Development Board, and the
National Seamen Board, or for violation of
the provisions of this and other applicable
laws, General Orders and Letters of
Instructions.
In the case of Eastern Assurance and Surety Corp. v. Secretary of
Labor,5 we held that:
The penalties of suspension and cancellation
of license or authority are prescribed for
violations of the above quoted provisions,
among others. And the Secretary of Labor
has the power under Section 35 of the law to
apply these sanctions, as well as the
authority, conferred by Section 36, not only
to "restrict and regulate the recruitment and
placement activities of all agencies," but
also to "promulgate rules and regulations to
carry out the objectives and implement the
provisions" governing said activities.
Pursuant to this rule-making power thus
granted, the Secretary of Labor gave the
POEA,6 "on its own initiative or upon filing
of a complaint or report or upon request for
19
 investigation by any aggrieved person, . .
(authority to) conduct the necessary
proceedings for the suspension or
cancellation of the license or authority of
any agency or entity" for certain enumerated
offenses including —
1) the imposition or acceptance, directly or
indirectly, of any amount of money, goods
or services, or any fee or bond in excess of
what is prescribed by the Administration,
and
2) any other violation of pertinent provisions
of the Labor Code and other relevant laws,
rules and regulations.7
The Administrator was also given the power
to "order the dismissal of the case of the
suspension of the license or authority of the
respondent agency or contractor or
recommend to the Minister the cancellation
thereof." 8 (Emphasis supplied)
This power conferred upon the Secretary of Labor and
Employment was echoed in People v. Diaz,9 viz.:
A non-licensee or non-holder of authority
means any person, corporation or entity
which has not been issued a valid license or
authority to engage in recruitment and
placement by the Secretary of Labor, or
whose license or authority has been
suspended, revoked or cancelled by the
POEA or the Secretary. (Emphasis supplied)
In view of the Court's disposition on the matter, we rule that the
power to suspend or cancel any license or authority to recruit
employees for overseas employment is concurrently vested with
the POEA and the Secretary of Labor.
As regards petitioner's alternative argument that the non-filing of
the 1987 POEA Schedule of Penalties with the UP Law Center
rendered it ineffective and, hence, cannot be utilized as basis for
penalizing them, we agree with Secretary Confesor's explanation,
to wit:
On the other hand, the POEA Revised Rules
on the Schedule of Penalties was issued
pursuant to Article 34 of the Labor Code, as
amended. The same merely amplified and
particularized the various violations of the
rules and regulations of the POEA and
clarified and specified the penalties therefore
(sic). Indeed, the questioned schedule of
penalties contains only a listing of offenses.
It does not prescribe additional rules and
regulations governing overseas employment
but only detailed the administrative
sanctions imposable by this Office for some
enumerated prohibited acts.
Under the circumstances, the license of the
respondent agency was cancelled on the
authority of Article 35 of the Labor Code, as
amended, and not pursuant to the 1987
POEA Revised Rules on Schedule of
Penalties. 10
WHEREFORE, in view of the foregoing, the instant petition is
hereby DISMISSED. Accordingly, the decision of the Secretary of
Labor dated April 5, 1991, is AFFIRMED. No costs.
SO ORDERED.
Regalado, Puno, Mendoza and Torres, Jr., JJ., concur.
Footnotes
1 "Art. 32. Fees to be paid by workers. — Any person applying
with a private fee-charging employment agency for employment
assistance shall not be charged any fee until he has obtained
employment through its efforts or has actually commenced
employment. Such fee shall be always covered with the
appropriate receipt clearly showing the amount paid. The Secretary
of Labor shall promulgate a schedule of allowable fees."
"Art. 34. Prohibited practices. — It shall be unlawful for any
individual, entity, licensee, or holder of authority:
(a) To charge or accept, directly or indirectly, any amount greater
than that specified in the schedule of allowable fees prescribed by
the Secretary of Labor, or to make a worker pay any amount
greater than that actually received by him as a loan or advance; . .
."
G.R. No. 103144 April 4, 2001
PHILSA INTERNATIONAL PLACEMENT and SERVICES
CORPORATION, petitioner,
vs.
THE HON. SECRETARY OF LABOR AND
EMPLOYMENT, VIVENCIO DE MESA, RODRIGO MIKIN
and CEDRIC LEYSON, respondents.
GONZAGA-REYES, J.:
This is a petition for certiorari from the Order dated November 25,
1991 issued by public respondent Secretary of Labor and
Employment. The November 25, 1991 Order affirmed in toto the
August 29, 1988 Order of the Philippine Overseas Employment
Administration (hereinafter the "POEA") which found petitioner
liable for three (3) counts of illegal exaction, two (2) counts of
contract substitution and one count of withholding or unlawful
deduction from salaries of workers in POEA Case No. (L) 85-05-
0370.
Petitioner Philsa International Placement and Services Corporation
(hereinafter referred to as "Philsa") is a domestic corporation
engaged in the recruitment of workers for overseas employment.
Sometime in January 1985, private respondents, who were
recruited by petitioner for employment in Saudi Arabia, were
required to pay placement fees in the amount of P5,000.00 for
private respondent Rodrigo L. Mikin and P6,500.00 each for
private respondents Vivencio A. de Mesa and Cedric P. Leyson.1
After the execution of their respective work contracts, private
respondents left for Saudi Arabia on January 29, 1985. They then
20
began work for Al-Hejailan Consultants A/E, the foreign principal consequently, private respondents filed a motion to decide the case
of petitioner. on the basis of the evidence on record. 8

While in Saudi Arabia, private respondents were allegedly made to On the aspects of the case involving money claims arising from the
sign a second contract on February 4, 1985 which changed some of employer-employee relations and illegal dismissal, the POEA
the provisions of their original contract resulting in the reduction of rendered a decision dated August 31, 1988 9 , the dispositive
some of their benefits and privileges.2 On April 1, 1985, their portion of which reads:
foreign employer allegedly forced them to sign a third contract
which increased their work hours from 48 hours to 60 hours a
"CONFORMABLY TO THE FOREGOING, judgment
week without any corresponding increase in their basic monthly
is hereby rendered ordering respondent PHILSA
salary. When they refused to sign this third contract, the services of
INTERNATIONAL PLACEMENT AND SERVICE
private respondents were terminated by Al-Hejailan and they were
CORPORATION to pay complainants, jointly and
repatriated to the Philippines.3
severally with its principal Al-Hejailan, the following
amounts, to wit:
Upon their arrival in the Philippines, private respondents
demanded from petitioner Philsa the return of their placement fees
1. TWO THOUSAND TWO HUNDRED TWENTY
and for the payment of their salaries for the unexpired portion of
FIVE SAUDI RIYALS (SR2,225.00) to each
their contract. When petitioner refused, they filed a case before the
complainant, representing the refund of their unpaid
POEA against petitioner Philsa and its foreign principal, Al-
separation pay;
Hejailan., with the following causes of action:

2. ONE THOUSAND SAUDI RIYALS (SR1,000.00)

1. Illegal dismissal;
2. Payment of salary differentials;
3. Illegal deduction/withholding of salaries;
4. Illegal exactions/refund of placement fees; and
for V.A. de Mesa alone, representing the salary
deduction from his March salary;
3. TWO THOUSAND SAUDI RIYALS (SR2,000.00)
each for R.I. Mikin and C.A.P. Leyson only,
representing their differential pay for the months of
February and March, 1985; and

4. Five percent (5%) of the total awards as and by way

5. Contract substitution. 4
of attorney's fees.

The case was docketed as POEA Case No. (L) 85-05 0370.
All payments of the abovestated awards shall be made
in Philippine Currency equivalent to the prevailing
Under the rules of the POEA dated May 21, 1985, complaints exchange rate according to the Central Bank at the time
involving employer-employee relations arising out of or by virtue of payment.
of any law or contract involving Filipino workers for overseas
employment, including money claims, are adjudicated by the
All other claims of complainants as well as the
Workers' Assistance and Adjudication Office (hereinafter the
counterclaims of respondent are dismissed for lack of
"WAAO") thru the POEA Hearing Officers.5 On the other hand,
merit.
complaints involving recruitment violations warranting suspension
or cancellation of the license of recruiting agencies are cognizable
by the POEA thru its Licensing and Recruitment Office SO ORDERED." 10
(hereinafter the "LRO"). 6 In cases where a complaint partakes of
the nature of both an employer-employee relationship case and a
Under the Rules and Regulations of the POEA, the decision of the
recruitment regulation case, the POEA Hearing Officer shall act as
POEA-Adjudication Office on matters involving money claims
representative of both the WAAO and the LRO and both cases
arising from the employer-employee relationship of overseas
shall be heard simultaneously. In such cases, the Hearing Officer
Filipino workers may be appealed to the National Labor Relations
shall submit two separate recommendations for the two aspects of
Commission (hereinafter the "NLRC)11 . Thus, as both felt
the case. 7
aggrieved by the said POEA Decision, petitioner and private
respondents filed separate appeals from the August 31, 1988
In the case at bench, the first two causes of action were in the POEA Decision to the NLRC.
nature of money claims arising from the employer-employee
relations and were properly cognizable by the WAAO. The last
In a decision dated July 26, 1989 12 , the NLRC modified the
two causes of action were in the nature of recruitment violations
appealed decision of the POEA Adjudication Office by deleting the
and may be investigated by the LRO. The third cause of action,
award of salary deductions and differentials. These awards to
illegal deduction/withholding of salary, is both a money claim and
private respondents were deleted by the NLRC considering that
a violation of recruitment regulations and is thus under the
these were not raised in the complaint filed by private respondents.
investigatory jurisdiction of both the WAAO and the LRO.
The NLRC likewise stated that there was nothing in the text of the
decision which would justify the award.
Several hearings were conducted before the POEA Hearing Officer
on the two aspects of private respondents' complaint. During these
Private respondents filed a Motion for Reconsideration but the
hearings, private respondents supported their complaint with the
same was denied by the NLRC in a Resolution dated October 25;
presentation of both documentary and testimonial evidence. When
1989.
it was its turn to present its evidence, petitioner failed to do so and

21
Private respondents then elevated the July 26, 1989 decision of the
NLRC to the Supreme Court in a petition for review for certiorari
where it was docketed as G.R. No. 89089. However, in a
Resolution dated October 25, 1989, the petition was dismissed
outright for "insufficiency in form and substance, having failed to
comply with the Rules of Court and Circular No. 1-88 requiring
submission of a certified true copy of the questioned resolution
dated August 23, 1989." 13
Almost simultaneous with the promulgation of the August 31,
1988 decision of the POEA on private respondents' money claims,
the POEA issued a separate Order dated August 29,
1988 14 resolving the recruitment violations aspect of private
respondents' complaint. In this Order, the POEA found petitioner
guilty of illegal exaction, contract substitution, and unlawful
deduction. The dispositive portion of this August 29, 1988 POEA
Order reads:
"WHEREFORE, premises considered, this Office finds
herein respondent PHILSA International Placement and
Services Corporation liable for three (3) counts of
illegal exaction, two (2) counts of contract substitution
and one count of withholding or unlawful deduction
from salaries of workers.
Accordingly, respondent is hereby ordered to refund the
placement fees in the amount of P2,500.00 to Rodrigo
L. Mikin, P4,000.00, each, to Vivencio A. de Mesa and
Cedric A.P. Leyson plus restitution of the salaries
withheld in the amount of SR1,000.00 to Vivencio A.
de Mesa.
Moreover, respondent's license is hereby suspended for
eight (8) months to take effect immediately and to
remain as such until full refund and restitution of the
above-stated amounts have been effected or in lieu
thereof, it is fined the amount of SIXTY THOUSAND
(P60,000.00) PESOS plus restitution.
SO ORDERED."
In line with this August 29, 1988 Order, petitioner deposited the
check equivalent to the claims of private respondents and paid the
corresponding fine under protest. From the said Order, petitioner
filed a Motion for Reconsideration which was subsequently denied
in an Order dated October 10, 1989.
Under the POEA Rules and Regulations, the decision of the POEA
thru the LRO suspending or canceling a license or authority to act
as a recruitment agency may be appealed to the Ministry (now
Department) of Labor and Employment. 15 Accordingly, after the
denial of its motion for reconsideration, petitioner appealed the
August 21, 1988 Order to the Secretary of Labor and Employment.
However, in an Order dated September 13, 1991, 16 public
respondent Secretary of Labor and Employment affirmed in
toto the assailed Order. Petitioner filed a Motion for
Reconsideration but this was likewise denied in an Order dated
November 25, 1991.
Hence, the instant Petition for Certiorari where petitioner raises the
following grounds for the reversal of the questioned Orders:
I substantial evidence. 19
THE PUBLIC RESPONDENT HAS ACTED
WITHOUT OR IN EXCESS OF JURISDICTION OR
WITH GRAVE ABUSE OF DISCRETION IN
HOLDING PETITIONER GUILTY OF ILLEGAL
EXACTIONS. THE FINDING IS NOT SUPPORTED
BY EVIDENCE AND IN ANY EVENT, THE LAW
ON WHICH THE CONVICTION IS BASED IS
VOID.
II
THE PUBLIC RESPONDENT HAS ACTED
WITHOUT OR IN EXCESS OF JURISDICTION OR
WITH GRAVE ABUSE OF DISCRETION IN
PENALIZING PETITIONER WITH CONTRACT
SUBSTITUTION. IN THE PREMISES, THE
CONTRACT SUBSTITUTION IS VALID AS IT
IMPROVED THE TERMS AND CONDITIONS OF
PRIVATE RESPONDENTS' EMPLOYMENT.
III.
THE PUBLIC RESPONDENT HAS ACTED
WITHOUT OR IN EXCESS OF JURISDICTION, OR
WITH GRAVE ABUSE OF DISCRETION IN
HOLDING PETITIONER LIABLE FOR ILLEGAL
DEDUCTIONS/WITHHOLDING OF SALARIES
FOR THE SUPREME COURT ITSELF HAS
ALREADY ABSOLVED PETITIONER FROM THIS
CHARGE.
With respect to the first ground, petitioner would want us to
overturn the findings of the POEA, subsequently affirmed by the
Secretary of the Department of Labor and Employment, that it is
guilty of illegal exaction committed by collecting placement fees in
excess of the amounts allowed by law. This issue, however, is a
question of fact which cannot be raised in a petition for certiorari
under Rule 65. 17 As we have previously held:
"It should be noted, in the first place, that the instant
petition is a special civil action for certiorari under Rule
65 of the Revised Rules of Court. An extraordinary
remedy, its use is available only and restrictively in
truly exceptional cases wherein the action of an inferior
court, board or officer performing judicial or quasi-
judicial acts is challenged for being wholly void on
grounds of jurisdiction. The sole office of the writ of
certiorari is the correction of errors of jurisdiction
including the commission of grave abuse of discretion
amounting to lack or excess of jurisdiction. It does not
include correction of public respondent NLRC's
evaluation of the evidence and factual findings based
thereon, which are generally accorded not only great
respect but even finality." 18
The question of whether or not petitioner charged private
respondents placement fees in excess of that allowed by law is
clearly a question of fact which is for public respondent POEA, as
a trier of facts, to determine. As stated above, the settled rule is that
the factual findings of quasi-judicial agencies like the POEA,
which have acquired expertise because their jurisdiction is
confined to specific matters, are generally accorded not only
respect, but at times even finality if such findings are supported by
22
On this point, we have carefully examined the records of the case
and it is clear that the ruling of public respondent POEA that
petitioner is guilty of illegal exaction is supported by substantial
evidence. Aside from the testimonial evidence offered by private
respondents, they also presented documentary evidence consisting
of receipts issued by a duly authorized representative of petitioner
which show the payment of amounts in excess of those allowed by
the POEA. In contrast, petitioner did not present any evidence
whatsoever to rebut the claims of private respondents despite the
many opportunities for them to do so.
Petitioner insists, however, that it cannot be held liable for illegal
exaction as POEA Memorandum Circular No. 11, Series of 1983,
which enumerated the allowable fees which may be collected from
applicants, is void for lack of publication.
There is merit in the argument.
In Tañada vs. Tuvera 20 , the Court held, as follows:
"We hold therefore that all statutes, including those of
local application and private laws, shall be published as
a condition for their effectivity, which shall begin
fifteen days after publication unless a different
effectivity date is fixed by the legislature.
Covered by this rule are presidential decrees and
executive orders promulgated by the President in the
exercise of legislative powers whenever the same are
validly delegated by the legislature or, at present,
directly conferred by the Constitution: Administrative
rules and regulations must also be published if their
purpose is to enforce or implement existing law
pursuant to a valid delegation.
Interpretative regulations and those merely internal in
nature, that is, regulating only the personnel of the
administrative agency and the public, need not be
published. Neither is publication required of the so-
called letter of instructions issued by the administrative
superiors concerning the rules or guidelines to be
followed by their subordinates in the performance of
their duties."
Applying this doctrine, we have previously declared as having no
force and effect the following administrative issuances: a) Rules
and Regulations issued by the Joint Ministry of Health-Ministry of
Labor and Employment Accreditation Committee regarding the
accreditation of hospitals, medical clinics and laboratories; 21 b)
Letter of Instruction No. 416 ordering the suspension of payments
due and payable by distressed copper mining companies to the
national government; 22 c) Memorandum Circulars issued by the
POEA regulating the recruitment of domestic helpers to Hong
Kong; 23 d) Administrative Order No. SOCPEC 89-08-01 issued by
the Philippine International Trading Corporation regulating
applications for importation from the People's Republic of
China;24 and e) Corporate Compensation Circular No. 10 issued by
the Department of Budget and Management discontinuing the
payment of other allowances and fringe benefits to government
officials and employees. 25 In all these cited cases, the
administrative issuances questioned therein were uniformly struck
down as they were not published or filed with the National
Administrative Register as required by the Administrative Code of
1987. 26
POEA Memorandum Circular No. 2, Series of 1983 must likewise
be declared ineffective as the same was never published or filed
with the National Administrative Register.
POEA Memorandum Order No. 2, Series of 1983 provides for the
applicable schedule of placement and documentation fees for
private employment agencies or authority holders. Under the said
Order, the maximum amount which may be collected from
prospective Filipino overseas workers is P2,500.00. The said
circular was apparently issued in compliance with the provisions of
Article 32 of the Labor Code which provides, as follows:
"ARTICLE 32. Fees to be paid by workers. — Any
person applying with a private fee-charging
employment agency for employment assistance shall
not be charged any fee until he has obtained
employment through its efforts or has actually
commenced employment. Such fee shall be always
covered with the approved receipt clearly showing the
amount paid. The Secretary of Labor shall promulgate
a schedule of allowable fees." (italic supplied)
It is thus clear that the administrative circular under consideration
is one of those issuances which should be published for its
effectivity, since its purpose is to enforce and implement an
existing law pursuant to a valid delegation. 27 Considering that
POEA Administrative Circular No. 2, Series of 1983 has not as yet
been published or filed with the National Administrative Register,
the same is ineffective and may not be enforced.
The Office of the Solicitor General argues however that the
imposition of administrative sanctions on petitioner was based not
on the questioned administrative circular but on Article 32 and
Article 34 (a) 28 of the Labor Code.
The argument is not meritorious. The said articles of the Labor
Code were never cited, much less discussed, in the body of the
questioned Orders of the POEA and Secretary of Labor and
Employment. In fact, the said Orders were consistent in
mentioning that petitioner's violation of Administrative Circular
No. 2, Series of 1983 was the basis for the imposition of
administrative sanctions against petitioner. Furthermore, even
assuming that petitioner was held liable under the said provisions
of the Labor Code, Articles 32 and 34 (a) of the Labor Code
presupposes the promulgation of a valid schedule of fees by the
Department of Labor and Employment. Considering that, as,
previously discussed, Administrative Circular No. 2, Series of
1983 embodying such a schedule of fees never took effect, there is
thus no basis for the imposition of the administrative sanctions
against petitioner. Moreover, under Book VI, Chapter II, Section 3
of the Administrative Code of 1987, "(r)ules in force on the date of
the effectivity of this Code which are not filed within three (3)
months from that date shall not thereafter be the basis of any
sanction against any party or persons." Considering that POEA
Administrative Circular No. 2 was never filed with the National
Administrative Register, the same cannot be used as basis for the
imposition of administrative sanctions against petitioner.
The Office of the Solicitor General likewise argues that the
questioned administrative circular is not among those requiring
publication contemplated by Tañada vs. Tuvera as it is addressed
only to a specific group of persons and not to the general public.
Again, there is no merit in this argument.
23
The fact that the said circular is addressed only to a specified
group, namely private employment agencies or authority holders,
does not take it away from the ambit of our ruling in Tañada vs.
Tuvera. In the case of Phil. Association of Service Exporters vs.
Torres,29 the administrative circulars questioned therein were
addressed to an even smaller group, namely Philippine and Hong
Kong agencies engaged in the recruitment of workers for Hong
Kong, and still the Court ruled therein that, for lack of proper
publication, the said circulars may not be enforced or implemented.
Our pronouncement in Tañada vs. Tuvera is clear and categorical.
Administrative rules and regulations must be published if their
purpose is to enforce or implement existing law pursuant to a valid
delegation., The only exceptions are interpretative regulations,
those merely internal in nature, or those so-called letters of
instructions issued by administrative superiors concerning the rules
and guidelines to be followed by their subordinates in the
performance of their duties. Administrative Circular No. 2, Series
of 1983 has not been shown to fall under any of these exceptions.
In this regard, the Solicitor General's reliance on the case
of Yaokasin vs. Commissioner of Customs 30 is misplaced. In the
said case, the validity of certain Customs Memorandum Orders
were upheld despite their lack of publication as they were
addressed to a particular class of persons, the customs collectors,
who were also the subordinates of the Commissioner of the Bureau
of Customs. As such, the said Memorandum Orders clearly fall
under one of the exceptions to the publication requirement, namely
those dealing with instructions from an administrative superior to a
subordinate regarding the performance of their duties, a
circumstance which does not obtain in the case at bench.
With respect to the second ground, petitioner would want us to
review the findings of fact of the POEA regarding the two counts
of alleged contract substitution. Again, this is a question of fact
which may not be disturbed if the same is supported by substantial
evidence. A reading of the August 29, 1988 Order of the POEA
shows that, indeed, the ruling that petitioner is guilty of two (2)
counts of prohibited contract substitution is supported by
substantial evidence. Thus:
"2. As admitted by respondent, there was definitely a
contract of substitution in the first count. The first
contract was duly approved by the Administration and,
therefore, the parties are bound by the terms and
condition thereof until its expiration. The mere
intention of respondents to increase the number of
hours of work, even if there was a corresponding
increase in wage is clear violation of the contract as
approved by the Administration, and notwithstanding
the same, the amendment is evidently contrary to law,
morals, good customs and public policy and hence,
must be shunned (Art. 1306, Civil Code of the
Philippines, Book III, Title I, Chapter 1, Article 83,
Labor Code of the Philippines, as amended). Moreover,
it would appear that the proposed salary increase
corresponding to the increase in number of work bonus
may just have been a ploy as complainant were (sic)
thereafter not paid at the increased rate.
As to contract substitution in the second part, a third
contract was emphatically intended by respondent to be
signed by complainants which, however, was not
consummated due to the adamant refusal of
complainants to sign thereon. Mere intention of the
respondent to commit contract substitution for a second
time should not be left unpunished. It is the duty of this
Office to repress such acts by teaching agencies a
lesson to avoid repetition of the same violation." 31
With respect to the third ground, petitioner argues that the public
respondent committed grave abuse of discretion in holding
petitioner liable for illegal deductions/withholding of salaries
considering that the Supreme Court itself has already absolved
petitioner from this charge. Petitioner premises its argument on the
fact that the July 26, 1989 Decision of the NLRC absolving it from
private respondent de Mesa's claim for salary deduction has
already attained finality by reason of the dismissal of private
respondents' petition for certiorari of the said NLRC decision by
the Supreme Court.
Petitioner is correct in stating that the July 26, 1989 Decision of the
NLRC has attained finality by reason of the dismissal of the
petition for certiorari assailing the same. However, the said NLRC
Decision dealt only with the money claims of private respondents
arising from employer-employee relations and illegal dismissal and
as such, it is only for the payment of the said money claims that
petitioner is absolved. The administrative sanctions, which are
distinct and separate from the money claims of private
respondents, may still be properly imposed by the POEA. In fact,
in the August 31, 1988 Decision of the POEA dealing with the
money claims of private respondents, the POEA Adjudication
Office precisely declared that "respondent's liability for said money
claims is without prejudice to and independent of its liabilities for
the recruitment violations aspect of the case which is the subject of
a separate Order." 32
The NLRC Decision absolving petitioner from paying private
respondent de Mesa's claim for salary deduction based its ruling on
a finding that the said money claim was not raised in the
complaint. 33 While there may be questions regarding such finding
of the NLRC, the finality of the said NLRC Decision prevents us
from modifying or reviewing the same. But the fact that the claim
for salary deduction was not raised by private respondents in their
complaint will not bar the POEA from holding petitioner liable for
illegal deduction or withholding of salaries as a ground for the
suspension or cancellation of petitioner's license.
Under the POEA Rules and Regulations, the POEA, on its own
initiative, may conduct the necessary proceeding for the suspension
or cancellation of the license of any private placement agency on
any of the grounds mentioned therein. 34 As such, even without a
written complaint from an aggrieved party, the POEA can initiate
proceedings against an erring private placement agency and, if the
result of its investigation so warrants, impose the corresponding
administrative sanction thereof. Moreover, the POEA, in an
investigation of an employer-employee relationship case, may still
hold a respondent liable for administrative sanctions if, in the
course of its investigation, violations of recruitment regulations are
uncovered. 35 It is thus clear that even if recruitment violations
were not included in a complaint for money claims initiated by a
private complainant, the POEA, under its rules, may still take
cognizance of the same and impose administrative sanctions if the
evidence so warrants.
As such, the fact that petitioner has been absolved by final
judgment for the payment of the money claim to private
respondent de Mesa does not mean that it is likewise absolved
from the administrative sanctions which may be imposed as a
result of the unlawful deduction or withholding of private
respondents' salary. The POEA thus committed no grave abuse of
discretion in finding petitioner administratively liable of one count
of unlawful deduction/withholding of salary.
24
To summarize, petitioner should be absolved from the three (3)
counts of illegal exaction as POEA Administrative Circular No. 2,
Series of 1983 could not be the basis of administrative sanctions
against petitioner for lack of publication. However, we affirm the
ruling of the POEA and the Secretary of Labor and Employment
that petitioner should be held administratively liable for two (2)
counts of contract substitution and one (1) count of withholding or
unlawful deduction of salary.
Under the applicable schedule of penalties imposed by the POEA,
the penalty for each count of contract substitution is suspension of
license for two (2) months or a fine of P10,000.00 while the
penalty for withholding or unlawful deduction of salaries is
suspension of license for two (2) months or fine equal to the salary
withheld but not less than P10,000.00 plus restitution of the
amount in both instances.36 Applying the said schedule on the
instant case, the license of petitioner should be suspended for six
(6) months or, in lieu thereof, it should be ordered to pay fine in
the amount of P30,000.00. Petitioner should likewise pay the
amount of SR1,000.00 to private respondent Vivencio A. de Mesa
as restitution for the amount withheld from his salary.
WHEREFORE, premises considered, the September 13, 1991 and
November 25, 1991 Orders of public respondent Secretary of
Labor and Employment are hereby MODIFIED. As modified, the
license of private respondent Philsa International Placement and
Services Corporation is hereby suspended for six (6) months or, in
lieu thereof, it is hereby ordered to pay the amount of P30,000.00
as fine. Petitioner is likewise ordered to pay the amount of
SR1,000.00 to private respondent Vivencio A. de Mesa. All other
monetary awards are deleted.
SO ORDERED.
Melo, Vitug, Panganiban and Sandoval-Gutierrez, JJ ., concur
Footnotes
Labor Code. Article 34. Prohibited Practices — It shall be
unlawful for any individual, entity, licensee or holder of authority:
.
(a) To charge or accept directly or indirectly, any amount greater
than that specified in the schedule of allowable fees prescribed by
the Secretary of Labor, or to make a worker pay any amount
greater than actually received by him as a loan or advance."
ILLEGAL RECRUITMENT-LOCAL
G.R. No. 81510 March 14, 1990
HORTENCIA SALAZAR, petitioner,
vs.
HON. TOMAS D. ACHACOSO, in his capacity as
Administrator of the Philippine Overseas Employment
Administration, and FERDIE MARQUEZ, respondents.
Gutierrez & Alo Law Offices for petitioner.
SARMIENTO, J.:
This concerns the validity of the power of the Secretary of Labor to
issue warrants of arrest and seizure under Article 38 of the Labor
Code, prohibiting illegal recruitment.
The facts are as follows:
xxx xxx xxx
1. On October 21, 1987, Rosalie Tesoro of 177 Tupaz Street,
Leveriza, Pasay City, in a sworn statement filed with the Philippine
Overseas Employment Administration (POEA for brevity) charged
petitioner Hortencia Salazar, viz:
04. T: Ano ba ang dahilan at ikaw ngayon ay narito at
nagbibigay ng salaysay.
S: Upang ireklamo sa dahilan ang aking PECC Card ay
ayaw ibigay sa akin ng dati kong manager. — Horty
Salazar — 615 R.O. Santos, Mandaluyong, Mla.
05. T: Kailan at saan naganap and ginawang panloloko sa
iyo ng tao/mga taong inireklamo mo?
S. Sa bahay ni Horty Salazar.
06. T: Paano naman naganap ang pangyayari?
S. Pagkagaling ko sa Japan ipinatawag niya ako. Kinuha
ang PECC Card ko at sinabing hahanapan ako ng
booking sa Japan. Mag 9 month's na ako sa Phils. ay
hindi pa niya ako napa-alis. So lumipat ako ng ibang
company pero ayaw niyang ibigay and PECC Card
ko.
2. On November 3, 1987, public respondent Atty. Ferdinand
Marquez to whom said complaint was assigned, sent to the
petitioner the following telegram:
YOU ARE HEREBY DIRECTED TO APPEAR BEFORE
FERDIE MARQUEZ POEA ANTI ILLEGAL RECRUITMENT
UNIT 6TH FLR. POEA BLDG. EDSA COR. ORTIGAS AVE.
MANDALUYONG MM ON NOVEMBER 6, 1987 AT 10 AM
RE CASE FILED AGAINST YOU. FAIL NOT UNDER
PENALTY OF LAW.
4. On the same day, having ascertained that the petitioner had no
license to operate a recruitment agency, public respondent
Administrator Tomas D. Achacoso issued his challenged
CLOSURE AND SEIZURE ORDER NO. 1205 which reads:
HORTY SALAZAR
No. 615 R.O. Santos St.
Mandaluyong, Metro Manila
Pursuant to the powers vested in me under Presidential Decree No.
1920 and Executive Order No. 1022, I hereby order the CLOSURE
of your recruitment agency being operated at No. 615 R.O. Santos
St., Mandaluyong, Metro Manila and the seizure of the documents
and paraphernalia being used or intended to be used as the means
of committing illegal recruitment, it having verified that you have
—
25
(1) No valid license or authority from the Department of Labor and
Employment to recruit and deploy workers for overseas
employment;
(2) Committed/are committing acts prohibited under Article 34 of
the New Labor Code in relation to Article 38 of the same code.
This ORDER is without prejudice to your criminal prosecution
under existing laws.
Done in the City of Manila, this 3th day of November, 1987.
5. On January 26, 1988 POEA Director on Licensing and
Regulation Atty. Estelita B. Espiritu issued an office order
designating respondents Atty. Marquez, Atty. Jovencio Abara and
Atty. Ernesto Vistro as members of a team tasked to implement
Closure and Seizure Order No. 1205. Doing so, the group assisted
by Mandaluyong policemen and mediamen Lito Castillo of the
People's Journal and Ernie Baluyot of News Today proceeded to
the residence of the petitioner at 615 R.O. Santos St.,
Mandaluyong, Metro Manila. There it was found that petitioner
was operating Hannalie Dance Studio. Before entering the place,
the team served said Closure and Seizure order on a certain Mrs.
Flora Salazar who voluntarily allowed them entry into the
premises. Mrs. Flora Salazar informed the team that Hannalie
Dance Studio was accredited with Moreman Development (Phil.).
However, when required to show credentials, she was unable to
produce any. Inside the studio, the team chanced upon twelve
talent performers — practicing a dance number and saw about
twenty more waiting outside, The team confiscated assorted
costumes which were duly receipted for by Mrs. Asuncion
Maguelan and witnessed by Mrs. Flora Salazar.
6. On January 28, 1988, petitioner filed with POEA the following
letter:
Gentlemen:
On behalf of Ms. Horty Salazar of 615 R.O. Santos, Mandaluyong,
Metro Manila, we respectfully request that the personal properties
seized at her residence last January 26, 1988 be immediately
returned on the ground that said seizure was contrary to law and
against the will of the owner thereof. Among our reasons are the
following:
1. Our client has not been given any prior notice or hearing, hence
the Closure and Seizure Order No. 1205 dated November 3, 1987
violates "due process of law" guaranteed under Sec. 1, Art. III, of
the Philippine Constitution.
2. Your acts also violate Sec. 2, Art. III of the Philippine
Constitution which guarantees right of the people "to be secure in
their persons, houses, papers, and effects against unreasonable
searches and seizures of whatever nature and for any purpose."
3. The premises invaded by your Mr. Ferdi Marquez and five (5)
others (including 2 policemen) are the private residence of the
Salazar family, and the entry, search as well as the seizure of the
personal properties belonging to our client were without her
consent and were done with unreasonable force and intimidation,
together with grave abuse of the color of authority, and constitute
robbery and violation of domicile under Arts. 293 and 128 of the
Revised Penal Code.
Unless said personal properties worth around TEN THOUSAND
PESOS (P10,000.00) in all (and which were already due for
shipment to Japan) are returned within twenty-four (24) hours from
your receipt hereof, we shall feel free to take all legal action, civil
and criminal, to protect our client's interests.
We trust that you will give due attention to these important
matters.
7. On February 2, 1988, before POEA could answer the letter,
petitioner filed the instant petition; on even date, POEA filed a
criminal complaint against her with the Pasig Provincial Fiscal,
docketed as IS-88-836.1
On February 2, 1988, the petitioner filed this suit for prohibition.
Although the acts sought to be barred are alreadyfait accompli,
thereby making prohibition too late, we consider the petition as one
for certiorari in view of the grave public interest involved.
The Court finds that a lone issue confronts it: May the Philippine
Overseas Employment Administration (or the Secretary of Labor)
validly issue warrants of search and seizure (or arrest) under
Article 38 of the Labor Code? It is also an issue squarely raised by
the petitioner for the Court's resolution.
Under the new Constitution, which states:
. . . no search warrant or warrant of arrest
shall issue except upon probable cause to be
determined personally by the judge after
examination under oath or affirmation of the
complainant and the witnesses he may
produce, and particularly describing the
place to be searched and the persons or
things to be seized. 2
it is only a judge who may issue warrants of search and arrest. 3 In
one case, it was declared that mayors may not exercise this power:
xxx xxx xxx
But it must be emphasized here and now that
what has just been described is the state of
the law as it was in September, 1985. The
law has since been altered. No longer does
the mayor have at this time the power to
conduct preliminary investigations, much
less issue orders of arrest. Section 143 of the
Local Government Code, conferring this
power on the mayor has been abrogated,
rendered functus officio by the 1987
Constitution which took effect on February
2, 1987, the date of its ratification by the
Filipino people. Section 2, Article III of the
1987 Constitution pertinently provides that
"no search warrant or warrant of arrest shall
issue except upon probable cause to be
determined personally by the judge after
examination under oath or affirmation of the
complainant and the witnesses he may
produce, and particularly describing the
place to be searched and the person or things
to be seized." The constitutional proscription
has thereby been manifested that
thenceforth, the function of determining
26
 probable cause and issuing, on the basis
thereof, warrants of arrest or search
warrants, may be validly exercised only by
judges, this being evidenced by the
elimination in the present Constitution of the
phrase, "such other responsible officer as
may be authorized by law" found in the
counterpart provision of said 1973
Constitution, who, aside from judges, might
conduct preliminary investigations and issue
warrants of arrest or search warrants. 4
Neither may it be done by a mere prosecuting body:
We agree that the Presidential Anti-Dollar
Salting Task Force exercises, or was meant
to exercise, prosecutorial powers, and on
that ground, it cannot be said to be a neutral
and detached "judge" to determine the
existence of probable cause for purposes of
arrest or search. Unlike a magistrate, a
prosecutor is naturally interested in the
success of his case. Although his office "is
to see that justice is done and not necessarily
to secure the conviction of the person
accused," he stands, invariably, as the
accused's adversary and his accuser. To
permit him to issue search warrants and
indeed, warrants of arrest, is to make him
both judge and jury in his own right, when
he is neither. That makes, to our mind and to
that extent, Presidential Decree No. 1936 as
amended by Presidential Decree No. 2002,
unconstitutional. 5
Section 38, paragraph (c), of the Labor Code, as now written, was
entered as an amendment by Presidential Decrees Nos. 1920 and
2018 of the late President Ferdinand Marcos, to Presidential
Decree No. 1693, in the exercise of his legislative powers under
Amendment No. 6 of the 1973 Constitution. Under the latter, the
then Minister of Labor merely exercised recommendatory powers:
(c) The Minister of Labor or his duly
authorized representative shall have the
power to recommend the arrest and
detention of any person engaged in illegal
recruitment. 6
On May 1, 1984, Mr. Marcos promulgated Presidential Decree No.
1920, with the avowed purpose of giving more teeth to the
campaign against illegal recruitment. The Decree gave the Minister
of Labor arrest and closure powers:
(b) The Minister of Labor and Employment
shall have the power to cause the arrest and
detention of such non-licensee or non-holder
of authority if after proper investigation it is
determined that his activities constitute a
danger to national security and public order
or will lead to further exploitation of job-
seekers. The Minister shall order the closure
of companies, establishment and entities
found to be engaged in the recruitment of
workers for overseas employment, without
having been licensed or authorized to do
so. 7
On January 26, 1986, he, Mr. Marcos, promulgated Presidential
Decree No. 2018, giving the Labor Minister search and seizure
powers as well:
(c) The Minister of Labor and Employment
or his duly authorized representatives shall
have the power to cause the arrest and
detention of such non-licensee or non-holder
of authority if after investigation it is
determined that his activities constitute a
danger to national security and public order
or will lead to further exploitation of job-
seekers. The Minister shall order the search
of the office or premises and seizure of
documents, paraphernalia, properties and
other implements used in illegal recruitment
activities and the closure of companies,
establishment and entities found to be
engaged in the recruitment of workers for
overseas employment, without having been
licensed or authorized to do so. 8
The above has now been etched as Article 38, paragraph (c) of the
Labor Code.
The decrees in question, it is well to note, stand as the dying
vestiges of authoritarian rule in its twilight moments.
We reiterate that the Secretary of Labor, not being a judge, may no
longer issue search or arrest warrants. Hence, the authorities must
go through the judicial process. To that extent, we declare Article
38, paragraph (c), of the Labor Code, unconstitutional and of no
force and effect.
The Solicitor General's reliance on the case of Morano v. Vivo 9 is
not well-taken. Vivo involved a deportation case, governed by
Section 69 of the defunct Revised Administrative Code and by
Section 37 of the Immigration Law. We have ruled that in
deportation cases, an arrest (of an undesirable alien) ordered by the
President or his duly authorized representatives, in order to carry
out a final decision of deportation is valid. 10 It is valid, however,
because of the recognized supremacy of the Executive in matters
involving foreign affairs. We have held: 11
xxx xxx xxx
The State has the inherent power to deport
undesirable aliens (Chuoco Tiaco vs. Forbes,
228 U.S. 549, 57 L. Ed. 960, 40 Phil. 1122,
1125). That power may be exercised by the
Chief Executive "when he deems such
action necessary for the peace and domestic
tranquility of the nation." Justice Johnson's
opinion is that when the Chief Executive
finds that there are aliens whose continued
presence in the country is injurious to the
public interest, "he may, even in the absence
of express law, deport them". (Forbes vs.
Chuoco Tiaco and Crossfield, 16 Phil. 534,
568, 569; In re McCulloch Dick, 38 Phil.
41).
The right of a country to expel or deport
aliens because their continued presence is
detrimental to public welfare is absolute and
unqualified (Tiu Chun Hai and Go Tam vs.
27
 Commissioner of Immigration and the connected in the
Director of NBI, 104 Phil. 949, 956). 12 printing of the "WE
FORUM" newspaper
and any and all
The power of the President to order the arrest of aliens for
documents/communic
deportation is, obviously, exceptional. It (the power to order
ations, letters and
arrests) can not be made to extend to other cases, like the one at
facsimile of prints
bar. Under the Constitution, it is the sole domain of the courts.
related to the "WE
FORUM" newspaper.
Moreover, the search and seizure order in question, assuming, ex
gratia argumenti, that it was validly issued, is clearly in the nature
2) Subversive
of a general warrant:
documents,
pamphlets, leaflets,
Pursuant to the powers vested in me under books, and other
Presidential Decree No. 1920 and Executive publications to
Order No. 1022, I hereby order the promote the
CLOSURE of your recruitment agency objectives and
being operated at No. 615 R.O. Santos St., purposes of the
Mandaluyong, Metro Manila and the seizure subversive
of the documents and paraphernalia being organizations known
used or intended to be used as the means of as Movement for Free
committing illegal recruitment, it having Philippines, Light-a-
verified that you have — Fire Movement and
April 6 Movement;
and
(1) No valid license or
authority from the
Department of Labor 3) Motor vehicles
and Employment to used in the
recruit and deploy distribution/circulatio
workers for overseas n of the "WE
employment; FORUM" and other
subversive materials
and propaganda, more
(2) Committed/are
particularly,
committing acts
prohibited under
Article 34 of the New 1) Toyota-Corolla,
Labor Code in colored yellow with
relation to Article 38 Plate No. NKA 892;
of the same code.
2) DATSUN, pick-up
This ORDER is without prejudice to your colored white with
criminal prosecution under existing laws. 13 Plate No. NKV 969;

We have held that a warrant must identify clearly the things to be 3) A delivery truck
seized, otherwise, it is null and void, thus: with Plate No. NBS
542;
xxx xxx xxx
4) TOYOTA-
TAMARAW, colored
Another factor which makes the search white with Plate No.
warrants under consideration PBP 665; and
constitutionally objectionable is that they are
in the nature of general warrants. The search
warrants describe the articles sought to be 5) TOYOTA Hi-Lux,
seized in this wise: pick-up truck with
Plate No. NGV 472
with marking
1) All printing "Bagong Silang."
equipment,
paraphernalia, paper,
ink, photo equipment, In Stanford v. State of Texas, the search
typewriters, cabinets, warrant which authorized the search for
tables, "books, records, pamphlets, cards, receipts,
communications/ lists, memoranda, pictures, recordings and
recording equipment, other written instruments concerning the
tape recorders, Communist Parties of Texas, and the
dictaphone and the operations of the Community Party in
like used and/or Texas," was declared void by the U.S.

28
 Supreme Court for being too general. In like
manner, directions to "seize any evidence in
connection with the violation of SDC 13-
3703 or otherwise" have been held too
general, and that portion of a search warrant
which authorized the seizure of any
"paraphernalia which could be used to
violate Sec. 54-197 of the Connecticut
General Statutes (the statute dealing with the
crime of conspiracy)" was held to be a
general warrant, and therefore invalid. The
description of the articles sought to be seized
under the search warrants in question cannot
be characterized differently.
In the Stanford case, the U.S. Supreme court
calls to mind a notable chapter in English
history; the era of disaccord between the
Tudor Government and the English Press,
when "Officers of the Crown were given
roving commissions to search where they
pleased in order to suppress and destroy the
literature of dissent both Catholic and
Puritan." Reference herein to such historical
episode would not be relevant for it is not
the policy of our government to suppress
any newspaper or publication that speaks
with "the voice of non-conformity" but
poses no clear and imminent danger to state
security. 14
For the guidance of the bench and the bar, we reaffirm the
following principles:
1. Under Article III, Section 2, of the l987
Constitution, it is only judges, and no other,
who may issue warrants of arrest and search:
2. The exception is in cases of deportation of
illegal and undesirable aliens, whom the
President or the Commissioner of
Immigration may order arrested, following a
final order of deportation, for the purpose of
deportation.
WHEREFORE, the petition is GRANTED. Article 38, paragraph
(c) of the Labor Code is declared UNCONSTITUTIONAL and
null and void. The respondents are ORDERED to return all
materials seized as a result of the implementation of Search and
Seizure Order No. 1205.
No costs.
SO ORDERED.
ILLEGAL RECRUITMENT-OVERSEAS
G.R. No. 121777 January 24, 2001
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
CAROL M. DELA PIEDRA, accused-appellant.
KAPUNAN, J.:
Accused-appellant Carol M. dela Piedra questions her conviction
for illegal recruitment in large scale and assails, as well, the
constitutionality of the law defining and penalizing said crime.
The Court affirms the constitutionality of the law and the
conviction of the accused, but reduces the penalty imposed upon
her.
The accused was charged before the Regional Trial Court of
Zamboanga City in an information alleging:
That on or about January 30, 1994, in the City of Zamboanga,
Philippines, and within the jurisdiction of this Honorable Court, the
above-named accused, without having previously obtained from
the Philippine Overseas Employment Administration, a license or
authority to engage in recruitment and overseas placement of
workers, did then and there, wilfully, unlawfully and feloniously,
offer and promise for a fee employment abroad particularly in
Singapore thus causing Maria Lourdes Modesto [y] Gadrino,
Nancy Araneta y Aliwanag and Jennelyn Baez y Timbol, all
qualified to apply, in fact said Maria Lourdes Modesto had already
advanced the amount of P2,000.00 to the accused for and in
consideration of the promised employment which did not
materialized [sic] thus causing damage and prejudice to the latter
in the said sum; furthermore, the acts complained of herein
tantamount [sic] to economic sabotage in that the same were
committed in large scale.1
Arraigned on June 20, 1994, the accused pleaded not guilty2 to
these charges.
At the trial, the prosecution presented five (5) witnesses, namely,
Erlie Ramos, SPO2 Erwin Manalopilar, Eileen Fermindoza, Nancy
Araneta and Lourdes Modesto. The succeeding narration is
gathered from their testimonies:
On January 30, 1994, at exactly 10:00 in the morning, Erlie
Ramos, Attorney II of the Philippine Overseas Employment
Agency (POEA), received a telephone call from an unidentified
woman inquiring about the legitimacy of the recruitment
conducted by a certain Mrs. Carol Figueroa. Ramos, whose duties
include the surveillance of suspected illegal recruiters, immediately
contacted a friend, a certain Mayeth Bellotindos, so they could
both go to No. 26-D, Tetuan Highway, Sta. Cruz, Zamboanga City,
where the recruitment was reportedly being undertaken. Upon
arriving at the reported area at around 4:00 p.m., Bellotindos
entered the house and pretended to be an applicant. Ramos
remained outside and stood on the pavement, from where he was
able to see around six (6) persons in the house's sala. Ramos even
heard a woman, identified as Carol Fegueroa, talk about the
possible employment she has to provide in Singapore and the
documents that the applicants have to comply with. Fifteen (15)
minutes later, Bellotindos came out with a bio-data form in hand.
On February 1, 1994, Ramos conferred with a certain Capt.
Mendoza of the Criminal Investigation Service (CIS) to organize
the arrest of the alleged illegal recruiter. Also present were other
members of the CIS, including Col. Rodolfo Almonte, Regional
Director of the PNP-CIS for Region IX, Eileen Fermindoza, and a
certain SPO3 Santos. The group planned to entrap the illegal
recruiter the next day by having Fermindoza pose as an applicant.3
On February 2, 1994, at around 8:00 p.m., Col. Almonte directed
the case to SPO2 Erwin Manalopilar, a member of the Philippine
National Police who was assigned as an investigator of the CIS, to
conduct a surveillance of the area to confirm the report of illegal
29
recruitment. Accordingly, he, along with Eileen Fermindoza,
immediately proceeded to Tetuan Highway. The two did not enter
the house where the recruitment was supposedly being conducted,
but Fermindoza interviewed two people who informed them that
some people do go inside the house. Upon returning to their office
at around 8:30 a.m., the two reported to Capt. Mendoza who
organized a team to conduct the raid.
The raiding team, which included Capt. Mendoza, SPO2
Manalopilar, Fermindoza and a certain Oscar Bucol, quickly set off
and arrived at the reported scene at 9:30 that morning. There they
met up with Erlie Ramos of the POEA. Fermindoza then proceeded
to enter the house while the rest of the team posted themselves
outside to secure the area. Fermindoza was instructed to come out
after she was given a bio-data form, which will serve as the team's
cue to enter the house.4
Fermindoza introduced herself as a job applicant to a man and a
woman, apparently the owners of the house, and went inside.
There, she saw another woman, later identified as Jasmine, coming
out of the bathroom. The man to whom Fermindoza earlier
introduced herself told Jasmine that Fermindoza was applying for a
position. Jasmine, who was then only wearing a towel, told her that
she would just get dressed. Jasmine then came back and asked
Fermindoza what position she was applying for. Fermindoza
replied that she was applying to be a babysitter or any other work
so long as she could go abroad. Jasmine then gave her an
application form.
A few minutes later, a certain Carol arrived. Jasmine informed
Carol that Fermindoza was an applicant. Fermindoza asked Carol
what the requirements were and whether she (Fermindoza) was
qualified. Carol told Fermindoza that if she had a passport, she
could fill up the application papers. Fermindoza replied that she
had no passport yet. Carol said she need not worry since Jasmine
will prepare the passport for her. While filling up the application
form, three women who appeared to be friends of Jasmine arrived
to follow up the result of their applications and to give their
advance payment. Jasmine got their papers and put them on top of
a small table. Fermindoza then proceeded to the door and signaled
to the raiding party by raising her hand.
Capt. Mendoza asked the owners of the house, a married couple,
for permission to enter the same. The owners granted permission
after the raiding party introduced themselves as members of the
CIS. Inside the house, the raiding party saw some supposed
applicants. Application forms, already filled up, were in the hands
of one Mrs. Carol Figueroa. The CIS asked Figueroa if she had a
permit to recruit. Figueroa retorted that she was not engaged in
recruitment. Capt. Mendoza nevertheless proceeded to arrest
Figueroa. He took the application forms she was holding as the
raiding party seized the other papers5 on the table.6
The CIS team then brought Figueroa, a certain Jasmine Alejandro,
and the three women suspected to be applicants, to the office for
investigation.7
In the course of their investigation, the CIS discovered that Carol
Figueroa had many aliases, among them, Carol Llena and Carol
dela Piedra. The accused was not able to present any authority to
recruit when asked by the investigators.8 A check by Ramos with
the POEA revealed that the acused was not licensed or authorized
to conduct recruitment.9 A certification10 dated February 2, 1994
stating thus was executed by Renegold M. Macarulay, Officer-in-
Charge of the POEA.
The CIS likewise interviewed the supposed applicants, Lourdes
Modesto, Nancy Araneta and Jennelyn Baez, all registered nurses
working at the Cabato Medical Hospital, who executed their
respective written statements.11
At the trial, Nancy Araneta, 23, recounted that she was at Jasmine
Alejandro's house in the afternoon of January 30, 1994. Araneta
had learned from Sandra Aquino, also a nurse at the Cabato
Medical Hospital, that a woman was there to recruit job applicants
for Singapore.
Araneta and her friends, Jennelyn Baez and Sandra Aquino, arrived
at Jasmine's house at around 4:30 p.m. Jasmine welcomed them
and told them to sit down. They listened to the "recruiter" who was
then talking to a number of people. The recruiter said that she was
"recruiting" nurses for Singapore. Araneta and her friends then
filled up bio-data forms and were required to submit pictures and a
transcript of records. They were also told to pay P2,000, and "the
rest will be salary deduction." Araneta submitted her bio-data form
to Carol that same afternoon, but did not give any money because
she was "not yet sure."
On the day of the raid on February 2, 1994, Araneta was again at
the Alejandro residence to submit her transcript of records and her
picture. She arrived at the house 30 minutes before the raid but did
not witness the arrest since she was at the porch when it
happened.12
Maria Lourdes Modesto, 26, was also in Jasmine Alejandro's house
on January 30, 1994. A friend of Jasmine had informed her that
there was someone recruiting in Jasmine's house. Upon arriving at
the Alejandro residence, Lourdes was welcomed by
Jasmine.1âwphi1.nêt
Lourdes recalled that Carol Figueroa was already briefing some
people when she arrived. Carol Figueroa asked if they would like a
"good opportunity" since a hospital was hiring nurses. She gave a
breakdown of the fees involved: P30,000 for the visa and the round
trip ticket, and P5,000 as placement fee and for the processing of
the papers. The initial payment was P2,000, while P30,000 will be
by salary deduction.
Lourdes filled up the application form and submitted it to Jasmine.
After the interview, she gave the initial payment of P2,000 to
Jasmine, who assured Lourdes that she was authorized to receive
the money. On February 2, 1994, however, Lourdes went back to
the house to get back the money. Jasmine gave back the money to
Lourdes after the raid.13
Denial comprised the accused's defense.
Carol dela Piedra, 37, is a housewife and a resident of Cebu City.
Her husband is a businessman from Cebu, the manager of the
Region 7 Branch of the Grollier International Encyclopedia. They
own an apartment in Cebu City, providing lodging to students.
The accused claimed that she goes to Singapore to visit her
relatives. She first traveled to Singapore on August 21, 1993 as a
tourist, and came back to the Philippines on October 20 of the
same year. Thereafter, she returned to Singapore on December 10,
1993.
On December 21, 1993, while in Singapore, the accused was
invited to a Christmas party sponsored by the Zamboanga City
Club Association. On that occasion, she met a certain Laleen
30
Malicay, who sought her help. A midwife, Malicay had been
working in Singapore for six (6) years. Her employer is a certain
Mr. Tan, a close friend of Carol.
According to the accused, Malicay sent P15,000 home for her
father who was then seriously ill. Malicay was not sure, however,
whether her father received the money so she requested the
accused to verify from her relatives receipt thereof. She informed
the accused that she had a cousin by the name of Jasmine
Alejandro. Malicay gave the accused Jasmine's telephone number,
address and a sketch of how to get there.
The accused returned to the country on January 21, 1994. From
Cebu City, the accused flew to Zamboanga City on January 23,
1994 to give some presents to her friends.
On January 30, 1994, the accused called up Jasmine Alejandro,
Laleen Malicay's cousin, to inform her that she would be going to
her house. At around noon that day, the accused, accompanied by
her friend Hilda Falcasantos, arrived at the house where she found
Jasmine entertaining some friends. Jasmine came down with two
of her friends whom she introduced as her classmates. Jasmine told
them that the accused was a friend of Laleen Malicay.
The accused relayed to Jasmine Malicay's message regarding the
money the latter had sent. Jasmine assured her that they received
the money, and asked Carol to tell Malicay to send more money for
medicine for Malicay's mother. Jasmine also told her that she
would send something for Malicay when the accused goes back to
Singapore. The accused replied that she just needed to confirm her
flight back to Cebu City, and will return to Jasmine's house. After
the meeting with Jasmine, the accused went shopping with Hilda
Falcasantos. The accused was in the house for only fifteen (15)
minutes.
The accused denied in court that she went to Jasmine's residence to
engage in recruitment. She claimed she came to Zamboanga City
to visit her friends, to whom she could confide since she and her
husband were having some problems. She denied she knew Nancy
Araneta or that she brought information sheets for job placement.
She also denied instructing Jasmine to collect P2,000 from alleged
applicants as processing fee.14
The accused presented two witnesses to corroborate her defense.
The first, Jasmine Alejandro, 23, testified that she met the accused
for the first time only on January 30, 1994 when the latter visited
them to deliver Laleen Malicay's message regarding the money she
sent. Carol, who was accompanied by a certain Hilda Falcasantos,
stayed in their house for 10 to 15 minutes only. Carol came back to
the house a few days later on February 2 at around 8:00 in the
morning to "get the envelope for the candidacy of her daughter."
Jasmine did not elaborate.
Jasmine denied that she knew Nancy Araneta or Lourdes Modesto.
She denied that the accused conducted recruitment. She claimed
she did not see Carol distribute bio-data or application forms to job
applicants. She disclaimed any knowledge regarding the P2,000
application fee.15
The other defense witness, Ernesto Morales, a policeman, merely
testified that the accused stayed in their house in No. 270
Tugbungan, Zamboanga City, for four (4) days before her arrest,
although she would sometimes go downtown alone. He said he did
not notice that she conducted any recruitment.16
On May 5, 1995, the trial court rendered a decision convicting the
accused, thus:

WHEREFORE, in view of all the foregoing

On February 2, 1994, the accused went to the Philippine Airlines
consideration[s][,] this Court finds the accused Carol
office at 7:30 in the morning to confirm her 5:30 p.m. flight to
dela Piedra alias Carol Llena and Carol Figueroa guilty
Cebu City. She then proceeded to Jasmine's residence, arriving
beyond reasonable doubt of Illegal Recruitment
there at past 8 a.m.
committed in a large scale and hereby sentences her to
suffer the penalty of LIFE IMPRISONMENT and to
Inside the house, she met a woman who asked her, "Are you Carol pay a fine of P100,000.00, and also to pay the costs.
from Singapore?" The accused, in turn, asked the woman if she
could do anything for her. The woman inquired from Carol if she
Being a detention prisoner, the said accused is entitled
was recruiting. Carol replied in the negative, explaining that she
to the full time of the period of her detention during the
was there just to say goodbye to Jasmine. The woman further
pendency of this case under the condition set forth in
asked Carol what the requirements were if she (the woman) were
Article 29 of the Revised Penal Code.
to go to Singapore. Carol replied that she would need a passport.

SO ORDERED.17
Two (2) minutes later, three (3) girls entered the house looking for
Jasmine. The woman Carol was talking with then stood up and
went out. A minute after, three (3) members of the CIS and a The accused, in this appeal, ascribes to the trial court the following
POEA official arrived. A big man identified himself as a member errors:
of the CIS and informed her that they received a call that she was
recruiting. They told her she had just interviewed a woman from
I
the CIS. She denied this, and said that she came only to say
goodbye to the occupants of the house, and to get whatever
Jasmine would be sending for Laleen Malicay. She even showed WITH DUE RESPECT, THE LOWER COURT
them her ticket for Cebu City. ERRED IN NOT FINDING SEC. 13 (B) OF P.D.
442[,] AS AMENDED[,] OTHERWISE KNOWN AS
Erlie Ramos then went up to Jasmine's room and returned with [THE] ILLEGAL RECRUITMENT LAW
UNCONSTITUTIONAL.
some papers. The accused said that those were the papers that
Laleen Malicay requested Jasmine to give to her (the accused). The
accused surmised that because Laleen Malicay wanted to go home II
but could not find a replacement, one of the applicants in the forms
was to be her (Malicay's) substitute. Ramos told the accused to
explain in their office.

31
WITH DUE RESPECT, THE LOWER COURT VIII
ERRED IN NOT HOLDING THAT THE
APPREHENDING TEAM COMPOSED OF POEA
WITH DUE RESPECT, THE LOWER COURT
AND CIS REPRESENTATIVES ENTERED INTO
ERRED IN NOT FINDING THAT THE ALLEGED
[sic] THE RESIDENCE OF JASMIN[E] ALEJANDRO
CRIME OF ILLEGAL RECRUITMENT WAS
WITHOUT ANY SEARCH WARRANT IN
COMMITTED NOT ON [sic] LARGE SCALE,
VIOLATION OF ARTICLE III, SECTION 2 OF THE
HENCE, THE PENALTY SHOULD NOT BE LIFE
PHILIPPINE CONSTITUTION, AND ANY
IMPRISONMENT;
EVIDENCE OBTAINED IN VIOLATION THEREOF,
SHALL BE INADMISSIBLE FOR ANY PURPOSE
IN ANY PROCEEDING AS PROVIDED UNDER IX
ARTICLE III, SECTION 3, (2) OF THE SAME
CONSTITUTION;
WITH DUE RESPECT, THE LOWER COURT
ERRED IN NOT FINDING THAT THOSE
III EVIDENCES [sic] SEIZED AT THE HOUSE OF
JASMIN[E] ALEJANDRO AND PRESENTED TO
THE COURT WERE PLANTED BY A BOGUS
WITH DUE RESPECT, THE LOWER COURT
ATTORNEY[,] ERLIE S. RAMOS OF THE POEA;
ERRED IN IGNORING THAT WHEN SPO2 [sic]
EILE[E]N FERMINDOZA ENTERED THE
RESIDENCE OF JASMIN[E] ALEJANDRO, THERE X
WAS NO CRIME COMMITTED WHATSOEVER,
HENCE THE ARREST OF THE ACCUSED-
WITH DUE RESPECT, THE LOWER COURT
APPELLANT WAS ILLEGAL;
ERRED IN NOT DISCOVERING THAT ACCUSED-
APPELLANT DID NOT RECEIVE ANY PAYMENT
[IV] EVEN A SINGLE CENTAVO FROM THE
ALLEGED VICTIMS WHO DID NOT SUFFER
DAMAGE IN ANY MANNER, YET SHE WAS
WITH DUE RESPECT, THE LOWER COURT
CONVICTED TO SERVE HER ENTIRE LIFE
ERRED IN NOT DISCOVERING THAT SPO2 [sic]
BEHIND PRISON BARS. SUCH PUNISHMENT
EILE[E]N FERMINDOZA WAS NOT ILLEGALLY
WAS CRUEL AND UNUSUAL, HENCE, A
RECRUITED BY THE ACCUSED-APPELLANT,
WANTON VIOLATION OF THE CONSTITUTION.18
HENCE, ACCUSED-APPELLANT SHOULD BE
ACQUITTED;
In the first assigned error, appellant maintains that the law defining
"recruitment and placement" violates due process. Appellant also
V
avers, as part of her sixth assigned error, that she was denied the
equal protection of the laws.
WITH DUE RESPECT, THE LOWER COURT
ERRED IN NOT DETECTING THAT NANCY
We shall address the issues jointly.
ARANETA WAS NOT ILLEGALLY RECRUITED
BY THE ACCUSED-APPELLANT, HENCE,
ACCUSED SHOULD BE EXONERATED; Appellant submits that Article 13 (b) of the Labor Code defining
"recruitment and placement" is void for vagueness and, thus,
violates the due process clause.19
VI

Due process requires that the terms of a penal statute must be

WITH DUE RESPECT, THE LOWER COURT
sufficiently explicit to inform those who are subject to it what
ERRED IN NOT REALIZING THAT MARIA
conduct on their part will render them liable to its penalties.20 A
LOURDES MODESTO WAS NOT ILLEGALLY
criminal statute that "fails to give a person of ordinary intelligence
RECRUITED BY THE ACCUSED-APPELLANT,
fair notice that his contemplated conduct is forbidden by the
HENCE, ACCUSED-APPELLANT SHOULD BE
statute," or is so indefinite that "it encourages arbitrary and erratic
EXCULPATED;
arrests and convictions," is void for vagueness.21 The constitutional
vice in a vague or indefinite statute is the injustice to the accused in
VII placing him on trial for an offense, the nature of which he is given
no fair warning.22
WITH DUE RESPECT, THE LOWER COURT
ERRED IN FINDING THAT THE ACCUSED- We reiterated these principles in People vs. Nazario:23
APPELLANT WAS CHARGED WITH LARGE
SCALE ILLEGAL RECRUITMENT ON JANUARY
As a rule, a statute or act may be said to be vague when it lacks
30, 1994, THE DATE STATED IN THE
comprehensible standards that men "of common intelligence must
INFORMATION AS THE DATE OF THE CRIME,
necessarily guess at its meaning and differ as to its application." It
BUT ACCUSED WAS ARRESTED ON FEB. 2, 1994
is repugnant to the Constitution in two respects: (1) it violates due
AND ALL THE EVIDENCES [sic] INDICATED [sic]
process for failure to accord persons, especially the parties targeted
THAT THE ALLEGED CRIME WERE [sic]
by it, fair notice of the conduct to avoid; and (2) it leaves law
COMMITTED ON FEB. 2, 1994, HENCE, THE
enforcers unbridled discretion in carrying out its provisions and
INFORMATION IS FATALLY DEFECTIVE;
become an arbitrary flexing of the Government muscle.

32
We added, however, that:
x x x the act must be utterly vague on its face, that is to
say, it cannot be clarified by either a saving clause or by
construction. Thus, in Coates v. City of Cincinnati, the
U.S. Supreme Court struck down an ordinance that had
made it illegal for "three or more persons to assemble
on any sidewalk and there conduct themselves in a
manner annoying to persons passing by." Clearly, the
ordinance imposed no standard at all "because one may
never know in advance what 'annoys some people but
does not annoy others.'"
Coates highlights what has been referred to as a
"perfectly vague" act whose obscurity is evident on its
face. It is to be distinguished, however, from legislation
couched in imprecise language—but which nonetheless
specifies a standard though defectively phrased—in
which case, it may be "saved" by proper construction.
Here, the provision in question reads:
ART. 13. Definitions.—(a) x x x.
(b) "Recruitment and placement" refers to any act of
canvassing, enlisting, contracting, transporting,
utilizing, hiring or procuring workers, and includes
referrals, contract services, promising or advertising for
employment, locally or abroad, whether for profit or
not: Provided, That any person or entity which, in any
manner, offers or promises for a fee employment to two
or more persons shall be deemed engaged in
recruitment and placement.
x x x.
When undertaken by non-licensees or non-holders of authority,
recruitment activities are punishable as follows:
ART. 38. Illegal Recruitment. — (a) Any recruitment
activities, including the prohibited practices enumerated
under Article 34 of this Code, to be undertaken by non-
licensees or non-holders of authority shall be deemed
illegal and punishable under Article 39 of this Code.
The Ministry of Labor and Employment or any law
enforcement officer may initiate complaints under this
Article.
(b) Illegal recruitment when committed by a syndicate
or in large scale shall be considered an offense
involving economic sabotage and shall be penalized in
accordance with Article 39 hereof.
Illegal recruitment is deemed committed by a syndicate
if carried out by a group of three (3) or more persons
conspiring and/or confederating with one another in
carrying out any unlawful or illegal transaction,
enterprise or scheme defined under the first paragraph
hereof. Illegal recruitment is deemed committed in
large scale if committed against three (3) or more
persons individually or as a group.
x x x.
Art. 39. Penalties. – (a) The penalty of life
imprisonment and a fine of One Hundred Thousand
Pesos (P100,000) shall be imposed if illegal recruitment
constitutes economic sabotage as defined herein:
(b) Any licensee or holder of authority found violating
or causing another to violate any provision of this Title
or its implementing rules and regulations, shall upon
conviction thereof, suffer the penalty of imprisonment
of not less than five years or a fine of not less than
P10,000 nor more than P50,000 or both such
imprisonment and fine, at the discretion of the court;
(c) Any person who is neither a licensee nor a holder of
authority under this Title found violating any provision
thereof or its implementing rules and regulations shall,
upon conviction thereof, suffer the penalty of
imprisonment of not less than four years nor more than
eight years or a fine of not less than P20,000 nor more
than P100,000 or both such imprisonment and fine, at
the discretion of the court;
x x x.
In support of her submission that Article 13 (b) is void for
vagueness, appellant invokes People vs. Panis,24 where this Court,
to use appellant's term, "criticized" the definition of "recruitment
and placement" as follows:
It is unfortunate that we can only speculate on the meaning of the
questioned provision for lack of records of debates and
deliberations that would otherwise have been available if the Labor
Code had been enacted as a statute rather than a presidential decree
is that they could be, and sometimes were, issued without previous
public discussion or consultation, the promulgator heeding only his
own counsel or those of his close advisers in their lofty pinnacle of
power. The not infrequent results are rejection, intentional or not,
of the interest of the greater number and, as in the instant case,
certain esoteric provisions that one cannot read against the
background facts usually reported in the legislative journals.
If the Court in Panis "had to speculate on the meaning of the
questioned provision," appellant asks, what more "the ordinary
citizen" who does not possess the "necessary [legal] knowledge?"
Appellant further argues that the acts that constitute "recruitment
and placement" suffer from overbreadth since by merely
"referring" a person for employment, a person may be convicted of
illegal recruitment.
These contentions cannot be sustained.
Appellant's reliance on People vs. Panis is misplaced. The issue
in Panis was whether, under the proviso of Article 13 (b), the
crime of illegal recruitment could be committed only "whenever
two or more persons are in any manner promised or offered any
employment for a fee." The Court held in the negative, explaining:
As we see it, the proviso was intended neither to impose a
condition on the basic rule nor to provide an exception thereto but
merely to create a presumption. The presumption is that the
individual or entity is engaged in recruitment and placement
whenever he or it is dealing with two or more persons to whom, in
consideration of a fee, an offer or promise of employment is made
33
in the course of the "canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring (of) workers."
The number of persons dealt with is not an essential ingredient of
the act of recruitment and placement of workers. Any of the acts
mentioned in the basic rule in Article 13(b) will constitute
recruitment and placement even if only one prospective worker is
involved. The proviso merely lays down a rule of evidence that
where a fee is collected in consideration of a promise or offer of
employment to two or more prospective workers, the individual or
entity dealing with them shall be deemed to be engaged in the act
of recruitment and placement. The words "shall be deemed" create
that presumption.
This is not unlike the presumption in article 217 of the Revised
Penal Code, for example, regarding the failure of a public officer to
produce upon lawful demand funds or property entrusted to his
custody. Such failure shall be prima facie evidence that he has put
them to personal use; in other words, he shall be deemed to have
malversed such funds or property. In the instant case, the word
"shall be deemed" should by the same token be given the force of a
disputable presumption or of prima facie evidence of engaging in
recruitment and placement.
It is unfortunate that we can only speculate on the meaning of the
questioned provision for lack of records of debates and
deliberations that would otherwise have been available if the Labor
Code had been enacted as a statute rather than a presidential decree
is that they could be, and sometimes were, issued without previous
public discussion or consultation, the promulgator heeding only his
own counsel or those of his close advisers in their lofty pinnacle of
power. The not infrequent results are rejection, intentional or not,
of the interest of the greater number and, as in the instant case,
certain esoteric provisions that one cannot read against the
background facts usually reported in the legislative journals.
At any rate, the interpretation here adopted should give more force
to the campaign against illegal recruitment and placement, which
has victimized many Filipino workers seeking a better life in a
foreign land, and investing hard-earned savings or even borrowed
funds in pursuit of their dream, only to be awakened to the reality
of a cynical deception at the hands of their own countrymen.
Evidently, therefore, appellant has taken the penultimate paragraph
in the excerpt quoted above out of context. The Court, in Panis,
merely bemoaned the lack of records that would help shed light on
the meaning of the proviso. The absence of such records
notwithstanding, the Court was able to arrive at a reasonable
interpretation of the proviso by applying principles in criminal law
and drawing from the language and intent of the law itself. Section
13 (b), therefore, is not a "perfectly vague act" whose obscurity is
evident on its face. If at all, the proviso therein is merely couched
in imprecise language that was salvaged by proper construction. It
is not void for vagueness.
An act will be declared void and inoperative on the ground of
vagueness and uncertainty, only upon a showing that the defect is
such that the courts are unable to determine, with any reasonable
degree of certainty, what the legislature intended. x x x. In this
connection we cannot pretermit reference to the rule that
"legislation should not be held invalid on the ground of uncertainty
if susceptible of any reasonable construction that will support and
give it effect. An Act will not be declared inoperative and
ineffectual on the ground that it furnishes no adequate means to
secure the purpose for which it is passed, if men of common sense
and reason can devise and provide the means, and all the
instrumentalities necessary for its execution are within the reach of
those intrusted therewith."25
That Section 13 (b) encompasses what appellant apparently
considers as customary and harmless acts such as " labor or
employment referral" ("referring" an applicant, according to
appellant, for employment to a prospective employer) does not
render the law overbroad. Evidently, appellant misapprehends
concept of overbreadth.
A statute may be said to be overbroad where it operates to inhibit
the exercise of individual freedoms affirmatively guaranteed by the
Constitution, such as the freedom of speech or religion. A
generally worded statute, when construed to punish conduct which
cannot be constitutionally punished is unconstitutionally vague to
the extent that it fails to give adequate warning of the boundary
between the constitutionally permissible and the constitutionally
impermissible applications of the statute.26
In Blo Umpar Adiong vs. Commission on Elections,27 for instance,
we struck down as void for overbreadth provisions prohibiting the
posting of election propaganda in any place – including private
vehicles – other than in the common poster areas sanctioned by the
COMELEC. We held that the challenged provisions not only
deprived the owner of the vehicle the use of his property but also
deprived the citizen of his right to free speech and information.
The prohibition in Adiong, therefore, was so broad that it covered
even constitutionally guaranteed rights and, hence, void for
overbreadth. In the present case, however, appellant did not even
specify what constitutionally protected freedoms are embraced by
the definition of "recruitment and placement" that would render the
same constitutionally overbroad.
Appellant also invokes the equal protection clause28 in her defense.
She points out that although the evidence purportedly shows that
Jasmine Alejandro handed out application forms and even received
Lourdes Modesto's payment, appellant was the only one criminally
charged. Alejandro, on the other hand, remained scot-free. From
this, appellant concludes that the prosecution discriminated against
her on grounds of regional origins. Appellant is a Cebuana while
Alejandro is a Zamboangueña, and the alleged crime took place in
Zamboanga City.
The argument has no merit.
At the outset, it may be stressed that courts are not confined to the
language of the statute under challenge in determining whether that
statute has any discriminatory effect. A statute nondiscriminatory
on its face may be grossly discriminatory in its operation.29 Though
the law itself be fair on its face and impartial in appearance, yet, if
it is applied and administered by public authority with an evil eye
and unequal hand, so as practically to make unjust and illegal
discriminations between persons in similar circumstances, material
to their rights, the denial of equal justice is still within the
prohibition of the Constitution.30
The prosecution of one guilty person while others equally guilty
are not prosecuted, however, is not, by itself, a denial of the equal
protection of the laws.31 Where the official action purports to be in
conformity to the statutory classification, an erroneous or mistaken
performance of the statutory duty, although a violation of the
statute, is not without more a denial of the equal protection of the
laws.32 The unlawful administration by officers of a statute fair on
its face, resulting in its unequal application to those who are
entitled to be treated alike, is not a denial of equal protection unless
there is shown to be present in it an element
34
of intentional or purposeful discrimination. This may appear on the
face of the action taken with respect to a particular class or person,
or it may only be shown by extrinsic evidence showing a
discriminatory design over another not to be inferred from the
action itself. But a discriminatory purpose is not presumed,
there must be a showing of "clear and intentional
discrimination."33 Appellant has failed to show that, in charging
appellant in court, that there was a "clear and intentional
discrimination" on the part of the prosecuting officials.
The discretion of who to prosecute depends on the prosecution's
sound assessment whether the evidence before it can justify a
reasonable belief that a person has committed an offense.34 The
presumption is that the prosecuting officers regularly performed
their duties,35 and this presumption can be overcome only by proof
to the contrary, not by mere speculation. Indeed, appellant has not
presented any evidence to overcome this presumption. The mere
allegation that appellant, a Cebuana, was charged with the
commission of a crime, while a Zamboangueña, the guilty party in
appellant's eyes, was not, is insufficient to support a conclusion
that the prosecution officers denied appellant equal protection of
the laws.
There is also common sense practicality in sustaining appellant's
prosecution.
While all persons accused of crime are to be treated on a basis of
equality before the law, it does not follow that they are to be
protected in the commission of crime. It would be unconscionable,
for instance, to excuse a defendant guilty of murder because others
have murdered with impunity. The remedy for unequal
enforcement of the law in such instances does not lie in the
exoneration of the guilty at the expense of society x x x. Protection
of the law will be extended to all persons equally in the pursuit of
their lawful occupations, but no person has the right to demand
protection of the law in the commission of a crime.36
Likewise,
[i]f the failure of prosecutors to enforce the criminal laws as to
some persons should be converted into a defense for others
charged with crime, the result would be that the trial of the district
attorney for nonfeasance would become an issue in the trial of
many persons charged with heinous crimes and the enforcement of
law would suffer a complete breakdown.37
We now come to the third, fourth and fifth assigned errors, all of
which involve the finding of guilt by the trial court.
Illegal recruitment is committed when two elements concur. First,
the offender has no valid license or authority required by law to
enable one to lawfully engage in recruitment and placement of
workers. Second, he or she undertakes either any activity within
the meaning of "recruitment and placement" defined under Article
13 (b), or any prohibited practices enumerated under Article 34 of
the Labor Code.38 In case of illegal recruitment in large scale, a
third element is added: that the accused commits said acts against
three or more persons, individually or as a group.39
In this case, the first element is present. The certification of POEA
Officer-in-Charge Macarulay states that appellant is not licensed or
authorized to engage in recruitment and placement.
The second element is also present. Appellant is presumed engaged
in recruitment and placement under Article 13 (b) of the Labor
Code. Both Nancy Araneta and Lourdes Modesto testified that
appellant promised them employment for a fee. Their testimonies
corroborate each other on material points: the briefing conducted
by appellant, the time and place thereof, the fees involved.
Appellant has not shown that these witnesses were incited by any
motive to testify falsely against her. The absence of evidence as to
an improper motive actuating the principal witnesses of the
prosecution strongly tends to sustain that no improper motive
existed and that their testimony is worthy of full faith and
credence.40
Appellant's denials cannot prevail over the positive declaration of
the prosecution witnesses. Affirmative testimony of persons who
are eyewitnesses of the fact asserted easily overrides negative
testimony.41
That appellant did not receive any payment for the promised or
offered employment is of no moment. From the language of the
statute, the act of recruitment may be "for profit or not;" it suffices
that the accused "promises or offers for a fee employment" to
warrant conviction for illegal recruitment.
The testimonies of Araneta and Modesto, coming as they do from
credible witnesses, meet the standard of proof beyond reasonable
doubt that appellant committed recruitment and placement. We
therefore do not deem it necessary to delve into the second and
third assigned errors assailing the legality of appellant's arrest and
the seizure of the application forms. A warrantless arrest, when
unlawful, has the effect of invalidating the search incidental thereto
and the articles so seized are rendered inadmissible in
evidence.42 Here, even if the documents seized were deemed
inadmissible, her conviction would stand in view of Araneta and
Modesto's testimonies.
Appellant attempts to cast doubt on the prosecution's case by
claiming in her ninth assigned error that Erlie Ramos of the POEA
supposedly "planted" the application forms. She also assails his
character, alleging that he passed himself off as a lawyer, although
this was denied by Ramos.
The claim of "frame-up," like alibi, is a defense that has been
invariably viewed by the Court with disfavor for it can easily be
concocted but difficult to prove.43 Apart from her self-serving
testimony, appellant has not offered any evidence that she was
indeed framed by Ramos. She has not even hinted at any motive
for Ramos to frame her. Law enforcers are presumed to have
performed their duties regularly in the absence of evidence to the
contrary.44
Considering that the two elements of lack of license or authority
and the undertaking of an activity constituting recruitment and
placement are present, appellant, at the very least, is liable for
"simple" illegal recruitment. But is she guilty of illegal
recruitment in large scale? We find that she is not.
A conviction for large scale illegal recruitment must be based on a
finding in each case of illegal recruitment of three or more persons
whether individually or as a group.45 In this case, only two persons,
Araneta and Modesto, were proven to have been recruited by
appellant. The third person named in the complaint as having been
promised employment for a fee, Jennelyn Baez, was not presented
in court to testify.
It is true that law does not require that at least three victims testify
at the trial; nevertheless, it is necessary that there is sufficient
evidence proving that the offense was committed against three or
35
more persons.46 In this case, evidence that appellant likewise
promised her employment for a fee is sketchy. The only evidence
that tends to prove this fact is the testimony of Nancy Araneta, who
said that she and her friends, Baez and Sandra Aquino, came to the
briefing and that they (she and her "friends") filled up application
forms.
The affidavit47 Baez executed jointly with Araneta cannot support
Araneta's testimony. The affidavit was neither identified, nor its
contents affirmed, by Baez. Insofar as it purports to prove that
appellant recruited Baez, therefore, the affidavit is hearsay and
inadmissible.48 In any case, hearsay evidence, such as the said
affidavit, has little probative value.49
Neither can appellant be convicted for recruiting CIS agent Eileen
Fermindoza or even the other persons present in the briefing of
January 30, 1994. Appellant is accused of recruiting only the three
persons named in the information — Araneta, Modesto and Baez.
The information does not include Fermindoza or the other persons
present in the briefing as among those promised or offered
employment for a fee. To convict appellant for the recruitment and
placement of persons other than those alleged to have been offered
or promised employment for a fee would violate her right to be
informed of the nature and cause of the accusation against her.50
In any event, the purpose of the offer of the testimonies of Araneta,
Morales and Fermindoza, respectively, was limited as follows:
FISCAL BELDUA:
Your Honor please, we are offering the oral
testimony of the witness, as one of those
recruited by the accused, and also to identify
some exhibits for the prosecution and as
well as to identify the accused.51
xxx
FISCAL BELDUA:
We are offering the oral testimony of the
witness, Your Honor, to testify on the fact
about her recruitment by the accused and
immediately before the recruitment, as well
as to identify some exhibits for the
prosecution, and also the accused in this
case, Your Honor.52
xxx
FISCAL BELDUA:
This witness is going to testify that at around
that date Your Honor, she was connected
with the CIS, that she was instructed
together with a companion to conduct a
surveillance on the place where the illegal
recruitment was supposed to be going on,
that she acted as an applicant, Your Honor,
to ascertain the truthfulness of the illegal
recruitment going on, to identify the
accused, as well as to identify some exhibits
for the prosecution.53
xxx
Courts may consider a piece of evidence only for the purpose for
which it was offered,54 and the purpose of the offer of their
testimonies did not include the proving of the purported
recruitment of other supposed applicants by appellant.
Appellant claims in her seventh assigned error that the information
is fatally defective since it charges her with committing illegal
recruitment in large scale on January 30, 1994 while the
prosecution evidence supposedly indicates that she committed the
crime on February 2, 1994.
We find that the evidence for the prosecution regarding the date of
the commission of the crime does not vary from that charged in the
information. Both Nancy Araneta and Lourdes Modesto testified
that on January 30, 1994, while in the Alejandro residence,
appellant offered them employment for a fee. Thus, while the
arrest was effected only on February 2, 1994, the crime had already
been committed three (3) days earlier on January 30, 1994.
The eighth and tenth assigned errors, respectively, pertain to the
penalty of life imprisonment imposed by the trial court as well as
the constitutionality of the law prescribing the same, appellant
arguing that it is unconstitutional for being unduly harsh. 55 Section
19 (1), Article III of the Constitution states: "Excessive fines shall
not be imposed, nor cruel, degrading or inhuman punishment
inflicted."
The penalty of life imprisonment imposed upon appellant must be
reduced. Because the prosecution was able to prove that appellant
committed recruitment and placement against two persons only,
she cannot be convicted of illegal recruitment in large scale, which
requires that recruitment be committed against three or more
persons. Appellant can only be convicted of two counts of "simple"
illegal recruitment, one for that committed against Nancy Araneta,
and another count for that committed against Lourdes Modesto.
Appellant is sentenced, for each count, to suffer the penalty of four
(4) to six (6) years of imprisonment and to pay a fine of
P30,000.00. This renders immaterial the tenth assigned error,
which assumes that the proper imposable penalty upon appellant is
life imprisonment.
WHEREFORE, the decision of the regional trial court
is MODIFIED. Appellant is hereby declared guilty of illegal
recruitment on two (2) counts and is sentenced, for each count, to
suffer the penalty of four (4) to six (6) years of imprisonment and
to pay a fine of P30,000.00.1âwphi1.nêt
SO ORDERED.
Davide, Jr., C.J., (Chairman), Puno, Pardo, and Ynares-Santiago,
JJ., concur
Footnotes
The documents seized include: Exhibit "C," the application form of
one Josilyn Villa, consisting of four (4) pages; Exhibit "D," the
application form of one Shirley Estrada, consisting of nine (9)
pages; Exhibit "E," the application form of one Cora Iglesia, with
an annex of nine (9) pages; Exhibit "F," the application form of
Jocelyn Santos. Exhibit "G," the application form of Jennifer
Alejandro; Exhibit "H," the application form of one Geraldine
Reyes; Exhibit "I," the application form of Lilibeth Estrada,
36
consisting of six (6) pages; Exhibit "J," is the application form of
Geraldine Sunga; Exhibit "K," is the diploma of Shirley Estrada,
together with a photocopy of her passport; Exhibit "L," a
certification that Jasmine Alejandro rendered services as Staff
Nurse with the Camp Navarro General Hospital.
G.R. No. 155903 September 14, 2007
C.F. SHARP CREW MANAGEMENT, INC., petitioner,
vs.
HON. UNDERSECRETARY JOSE M. ESPANOL, JR., HON.
SECRETARY LEONARDO A. QUISUMBING and RIZAL
INTERNATIONAL SHIPPING SERVICES, respondents.
DECISION
NACHURA, J.:
The petitioner C.F. Sharp Crew Management, Inc. (C.F. Sharp)
appeals by certiorari the April 30, 2002 Decision 1 of the Court of
Appeals (CA) in CA-G.R. SP No. 53747 and the November 5,
2002 Resolution2 denying its reconsideration.
In 1991, Louis Cruise Lines (LCL), a foreign corporation duly
organized and existing under the laws of Cyprus, entered into a
Crewing Agreement3 with Papadopolous Shipping, Ltd.
(PAPASHIP). PAPASHIP in turn appointed private respondent
Rizal International Shipping Services (Rizal) as manning agency in
the Philippines, recruiting Filipino seamen for LCL’s vessel.
On October 3, 1996, LCL terminated the Crewing Agreement with
PAPASHIP to take effect on December 31, 1996. It then appointed
C.F. Sharp as crewing agent in the Philippines. C.F. Sharp
requested for accreditation as the new manning agency of LCL
with the Philippine Overseas Employment Administration (POEA),
but Rizal objected on the ground that its accreditation still existed
and would only expire on December 31, 1996.
Pending approval of the accreditation, Theodoros Savva and
Adrias Tjiakouris of LCL arrived in the Philippines and conducted
a series of interviews for seafarers at C.F. Sharp’s office. Rizal
reported LCL’s recruitment activities to the POEA on December 9,
1996, and requested an ocular inspection of C.F. Sharp’s premises.
On December 17, 1996, POEA representatives conducted an
inspection and found Savva and Tjiakouris at C.F. Sharp
interviewing and recruiting hotel staffs, cooks, and chefs for M/V
Cyprus, with scheduled deployment in January 1997.4 The
Inspection Report5 signed by Corazon Aquino of the POEA and
countersigned by Mr. Reynaldo Banawis of C.F. Sharp was
thereafter submitted to the POEA.
On January 2, 1997, Rizal filed a complaint6 for illegal
recruitment, cancellation or revocation of license, and blacklisting
against LCL and C.F. Sharp with the POEA, docketed as POEA
Case No. RV-97-01-004. Then, on January 31, 1997, Rizal filed a
Supplemental Complaint7 adding violation of Section 29 of the
Labor Code of the Philippines, for designating and/or appointing
agents, representatives and employees, without prior approval from
the POEA.
For its part, C.F. Sharp admitted that Savva and Tjiakouris
conducted interviews at C.F. Sharp’s office, but denied that they
were for recruitment and selection purposes. According to C.F.
Sharp, the interviews were held for LCL’s ex-crew members who
had various complaints against Rizal. It belittled the inspection
report of the POEA inspection team claiming that it simply stated
that interviews and recruitment were undertaken, without reference
to who were conducting the interview and for what vessels. 8 C.F.
Sharp also averred that Rizal was guilty of forum shopping, and
prayed for the dismissal of the complaint on this ground and for its
lack of merit. 9
The POEA Administrator was not persuaded and found C.F. Sharp
liable for illegal recruitment. According to the Administrator, the
inspection report of Ms. Aquino established that Savva and
Tjiakouris had conducted, and, at the time of the inspection, had
been conducting interviews, selection and hiring for LCL, without
any authority from the POEA. The Administrator also held that
C.F. Sharp violated Section 29 of the Labor Code when it
designated officers and agents without prior approval of the
POEA. 10
Thus, the Administrator disposed:
WHEREFORE, premises considered, the respondent
CF Sharp Agency is as it is hereby ordered suspended
for a period of six (6) months or in lieu thereof, it is
ordered to pay a fine of P50,000.00 for violation of Art.
29 of the Labor Code, as amended in relation to Sec.
6(b), Rule II, Book II of the Rules and Regulations
Governing Overseas Employment in accordance with
the schedule of penalties.
Further, the respondent CF Sharp is as it is hereby
ordered suspended for another period of [eighteen] (18)
months or to pay the fine of P180,000.00 for
committing 9 counts of violation of Article 29 of the
Labor Code as amended in relation to Sec. 2(k), Rule I,
Book VI of the Rules and Regulations governing
Overseas Employment.
The period of suspension shall be served cummulatively
(sic).
The charges of violation of Sec. 6(b) of RA 8042 are
hereby referred to the Anti-Illegal Recruitment Branch
for appropriate action.
SO ORDERED.11
C.F. Sharp elevated the Administrator’s ruling to the Department
of Labor and Employment (DOLE). On December 19, 1997, the
then Secretary of Labor, Leonardo A. Quisumbing,12 issued an
Order,13 ruling that:
WHEREFORE, except as above MODIFIED, the Order
dated March 13, 1997 of the POEA Administrator is
AFFIRMED.
Accordingly, the C.F. Sharp Crew Management, Inc. is
hereby found guilty of having violated Sec. 6, R.A.
8042 in relation to Article 13 (b) and (f), and Article 16
of the Labor Code as amended; Rule II (jj), Book I and
Sec 1 and 6, Rule I, Book II, POEA Rules and
Regulations Governing Overseas Employment, for
37
 having conspired and confederated with the [Louis]
Cruise Lines, Theodorus Savva and Andrias (sic)
Tjiakouris in the recruitment of seafarers for LCL’s
ships, before it was duly accredited by POEA as the
manning agency of LCL, thus a non-holder of authority
at the time. The penalty imposed against it of
suspension of its license for six (6) months or in lieu
thereof, to pay a fine of Fifty Thousand Pesos
(P50,000.00), is AFFIRMED.
Further, C.F. Sharp Crew Management, Inc. is hereby
found guilty of one (1) count of violation of Art. 29 of
the Labor Code in relation to Sec. 2 (k), Rule I, Book
VI of the Rules and Regulations Governing Overseas
Employment, and is imposed the penalty of two (2)
months suspension of its license or in lieu thereof, to
pay a fine of P20,000.00.
The penalties of suspension for both violations shall be
served cumulatively.
Out of the P230,000.00 cash supersedeas bond posted
by the petitioner-appellant, let the amount
of P160,000.00 be released and refunded to it,
retaining P70,000.00 to be applied to the payment of the
fines as imposed above, should the petitioner opt to pay
the fine instead of undergoing suspension of its license.
However, the suspension shall remain in force until
such fine is paid, or in the event that the petitioner-
appellant further appeals this Order.
The charge and finding of violation of Sec. 6 (b) of
R.A. 8042 are hereby referred to the Anti-Illegal
Recruitment Branch for appropriate action.
SO ORDERED.14
C.F. Sharp’s motion for reconsideration having been denied on
February 5, 1999 by the then Undersecretary, Jose M. Espanol,
Jr.,15 it elevated the case to this Court on petition for certiorari,
with the case docketed as G.R. No. 137573. But, in the June 16,
1999 Resolution, this Court referred the petition to the CA.
In the meantime, on April 15, 1999, C.F. Sharp requested the
lifting of the suspension decreed by the Secretary of Labor in his
December 19, 1997 Order,16 which was granted by Deputy
Administrator for Licensing and Adjudication Valentin C. Guanio.
C.F. Sharp was allowed to deploy seafarers for its principals.
Consequently, on April 30, 2002, the CA denied C.F. Sharp’s
petition for certiorari,17 holding that C.F. Sharp was already
estopped from assailing the Secretary of Labor’s ruling because it
had manifested its option to have the cash bond posted answer for
the alternative fines imposed upon it. By paying the adjudged
fines, C.F. Sharp effectively executed the judgment, having
acquiesced to, and ratified the execution of the assailed Orders of
the Secretary of Labor. The CA also agreed with the POEA
Administrator and the Secretary of Labor that Savva and Tjiakouris
of LCL, along with C.F. Sharp, undertook recruitment activities on
December 7, 9 to 12, 1996, sans any authority. Finally, it affirmed
both labor officials’ finding that C.F. Sharp violated Article 29 of
the Labor Code and Section 2(k), Rule I, Book VI of the POEA
Rules when it appointed Henry Desiderio as agent, without prior
approval from the POEA. Thus, the appellate court declared that
the Secretary of Labor acted well within his discretion in holding
C.F. Sharp liable for illegal recruitment.
C.F. Sharp filed a motion for reconsideration,18 but the CA denied
it on November 25, 2002.19
Hence, this appeal, positing these issues:
A. WHETHER OR NOT THE COURT OF APPEALS
PATENTLY ERRED IN RULING THAT
PETITIONER IS IN ESTOPPEL IN QUESTIONING
THE ORDER DATED DECEMBER 19, 1997 AND
THE RESOLUTION DATED FEBRUARY 5, 1999.
B. WHETHER OR NOT THE COURT OF APPEALS
PATENTLY ERRED WHEN IT RULED THAT
PETITIONER IS LIABLE FOR VIOLATION OF
SECTION 6[,] R.A. NO. 8042 IN RELATION TO
ARTICLE 13 (b) and (f) AND ARTICLE 66 (sic) OF
THE LABOR CODE AS AMENDED; RULE II (jj)
BOOK I; AND SECTIONS 1 AND 6, RULE I, BOOK
III POEA RULES AND REGULATIONS
GOVERNING OVERSEAS EMPLOYMENT.
WHETHER OR NOT THE COURT OF APPEALS
GRAVELY ERRED WHEN IT RULED THAT
PETITIONER IS LIABLE FOR VIOLATION OF
ARTICLE 29 OF THE LABOR CODE, AS
AMENDED, IN RELATION TO SECTION II (k)[,]
RULE I, BOOK VI OF THE RULES AND
REGULATIONS GOVERNING OVERSEAS
EMPLOYMENT.20
C.F. Sharp faults the CA for ruling that petitioner is estopped from
questioning the resolutions of the Secretary of Labor. It denied that
it voluntarily executed, or acquiesced to, the assailed resolutions of
the Secretary.
The general rule is that when a judgment has been satisfied, it
passes beyond review, satisfaction being the last act and the end of
the proceedings, and payment or satisfaction of the obligation
thereby established produces permanent and irrevocable discharge;
hence, a judgment debtor who acquiesces to and voluntarily
complies with the judgment is estopped from taking an appeal
therefrom.21
In holding C.F. Sharp in estoppel, the CA apparently relied on the
April 15, 1999 Order of the POEA, and, thus, declared:
[P]etitioner C.F. Sharp had already manifested its
option to have the cash bond posted as an answer for
the alternative fines imposed in the Orders dated
December 19, 1997 as stated in the Order dated April
15, 1999 of the POEA, Adjudication Office x x x. Thus,
for voluntary execution of the Order of the Secretary of
DOLE dated December 19, 1997 by paying the
adjudged fines, the petitioner was then estopped from
assailing such Order before Us by way of petition for
certiorari. Where a party voluntarily executes, partially
or totally a judgment or acquiesces or ratifies the
execution of the same, he is estopped from appealing
therefrom. x x x.22
The April 15, 1999 Order of Deputy Commissioner Valentin C.
Guanio reads:
Respondent C.F. Sharp Crew Management, Inc., thru
counsel having manifested its option to have the cash
38
 bond posted answer for the alternative fines imposed in
the above-entitled case; the alternative suspension
imposed in the Order of the Secretary dated December
19, 1997 is hereby Lifted.
SO ORDERED.23
This Order was issued in response to C.F. Sharp’s request to lift
the suspension decree of the Secretary of Labor. The request
stated, viz.:
[W]e write in behalf of our client, C.F. Sharp Crew
Management Inc., regarding the Advice To Operating
Units dated April 15, 1999, which arose from the
Decision of the Office of the Secretary of Labor in the
case entitled C.F. Sharp Crew Management, Inc. versus
Rizal Shipping and docketed as RV 97-01-004.
In this connection, we would like to express our option
to have the cash bond posted by us in the case entitled
C.F. Sharp Crew Management, Inc. versus Rizal
Shipping and docketed as RV 97-01-044 to answer for
any fine that the Supreme Court may finally decide that
our client should pay in the Case entitled, C.F. Sharp
Crew Management, Inc. vs. Secretary Leonardo
Quisumbing and Rizal International Shipping Services
and docketed as G.R. No. 137573.
Under the circumstances, it is most respectfully
requested that the aforesaid advice be RECALLED and
that a clearance be issued in favor of our client, C.F.
Sharp Crew Management, Inc.
Hoping for your immediate and favorable action on the
matter.24 (Emphasis supplied)
C.F. Sharp’s letter was explicit that the cash bond posted would be
answerable for any fine that it may ultimately be held liable to pay
by virtue of a final decision. In fact, on March 25, 1999, prior to
the filing of the above-quoted letter-request, C.F. Sharp had
already filed a petition for certiorari assailing the Orders of the
Secretary of Labor. Furthermore, there is no showing that the
assailed Order of then Secretary Quisumbing was indeed executed
to warrant the appellate court’s conclusion that C.F. Sharp was
estopped from assailing the said Order. Clearly, there is no basis
for the CA to rule that C.F. Sharp voluntarily executed, or
acquiesced to, the execution of the unfavorable ruling of the
Secretary of Labor.
The first issue having been settled, we now resolve whether C.F.
Sharp is liable for illegal recruitment.
C.F. Sharp denies committing illegal recruitment activities in
December 1996. It posits that the interviews undertaken by Savva
and Tjiakouris do not amount to illegal recruitment under Section 6
of Republic Act No. 8042 or the Migrants Workers Act. Further, it
contends that the interviews conducted were not for selection and
recruitment purposes, but were in connection with the seamen’s
past employment with Rizal, specifically, their complaints for non-
remittance of SSS premiums, withholding of wages, illegal
exactions from medical examinations and delayed allotments. It
claims that it was only upon approval of its application for
accreditation that the employment contracts were entered into and
actual deployment of the seamen was made. C.F. Sharp, thus,
concludes that it cannot be held liable for illegal recruitment.
The reasoning is specious.
Undoubtedly, in December 1996, LCL had no approved POEA
license to recruit. C.F. Sharp’s accreditation as LCL’s new
manning agency was still pending approval at that time. Yet Savva
and Tjiakouris, along with C.F. Sharp, entertained applicants for
LCL’s vessels, and conducted preparatory interviews.
Article 13(b) of the Labor Code defines recruitment and placement
as:
any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring workers, and
includes referrals, contract services, promising or
advertising for employment, locally or abroad whether
for profit or not: Provided, That any person or entity
which in any manner, offers or promises for a fee
employment to two or more persons shall be deemed
engaged in recruitment and placement.
On the basis of this definition – and contrary to what C.F. Sharp
wants to portray - the conduct of preparatory interviews is a
recruitment activity.
The fact that C.F. Sharp did not receive any payment during the
interviews is of no moment. From the language of Article 13(b),
the act of recruitment may be "for profit or not." Notably, it is the
lack of the necessary license or authority, not the fact of payment,
that renders the recruitment activity of LCL unlawful.
C.F. Sharp’s claim that the interviews were not for selection and
recruitment purposes does not impress. As the Secretary of Labor
aptly said:
This Office cannot conceive of a good reason why
LCL/Savva/Tjiakouris should be interested at the time
in unearthing alleged violations committed by Rizal
Shipping whose representative status as manning
agency was to be terminated in just a few weeks
thereafter, spending valuable time and money in the
process. They stood to gain nothing from such taxing
exercise involving several hundreds of ex-crew
members, which could be handled by government
agencies like the POEA, NLRC, SSS. The observation
of the POEA Administrator that the complaints of the
crewmen were filed only after Rizal Shipping filed its
complaints with the POEA merely to bolster the
defense of CF Sharp/LCL/Savva and Tjiakouris, is
telling.
Upon the other hand, it was more to LCL’S gain to
interview, select and recruit the disembarking crewmen
previously recruited by Rizal Shipping, using CF
Sharp’s facilities, as this would result in less
recruitment time and cost.
Finally, the claim of Savva and Tjiakouris that Savva
"talked to the POEA representative during their visit"
about these interviews and the violations which were
confirmed, is just an afterthought to support their
defense; there is no entry in the Inspection Report
confirming such claim. If such claim were true, then the
"able officer" of CF Sharp (LCL’s Attorney-in fact)
who signed his conformity on the 4th page of the report,
and put his initial on the last page of the report
39
 containing the handwritten findings of the inspectors on
the selection and recruitment activities of Savva and
Tjiakouris, would have insisted that an entry be made
thereon about what Savva told the inspectors, or he
could simply himself have written thereon that the two
LCL officials merely conducted interviews on the
violations committed by Rizal Shipping. However, the
report is bereft of anything to that effect. More
significant is the fact that the inspectors, in their
Memorandum dated December 11, 1996 (the very same
day they conducted the inspection), stated that they
"approached said persons" (referring to Banawis, Savva
and Tjiakouris) "and told us that they were doing
interview to select applicants… to complement the crew
of a passenger ship for [LOUIS] CRUISE LINES."25
Indeed, it was Savva and Tjiakouris that conducted the interviews,
and undertook selection and hiring. However, C.F. Sharp cannot
steer clear of liability for it conspired with LCL in committing
illegal recruitment activities. As the Secretary of Labor had taken
pains to demonstrate:
x x x [T]here is substantial evidence on record that as
alleged by Rizal Shipping, CF Sharp conspired with
LCL and its officers Savva and Tjiakouris to conduct
recruitment activities in its offices, at a time when LCL
was not yet its POEA-accredited principal, in violation
of Sec. 6, R.A. 8042 in relation to Article 13(b) and (f)
and Article 16 of the Labor Code as amended; Rule
II(jj) Book I, and Sec. 1 and 6, Rule I, Book III, all of
the POEA Rules and Regulations Governing Overseas
Employment.
Indeed, C.F. Sharp was aware of these violations when
it alleged in its Petition for Review that:
"…in any and all events, the findings relied
upon by the Public Respondent show, at
best, that the parties responsible for the
alleged acts of illegal recruitment are LCL
and its officers alone, or at worst, LCL and
its officers, in conspiracy with petitioner.
Yet, it is petitioner alone, who is severely
punished and penalized." (underscoring
supplied)
xxxx
The intention, agreement and both common design of
both LCL and CF Sharp to engage in recruitment of
crewmen for LCL’s ships had already been made
manifest when LCL through Savva had instructed, in
the October 14, 1996 letter to disembarking
crewmembers, for the latter to report to CF Sharp for
processing of their papers. This was followed by the
execution by LCL on October 17, 1996 of a Special
Power of Attorney in favor of CF Sharp as new
manning agent and attorney-in-fact of LCL, with
authority, among others, "to sign, authenticate and
deliver all documents necessary to complete any
transaction related to the recruitment and hiring of
Filipino seamen including the necessary steps to
facilitate the departure of recruited seamen"; "to
assume, on our behalf and for our account, any liability
that may arise in connection with the recruitment of
seamen and/or implementation of the employment
contract of said seamen." And on November 8, 1996,
CF Sharp applied for accreditation as manning agent of
LCL for the latter’s five named vessels. The discovery
by the POEA inspectors of the selection and
recruitment activities undertaken by Savva and
Tjiakouris at CF Sharp’s offices on December 11, 1996,
followed. The interviews by Savva and Tjiakouris at CF
Sharp’s offices on December 7, 1996 with around 300
crewmen, as sworn to by 98 crewmen (their affidavits
were submitted in evidence by CF Sharp); the
interviews for selection and recruitment from December
9 to 12, 1996 as found by the POEA inspectors; and the
immediate deployment of 154 crewmen for LCL right
after [the] POEA approval of accreditation of LCL as
principal of CF Sharp, could not have been undertaken
without the assistance and cooperation of CF Sharp,
even before such transfer of accreditation was granted
by POEA.
The petitioner-appellant must be reminded that prior to
approval of the transfer of accreditation, no recruitment
or deployment may be made by the principal by itself or
through the would-be transferee manning agency, or by
the latter, as this would constitute illegal recruitment by
a non-holder of authority under Sec. 6, R.A. 8042 in
relation to Article 13(b) and (f) and Article 16 of the
Labor Code as amended; Rule II(jj), Book I, and Sec. 1
and 6, Rule 1, Book III, POEA Rules and Regulations
Governing Overseas Employment.
The petitioner-appellant alleges that "there is no need
for a license to enable LCL’s officers to conduct their
alleged activities of interviewing, selecting and hiring
crewmen. Indeed, LCL’s officers could have conducted
these activities without a license."
Such claim is without legal basis, as direct hiring by
employers of Filipino workers for overseas employment
is banned; they can only do so through, among others,
licensed private recruitment and shipping/mining
agencies (Art. 18, Labor Code as amended; Sec. 1, Rule
1, Book II, POEA Rules and Regulations Governing
Overseas Employment).26
We need not say more.
C.F. Sharp also denies violating Article 29 of the Labor Code. It
insists that Henry Desiderio was neither an employee nor an agent
of C.F. Sharp. Yet, except for its barefaced denial, no proof was
adduced to substantiate it.
Desiderio’s name does not appear in the list of employees and
officials submitted by C.F. Sharp to the POEA. However, his name
appeared as the contact person of the applicants for the position of
2nd and 3rd assistant engineers and machinist/fitter in C.F Sharp’s
advertisement in the February 2, 1997 issue of The Bulletin
Today.27
Article 29 of the Labor Code is explicit, viz.:
Art. 29. NON-TRANSFERABILITY OF LICENSE OR
AUTHORITY
No license or authority shall be used directly or
indirectly by any person other than the one in whose
favor it was issued or at any place other than that stated
40
 in the license or authority, nor may such license or
authority be transferred, conveyed or assigned to any
other person or entity. Any transfer of business
address, appointment or designation of any agent or
representative including the establishment of additional
offices anywhere shall be subject to the prior approval
of the Department of Labor. (Emphasis ours)
Thus, Section 2(k), Rule 1, Book VI of the POEA Rules Governing
Overseas Employment provides:
Section 2. Grounds for Suspension/Cancellation of
License.
xxxx
k. Appointing or designating agents, representatives or
employees without prior approval from the
Administration.
The appointment or designation of Desiderio as an employee or
agent of C.F. Sharp, without prior approval from the POEA,
warrants administrative sanction. The CA, therefore, correctly
rejected C.F. Sharp’s posture.
Apparently, realizing the folly of its defenses, C.F. Sharp assails
the admissibility of the Memorandum and Inspection Report of the
POEA. It contends that these are patently inadmissible against C.F.
Sharp for it was not given an opportunity to cross–examine the
POEA inspectors regarding the report.
The argument does not deserve even a short shrift. First, C.F.
Sharp did not raise it before the POEA and Secretary of Labor. The
issue was raised for the first time in its petition for certiorari with
the CA, where the jurisdiction of the appellate court is limited to
issues of jurisdiction and grave abuse of discretion. On numerous
occasions, we have made it clear that to allow fresh issues at this
stage of the proceedings is violative of fair play, justice and due
process.28
Second, jurisprudence is replete with rulings that administrative
bodies are not bound by the technical niceties of law and procedure
and the rules obtaining in the courts of law.29 Hence, whatever
merit C.F. Sharp’s argument might have in the context of ordinary
civil actions, where the rules of evidence apply with greater
rigidity, disappears when adduced in connection with labor cases.
The claim of denial of due process on the part of C.F. Sharp must
also be rejected. The essence of due process lies in the reasonable
opportunity afforded a party to be heard and to submit any
evidence in support of its defense. What is vital is not the
opportunity to cross-examine an adverse witness, but an
opportunity to be heard.30
In this case, C.F. Sharp was given ample opportunity to be heard,
to adduce evidence in support of its version of the material
occurrences, and to controvert Rizal’s allegation and the Inspection
Report. It submitted its position paper with supporting affidavits
and documents, and additionally pleaded its causes on appeal
before the Secretary of Labor. Under the circumstances, a claim of
denial of due process on C.F. Sharp’s part is completely
unavailing.
C.F. Sharp next impugns the probative value given by the
Administrator and the Secretary of Labor to the Inspection Report.
It alleges that the POEA Administrator, the Labor Secretary and
the CA relied only on the Inspection Report and gave very little or
no probative value to the affidavits that it submitted in support of
its claim.
C.F. Sharp would have us re-evaluate the factual veracity and
probative value of the evidence submitted in the proceedings a
quo. C.F. Sharp may well be reminded that it is not our function to
review, examine, and evaluate or weigh the evidence adduced by
the parties. Elementary is the principle that this Court is not a trier
of facts. Judicial review of labor cases does not go beyond the
evaluation of the sufficiency of the evidence upon which the labor
officials' findings rest. Hence, where the factual findings of the
labor tribunals or agencies conform to, and are affirmed by, the
CA, the same are accorded respect and finality, and are binding
upon this Court. It is only when the findings of the labor agencies
and the appellate court are in conflict that this Court will review
the records to determine which findings should be upheld as being
more in conformity with the evidentiary facts. Where the CA
affirms the labor agencies on review and there is no showing
whatsoever that said findings are patently erroneous, this Court is
bound by the said findings.31
Although the rule admits of several exceptions, none of them are in
point in this case. In any event, we have carefully examined the
factual findings of the CA and found the same to be borne out of
the record and sufficiently anchored on the evidence presented.
WHEREFORE, the petition is DENIED. The Decision and
Resolution of the Court of Appeals in CA-G.R. SP. No. 53747
are AFFIRMED.
SO ORDERED.
Ynares-Santiago, Chairperson, Austria-Martinez, Chico-Nazario,
Reyes, JJ., concur
G.R. No. 179931 October 26, 2009
PEOPLE OF THE PHILIPPINES, Appellee,
vs.
NIDA ADESER y RICO, Appellant.
DECISION
QUISUMBING, J.:
On appeal is the Decision1 dated June 28, 2007, of the Court of
Appeals in CA-G.R. CR-H.C. No. 01902, affirming the
Decision2 dated May 2, 2005, of the Regional Trial Court (RTC) of
Pasay City, Branch 118 in Criminal Cases Nos. 03-2700 and 03-
2701. The RTC convicted appellant of the crimes of syndicated
illegal recruitment constituting economic sabotage and estafa.
On November 12, 2003, the Office of the City Prosecutor of Pasay
filed before the RTC two Informations3 against appellant Nida
Adeser y Rico, Lourdes Chang, and the spouses Roberto and Mel
Tiongson. The Informations read as follows:
Criminal Case No. 03-2700
41
That on or about and sometime in the month of May, 2003, in
Pasay City, Metro Manila, Philippines and within the jurisdiction
of this Honorable Court, the above-named accused, conspiring and
confederating together and mutually helping one another, by means
of false representation and fraudulent allegation to the effect that
they could secure employment abroad for complainant
JOSEPHINE R. PALO, did then and there wilfully, unlawfully and
feloniously recruit for a fee aforesaid person without the
corresponding license from the Philippine Overseas Employment
Administration, a syndicated illegal recruitment involving
economic sabotage.
Contrary to law.4
Criminal Case No. 03-2701
That on or about and sometime in the month of May, 2003, in
Pasay City, Metro Manila, Philippines and within the jurisdiction
of this Honorable Court, the above-named accused, conspiring and
confederating together and mutually helping one another,
defrauded private complainant JOSEPHINE R. PALO, in the
following manner to wit: that said accused, by means of false
representations and fraudulent allegations that they could facilitate
private complainant’s working and travel papers, did then and
there wilfully, unlawfully, and feloniously ask, demand and receive
from the said complainant the amount of ₱80,000.00 as placement
fee for the latter’s supposed deployment to Australia as "Apple
Picker/Office Worker"; and said private complainant carried away
by said misrepresentations, in fact gave and delivered to said
accused the amount of ₱80,000.00, which amount accused in turn
misapplied, misappropriated and converted to their own personal
use and benefit, failing, however, to deploy private complainant to
Australia, and despite repeated demands accused failed and refused
to do so, or account for the said amount, to the damage and
prejudice of the said private complainant in the aforesaid amount
of ₱80,000.00.
Contrary to law.5
Upon arraignment, appellant pleaded not guilty6 to both charges
while her co-accused remained at large. Trial on the merits
thereafter ensued.
Private complainant Josephine R. Palo and her sister Teresa Caraig
testified that sometime in November 2002, the spouses Roberto
and Mel Tiongson, agents of Naples Travel and Tours, introduced
Palo to appellant, owner and general manager of Naples, to discuss
employment opportunities in Australia. During their meeting held
at the Naples office in Villaruel Tower, Villaruel Street, Pasay
City, appellant and the spouses Tiongson informed Palo that for a
placement fee of ₱80,000, she can work as an apple picker in
Australia with a monthly salary of $1,400.
Thus, on November 8, 2002, Palo and Caraig went to the Naples
office and gave Roberto Tiongson and Lourdes Chang, operations
manager of Naples, ₱15,000 as first installment for the placement
fee. Palo was issued a voucher7 signed by Roberto and Chang
stating therein that the ₱15,000 was for Palo’s visa application.
On November 11, 2002, Palo and Caraig returned to the Naples
office and paid ₱58,500. She was again issued a voucher8 signed
by Roberto and Chang stating therein that the amount paid was for
Palo’s visa application. Palo insisted that the voucher should
indicate that her payments were for "placement fees" but they were
able to convince her that it is not necessary because they know her.
After making her payments, she was required to submit her resume
and pictures and was promised that she would be employed within
three months.
More than three months passed, however, but Palo was not
deployed to Australia. Neither did she get her Australian visa.
In May 2003, she learned from the National Bureau of
Investigation (NBI) that Naples had closed down. NBI likewise
informed her that Naples had no license to operate and deploy
workers abroad. Upon advice of the NBI, Palo filed a
complaint9 against appellant, the spouses Tiongson and Chang.
Appellant on the other hand denied the charges against her. She
admitted that she was the owner and general manager of Naples
which was a travel agency that offered visa assistance, ticketing,
documentation, airport transfer and courier services, but denied
having engaged in recruitment. She claimed that she cannot
remember meeting Palo in her office and asserted that she met her
for the first time only at the fiscal’s office when Palo was already
claiming for a refund. She testified that Roberto, to whom Palo
claims to have given her payment, was neither her employee nor
her agent but was only her driver’s brother. Based on her records,
Roberto endorsed to her office ₱30,000 from Palo for tourist visa
assistance. Appellant also admitted that she and Roberto offered to
settle the ₱30,000 but not the amount claimed by Palo per vouchers
issued to her.
On May 2, 2005, the trial court rendered a Decision finding
appellant guilty of both charges. The dispositive portion reads:
WHEREFORE, all the foregoing considered NIDA ADESER is
hereby found GUILTY beyond reasonable doubt of the crime of
Syndicated Illegal Recruitment constituting Economic Sabotage in
Criminal Case No. 03-2700 and Estafa in Criminal Case No. 03-
2701. Accordingly, she is hereby sentenced to suffer the following
penalties:
1. In Criminal Case No. 3-2700 – LIFE
IMPRISONMENT and a FINE of Five Hundred
Thousand Pesos (₱500,000.00), and
2. In Criminal Case No. 03-2701 – Indeterminate
imprisonment of six (6) years of prision correccional,
as minimum, to 13 years of reclusion temporal, as
maximum, and to indemnify Josephine R. Palo the sum
of Eighty Thousand Pesos (₱80,000.00) with legal
interest from the time of the filing of the information.
Cost against the accused.
SO ORDERED.10
Appellant appealed her conviction but the same was affirmed by
the Court of Appeals in its Decision dated June 28, 2007. The
appellate court did not give credence to appellant’s denials and
found that the prosecution evidence fully supports the finding that
appellant and her co-accused engaged in recruitment and
placement as defined under the Labor Code despite having no
authority to do so. It likewise held that the same evidence proving
the commission of the crime of illegal recruitment also established
that appellant and her co-accused acted in unity in defrauding Palo
and in misrepresenting to her that upon payment of the placement
fee, they could obtain employment abroad for her. The appellant’s
42
act of deception and the resultant damage suffered by Palo render
appellant guilty of estafa.
In this appeal, appellant raises the following lone assignment of
error:
THE [APPELLATE] COURT GRAVELY ERRED IN
CONVICTING THE ACCUSED-APPELLANT OF THE CRIME
CHARGED DESPITE THE FAILURE OF THE PROSECUTION
TO PROVE HER GUILT BEYOND REASONABLE DOUBT.11
Essentially, the issue is whether appellant’s guilt for the crimes of
syndicated illegal recruitment and estafa was proven beyond
reasonable doubt.
Appellant argues that she was able to prove that she was not part of
the group that defrauded Palo. She points out that as can be
gleaned from the facts established and even from Palo’s testimony,
she was not involved in the evil scheme orchestrated by Roberto
and Chang as her signature did not even appear on the vouchers
issued to Palo.
Appellant likewise contends that the elements of the crime of
illegal recruitment were not established with moral certainty.
Naples was never into recruitment as it was only engaged in the
business of assisting clients procure passports and visas. She
argues that it should be Roberto and Chang who should be
convicted as she had no hand in recruiting Palo.
Appellant’s arguments are bereft of merit.
Illegal recruitment is committed when these two elements concur:
(1) the offenders have no valid license or authority required by law
to enable them to lawfully engage in the recruitment and placement
of workers, and (2) the offenders undertake any activity within the
meaning of recruitment and placement defined in Article 13(b) or
any prohibited practices enumerated in Article 34 of the Labor
Code. Under Article 13(b), recruitment and placement refers to
"any act of canvassing, enlisting, contracting, transporting,
utilizing, hiring or procuring workers and includes referrals,
contract services, promising or advertising for employment, locally
or abroad, whether for profit or not." In the simplest terms, illegal
recruitment is committed by persons who, without authority from
the government, give the impression that they have the power to
send workers abroad for employment purposes.12 The law imposes
a higher penalty when the crime is committed by a syndicate as it
is considered as an offense involving economic sabotage. Illegal
recruitment is deemed committed by a syndicate if carried out by a
group of three (3) or more persons conspiring and/or confederating
with one another in carrying out any unlawful or illegal
transaction, enterprise or scheme defined under the first paragraph
of Article 38 of the Labor Code.13
Undoubtedly, what transpired in the instant case is illegal
recruitment by a syndicate. As categorically testified by Palo and
Caraig, appellant, together with her co-accused, made
representations to Palo that they could send her to Australia to
work as an apple picker. There is no denying that they gave Palo
the distinct impression that they had the power or ability to send
her abroad for work such that the latter was convinced to part with
a huge amount of money as placement fee in order to be employed.
And this act was committed by appellant and her co-accused even
if they did not have the required license to do so. Appellant herself
admitted that Naples, the travel agency which she owned and
managed, only offered visa assistance, ticketing, documentation,
airport transfer and courier services. Clearly, neither she nor her
agents had a license to recruit Palo to work abroad. It is the lack of
the necessary license or authority that renders the recruitment
unlawful or criminal.14
Thus, as against the positive and categorical testimonies of Palo
and Caraig, appellant’s denials cannot prevail.15Moreover, there is
no reason to overturn the trial and appellate courts’ findings on the
credibility of the prosecution witnesses as there is no showing that
any of them had ill motives against appellant or her co-accused and
especially since it appears they were motivated solely by the desire
to bring appellant and her co-accused to justice for the crimes they
have committed.16
Neither can this Court sustain appellant’s contention that her
participation in the recruitment is negated by the fact that her
signature does not even appear on the vouchers issued to Palo.
Even if Palo did not present receipts signed by appellant, this
would not rule out the fact that appellant did receive the money.
This Court has consistently ruled that absence of receipts as to the
amounts delivered to a recruiter does not mean that the recruiter
did not accept or receive such payments. Neither in the Statute of
Frauds nor in the rules of evidence is the presentation of receipts
required in order to prove the existence of a recruitment agreement
and the procurement of fees in illegal recruitment cases. Such
proof may come from the credible testimonies of witnesses17 as in
the case at bar.
We likewise uphold appellant’s conviction for estafa. A person
who is convicted of illegal recruitment may also be convicted
of estafa under Article 315(2) (a) of the Revised Penal Code
provided the elements of estafa are present. Estafa under Article
315, paragraph 2(a) of the Revised Penal Code is committed by
any person who defrauds another by using a fictitious name, or
falsely pretends to possess power, influence, qualifications,
property, credit, agency, business or imaginary transactions, or by
means of similar deceits executed prior to or simultaneously with
the commission of the fraud. The offended party must have relied
on the false pretense, fraudulent act or fraudulent means of the
accused and as a result thereof, the offended party suffered
damage.18
Such is the case before us. Palo parted with her money upon the
prodding and enticement of appellant and her co-accused on the
false pretense that they had the capacity to deploy her for
employment in Australia. Unfortunately, however, Palo was not
able to work abroad nor get her Australian visa. Worse, she did not
get her money back.
As to the penalties, Section 7 of Republic Act No. 804219 or the
Migrant Workers’ Act of 1995 provides the penalties for illegal
recruitment:
SEC. 7. Penalties.—
(a) Any person found guilty of illegal recruitment shall
suffer the penalty of imprisonment of not less than six
(6) years and one (1) day but not more than twelve (12)
years and a fine not less than Two hundred thousand
pesos (₱200,000.00) nor more than Five hundred
thousand pesos (₱500,000.00).
(b) The penalty of life imprisonment and a fine of not
less than Five hundred thousand pesos (₱500,000.00)
nor more than One million pesos (₱1,000,000.00) shall
be imposed if illegal recruitment constitutes economic
sabotage as defined herein. (Emphasis supplied.)
43
xxxx
As appellant was found guilty of syndicated illegal recruitment
constituting economic sabotage, she was aptly meted out the
penalty of life imprisonment and to pay a fine of ₱500,000.
With respect to the estafa case, Article 315 of the Revised Penal
Code reads:
ART. 315. Swindling (estafa). — Any person who shall defraud
another by any of the means mentioned hereinbelow shall be
punished by:
1st. The penalty of prision correccional in its maximum period
to prision mayor in its minimum period, if the amount of the fraud
is over 12,000 pesos but does not exceed 22,000 pesos; and if such
amount exceeds the latter sum, the penalty provided in this
paragraph shall be imposed in its maximum period, adding one
year for each additional 10,000 pesos; but the total penalty which
may be imposed shall not exceed twenty years. In such cases, and
in connection with the accessory penalties which may be imposed
and for the purpose of the other provisions of this Code, the
penalty shall be termed prision mayor or reclusion temporal, as the
case may be;
xxxx
Considering that the total amount paid by Palo is ₱73,500 or
₱51,500 in excess of the ₱22,000 limit, an additional sentence of
five years should be imposed based on the above-quoted provision.
Thus, appellant was correctly meted the maximum penalty of 13
years of reclusion temporal.1avvphi1
As to the amount to be indemnified to Palo, contrary to the
findings of the trial and appellate courts, Palo’s testimony and the
vouchers she presented establish that the total amount she paid is
only ₱73,50020 and not the ₱80,000 quoted as placement fee. Thus,
she should only be indemnified the said amount, plus legal interest
of 12% per annum from the time of filing of the information.21
WHEREFORE, the appeal is DENIED. The Decision dated June
28, 2007 of the Court of Appeals in CA-G.R. CR-H.C. No. 01902
is hereby AFFIRMED with MODIFICATION. The amount to be
indemnified to private complainant Josephine R. Palo is reduced to
Seventy-Three Thousand Five Hundred Pesos (₱73,500) with legal
interest of 12% per annum from the time of filing of the
information until fully paid.
No pronouncement as to costs.
SO ORDERED.
THIRD DIVISION
[G.R. Nos. 145734-35. October 15, 2002]
PEOPLE OF THE PHILIPPINES, appellee, vs. VICENTA
MEDINA LAPIS, ANGEL MATEO, AIDA DE LEON (at
large) and JEAN AM-AMLAW (at large), appellants.
DECISION
PANGANIBAN, J.:
Illegal recruiters prey on our gullible and impoverished
people by inveigling them with false or fraudulent promises of
attractive employment in foreign shores. Such vultures deserve the
full sanction of the law.
The Case
Vicenta Medina Lapis and Angel Mateo appeal the March 6,
2000 Joint Decision[1] of the Regional Trial Court (RTC) of Makati
City (Branch 138), finding them guilty beyond reasonable doubt of
illegal recruitment and estafa. The dispositive portion of the
Decision reads as follows:
WHEREFORE, the Court rules
1. In Criminal Case No. 99-1112[,] accused Vicenta Medina
Lapis and Angel Mateo are pronounced guilty of violating Section
6, of Republic Act No. 8042, the Migrant Workers and Overseas
Filipinos Act of 1995 and they are both sentenced to suffer life
imprisonment. Pursuant to the last paragraph of Section 7,
Republic Act No. 8042, considering that both accused are non-
licensers or non-holders of authority, they are both sentenced to
pay fines of One Million Pesos (P1,000,000.00) each. Both
accused are ordered to indemnify both complainants jointly and
severally of the amount of P118,000.00, the net amount after
deducting the recovery of P40,000.00. They are likewise ordered to
pay both complainants jointly and severally the amounts
of P24,000.00 as reimbursement for traveling expenses; P4,000.00
as rental for boarding house, and P100,000.00 as unrealized
income;
2. In Criminal Case No. 99-1113[,] accused Vicenta Medina
Lapis and Angel Mateo are guilty of violating Article 315 (2) (a) of
the Revised Penal Code and they are both sentenced to suffer
imprisonment of twenty (20) years of reclusion temporal.
No civil liability need be imposed considering that in
Criminal Case No. 99-1112 the same was already provided.
Let the case as against Jane Am-amlao and Aida de Leon be
sent to the archives to be revived upon arrest, surrender or
acquisition of jurisdiction over their person.
SO ORDERED.[2]
Two separate Informations,[3] both dated April 20, 1999,
charged appellants with syndicated illegal recruitment under
44
Republic Act (RA) 8042[4] and estafa under paragraph 2 (a) of
Article 315 of the Revised Penal Code.[5]
In Criminal Case No. 99-1112, they were charged as
follows:
That on or about March, 1998 and thereafter in Makati City, Metro
Manila, Philippines, and within the jurisdiction of this Honorable
Court, the above-named accused, conspiring and confederating
with each other, did then and there willfully, unlawfully and
feloniously recruit the herein complainants, MELCHOR F. DEGSI
and PERPETUA L. DEGSI for employment as an office worker
and as a cook or mechanic in Japan, for and in consideration
thereof, they were required to pay the amount of P158,600.00 as
alleged placement and processing fees, which the complainants
delivered and paid the amount of P158,600.00 Philippine
Currency, without the accused having deployed the complainants
despite the lapse of several months, to their damage and
prejudice.[6]
In Criminal Case No. 99-1113, the Information reads:
That on or about March, 1998 and thereafter in Makati City, Metro
Manila, Philippines, and within the jurisdiction of this Honorable
Court, the above-named accused, conspiring and confederating
with each other, did then and there, willfully, unlawfully and
feloniously recruit and promise employment to spouses
MELCHOR and PERPETUA DEGSI in Japan for a total
consideration of one hundred fifty eight thousand and six hundred
pesos (P158,600.00) as placement and processing fees, knowing
that they have no capacity whatsoever and with no intention to
fulfill their promise, but merely as a pretext, scheme or excuse to
get or exact money from said complainant as they in fact collected
and received the amount of P158,600.00 from said MELCHOR
and PERPETUA DEGSI to their damage, loss and prejudice for the
aforesaid amount.[7]
With the assistance of their counsel de oficio,[8] appellants
pleaded not guilty to the charges during their arraignment on July
27, 1999.[9]
The Facts
Version of the Prosecution
The Office of the Solicitor General (OSG) relates how
appellants, despite their lack of authority or license, represented
themselves as persons who had the capacity to send the victims
abroad for employment. We quote its version of the facts as
follows:
The prosecution presented three witnesses, namely, Melchor Degsi
and Perpetua Degsi (Complainants for brevity) and Priscilla
Marreo (or Priscilla Marelo).
The prosecution and appellants stipulated that appellants are not
licensed or authorized to recruit workers for employment abroad,
in lieu of the testimony of Senior Labor Researcher Johnson
Bolivar of the Philippine Overseas Employment Administration
(POEA).
Complainants are husband and wife, residents of Baguio
City. They made a living earning an average of P20,000.00 a
month by selling fish and vegetables in a rented stall in said City,
at least until March 24, 1998 when they closed shop for reasons of
attending to the demands of the promised jobs for them in
Japan. Both categorically identified Jane Am-amlao (or Jean Am-
amlaw), their co-vendor in Baguio City Market, as the person who
approached them and assured them that she knew a legal recruiter,
an ex-POEA employee, who had the capacity to send them both
abroad. Jane Am-amlaw (or Am-amlaw for brevity) recruited
complainants and personally accompanied them on March 24,
1998 to meet the person she earlier referred to, or Aida de Leon (or
Alma de Leon), in the latters apartment at No. 7280 J. Victor St.,
Pio del Pilar, Makati.
Complainants likewise categorically identified Aida de Leon (de
leon for brevity) as the person who arranged a meeting in her
apartment on March 24, 1998 between complainants and appellant
Angel Mateo (Mateo for brevity) whom de Leon introduced as
their contact person for Japan-bound workers. In said meeting,
Mateo represented himself as having the capacity to send people
abroad and showed complainants various documents to convince
them of his legitimate recruitment operations. Convinced that
Mateo had indeed the capacity to facilitate their employment as an
office worker and as a cook or mechanic in Japan, complainants,
on that same day, handed Mateo P15,000.00 which Mateo required
them to pay for their processing fees. This was to be the first of a
series of sums of money to be extracted from complainants.
Complainants were able to positively identify Mateo in court as the
contact person of de Leon and who collected from them, from
March 24, 1998 to June 23, 1998, sums of money for the alleged
necessary expenses relative to the promised jobs awaiting them in
Japan in the total amount of P158,600.00. Complainants likewise
categorically identified Mateo as the same person whose
authorization was needed for the recovery of P40,000.00 of
the P45,000.00 they gave Mateo who in turn deposited it to
Sampaguita Travel Agency under his own name.
Complainants likewise positively identified appellant Vicenta
Vicky Lapis (Lapis for brevity) in Court as the person introduced
to them by Mateo as his wife on April 29, 1998 at Maxs Restaurant
in Makati when Lapis required complainants to pay P49,240.00 for
their plane tickets and travel taxes. Lapis is, in fact, only the live-in
partner of Mateo. Lapis told complainants that she was helping to
speed up the process[ing] of their papers relative to the promised
jobs awaiting them in Japan. Complainants met again Lapis, who
was with Mateo on May 2, 1998 at the Makati Restaurant, annex of
Maxs Restaurant, when Lapis assured them that Mateo could really
send them abroad and even wrote in a piece of paper appellants
address at Phase I, Lot 14, Blk 13 Mary Cris Subd., Imus,
Cavite. On May 17, 1998, complainants once more met Lapis who
was with Mateo, de Leon and de Leons husband in Baguio City at
the house of Priscilla Marreos daughter. Both appellants updated
complainant as to the status of their paper and reiterated their
promise that complainants would soon be leaving for Japan, then
collected from complainants unreceipted amount
of P20,000.00. Complainants met again with Lapis, who was again
with Mateo, on May 19, 1998 at the Sampaguita Travel
Agency. Mateo extracted P45,000.00 from complainants and
deposited it under his name. On that occasion, Perpetua wanted to
ask from the Sampaguita Travel Agencys employees where to pay
the P45,000.00 but failed to do so because Lapis took her attention
away from asking while Mateo asked Melchor to hand over to him
said sum.
Priscilla Marreo (Priscilla for brevity) is the sister of Melchor who
loaned complainants part of the P158,000.00 which appellants
45
extracted from complainant[s]. Thus, she made herself present in
most of the meetings between complainants and appellants
together with the two other accused where she witnessed the
assurances and promises made by appellants relative to
complainants immediate departure for Japan and their
corresponding demands of sums of money. The testimony of
Priscilla underscored the testimony of complainants showing that
Am-amlaw, de Leon, Lapis and Mateo indeed corroborated and
confederated in the commission of illegal recruitment.
The prosecution presented documentary evidence, such as varied
unofficial receipts all bearing the signature of Mateo; Sinumpaang
Salaysay of Perpetua L. Degsi executed on July 21, 1998; Affidavit
executed by complainants on July 21, 1998; Requirement for
Guarantee Letter of Visa bearing the names of both private
complainants; Request for Certification of POEA-CIDG, Team to
Mr. Hermogenes Mateo, Director II, Licensing Branch of POEA as
represented by Johnson Bolivar, Senior Labor Researcher of
POEA, and the various documents that complainants alleged to
have been shown to them by Mateo to prove the legality of his
recruitment operations.[10] (Citations omitted)
Version of the Defense
For their part, appellants deny that they were engaged in
recruitment activities, and that they promised foreign employment
to the victims. Below is the version of the facts presented by the
defense:
VICENTA MEDINA LAPIS testified that she is the live-in partner
of her co-accused Mateo. They have been living together for
almost three (3) years. According to her, she first met both
complainants at Maxs Restaurant in Makati when they talked to
accused Mateo. She was there only to accompany her live-in
partner. The subject of the conversation between the complainants
and accused Mateo was a contract in Baguio City. She did not see
complainant deliver money to accused Mateo while they were in
that meeting. She also has no knowledge about the transaction
between complainant and accused Mateo. She admitted that she
went to Baguio City together with accused Mateo to talk to the
City Mayor. She likewise admitted that the handwriting appearing
in Exhibit F is hers but the reason why she gave it was only to
comply to the request of the complainant Perpetua Degsi regarding
a matter to be followed up at the National Bureau of Investigation
(NBI). The result of her follow-up rendered was that complainant
Perpetua Degsi has a pending case of estafa.
ANGEL MATEO averred that he is engaged in the importation of
heavy equipment and containers but he has never been engaged in
recruitment. To prove that he was really engaged in the delivery of
heavy equipment, he presented a document of Import Service
signed by a certain Alexander Arcilla addressed to Honorable
Timoteo Encar Jr., City Mayor, Cavite City dated March 14, 1997
and were marked as Exhibit 1 and 1-a. He also presented another
document of Import Services issued by the Department of Trade
and Industry addressed to Honorable Mayor Maliksi as Municipal
Mayor of Imus, Cavite; a photocopy of a Bill of Lading from Trade
Bulk cargoes by Eastern Shipping Lines, Inc.; and Invoice of used
vehicles, airconditioners and washing machines and the packing
list which were all marked as Exhibits 3 to 5. Sometime in March
24, 1998, he met the complainants at Pio del Pilar, in Makati City
at the apartment of accused Aida de Leon. He went there to follow-
up their transaction about heavy equipment with Mayor Binay
because, it was accused de Leon who entered the transaction with
Mayor Binay. While he was there, the complainants were
introduced to him by accused de Leon. He admitted meeting the
complainants on April 29, 1998 at Maxs Restaurant but the reason
was for him to meet Mrs. Marero in person and also because
complainant Perpetua Degsi has a pending case for large scale
estafa and she needed a clearance. He denied having signed Exhibit
B. He further claimed that the topic of their meeting was to supply
heavy equipment in Baguio City. He denied having asked
for P50,000.00 on May 6, 1999. He likewise denied signing the
receipt showing the total amount of P158,600.00.[11]
The Trial Courts Ruling
The trial court held that the evidence for the prosecution
sufficiently established the criminal liability of appellants for the
crimes charged. It ruled in this manner:
Evidence for the prosecution clearly established that both
complainants were enticed by accused Mateo and were led to
believe that the latter has the capacity to send them for
employment to Japan. Complainant Melchor Degsi and his wife
Perpetua Degsi both testified to this fact. Acting on their belief that
indeed accused Mateo can deploy them to Japan, amounts were
disbursed by both complainants to accused Mateo to cover the
processing and placement fees. x x x The Court finds the evidence
presented by the prosecution sufficient to establish that accused
Mateo violated Section 6 of Republic Act No. 8042 when he
demanded amounts for placement and processing fees but he failed
to deploy both complainants. The Court has a similar conclusion
insofar as the accusation for estafa is concerned as the evidence
shows accused Mateo knew beforehand that he has no capacity to
deploy both complainants abroad and that the enticement to work
abroad was merely a scheme or plan to exact money from both
complainants. Deception was proven.
Insofar as the accused Lapis is concerned it is to be noted that the
theory of the prosecution is that she acted in conspiracy with her
co-accused Mateo who is her live-in partner. Evidence for the
prosecution shows that at least on three (3) occasions accused
Lapis was present when accused Mateo asked and received money
from complainants in connection with their intended employment
in Japan. x x x The Court conclude[d] that accused Lapis has
knowledge of the intention of her co-accused Mateo in asking for
money from both complainants. There was active participation on
her part in the recruitment of both complainants and in deceiving
them about the capacity to secure employment. The Court believes
that conspiracy was established beyond reasonable doubt. Her
defense of ignorance of the transaction cannot be considered given
the positive evidence presented by the prosecution which should
prevail over her plain denial.[12]
Hence, this appeal.[13]
The Issues
In their Brief, appellants interpose the following assignment
of errors:
I
The court a quo gravely erred in finding accused-appellants guilty
beyond reasonable doubt of violations of Republic Act No. 8042
46
(Migrant Workers and Overseas Filipinos Act of 1995) committed
by a syndicate and Article 315 paragraph 2(a) of the Revised Penal
Code.
II
The court a quo gravely erred in finding accused-appellant Vicenta
Medina Lapis guilty beyond reasonable doubt of illegal
recruitment and estafa.
III
The court a quo gravely erred in finding accused-appellants guilty
beyond reasonable doubt of illegal recruitment committed by a
syndicate.
IV
The court a quo gravely erred in finding accused-appellants guilty
beyond reasonable doubt of the crime of estafa defined and
penalized under Article 315 par. 2(a) of the Revised Penal Code as
amended.[14]
The Courts Ruling
The appeal has no merit.
First Issue:
Syndicated Illegal Recruitment
Appellants aver that the finding of syndicated illegal
recruitment by the lower court was erroneous; its conclusion that
the offense was committed by three (3) or more persons had no
factual or legal basis. Allegedly, without sufficient evidence, the
trial court wrongfully presumed that all of them had acted in
conspiracy. According to them, the prosecution failed to prove
beyond reasonable doubt that they had conspired and confederated
in illegally recruiting complainants. Appellants conclude that, if at
all, they could only be held liable for illegal recruitment in its
simple form. We disagree.
Illegal recruitment is committed when these two elements
concur: (1) the offenders have no valid license or authority
required by law to enable them to lawfully engage in the
recruitment and placement of workers, and (2) the offenders
undertake any activity within the meaning of recruitment and
placement[15] defined in Article 13(b) or any prohibited practices
enumerated in Article 34 of the Labor Code.[16]
Under Article 13(b), recruitment and placement refers to
any act of canvassing, enlisting, contracting, transporting, utilizing,
hiring or procuring workers[;] and includes referrals, contract
services, promising or advertising for employment, locally or
abroad, whether for profit or not. In the simplest terms, illegal
recruitment is committed by persons who, without authority from
the government, give the impression that they have the power to
send workers abroad for employment purposes.[17]
We believe that the prosecution was able to establish the
elements of the offense sufficiently. The case records reveal that
appellants did in fact engage in recruitment and placement
activities by promising complainants employment in Japan.
Undisputed is the fact that the former did not have any valid
authority or license to engage in recruitment and placement
activities. Moreover, the pieces of testimonial and documentary
evidence presented by the prosecution clearly show that, in
consideration of their promise of foreign employment, they indeed
received various amounts of money from complainants
totalling P158,600.
Where appellants made misrepresentations concerning their
purported power and authority to recruit for overseas employment,
and in the process, collected from complainants various amounts in
the guise of placement fees, the former clearly committed acts
constitutive of illegal recruitment.[18] In fact, this Court held
that illegal recruiters need not even expressly represent themselves
to the victims as persons who have the ability to send workers
abroad. It is enough that these recruiters give the impression that
they have the ability to enlist workers for job placement abroad in
order to induce the latter to tender payment of fees.[19]
It is also important to determine whether illegal recruitment
committed by appellants can be qualified as a syndicated illegal
recruitment or an offense involving economic sabotage.
Section 6 of RA 8042, otherwise known as the Migrant
Workers and Overseas Filipinos Act of 1995, provides that illegal
recruitment shall be considered an offense involving economic
sabotage when it is committed by a syndicate or carried out by a
group of three or more persons conspiring and confederating with
one another.
In several cases, illegal recruitment has been deemed
committed by a syndicate if carried out by a group of three or more
persons conspiring and/or confederating with each other in
carrying out any unlawful or illegal transaction, enterprise or
scheme defined under Article 38(b) of the Labor Code. [20]
In this case, it cannot be denied that all four (4) accused --
Jane Am-amlaw, Aida de Leon, Angel Mateo and Vicenta Medina
Lapis participated in a network of deception. Verily, the active
involvement of each in the various phases of the recruitment scam
formed part of a series of machinations. Their scheme was to
lure complainants to Manila and to divest them of their hard-
earned money on the pretext of guaranteed employment
abroad. The prosecution evidence shows that complainants were
convinced by Jane Am-amlaw to go to Manila to meet someone
who could find employment for them abroad. Upon reaching the
city, they were introduced to Aida de Leon and Angel Mateo;
Mateo claimed to have the contacts, the resources and the capacity
to employ them overseas. After that initial meeting, complainants
made several payments to him, supposedly for the processing
requirements of their deployment to Japan. Later on, they met
Vicenta Medina Lapis who volunteered her assistance in the
processing of their employment papers and assured them that
Mateo could easily send them abroad. Complainant Perpetua Degsi
testified on the devious trail of transactions with all of the accused
as follows:
Q How did you come to know the accused in this
case?
A They were introduced to me by one Aida de Leon
and Jane Am-Amlao.
Q Who is this Jane Am-Amlao you are referring to?
A She is our co-member in Baguio.
47
Q What is she in relation to your recruitment by
Angel Mateo and Vicenta Lapis?
A She was the first one who mentioned to us that she
knows somebody who has the capacity to send
us abroad.
Q When was this?
A March, 1998.
Q When Jane Am-Amlao told you that she knows
somebody who has the capacity to send you
abroad what happened next?
A On March 24, 1998 Jane accompanied us here in
Manila.
Q Where in Manila particularly?
A At No. 72 J. Victor Street, Pio del Pilar, Makati in
the apartment of Aida de Leon.
Q So what happened at the apartment of Aida de
Leon?
A Jane told us that Aida de Leon was an ex-employee
of POEA and she was able to send many
workers abroad.
Q Were you able to meet Aida de Leon?
A Yes, maam.
Q What happened when you met her?
A Aida called us by phone and according to her she
has the contact person who can explain [to] us
the details on how to be able to work abroad.
Q After Aida called you up on the phone what
happened next?
A We waited because according to her, that person is
coming over to the house.
Q A[fter] waiting what happened after that?
A ANGEL MATEO arrived and he was introduced to
me as the contact person and we could ask him
how we could work abroad.
Q Who is this siya, you are referring to?
A ANGEL MATEO.
Q Who introduced you to ANGEL MATEO?
A AIDA DE LEON.
Q After introducing you to ANGEL MATEO what
happened?
A ANGEL MATEO showed us some documents
AND HE WAS ABLE TO convince us that he
has the capacity to send us abroad.
Q What documents were shown to you?
A Incorporation documents of two companies one,
Philippine company and one is Japan company
and some other documents they made in order
to send workers abroad.
Q After convincing you that he can send you abroad
what happened after that?
A He asked for a processing fee and I asked him how
much.
Q What did he tell you?
A He told me that he does not know because AIDA
DE LEON will be the one to give us the price.
Q After that what happened?
A I asked AIDA how much and she answered, twenty
thousand pesos.
Q After telling you that the amount is P20,000.00
what happened next?
A We went to the bank to withdraw P20,000.00 but
we were only able to withdraw P15,000.00 and
then we handed the P15,000.00 to ANGEL
MATEO, in front of Jane Am-Amlaw.
Q After receiving said amount from you by ANGEL
MATEO what happened next?
A We parted ways.
Q Was there anything else that happened after that?
A Before we parted ways, [he] asked from us other
documents like ID, birth certificate, marriage
contract in order for him to begin processing
our papers.
Q After that what happened next?
A On March 31, we went back to [him] and we gave
[him] the other documents needed and we also
gave [him] the balance for the processing fee.
Q Who is this niya or he you are referring to?
A Angel Mateo.
Q Where did you meet?
A [He] called me and we met in the apartment of
AIDA.
Q Were you able to meet ANGEL MATEO in the
apartment of AIDA DE LEON?
A Yes.
Q What happened there?
A We gave [him] the documents and we started
processing the documents
Q What are those documents that you gave to
ANGEL MATEO?
A Birth certificate authenticated, marriage contract
and passport IDs and then we went to Pasay
City to start the processing of the passport.
Q You told us that ANGEL MATEO asked for the
balance of P5,000.00, were you able to pay the
said amount to ANGEL MATEO?
A Yes, maam.
xxxxxxxxx
Q After receiving said amount of P5,000.00 what
happened?
48
A After that meeting at Pasay City we parted ways
but [he] did not issue us any receipt so on
April 15, [he] again called us up and told me
that he needs NBI clearance so we processed
our NBI clearance.
Q You told us that ANGEL MATEO called you,
where were you at that time?
A Baguio City.
Q Were you able to come here in Manila?
A Yes maam, we met in Quiapo.
Q Were you able to meet ANGEL MATEO in
QUIAPO?
A [He] did not arrive in Quiapo.
Q So what did you do?
A We proceeded [to] the NBI and we called up AIDA
and asked her why ANGEL MATEO did not
arrive and whom did AIDA talk to.
Q What was the reply of AIDA DE LEON?
A She told me that whatever ANGEL MATEO would
tell us, thats what we should follow.
Q After that what happened?
A The processing of our NBI clearance did not finish
so on April 15 ANGEL MATEO asked
for P2,000.00 in order to help us process the
NBI.
Q After calling you on April 15, what happened next?
A On April 29, 1998 me, my sister, Melchor, and
Melchors sister together with ANGEL
MATEO met at Maxs Restaurant in Makati.
xxxxxxxxx
Q Were you able to meet ANGEL MATEO?
A Yes maam, they arrived together with somebody
whom [she] introduced to us as [his] wife.
Q Who is this wife you are referring to?
A She is Vicky Lapis, and later on we found out that
she is Vicenta Medina Lapis.
Q What was this meeting all about?
A We were updated on what was happening on our
papers and then ANGEL MATEO AND
VICENTA LAPIS asked for a plane ticket.
Q What was the update for the processing of your
papers?
xxxxxxxxx
A Vicenta Lapis told us that she is just helping to
speed up the processing of papers so that we
could be sent abroad immediately and she even
showed us some documents and I even told her
that I could help them in typing those
documents.[21]
The foregoing testimony very clearly demonstrates that the
individual actuations of all four (4) accused were directed at a
singular criminal purpose -- to delude complainants into believing
that they would be employed abroad. The nature and the extent of
the formers interactions among themselves as well as with the
latter clearly show unity of action towards a common
undertaking. Certainly, complainants would not have gone to
Manila to meet Aida de Leon and Angel Mateo without the
prodding of Am-amlaw. They would not have made various
payments for their travel and employment papers without the
fraudulent representations of Mateo De Leon. Moreover, they
would not have complied with further instructions and demands of
Mateo without the repeated assurances made by Lapis.
Even assuming that the individual acts of the accused were
not necessarily indispensable to the commission of the offense,
conspiracy would have still been present. Their actions, when
viewed in relation to one another, showed a unity of purpose
towards a common criminal enterprise and a concurrence in their
resolve to commit it.
In People v. Gamboa,[22] the Court had occasion to discuss
the nature of conspiracy in the context of illegal recruitment as
follows:
Conspiracy to defraud aspiring overseas contract workers was
evident from the acts of the malefactors whose conduct before,
during and after the commission of the crime clearly indicated that
they were one in purpose and united in execution. Direct proof of
previous agreement to commit a crime is not necessary as it may
be deduced from the mode and manner in which the offense was
perpetrated or inferred from the acts of the accused pointing to a
joint purpose and design, concerted action and community of
interest. As such, all the accused, including accused-appellant, are
equally guilty of the crime of illegal recruitment since in a
conspiracy the act of one is the act of all.[23] (Emphasis supplied)
To establish conspiracy, it is not essential that there be
actual proof that all the conspirators took a direct part in every
act. It is sufficient that they acted in concert pursuant to the same
objective.[24]
Conspiracy is present when one concurs with the criminal
design of another, indicated by the performance of an overt act
leading to the crime committed.[25]
The OSG avers, as an incident to this issue, and in line
with People v. Yabut,[26] that complainants are entitled to recover
interest on the amount of P118,000, which the trial court awarded
from the time of the filing of the Information until fully paid. We
agree with the OSGs observation and hereby grant the legal
interest on the amount prayed for.
In a number of cases,[27] this Court has affirmed the trial
courts finding that victims of illegal recruitment are entitled to
legal interest on the amount to be recovered as indemnity, from the
time of the filing of the information until fully paid.
Second Issue:
Appellants Liability for Estafa
Appellants argue that in a prosecution for estafa under
Article 315, paragraph 2(a) of the Revised Penal Code, it is
49
indispensable that the element of deceit, consisting of fraudulent
representations or false statements of the accused, be made prior to
or simultaneous with the delivery of the thing; and that such
misrepresentations or false statements induce the complainants to
part with the object of the crime. The former allege that the
prosecution failed to point out with certainty whether their
misrepresentations or false statements were made prior to or at
least simultaneous with the latters delivery of the money.
Under the cited provision of the Revised Penal Code, estafa
is committed by any person who defrauds another by using a
fictitious name; or by falsely pretending to possess power,
influence, qualifications, property, credit, agency, business; by
imaginary transactions or similar forms of deceit executed prior to
or simultaneous with the fraud.[28] Moreover, these false pretenses
should have been the very reason that motivated complainants to
deliver property or pay money to the perpetrators of the
fraud. While appellants insist that these constitutive elements of
the crime were not sufficiently shown by the prosecution, the
records of the case prove otherwise.
During almost all of their meetings, complainants paid
various amounts of money to appellants only after hearing the
feigned assurances proffered by the latter regarding the formers
employment prospects in Japan. Even as early as their first meeting
in the house of Aida de Leon, the payment by complainants of the
initial amount of P15,000 was immediately preceded by an
onslaught of promises. These enticing, albeit empty, promises were
made by Angel Mateo, who even showed them documents
purportedly evincing his connections with various foreign
companies. Equally important, they relied on such
misrepresentations, which convinced them to pay the initial
amount as processing fees. Complainant Melchor Degsi testified
on the matter in this wise:
Prosecutor Ong:
So when Angel Mateo arrived at the apartment of
Aida de Leon, what did he do, if any?
Witness:
He introduced himself to us and told us that he can
easily send us to Japan because he knows
many Japanese employers and he also showed
us some documents, maam. (Nagpakilala siya
at ang sabi niya ay kayang-kaya niya kaming
padalhin sa Japan dahil marami siyang
kilalang Japanese employer at may ipinakita
siyang mga dokumento, maam).
Q What are these documents, if you remember, that
were shown to you?
A Papers of Japanese companies, Clean Supplies Co.
Ltd., Arabian Boy Express Corporation and
that is the reason why we were convinced,
maam.
Q So, after being convinced that Angel Mateo can
send you abroad, what did you do after
that?
A Nakumbinsi nga po kami at pagkatapos noon ay
nag-usap-usap silang tatlo nina Jean Am-
amlaw at humihingi na sila ng processing
fee na P20,000, maam.
Q So what did you do when they were already
asking for the amount of P20,000 from you
as processing fee?
A We told them that we do not have any money
that time and we have to withdraw from the
bank and then we went to Pasay and we
withdrew the amount of P15,000.00 so that
was the only amount we were able to give
them that time, maam.
Q Who were with you when you withdrew the said
amount from the bank in Pasay?
A Jean Am-amlaw and Angel Mateo, maam.
Q Who received the amount of P15,000?
A Angel Mateo in front of Jean Am-amlaw,
maam.[29] (Emphasis supplied)
From the foregoing, it is evident that the false statements
that convinced complainants of the authenticity of the transaction
were made prior to their payment of the various fees. Indubitably,
the requirement that the fraudulent statements should have been
made prior to or simultaneous with the actual payment was
satisfied.
Verily, by their acts of falsely representing themselves as
persons who had the power and the capacity to recruit workers for
abroad, appellants induced complainants to pay the required
fees.[30] There is estafa if, through insidious words and
machinations, appellants deluded complainants into believing that,
for a fee, the latter would be provided overseas jobs.[31]
Although we agree with the ruling of the RTC convicting
appellants of estafa, we note that it failed to apply the
Indeterminate Sentence Law in imposing the penalty. Under
Section 1 of that law, the maximum term of the indeterminate
sentence shall be the penalty properly imposed, considering the
attending circumstances; while the minimum term shall be within
the range of the penalty next lower than that prescribed by the
Code.[32] Hence, pursuant to the Indeterminate Sentence Law, the
trial court should have fixed the minimum and the maximum
penalties.[33]
The Revised Penal Code provides the penalties for estafa as
follows:
Art. 315. Swindling (estafa). -- Any person who shall defraud
another by any of the means mentioned hereinbelow shall be
punished by:
1st. The penalty of prision correccional in its maximum period
to prision mayor in its minimum period, if the amount of the fraud
is over 12,000.00 but does not exceed 22,000 pesos, and if such
amount exceeds the latter sum, the penalty provided in this
paragraph shall be imposed in its maximum period, adding one
year for each additional 10,000 pesos; but the total penalty which
may be imposed shall not exceed twenty years. In such cases, and
in connection with the accessory penalties which may be imposed
and for the purpose of the other provisions of this Code, the
penalty shall be termed prision mayor or reclusion temporal, as the
case may be. (Italics supplied)
Considering that complainants were defrauded in excess of
the P22,000 limit fixed by law, the maximum penalty of prision
mayor should be imposed in its minimum period, or six (6) years
and one (1) day to eight (8) years, plus one (1) year for each
additional P10,000 in excess of the P22,000 limit. The total amount
defrauded from the complainants was P158,600 -- or P136,600 in
excess of P22,000, which translates to an additional prison
sentence of thirteen (13) years based on the aforementioned
computation.Accordingly, the maximum penalty to be imposed
50
should be nineteen (19) years and one (1) day to twenty-one (21)
years, thus raising the penalty to reclusion temporal. However, the
penal provisions for the crime of estafa provide that the total
penalty to be imposed should not in any case exceed twenty (20)
years imprisonment.
In Criminal Case No. 99-1113 for estafa, consonant with the
Indeterminate Sentence Law, appellants should thus be sentenced
to an indeterminate penalty of twelve (12) years of prision
mayor which is the penalty next lower than that prescribed by the
Code for the offense to twenty (20) years of reclusion
temporal. Indeed, the expression the penalty next lower to that
prescribed by said Code for the offense, used in Section 1 of the
Indeterminate Sentence Law, means the penalty next lower than
that determined by the court in the case before it as the
maximum.[34]
Third Issue:
Liability as Co-conspirator
Finally, appellants contend that the trial court should not
have convicted Vicenta Medina Lapis because the prosecution
evidence did not sufficiently prove her participation in the
conspiracy to defraud the victims. They maintain that she merely
accompanied Angel Mateo during his meetings with complainants
and that she had no knowledge of the intentions of her co-
accused. They add that mere knowledge, acquiescence or
agreement to cooperate is not enough to constitute one as a co-
conspirator.
We are not persuaded. As discussed earlier, Lapis not only
knew of the conspiracy, but she also offered her assistance in the
processing of the employment requirements of
complainants. Contrary to her claim that she was merely an
unknowing spectator in the underhanded transactions, she
deliberately inveigled them into pursuing the promise of foreign
employment. The records clearly belie her claim of innocence and
indicate that her participation in the criminal scheme transcends
mere knowledge or acquiescence.Complainant Melchor Degsi
describes one of the many instances of how deeply involved Lapis
was in the whole recruitment charade:
Prosecutor Ong:
Mr. Witness, you testified a while ago that you were
at Max Restaurant together with Vicenta Lapis
and Angel Mateo?
Witness:
Yes, maam.
Q: Could you remember what Vicenta Medina
[Lapis] said to you?
A: She promised that we will be sent to Japan
sooner as OCW, maam.
Q: Could you recall how she said it?
A: She said Sigurado kay, makakapunta kayo ng
Japan, maam.
Q: During that time that she was telling you sigurado
kay makakapunta kayo ng Japan, did she show
you anything?
A: Tinanong namin ang address nila at kusang loob
na ibinigay ni Vicenta Medina [Lapis] sa amin
ang address at direksyon para makapunta
kami sa Imus, Cavite, maam.
Q: What was the reason why Vicenta Medina Lapis
gave you the address?
A: Para sigurado raw kami na hindi sila
illegal kaya ibinigay niya ang address nila,
maam.[35] (Emphasis supplied)
Once conspiracy is established, the act of one becomes the
act of all regardless of the degree of individual
participation.[36] Moreover, the precise modality or extent of
participation of each individual conspirator becomes merely a
secondary consideration.[37]Notwithstanding nonparticipation in
every detail of the execution of the crime, the culpability of the
accused still exists.[38]
WHEREFORE, the appealed Decision is
hereby AFFIRMED with the following MODIFICATIONS:
1. In Criminal Case No. 99-1112, appellants are ordered to
pay legal interest on the amount of P118,000 from the time of the
filing of the Information until fully paid.
2. In Criminal Case No. 99-1113, appellants are sentenced
to an indeterminate penalty of twelve (12) years of prision
mayor as minimum to twenty (20) years of reclusion temporal as
maximum.
SO ORDERED.
Puno, (Chairman), Sandoval-Gutierrez,
Corona, and Carpio-Morales, JJ., concur.
SECOND DIVISION
[G.R. Nos. 138535-38. April 19, 2001]
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. LUZ
GONZALES-FLORES, accused-appellant.
DECISION
MENDOZA, J.:
This is an appeal from the decision [1] of the Regional Trial
Court, Branch 77, Quezon City, finding accused-appellant Luz
Gonzalez-Flores guilty of illegal recruitment in large scale and of
three counts of estafa against Felixberto Leongson, Jr., Ronald
Frederizo,[2] and Larry Tibor and sentencing her to suffer four
prison terms and to pay indemnity and damages to complainants.
In Criminal Case No. Q-94-59470, the information for
estafa against accused-appellant alleged:
51
That on or about the month of August, 1994, in Quezon City,
Philippines, the said accused, conspiring together, confederating
with several persons whose true names and true identities have not
as yet been ascertained, and helping one another, did then and there
wilfully, unlawfully and feloniously defraud FELIXBERTO
LEONGSON, JR. y CASTAEDA in the following manner, to wit:
the said accused, by means of false manifestations and fraudulent
representation which she made to said complainant to the effect
that they had the power and capacity to recruit and employ
complainant abroad as [a] seaman and could facilitate the
processing of the requirements thereof, and by means of other
similar deceits, induced and succeeded in inducing said
complainant to give and deliver, as in fact he gave and delivered to
said accused the amount of P45,000.00 on the strength of said
manifestations and representations, said accused well knowing that
the same were false and fraudulent and were made solely to obtain,
as in fact they did obtain the amount of P45,000.00, which amount
once in possession, with intent to defraud FELIXBERTO
LEONGSON, JR. wilfully, unlawfully and feloniously
misappropriated, misapplied and converted to their own personal
use and benefit, to the damage and prejudice of said complainant in
the aforesaid amount of P45,000.00, Philippine Currency.
CONTRARY TO LAW.[3]
In Criminal Case No. Q-94-59471, also for estafa, the
information charged:
That on or about the month of August, 1994, in Quezon City,
Philippines, the said accused conspiring together, confederating
with several persons whose true names and true identities have not
as yet been ascertained and helping one another did then and there
wilfully, unlawfully and feloniously defraud RONALD
F[R]EDERI[Z]O Y HUSENIA in the following manner, to wit: the
said accused, by means of false manifestations and fraudulent
representations which they made to said complainant to the effect
that they had the power and capacity to recruit and employ
complainant abroad as [a] seaman and could facilitate the
processing of the pertinent papers if given the necessary amount to
meet the requirements thereof, and by means of other similar
deceits, induced and succeeded in inducing said RONALD
F[R]EDERI[Z]O Y HUSENIA to give and deliver, as in fact gave
and delivered to said accused the amount of P45,000.00 on the
strength of said manifestations and representations, said accused
well knowing that the same were false and fraudulent and were
made solely to obtain, as in fact they did obtain the amount
of P45,000.00 which amount once in possession, with intent to
defraud complainant wilfully, unlawfully and feloniously
misappropriated, misapplied and converted to their own personal
use and benefit, to the damage and prejudice of said RONALD
F[RE]DERI[Z]O Y HUSENIA in the aforesaid amount
of P45,000.00, Philippine Currency.
CONTRARY TO LAW.[4]
In Criminal Case No. Q-94-59472, another case for estafa,
the information averred:
That on or about the month of August, 1994, in Quezon City,
Philippines, the said accused, conspiring together, confederating
with several persons whose true names and whereabouts have not
as yet been ascertained and helping one another, did then and there
wilfully, unlawfully and feloniously defraud LARRY TIBOR Y
MABILANGAN in the following manner, to wit: the said accused,
by means of false manifestations and fraudulent representations
which they made to said complainant to the effect that they had the
power and capacity to recruit and employ complainant abroad as
[a] seaman and could facilitate the processing of the pertinent
papers if given the necessary amount to meet the requirements
thereof, and by means of other similar deceits, induced and
succeeded in inducing said complainant to give and deliver, as in
fact gave and delivered to said accused the amount of P38,000.00
on the strength of said manifestations and representations, said
accused well knowing that the same were false and fraudulent and
were made solely to obtain, as in fact they did obtain the amount
of P38,000.00 which amount once in possession, with intent to
defraud LARRY TIBOR Y MABILANGAN wilfully, unlawfully
and feloniously mis-appropriated, misapplied and converted to
their own personal use and benefit, to the damage and prejudice of
said complainant in the amount of P38,000.00, Philippine
Currency.
CONTRARY TO LAW.[5]
On the other hand, in Criminal Case No. Q-94-59473, the
information for illegal recruitment in large scale charged:
That on or about the month of August, 1994, in Quezon City,
Philippines, the said accused, conspiring together, confederating
with several persons whose true names and whereabouts have not
as yet been ascertained and helping one another, did then and there,
wilfully, unlawfully and feloniously canvass, enlist, contract and
promise employment to the following persons, to wit:
1. RONALD F[R]EDERI[Z]O Y HUSENIA
2. LARRY TIBOR Y MABILANGAN
3. FELIXBERTO LEONGSON, JR. Y CASTAEDA
after requiring them to submit certain documentary requirements
and exacting from them the total amount of P128,000.00,
Philippine Currency, as recruitment fees, such recruitment
activities being done without the required license or authority from
the Department of Labor.
That the crime described above is committed in large scale as the
same was perpetrated against three (3) or more persons
individually or as group as penalized under Articles 38 and 39, as
amended by P.D. 2018, of the Labor Code.[6]
When arraigned, accused-appellant pleaded not guilty to the
criminal charges, whereupon the cases were jointly tried.
The evidence for the prosecution is as follows:
On August 6, 1994, at around 1:00 p.m., complainant
Felixberto Leongson, Jr. chanced upon his neighbors, Cloyd
Malgapo, Jojo Bumatay, and accused-appellant, who were talking
in front of his house at 68-C East Riverside, Bgy. Paltok, San
Francisco del Monte, Quezon City.Complainant was asked by
accused-appellant if he was interested to work as a seaman in
Miami, Florida, United States of America. He replied that he was
interested to work abroad but he had doubts regarding his
qualification for the job. Accused-appellant assured him that this
was not aproblem because she could fix his application. All he had
to do was pay P45,000.00 as processing fee. Accused-appellant
told him that Jojo and Cloyd were departing soon. Complainant
told accused-appellant that he would consider the offer.
That night, accused-appellant came to see Felixberto and
reiterated her proposal. Felixberto said he wanted the job but he
only had P10,000.00. Accused-appellant told him the amount
would be sufficient as an initial payment.
52
 Accused-appellant came back with Joseph Mendoza, whose
brother-in-law, Engr. Leonardo Domingo, according to accused-
appellant, was recruiting seamen. Thereafter, accused-appellant
and Mendoza took complainant, Cloyd, and Jojos wife, Clarita, to
a house on Second Street, near Camp Crame in Quezon City,
where the latter were introduced to Andy Baloran. [7] Complainant
and his companions were told that Baloran was an employee of the
National Bureau of Investigation and he would take care of
processing the applications for employment. Baloran told
complainant and the other job applicants that those who would be
employed would be paid a monthly salary of US$1,000.00, plus
tips, and given vacation leaves of 45 days with pay. Baloran asked
complainant to submit his picture, bio-data, and birth certificate,
which complainant later did.Accused-appellant then asked
complainant to give her the P10,000.00 as initial
payment. Complainant handed her the money and asked for a
receipt, but accused-appellant told him not to worry and assured
him that she would be responsible if anything untoward
happened. Complainant, therefore, did not insist on asking
accused-appellant for a receipt. Accused-appellant said she gave
the money to Baloran.
Two days later, Baloran and Domingo went to the
compound where Felixberto and accused-appellant were residing
and called Felixberto, Cloyd, and Jojo to a meeting. Domingo told
the applicants that he was the chief engineer of the luxury ocean
liner where they would embark and repeated to them the salaries
and other benefits which they would receive. He told them not to
get impatient.
Accused-appellant later saw complainant to collect the
balance of P35,000.00. Complainant was told to give the money to
accused-appellant at Wendys in Cubao, Quezon City on August 12,
1994.
At the appointed date and place, complainant and his wife
delivered the amount to accused-appellant who, in turn, handed it
to Baloran. No receipt was, however, issued to Felixberto.
Another meeting was held on August 16, 1994 at the
Mandarin Hotel in Makati City by accused-appellant, Domingo,
Baloran, Mendoza, the Leongson spouses, the Malgapo spouses,
and Jojo Bumatay. The applicants were told by Domingo that they
would be employed as waiters and attendants in the luxury liner
and asked them again to wait a while.
On August 18, 1994, accused-appellant saw complainant
again to collect the P25,000.00 balance. Felixberto paid the amount
to accused-appellant four days later. As in the case of the first two
payments, no receipt was given for the P25,000.00. Accused-
appellant told him that she would turn over the amount to
Baloran. Although complainant regularly followed up his
application with accused-appellant, he was told each time to have
patience and to just wait for the call from Domingo or from
Baloran. But Felixberto never heard from either one of these two.[8]
Felixbertos testimony was corroborated by his wife, Maria
Luz, who said that accused-appellant claimed she could help her
husband get a job as a seamen despite the latters lack of formal
training. She knew of the three payments made to accused-
appellant, totalling P45,000.00, andwitnessed the last two
payments of P10,000.00 at Wendys, Cubao, and P25,000.00 at
accused-appellants residence. Maria Luz said she met Baloran,
Mendoza, and Domingo and discussed with them the job offered to
her husband and the salaries and benefits appurtenant thereto.[9]
Complainant Ronald Frederizo, a resident of 68-A East
Riverside, San Francisco del Monte, Quezon City, also
testified. According to him, in the morning of August 10, 1994, he
received a call from his sister, Elsa Cas, at Far East Bank, Binondo
Branch, Manila, asking him to go home because accused-appellant,
their neighbor, was in his house recruiting seaman for employment
abroad. Ronald said that when he arrived home, he was told by
accused-appellant that he had to pay P10,000.00 as initial payment
for the processing of his application. Ronald withdrew the amount
from Elsas account. Then, Ronald went with accused-appellant to a
house on Second Street near Camp Crame in Quezon City. On the
way to that place, accused-appellant assured him that he would
receive a salary of US$1,000.00. At an apartment on Second
Street, Ronald saw his neighbors, complainant Felixberto, Jojo,
and Cloyd. Baloran and Mendoza were also there. Accused-
appellant introduced Baloran to Ronald, Cloyd, and Jojo. She told
them that Baloran was going to take care of their applications and
that he could pull strings at the NBI. Ronald paid accused-
appellant P10,000.00 for which no receipt was issued. He was
assured by accused-appellant that he would be able to leave for his
job abroad in one or two weeks. He was told to be ready with the
balance of P35,000.00 for the plane ticket on August 12, 1994.
Hence, on August 15, 1994, Ronald mortgaged his land in
Batangas just so he could pay the P35,000.00 remaining
balance. Accused-appellant went to Ronalds house to meet
him. Thereafter, Ronald, Elsa, and accused-appellant took a cab to
Mandarin Hotel in Makati City. Accused-appellant told Ronald to
have no fear because the persons whom he was dealing with were
her relatives. Elsa gave the P35,000.00 to accused-
appellant. Ronald no longer asked for a receipt because he trusted
accused-appellant. At the hotel were Felixberto and his wife,
Baloran, and Domingo. Domingo showed Ronald and Felixberto
his identification card and said that he was the captain of a ship. He
told them that they would receive a salary of US$1,000.00 plus
other benefits. He also assured them that he would inform them of
developments in their applications through accused-
appellant. After the meeting, Ronald went to his office and
tendered his resignation. Ronald followed up his application almost
every week but every time he was told by accused-appellant to be
patient[10] because Domingo had not yet called.
Complainant Larry Tibor said that on August 10, 1994, he
went to the house of his cousin, Elsa Cas, at 68-A East Riverside,
Bgy. Paltok, San Francisco del Monte, Quezon City, because
accused-appellant was there recruiting seamen to work
abroad. Larry was then looking for a job.Accused-appellant
introduced herself and told him that she could get him a job abroad
if he had the necessary documents and P45,000.00. Larry said he
had only P3,000.00. He was told by accused-appellant to bring the
amount the next day for his fare and certification. As instructed,
Larry paidthe amount in the presence of his sister, Junet. He asked
for a receipt, but accused-appellant told him to trust her. Accused-
appellant instructed Larry to prepare extra money as his initial
payment was insufficient. Larry left for the province to get a
loan. He went to accused-appellants house on August 15, 1994 and
paid her an additional amount of P35,000.00. Again, no receipt
was issued to him. Thereafter, accused-appellant took him to
Mandarin Hotel where he was introduced to Baloran and Domingo.
Larry kept waiting for a call, but none came. He was later told by
accused-appellant that he could not leave yet because Baloran was
sick and he had to postpone his trip.[11]
Junet T. Lim, Larrys sister, testified that she was present her
when brother paid P3,000.00 to accused-appellant, although no
receipt was issued. She stated that she asked accused-appellant
questions to make sure she could help Larry get a job abroad as a
seaman. Janet said accused-appellant was able to convince her that
she could do so. Junet also testified that she accompanied her
brother in following up his job application for about three months
until November 1994, when they realized they had been defrauded
by accused-appellant, Domingo, and Baloran.[12]
Realizing that they had been deceived, complainants went to
the Baler Police Station 2 in Quezon City on November 11, 1994
to file their complaints for illegal recruitment and estafa against
53
accused-appellant, Baloran, Domingo, and Mendoza. Felixberto
executed his sworn statement[13]on the same day, while Ronald and
Larry gave their respective statements[14] on November 12, 1994.
On November 14, 1994, complainants went to the Philippine
Overseas Employment Administration (POEA) and discovered that
accused-appellant and her companions did not have any license or
authority to engage in any recruitment activity.
Felixberto and Ronald asked the court to order accused-
appellant to pay them back the placement fees of P45,000.00
which each of them had paid and moral damages of P200,000.00
for each of them for the shame, anxiety, and loss of jobs they
suffered. They also sought the reimbursement for litigation
expenses they each incurred, amounting to P20,000.00 as attorneys
fees and P500.00 per court appearance. Larry, on the other hand,
sought the recovery of the total amount of P150,000.00 for
placement fee, travelling expenses from the province to Manila to
follow up his application, and the anguish and shame he
suffered.[15]
In her defense, accused-appellant Luz Gonzales-Flores, a
resident of 68-B East Riverside, San Francisco del Monte, Quezon
City, testified that she knew Felixberto Leongson, Jr., who was her
neighbor and a nephew of the owner of the house in which they
were staying. She came to know Ronald Frederizo and Larry Tibor
through Elsa Cas. Accused-appellant denied having promised
complainants overseas employment and having collected money
from them. According to her, she came to know Andy Baloran and
Engr. Leonardo Domingo through Joseph Mendoza, who referred
her and her son, Noli, to them in connection with their own
applications for overseas employment. She came to know Joseph
Mendoza through Elsa Cas and Felixberto Leongson, Jr.
Accused-appellant claimed that she and Noli agreed to pay
Baloran, Domingo, and Mendoza the total sum of P90,000.00 for
their application fees. Since she did not have enough money to
cover the amount, she asked her neighbors and friends to help her
get a loan. Felixberto and his wife offered help and introduced her
to Jenny Tolentino, from whom she got a loan of P15,000.00
guaranteed by Felixbertos wife. Accused-appellant said she used
the amount to pay for her and her sons recruitment fees. Accused-
appellant claimed that she paid the total amount of P46,500.00 for
her recruitment fee in three installments, i.e., P10,000.00 to
Mendoza at her house, P10,000.00, and P16,500.00 to Baloran at
the Mandarin Hotel. She alleged that she also gave them several
pieces of jewelry worth P10,000.00. According to her, no receipts
were issued for the money and jewelry she gave.
Accused-appellant said that because Domingo, Baloran, and
Mendoza did not make good their promises, accused-appellant
filed a complaint for illegal recruitment and estafa against them on
November 7, 1994 in the NBI, including as her co-complainants
Felixberto Leongson, Jr., Ronald Frederizo, Larry Tibor, Eduardo
Sibbalucas, Har Taccad, Romeo Gallardo, Joseph Mendoza, and
her son, Noli Flores.[16]
Accused-appellant was investigated by the Baler Police
Station 2 on November 11, 1994 as a result of the complaints filed
against her by Felixberto, Ronald, and Larry. Thereafter, she was
detained.[17]
On November 24, 1994, she appeared before the NBI
accompanied by a policewoman to comply with the
subpoena[18] issued regarding her complaint. According to NBI
Agent Jesus Manapat, accused-appellants complaint was dismissed
for lack of merit.[19]
Based on the evidence presented, the trial court rendered its
assailed decision on November 23, 1998, the dispositive portion of
which reads:
WHEREFORE, the guilt of the accused for illegal recruitment in
large scale and estafa in three (3) counts having been proved
beyond reasonable doubt, she is hereby convicted of said crimes
and is sentenced:
(1) To suffer the penalty of life imprisonment and pay a fine of
P100,000 in Criminal Case No. Q-94-59473;
(2) To suffer the penalty of imprisonment ranging from FOUR (4)
YEARS AND THREE (3) MONTHS of prision correccional, as
minimum, and up to TEN (10) YEARS of prision mayor, as
maximum, and to pay the costs in Criminal Case No. Q-94-59470;
(3) To suffer the penalty of imprisonment ranging from FOUR (4)
YEARS AND THREE (3) MONTHS of prision correccional, as
minimum, and up to TEN (10) YEARS of prision mayor, as
maximum, and to pay the costs in Criminal Case No. Q-94-59471;
and
(4) To suffer the penalty of imprisonment ranging FOUR (4)
YEARS AND THREE (3) MONTHS of prision correccional, as
minimum, and up to NINE (9) YEARS of prision mayor, as
maximum, and to pay the costs in Criminal Case No. Q-94-59472.
The accused is also directed to pay: (a) Ronald Federi[z]o, the
amount of P45,000.00 as and by way of actual damages; (b)
Felixberto Leongson, Jr. P45,000.00 as and by way of actual
damages; and (c) Larry Tibor, P38,000.00 as and by way of actual
damages.
The accused is further directed to pay to the said private
complainants moral damages in the sum of TWENTY
THOUSAND PESOS (P20,000.00) each.
SO ORDERED.[20]
Hence, this appeal. Accused-appellant contends that-
I. THE LOWER COURT ERRED IN RELYING
UPON THE JURISPRUDENCE AND
AUTHORITIES CITED, I.E., PEOPLE VS.
COMIA, PEOPLE VS. MANOZCA, PEOPLE
VS. HONRADA, PEOPLE VS. TAN TIONG
MENG, PEOPLE VS. VILLAS AND PEOPLE
VS. SENDON BECAUSE, WITH DUE
RESPECT, THE FACTS AND
CIRCUMSTANCES AVAILING IN SAID
CASES ARE DIFFERENT AS IN THE
PRESENT CASE; AND
II. [THE LOWER COURT] ERRED IN HOLDING
THE ACCUSED GUILTY BEYOND
REASONABLE DOUBT ON THE BASIS OF
THE EVIDENCE ADDUCED BY THE
PROSECUTION TAKEN IN THE LIGHT OF
THE UNREBUTTED EVIDENCE OF THE
ACCUSED ON VERY MATERIAL POINTS.[21]
The contentions are without merit.
In Criminal Case No. Q-94-59473, accused-appellant was
charged with illegal recruitment in large scale, the essential
elements of which are: (1) that the accused engages in acts of
recruitment and placement of workers defined under Art. 13 (b) or
in any of the prohibited activities under Art. 34 of the Labor Code;
(2) that the accused has not complied with the guidelines issued by
the Secretary of Labor and Employment, particularly with respect
54
to the securing of a license or an authority to recruit and deploy
workers, either locally or overseas; and (3) that the accused
commits the unlawful acts against three or more persons,
individually or as a group.[22]
In these cases, according to the certification of the POEA,
accused-appellant had no license or authority to engage in any
recruitment activities.[23] In fact, this was stipulated at the
trial.[24] Accused-appellant claims, however, that she herself was a
victim of illegal recruitment and that she simply told complainants
about job opportunities abroad.
The allegation is untenable. Art. 13 (b) of the Labor Code
defines recruitment and placement as referring to any act of
canvassing, enlisting, contracting, transporting, utilizing, hiring or
procuring workers, and includes referrals, contract services,
promising or advertising for employment, locally or abroad,
whether for profit or not. The same article further states that any
person or entity which, in any manner, offers or promises for a fee
employment to two or more persons shall be deemed engaged in
recruitment and placement.[25]
The evidence for the prosecution shows that accused-
appellant sought out complainants and promised them overseas
employment. Despite their initial reluctance because they lacked
the technical skills required of seamen, complainants were led to
believe by accused-appellant that she could do something so that
their applications would be approved. Thus, because of accused-
appellants misrepresentations, complainants gave her their
moneys. Accused-appellants companions, Domingo, Baloran, and
Mendoza, made her ploy even more plausible.
Accused-appellant contends that all she did was to refer
complainants to Domingo, Baloran, and Mendoza. However, under
Art. 13 (b) of the Labor Code, recruitment includes referral, which
is defined as the act of passing along or forwarding an applicant for
employment after initial interview of a selected applicant for
employment to a selected employer, placement officer, or
bureau.[26] In these cases, accused-appellant did more than just
make referrals. She actively and directly enlisted complainants for
supposed employment abroad, even promising them jobs as
seamen, and collected moneys from them.
The failure of complainants to present receipts to evidence
payments made to accused-appellant is not fatal to the prosecution
case. The presentation of the receipts of payments is not necessary
for the conviction of accused-appellant. As long as the prosecution
is able to establish through credible testimonies and affidavits that
the accused-appellant was involved in the prohibited recruitment, a
conviction for the offense can very well be justified.[27] In these
cases, complainants could not present receipts for their payment
because accused-appellant assured them she would take care of
their money.
It must be remembered that the trial courts appreciation of
complainants testimonies deserves the highest respect since it was
in a better position to assess their credibility.[28] In these cases,
complainants testimonies, to the effect that they paid money to
accused-appellant and her companions, Domingo and Baloran,
because the latter promised them overseas employment, were
positive, straightforward, and categorical. They maintained their
testimonies despite the lengthy and gruelling cross-examination by
the defense counsel. They have not been shown to have any ill
motive to falsely testify against accused-appellant. Naive, simple-
minded, and even gullible as they may have been, it is precisely for
people like complainants that the law was made. Accordingly, their
testimonies are entitled to full faith and credit.[29]
In contrast, accused-appellants defense is merely
denial. Time and again, this Court has ruled that denial, being
negative evidence which is self-serving in nature, cannot prevail
over the positive identification of prosecution witnesses.[30] Here,
complainants positively identified accused-appellant as one of
those who represented that they could be deployed for overseas
work upon payment of the fees.
Accused-appellant claims that she herself had to
borrow P15,000.00 from Jenny Tolentino, guaranteed by Maria
Luz Leongson, to defray her own and her sons application
expenses. The claim has no merit. Maria Luz Leongson, who is
Felixbertos wife, testified that accused-appellant sought her help to
guarantee a loan to pay the tuition fees of her daughter and the rent
of the apartment in which she and her family were staying,[31] and
not to finance her and her sons overseas job applications.
Accused-appellant likewise testified that she paid in cash a
total of P36,500.00 in three installments, i.e., P10,000.00 to
Mendoza at her house, and P10,000.00 and P16,500.00 to Baloran,
at the Mandarin Hotel. This testimony cannot be deemed worthy of
belief. When cross-examined, accused-appellant could not
remember the dates when she allegedly made these payments. For
someone who was jobless[32] and looking for employment, it is
very doubtful that she would pay considerable sums of money to
strangers without even remembering at least the month or the year
when the same were supposed to have been paid.
Accused-appellant further contends that if she was indeed a
conspirator in the illegal recruitment transactions with
complainants, she would not have filed a complaint[33] in the NBI
against Domingo and Baloran. The complaint was, as already
stated, dismissed and it is apparent that accused-appellant filed the
complaint only to make it appear that she herself had been the
victim of swindling and illegal recruitment. First, the complaint
shows that it was filed on November 7, 1994, even before she was
detained at the Baler Police Station 2 upon the sworn statements of
complainants. Complainants were included as complainants in a
complaint filed by accused-appellant. Yet, the complainants were
never told, nor did they ever knew, of the complaint until the trial
of these cases. Second, accused-appellant could have easily told
them at least of the complaint because Felixberto Leongson, Jr.,
Ronald Frederizo and Elsa Cas, a relative of complainant Larry
Tibor, were her immediate neighbors. Third, it is also noteworthy
that despite her claim that she paid P10,000.00 to Mendoza,
accused-appellant made the latter a co-complainant in the
complaint she filed with the NBI.
More importantly, accused-appellants defense is
uncorroborated. Not one of the persons she included in her
complaint to the NBI was ever presented in her defense in these
cases. Nor did she present Domingo, Baloran, or Mendoza to
corroborate her statements. It is probable that had she presented
any of these persons, their testimonies would have been adverse to
accused-appellant.[34]
Direct proof of previous agreement to commit a crime is not
necessary as it may be deduced from the mode in which the
offense was perpetrated, or inferred from the acts of the accused
which point to a joint purpose and design.[35] In these cases, the fact
is that there was conspiracy among accused-appellant, Domingo,
and Baloran in recruiting complainants for employment
overseas. The evidence shows that each had a role in that
conspiracy. Domingo posed as a representative of the luxury liner
in recruiting crew for the vessel. Baloran represented himself as the
person who would actually process complainants travel documents,
while accused-appellant acted as a scout for job applicants and a
collector of their payments. It was only Mendoza who did not
misrepresent himself as someone capable of helping complainants
go abroad nor collect money from them.[36]
In sum, we are of the opinion that the trial court correctly
found accused-appellant guilty of illegal recruitment in large
55
scale. The imposition on accused-appellant of the penalty of life AFFIRMED, with the MODIFICATIONS that, in the cases for
imprisonment and a fine of P100,000.00 is thus justified. estafa, accused-appellant is sentenced:

Accused-appellant was likewise found guilty of estafa under
Art. 315 (2) (a) of the Revised Penal Code committed -
By means of any of the following false pretenses or fraudulent acts
executed prior to or simultaneously with the commission of the
fraud:
(a) By using fictitious name, or falsely pretending to possess
power, influence, qualifications, property, credit, agency, business
or imaginary transactions, or by means of other similar deceits.
Both elements of the crime were established in these cases,
namely, (a) accused-appellant defrauded complainant by abuse of
confidence or by means of deceit and (b) complainant suffered
damage or prejudice capable of pecuniary estimation as a
result.[37] Complainants parted with their money upon the prodding
and enticement of accused-appellant on the false pretense that she
had the capacity to deploy them for employment abroad. In the
end, complainants were neither able to leave for work overseas nor
did they get their money back, thus causing them damage and
prejudice.[38]
(1) In Criminal Case No. Q-94-59470, to suffer a prison
term ranging from four (4) years and two (2) months of prision
correccional, as minimum, to ten (10) years of prision mayor, as
maximum;
(2) In Criminal Case No. Q-94-59471, to suffer a prison
term ranging from four (4) years and two (2) months of prision
correccional, as minimum, to 10 years of prision mayor, as
maximum; and
(3) In Criminal Case No. Q-94-59472, to suffer a prison
term ranging from four (4) years and two (2) months of prision
correccional, as minimum, to nine (9) years of prision mayor, as
maximum.
SO ORDERED.
Bellosillo, J. (Chairman), Quisumbing, Buena, and De Leon,
Jr., JJ., concur.
THIRD DIVISION

The issues that misappropriation on the part of accused-

appellant of the money paid by complainants and their demand for ROSITA SY, G.R. N
the same were not sufficiently established are immaterial and Petitioner,
irrelevant, conversion and demand not being elements of estafa Present
under Art. 315 (2) (a) of the Revised Penal Code.
CORO
In Criminal Case Nos. Q-94-59470 and Q-94-59471, the Chairp
amounts involved are both P45,000.00, as testified to by - versus - VELAS
complainants Felixberto Leongson, Jr. and Ronald NACH
Frederizo. Pursuant to Art. 315, par. 1 of the Revised Penal Code, PERAL
the Indeterminate Sentence Law, and the ruling in People v. MEND
Gabres,[39] the trial court correctly meted accused-appellant the
maximum penalty of ten (10) years of prision mayor in each Promul
case. This is so considering that the maximum penalty prescribed PEOPLE OF THE PHILIPPINES,
by law for the felony is six (6) years, eight (8) months, and 21 days Respondent. April 1
to eight (8) years of prision mayor. The amounts involved in these
cases exceed P22,000.00 by at least P20,000.00, necessitating an x------------------------------------------------------------------------------------x
increase of one (1) year for every P10,000.00. Applying the
Indeterminate Sentence Law, the minimum of the sentence is thus
from six (6) months and one (1) day to four (4) years and two (2) RESOLUTION
months of prision correccional. The trial court can exercise its
discretion only within this period. Thus, the minimum penalty NACHURA, J.:
imposed by the trial court should be reduced to four (4) years and
two (2) months of prision correccional.

In Criminal Case No. Q-94-59472, where the amount

involved is P38,000.00, the indeterminate sentence which should
be imposed on accused-appellant should range from four (4) years
and two (2) months of prision correccional, as minimum, to nine
(9) years of prision mayor, as maximum.
Before the Court is a petition for review on certiorari under Rule
In accordance with the ruling in People v. Mercado,[40] the
fact that no receipts were presented to prove the amounts paid by 45 of the Rules of Court, assailing the Decision [1] dated July 22,
complainants to accused-appellant does not prevent an award of
actual damages in view of the fact that complainants were able to 2008 of the Court of Appeals (CA) in CA-G.R. CR No. 30628.
prove by their respective testimonies and affidavits that accused-
appellant was involved in the recruitment process and succeeded in
inveigling them to give their money to her. The award of moral
damages should likewise be upheld as it was shown to have factual Rosita Sy (Sy) was charged with one count of illegal recruitment in
basis.
Criminal Case No. 02-0537 and one count of estafa in Criminal
WHEREFORE, the decision of the Regional Trial Court,
Branch 77, Quezon City, finding accused-appellant guilty of illegal Case No. 02-0536. In a joint decision of the Regional Trial Court
recruitment in large scale and estafa against complainants
Felixberto Leongson, Jr., Ronald Frederizo, and Larry Tibor is (RTC), Sy was exonerated of the illegal recruitment charge.

56
However, she was convicted of the crime of estafa. Thus, the
instant appeal involves only Criminal Case No. 02-0536 for the
crime of estafa.
The Information[2] for estafa reads:
That sometime in the month of March 1997,
in the City of Las Pias, Philippines, and
within the jurisdiction of this Honorable
Court, the above-named accused, did, then
and there willfully, unlawfully and
feloniously defraud Felicidad Mendoza-
Navarro y Landicho in the following
manner, to wit: the said accused by means of
false pretenses and fraudulent representation
which she made to the said complainant that
she can deploy her for employment in
Taiwan, and complainant convinced by said
representations, gave the amount
of P120,000.00 to the said accused for
processing of her papers, the latter well
knowing that all her representations and
manifestations were false and were only
made for the purpose of obtaining the said
amount, but once in her possession[,] she
misappropriated, misapplied and converted
the same to her own personal use and
benefit, to the damage and prejudice
of Felicidad Mendoza-Navarro y Landicho
in the aforementioned amount
of P120,000.00.
CONTRARY TO LAW.[3]
On May 27, 2007, Sy was arraigned and pleaded not guilty to the
crimes charged. Joint trial ensued thereafter.
As summarized by the CA, the facts of the case are as follows:
Version of the Prosecution
Sometime in March 1997, appellant,
accompanied by Corazon Miranda
(or Corazon), went to the house of Corazons
sister, Felicidad Navarro (or Felicidad), in
Talisay, Batangas to convince her
(Felicidad) to work abroad. Appellant
assured Felicidad of a good salary and
entitlement to a yearly vacation if she
decides to take a job in Taiwan. On top of
these perks, she shall receive compensation
in the amount of Php120,000.00. Appellant
promised Felicidad that she will take care of
the processing of the necessary documents,
including her passport and visa. Felicidad
told appellant that she will think about the
job offer.
Two days later, Felicidad succumbed to
appellants overseas job solicitation. With
Corazon in tow, the sisters proceeded to
appellants residence in Better Homes,
Moonwalk, Las Pias City. Thereat, Felicidad
handed to appellant the amount of
Php60,000.00. In the third week of March
1997, Felicidad returned to appellants abode
and paid to the latter another
Php60,000.00. The latter told her to come
back the following day. In both instances, no
receipt was issued by appellant to
acknowledge receipt of the total amount of
Php120,000.00 paid by Felicidad.
On Felicidads third trip to appellants house,
the latter brought her to Uniwide in Sta.
Cruz, Manila, where a male person showed
to them the birth certificate that Felicidad
would use in applying for a Taiwanese
passport. The birth certificate was that of a
certain Armida Lim, born to Margarita
Galvez and Lim Leng on 02 June
1952. Felicidad was instructed on how to
write Armida Lims Chinese name.
Subsequently, appellant contacted Felicidad
and thereafter met her at the Bureau of
Immigration office. Thereat, Felicidad,
posing and affixing her signature as Armida
G. Lim, filled out the application forms for
the issuance of Alien Certificate of
Registration (ACR) and Immigrant
Certificate of Registration (ICR). She
attached to the application forms her own
photo. Felicidad agreed to use the name of
Armida Lim as her own because she already
paid to appellant the amount of
Php120,000.00.
In December 1999, appellant sent to
Felicidad the birth certificate of Armida
Lim, the Marriage Contract of Armida Lims
parents, ACR No. E128390, and ICR No.
317614. These documents were submitted to
and eventually rejected by the Taiwanese
authorities, triggering the filing of illegal
recruitment and estafa cases against
appellant.
Version of the Defense
Appellant denied offering a job to Felicidad
or receiving any money from her. She
asserted that when she first spoke to
Felicidad at the latters house, she mentioned
that her husband and children freely
entered Taiwan because she was a holder of
a Chinese passport. Felicidad commented
that many Filipino workers in Taiwan were
holding Chinese passports.
Three weeks later, Felicidad and Corazon
came to her house in Las Pias and asked her
if she knew somebody who could help
Felicidad get a Chinese ACR and ICR for a
fee.
Appellant introduced a certain Amelia Lim,
who, in consideration of the amount of
57
 Php120,000.00, offered to Felicidad the use
of the name of her mentally deficient sister, pretenses or fraudulent acts; or (3) through fraudulent means. The
Armida Lim. Felicidad agreed. On their
second meeting at appellants house, three ways of committing estafa may be reduced to two, i.e., (1) by
Felicidad paid Php60,000.00 to Amelia Lim
and they agreed to see each other at Uniwide means of abuse of confidence; or (2) by means of deceit.
the following day. That was the last time
appellant saw Felicidad and Amelia Lim.[4]

The elements of estafa in general are the following: (a)

On January 8, 2007, the RTC rendered a decision,[5] the that an accused defrauded another by abuse of confidence, or by

dispositive portion of which reads: means of deceit; and (b) that damage and prejudice capable of

pecuniary estimation is caused the offended party or third person.

WHEREFORE, premises considered the
court finds the accused Rosita Sy NOT
GUILTY of the crime of Illegal Recruitment
and she is hereby ACQUITTED of the said The act complained of in the instant case is penalized under Article
offense. As regards the charge of Estafa, the
court finds the accused GUILTY thereof and 315, paragraph 2(a) of the RPC, wherein estafa is committed by
hereby sentences her to an indeterminate
penalty of four (4) years of prision any person who shall defraud another by false pretenses or
correctional as minimum to 11 years of
prision mayor, as maximum. The accused is fraudulent acts executed prior to or simultaneously with the
ordered to reimburse the amount of sixty-
commission of the fraud. It is committed by using fictitious name,
thousand (Php60,000.00) to the private
complainant.
or by pretending to possess power, influence, qualifications,
SO ORDERED.[6]
property, credit, agency, business or imaginary transactions, or by

means of other similar deceits.

Aggrieved, Sy filed an appeal for her conviction

of estafa. On July 22, 2008, the CA rendered a

The elements of estafa by means of deceit are the
Decision,[7] affirming with modification the conviction of Sy, viz.:
following, viz.: (a) that there must be a false pretense or fraudulent
WHEREFORE, with the MODIFICATION representation as to his power, influence, qualifications, property,
sentencing accused-appellant to suffer the
indeterminate penalty of four (4) years and credit, agency, business or imaginary transactions; (b) that such
two (2) months of prision correccional, as
minimum, to seventeen (17) years false pretense or fraudulent representation was made or executed
of reclusion temporal, as maximum, the
appealed decision is AFFIRMED in all other prior to or simultaneously with the commission of the fraud; (c)
respects.
that the offended party relied on the false pretense, fraudulent act,
SO ORDERED.[8]
or fraudulent means and was induced to part with his money or

property; and (d) that, as a result thereof, the offended party

Hence, this petition.
suffered damage.[10]

The sole issue for resolution is whether Sy should be

In the instant case, all the foregoing elements are present. It was
held liable for estafa, penalized under Article 315, paragraph 2(a)
proven beyond reasonable doubt, as found by the RTC and
of the Revised Penal Code (RPC).[9]
affirmed by the CA, that Sy misrepresented and falsely pretended

that she had the capacity to deploy Felicidad Navarro (Felicidad)

Swindling or estafa is punishable under Article 315 of
for employment in Taiwan. The misrepresentation was made prior
the RPC. There are three ways of committing estafa, viz.: (1) with
to Felicidads payment to Sy of One Hundred Twenty Thousand
unfaithfulness or abuse of confidence; (2) by means of false
Pesos (P120,000.00). It was Sys misrepresentation and false

58
pretenses that induced Felicidad to part with her money. As a result Thousand Pesos (P12,000.00) but does not exceed Twenty-two

of Sys false pretenses and misrepresentations, Felicidad suffered Thousand Pesos (P22,000.00), and if such amount exceeds the

damages as the promised employment abroad never materialized latter sum, the penalty shall be imposed in its maximum period,

and the money she paid was never recovered. adding one year for each additional Ten Thousand Pesos

(P10,000.00); but the total penalty that may be imposed shall not

The fact that Felicidad actively participated in the processing of the exceed twenty years. In such cases, and in connection with the

illegal travel documents will not exculpate Sy from accessory penalties that may be imposed under the provisions of

liability. Felicidad was a hapless victim of circumstances and of this Code, the penalty shall be termed prision mayor or reclusion

fraud committed by Sy. She was forced to take part in the temporal, as the case may be.

processing of the falsified travel documents because she had

already paid P120,000.00. Sy committed deceit by representing The addition of one year imprisonment for each

that she could secure Felicidad with employment in Taiwan, the additional P10,000.00, in excess of P22,000.00, is the incremental

primary consideration that induced the latter to part with her penalty. The incremental penalty rule is a mathematical formula

money. Felicidad was led to believe by Sy that she possessed the for computing the penalty to be actually imposed using the

power and qualifications to provide Felicidad with employment prescribed penalty as the starting point. This special rule is

abroad, when, in fact, she was not licensed or authorized to do so. applicable in estafa and in theft.[13]

Deceived, Felicidad parted with her money and delivered the same

to petitioner. Plainly, Sy is guilty of estafa. In estafa, the incremental penalty is added to the maximum period

of the penalty prescribed, at the discretion of the court, in order to

Illegal recruitment and estafa cases may be filed simultaneously or arrive at the penalty to be actually imposed, which is the maximum

separately. The filing of charges for illegal recruitment does not term within the context of the Indeterminate Sentence Law

bar the filing of estafa, and vice versa. Sys acquittal in the illegal (ISL).[14] Under the ISL, attending circumstances in a case are

recruitment case does not prove that she is not guilty applied in conjunction with certain rules of the Code in order to

of estafa. Illegal recruitment and estafa are entirely different determine the penalty to be actually imposed based on the penalty

offenses and neither one necessarily includes or is necessarily prescribed by the Code for the offense. The circumstance is that

included in the other. A person who is convicted of illegal the amount defrauded exceeds P22,000.00, and the incremental

recruitment may, in addition, be convicted of estafa under Article penalty rule is utilized to fix the penalty actually imposed.[15]

315, paragraph 2(a) of the RPC.[11] In the same manner, a person

acquitted of illegal recruitment may be held liable for estafa. To compute the incremental penalty, the amount defrauded shall be

Double jeopardy will not set in because illegal recruitment subtracted by P22,000.00, and the difference shall be divided

is malum prohibitum, in which there is no necessity to prove by P10,000.00, and any fraction of P10,000.00 shall be
[16]
criminal intent, whereas estafa is malum in se, in the prosecution of discarded.

which, proof of criminal intent is necessary.[12]

In the instant case, prision correccional in its maximum period
The penalty prescribed for estafa under Article 315 of the RPC
to prision mayor in its minimum period is the imposable penalty.
is prision correccional in its maximum period to prision mayor in
The duration of prision correccional in its maximum period is
its minimum period, if the amount defrauded is over Twelve

59

from four (4) years, two (2) months and one (1) day to six (6)
years; while prision mayor in its minimum period is from six (6)
years and one (1) day to eight (8) years. The incremental penalty
for the amount defrauded would be an additional nine years
imprisonment, to be added to the maximum imposable penalty of
eight years. Thus, the CA committed no reversible error in
sentencing Sy to an indeterminate penalty of four (4) years and two
(2) months of prision correccional, as minimum, to seventeen (17)
years of reclusion temporal, as maximum.
As to the amount that should be returned or restituted by Sy, the
sum that Felicidad gave to Sy, i.e., P120,000.00, should be
returned in full. The fact that Felicidad was not able to produce
receipts is not fatal to the case of the prosecution since she was
able to prove by her positive testimony that Sy was the one who
received the money ostensibly in consideration of an overseas
employment in Taiwan.[17]
WHEREFORE, in view of the foregoing, the Decision
of the Court of Appeals dated July 22, 2008 in CA-G.R. CR No.
30628, sentencing petitioner Rosita Sy to an indeterminate penalty
of four (4) years and two (2) months of prision correccional, as
minimum, to seventeen (17) years of reclusion temporal, as
maximum, is hereby AFFIRMED. We, however, MODIFY the
CA Decision as to the amount of civil indemnity, in that Sy is
ordered to reimburse the amount of One Hundred Twenty
Thousand Pesos (P120,000.00) to private complainant Felicidad
Navarro.
FOOTNOTES
Petitioner assigned the following errors in the CA Decision:
I intervene in questions of selection of employees and workers so as
THE COURT OF APPEALS COMMITTED REVERSIBLE
ERROR IN HOLDING THAT PETITIONER OFFERED
OVERSEAS JOB TO PRIVATE RESPONDENT.
II
THE COURT OF APPEALS COMMITTED REVERSIBLE
ERROR IN HOLDING THAT PETITIONER
MISREPRESENTED AND FALSELY PRETENDED TO
RESPONDENT THAT SHE HAD THE POWER AND
CAPACITY TO DEPLOY HER FOR A WORK IN TAIWAN.
III
THE COURT OF APPEALS COMMITTED REVERSIBLE
ERROR IN HOLDING THAT PETITIONERS
MISREPRESENTATION AND FALSE PRETENSES WAS
WHAT INDUCED RESPONDENT TO PART WITH HER
MONEY. (Rollo, p. 13).
Under the ISL, in imposing a prison sentence for an offense
punished by the Revised Penal Code, or its amendments, the court
shall sentence an accused to an indeterminate sentence the
maximum term of which shall be that which, in view of the
attending circumstances, could be properly imposed under the rules
of the said Code, and the minimum which shall be within the range
of the penalty next lower to that prescribed by the Code for the
offense; and if the offense is punished by any other law, the court
shall sentence the accused to an indeterminate sentence, the
maximum term of which shall not exceed the maximum fixed by
said law and the minimum shall not be less than the minimum term
prescribed by the same.
EMPLOYMENT OF NON-RESIDENT ALIENS
G.R. No. L-2216 January 31, 1950
DEE C. CHUAN & SONS, INC., petitioner,
vs.
THE COURT OF INDUSTRIAL RELATIONS, CONGRESS
OF LABOR ORGANIZATIONS (CLO), KAISAHAN NG
MGA MANGGAGAWA SA KAHOY SA PILIPINAS and
JULIAN LUMANOG AND HIS WORK-CONTRACT
LABORERS, respondents.
Quisumbing, Sycip and Quisumbing for petitioner.
Lazatin and Caballero for respondents.
Arsenio I. Martinez for the Court of Industrial Relations.
TUASON, J.:
Dee C. Chuan & Sons, Inc. assails the validity of an order of the
Court of Industrial Relations. The order made upon petitioner's
request for authority to hire" about twelve(12) more laborers from
time to time and on a temporary basis," contains the proviso that
"the majority of the laborers to be employed should be native." The
petition was filed pending settlement by the court of a labor dispute
between the petitioner and Kaisahan Ng Mga Manggagawa sa
Kahoy sa Pilipinas.
At the outset, the appellant takes exception to the finding of the
court below that Dee C. Chuan & Sons, Inc. is capitalized with
foreign descent. This question has little or no bearing on the case
and may well be passed over except incidentally as a point of
argument in relation to the material issues.
It is next said that "The Court of Industrial Relations cannot
to impose unconstitutional restrictions," and that "The restrictions
of the number of aliens that nay be employed in any business,
occupation, trade or profession of any kind, is a denial of the equal
protection of the laws." Although the brief does not name the
persons who are supposed to be denied the equal protection of the
laws, it is clearly to be inferred that aliens in general are in
petitioner's mind. certainly, the order does not, directly or
indirectly, immediately or remotely, discriminate against the
petitioner on account of race or citizenship. The order could have
60
been issued in a case in which the employer was a Filipino. As a
matter of fact the petitioner insists that 75 % of its shares of stock
are held by Philippine citizens, a statement which is here assumed
to be correct.
But is petitioner entitled to challenge the constitutionality of a law
or an order which does not adversely affect it, in behalf of aliens
who are prejudiced thereby? The answer is not in doubt. An alien
may question the constitutionality of a statute (or court order) only
when and so far as it is being, or is about to be, applied to his
disadvantage. (16 C.J.S. 157 et seq.) The prospective employees
whom the petitioner may contemplate employing have not come
forward to seek redress; their identity has not even been revealed.
Clearly the petitioner has no case in so far as it strives to protect
the rights of others, much less others who are unknown and
undetermined. U.S. vs. Wong Ku Ark, 169 U.S. 649;
Truax vs. Reich, 239 U.S. 39 60 Law ed., 131., and other American
decisions cited do not support the petitioner for the very simple
reasons that in those cases it was the persons themselves whose
rights and immunities under the constitution were being violated
that invoked the protection of the courts.
The petitioner is within its legitimate sphere of interest when it
complains that the appealed order restrains it in its liberty to
engage the men it pleases. This complaint merits a more detailed
examination.
That the employer's right to hire labor is not absolute has to be
admitted. "This privilege of hiring and firing ad libitumis, of
course, being subjected to restraints today." Statutes are cutting in
on it. And so does Commonwealth Act No. 103. The regulations of
the hours of labor of employees and of the employment of women
and children are familiar examples of the limitation of the
employer's right in this regard. The petitioner's request for
permission to employ additional; laborers is an implicit recognition
of the correctness of the proposition. The power of the legislature
to make regulations is subject only to the condition that they
should be affected with public interest and reasonable under the
circumstances. The power may be exercised directly by the law-
making body or delegated by appropriate rules to the courts or
administrative agencies.
We are of the opinion that the order under consideration meets the
test of reasonableness and public interest. The passage of
Commonwealth Act No. 103 was "in conformity with the
constitutional objective and . . . the historical fact that industrial
and agricultural disputes have given rise to disquietude, bloodshed
and revolution in our country." (Antamok Goldfields Mining
Co. vs. Court of Industrial Relations, 40 Off. Gaz., 8th Supp.,
173.)1 "Commonwealth Act No. 103 has precisely vested the Court
of Industrial Relations with authority to intervene in all disputes
between employees or strikes arising from the difference as regards
wages, compensation, and other labor conditions which it may take
cognizance of." (Central Azucarera de Tarlac vs. Court of
Industrial Relations, 40 Off. Gaz., 3rd Supp., 319, 324.)2 Thus it
has jurisdiction to determine the number of men to be laid off
during off-seasons. By the same token, the court may specify that a
certain proportion of the additional laborers to be employed should
be Filipinos, if such condition, in the court's opinion, "is necessary
or expedient for the purpose of settling disputes or doing justice to
the parties."
The order in question has that specific end in view. In parallel view
the court observed: "Undoubtedly, without the admonition of the
Court, nothing could prevent petitioner from hiring purely alien
laborers, and there is no gainsaying the fact that further conflict or
dispute would naturally ensue. To cope with this contingency, and
acting within the powers granted by the organic law, the court,
believing in the necessity and expediency of making patent its
desire to avoid probable and possible further misunderstanding
between the parties, issued the order."
We are not prepared to declare that the order is not conducive to
the aim pursued. The question is a practical one depending on facts
with which the court is best familiar. The fact already noted should
not be lost sight of — that there is a pending strike and besides,
that the employment of temporary laborers was opposed by the
striking employees and was the subject of a protracted hearing.
We can not agree with the petitioner that the order constitutes an
unlawful intrusion into the sphere of legislation, by attempting to
lay down a public policy of the state or to settle a political
question. In the first place, we believe, as we have already
explained, that the court's action falls within the legitimate scope of
its jurisdiction. In the second place, the order does not formulate a
policy and is not political in character. It is not a permanent, all-
embracing regulation. It is a compromise and emergency measure
applicable only in this case and calculated to bridge a temporary
gap and to adjust conflicting interests in an existing and menacing
controversy. The hiring of Chinese laborers by the petitioner was
rightly considered by the court likely to lead the parties away from
the reconciliation which it was the function of the court to
effectuate.
As far as the petitioner is concerned, the requirement that majority
of the laborers to be employed should be Filipinos is certain not
arbitrary, unreasonable or unjust. The petitioner's right to employ
labor or to make contract with respect thereto is not unreasonably
curtailed and its interest is not jeopardized. We take it that the
nationality of the additional laborers to be taken in is immaterial to
the petitioner. In its application for permission to employ twelve
temporary laborers it expressly says that these could be Filipinos or
Chinese. On the face of this statement, assuming the same to be
sincere, the petitioner objection to the condition imposed by the
court would appear to be academic and a trifle.
We should not close without adverting to the fact that the petitioner
does not so much as pretend that the hiring of additional laborers is
its prerogative as a matter of right. It seems to be conceded that
during the pendency of the dispute the petitioner could employ
temporary laborers only with the permission of the Court of
Industrial Relations. The granting of the application thus lies
within the sound judgment of the court, and if the court could turn
it down entirely, as we think it could, its authority to quality the
permission should be undeniable, provided only that the
qualification is not arbitrary, against law, morals, or established
public policy, which it is not; it is an expedient and emergency step
designed to relieve petitioner's own difficulties. Also important to
remember is that it is not compulsory on petitioner's part to take
advantage of the order. Being a permute petitioner is the sole judge
of whether it should take the order as it is, or leave it if it does not
suit its interest to hire new laborers other than Chinese.
The order appealed from is affirmed with costs to this appeal
against the petitioner-appellant.
Moran, C.J., Pablo, Padilla, and Torres, JJ., concur.
Separate Opinions
61
OZAETA, J., with whom concur PARAS, MONTEMAYOR,
and REYES, JJ., dissenting:
During the trial of an industrial dispute between the petitioner and
the respondent labor union, the former applied to the Court of
Industrial Relations for authority "to hire about twelve more
laborers from time to time and on a temporary basis, to be chosen
by the petitioner from either Filipinos or Chinese." the court
granted the authority applied for but imposed as a condition that
the majority of the twelve new laborers to be hired "should be
native and only a nominal percentage thereof alien." In imposing
such condition the court said:
The hiring of laborers who are not native or Filipino
should be discouraged, as it is being discouraged by this
court. In these critical moments of unemployment, any
competition of alien and native labor would be
destructive of our Nation that is in the making. By the
act of God, this nation is the Philippines, her soil is the
patrimony of the Filipino people, and in this Philippine
soil the Filipino laborers must have priority and
preference. No capitalistic management can violate this
written law, unless it wants to court trouble and
conflict. In the hiring, therefore, of laborers, it is the
opinion of this court that management, in employing
aliens, should be prudent and cautious and should, as
much as possible, employ only a small percentage
thereof limited to those absolutely necessary and
confidential.
The power of the Court of Industrial Relations to impose such
condition as to limit the authority of the employer to hire laborers
than Filipinos is challenged by the petitioner. "The petitioner is
within its legitimate sphere of interest when it complains that the
appealed order restrains it in liberty to engage the men it pleases,"
says the majority opinion, and we add — "regardless of race or
nationality." It is true that no alien laborer who may be adversely
affected by the order has been made a party herein. Under the
circumstances of the case he could not be expected to have
intervened in the incident which gave rise to the order complained
of. But his intervention is not necessary in order to determine
whether or not the Court of Industrial Relations is empowered by
law to impose the condition above mentioned. If the court has no
power to discriminate against a certain class of laborers on account
of their race or nationality, it has no power to impose the condition
in question, and the employer has legitimate right to complain
against such imposition.
The Court of Industrial Relations impliedly admits the
nonexistence of any statue providing that Filipino laborers must be
preferred over aliens; but it claims or adopts an "unwritten law" to
that effect and says that "no capitalistic management can violate
this unwritten law, unless it wants to court trouble and conflict."
Who made such unwritten law? Certainly the Congress of the
Philippines, the only entity authorized by the Constitution to make
laws, and which does not promulgate unwritten laws, did not do so.
The court, therefore, cannot take cognizance of, and much less
apply, such supposed unwritten law.
It is sheer usurpation of legislative power for the court to enact or
make laws. Its power is confined to interpreting and applying the
laws enacted by the legislature.
The case of Truax vs. Reich (600 law. ed., 131), which was
decided by the Supreme Court of the United States on November
1, 1915, is of pertinent and persuasive application to the question at
issue in that, in our opinion, it emphasizes the utter lack of power
of the court to impose the condition here complained of; for in said
case Supreme Court of the United States ruled that the Legislature
of the State of Arizona could not validly enact a law similar to the
supposed unwritten law which the Court of Industrial Relations has
conceived and has tried to enforce. The law involved in said case
pertinently reads as follows:
SEC. 1. Any company, corporation, partnership,
association or individual who is, may hereafter become,
an employer of more than five (5) workers at any one
time, in the state of Arizona, regardless of kind or class
of work, or sex of workers, shall employ not less than
(80) per cent qualified electors or native-born citizens
of the United States or some subdivision thereof.
SEC. 2. Any company, corporation, partnership,
association or individual, their agent or agents, found
guilty of violating any of the provisions of this act shall
be subject to a fine of not less than one hundred ($100)
dollars, and imprisoned for not less than thirty (30)
days.
Mike Raich, a native of Austria and an inhabitant of the State of
Arizona, but not a qualified elector, was employed as a cook by
William Truax in his restaurant, where he had nine employees, of
whom seven were neither native-born citizens of the United States
nor qualified electors. After the passage of said law Raich was
informed by his employer that because of its requirements and
because of the fear of the penalties that would be incurred in case
of its violation, he would be discharged. Thereupon Raich sued
Truax and the Attorney General of Arizona to enjoin them from
enforcing the law on the ground that it was unconstitutional
because it denied him the equal protection of the laws. Both the
District Court and the Supreme Court of the United States upheld
his contention. The court said that the complainant was entitled
under the Fourteenth Amendment to the equal protection of the
laws of Arizona. "These provisions," said the court, "are universal
in their application, to all person within the territorial jurisdiction,
without regard to any differences of race, of color, or of
nationality; and the equal laws. . . . The discrimination defined by
the act does not pertain to the regulation or distribution of the
public domain, or of the common property or resources of the
people of the state, the enjoyment of which may be limited to its
citizens as against both aliens and the citizens of other states." The
court said further:
It is sought to justify this act as an exercise of the power
of the state to make reasonable classifications in
legislating to promote the health, safety, morals, and
welfare of those within its jurisdiction. But this
admitted authority, with the broad range of legislative
discretion that it implies, does not go so far as to make
it possible for the state to deny to lawful inhabitants,
because of their race or nationality, the ordinary means
of earning a livelihood. It requires no argument to show
that the right to work for a living in the common
occupations of the community is of the very essence of
the personal freedom and opportunity that it was the
purpose of the Amendment to secure. . . . If this could
be refused solely upon the ground of race or nationality,
the prohibition of the denial to any person of the equal
protection of the laws would be a barren form of words.
It is no answer to say, as it is argued, that the act
proceeds upon the assumption that 'the employment of
aliens, unless restrained, was a peril to the public
welfare. The discrimination against aliens in the wide
range of employments to which the acts relates is made
an end in itself, and thus the authority to deny to aliens,
62
 upon the mere fact of their alienage, the right to obtain
support in the ordinary fields of labor, is necessarily
involved.
Our own Constitution contains a provision similar to the
Fourteenth Amendment to the Constitution of the United States.
Section 1 of Article III provides:
No person shall be deprived of life, liberty, or property
without due process of law, nor shall any person be
denied the equal protection of the laws.
It is patent that if the lawmaking body itself cannot validly enact
the supposed unwritten law conceived or adopted by the lower
court, much less could the latter do so.
Section 13 of Commonwealth Act No. 103, invoked by the trial
court and by majority of this court as authorizing the imposition of
the discriminatory condition contained in the order appealed from,
reads as follows:
SEC. 13. Character of the award. — In making an
award, order or decision, under the provision of section
four of this Act, the Court shall not be restricted to the
specific relief claimed or demands made by the parties
to the industrial or agricultural dispute, but may include
in the award, order or decision any matter or
determination which may be deemed necessary or
expedient for the purpose of setting the dispute or of
preventing further industrial or agricultural dispute.
As correctly stated by Judge Lanting of the lower court in his
dissenting opinion:
The reference in the resolution of the majority to
section 13 of Commonwealth Act No. 103, authorizing
this Court to include in its awards, orders or decisions
"any matter or determination which may be deemed
necessary or expedient for the purpose of setting the
dispute or of preventing further . . . disputes", is
farfetched. This provision certainly does not authorize
this Court to go beyond its prescribed powers and issue
an order which grossly violates the fundamental law.
More specifically, it cannot make any ruling which will
produce the effect of discriminating against and
oppressing a person or class of persons and deny them
the equal protection of the laws, aside from curtailing
their individual freedom and their right to live.
As matter of fact the respondent labor union "manifested its
conformity to the hiring of additional laborers, provided that it be
consulted by the petitioner and that it be given the privilege of
recommending the twelve new laborers that are to be hired." And
Judge Roldan in his order overruled that proposition by saying :
"The stand taken by the respondent labor union is not correct,
because it attempts to encroach upon the prerogative of the
company to determine and adopt its own policy in the selection of
its employees and workers, and the Court should only intervene in
questions of this nature when there is discrimination or retaliation
on the part of the company, which has not been proven or even
alleged in the case bar (Manila Trading & Supply Co. vs. Judge
Francisco Zulueta et al., G. R. No. 46853; 1 Manila Chauffeurs
League vs. Bachrach Motor Co., G. R. No. 49138;2 Pampanga Bus
Co. vs.Pampanga Bus Co. Employees' Union, G. R. No.
46739;3 National Labor Union vs. San Miguel Brewery, CIR case
No. 26-V, June 12, 1947)."
Thus the Court of Industrial Relations itself correctly held that the
respondent labor union has no right to encroach upon the
prerogative of the company to determine and adopt its own policy
in the selection of its employees and workers, and that the court
itself should not intervene in such selection because there was no
proof of discrimination or retaliation on the part of the company.
Yet in the dispositive part of its order the court not only intervenes
in such selection but compels the company to discriminate against
a certain class of laborers. The inconsistency and illegality of the
order appealed from are too patent fro argument.
To hold that the Court of Industrial Relations may, under section
13, impose any condition in its order or award in order to prevent
further industrial disputes, regardless of whether or not such
condition is in violation of law or of the Constitution, is, in our
opinion, thinkable. It goes without saying that industrial dispute
must be settled in accordance with law and justice. Suppose that
the members of a labor union should demand of an employer that
80 per cent of the new laborers the latter may hire should be
Filipinos, or that all of them should be Tagalogs or Ilocanos, and
should threaten to declare a strike unless such demand be complied
with; would the court be justified in granting such demand under
section 13 on the ground that by doing so it would prevent a or
strike or lockout and settle an industrial dispute? The negative
answer can hardly be disputed, since unreasonableness or illegal
demands should not be countenanced by the court. Yet the
affirmance by this Court of the order appealed from in effect
authorizes the Court of Industrial Relations hereafter to commit
such arbitrariness.
For the foregoing reasons, we vote to modify the appealed order by
eliminating therefrom the discriminatory condition in question.
G.R. No. 93666 April 22, 1991
GENERAL MILLING CORPORATION and EARL
TIMOTHY CONE, petitioners,
vs.
HON. RUBEN D. TORRES, in his capacity as Secretary of
Labor and Employment, HON. BIENVENIDO E.
LAGUESMA, in his capacity as Acting Secretary of Labor and
Employment, and BASKETBALL COACHES
ASSOCIATION OF THE PHILIPPINES, respondents.
Sobrevinas, Diaz, Hayudini & Bodegon Law Office for petitioners.
Rodrigo, Cuevas & De Borja for respondent BCAP.
RESOLUTION
FELICIANO, J.:
On 1 May 1989, the National Capital Region of the Department of
Labor and Employment issued Alien Employment Permit No. M-
0689-3-535 in favor of petitioner Earl Timothy Cone, a United
States citizen, as sports consultant and assistant coach for
petitioner General Milling Corporation ("GMC").
On 27 December 1989, petitioners GMC and Cone entered into a
contract of employment whereby the latter undertook to coach
GMC's basketball team.
63
On 15 January 1990, the Board of Special Inquiry of the
Commission on Immigration and Deportation approved petitioner
Cone's application for a change of admission status from temporary
visitor to pre-arranged employee.
On 9 February 1990, petitioner GMC requested renewal of
petitioner Cone's alien employment permit. GMC also requested
that it be allowed to employ Cone as full-fledged coach. The
DOLE Regional Director, Luna Piezas, granted the request on 15
February 1990.
On 18 February 1990, Alien Employment Permit No. M-02903-
881, valid until 25 December 1990, was issued.
Private respondent Basketball Coaches Association of the
Philippines ("BCAP") appealed the issuance of said alien
employment permit to the respondent Secretary of Labor who, on
23 April 1990, issued a decision ordering cancellation of petitioner
Cone's employment permit on the ground that there was no
showing that there is no person in the Philippines who is
competent, able and willing to perform the services required nor
that the hiring of petitioner Cone would redound to the national
interest.
Petitioner GMC filed a Motion for Reconsideration and two (2)
Supplemental Motions for Reconsideration but said Motions were
denied by Acting Secretary of Labor Bienvenido E. Laguesma in
an Order dated 8 June 1990.
Petitioners are now before the Court on a Petition for Certiorari,
dated 14 June 1990, alleging that:
1. respondent Secretary of Labor gravely abused his
discretion when he revoked petitioner Cone's alien
employment permit; and
2. Section 6 (c), Rule XIV, Book I of the Omnibus
Rules Implementing the Labor Code is null and void as
it is in violation of the enabling law as the Labor Code
does not empower respondent Secretary to determine if
the employment of an alien would redound to national
interest.
Deliberating on the present Petition for Certiorari, the Court
considers that petitioners have failed to show any grave abuse of
discretion or any act without or in excess of jurisdiction on the part
of respondent Secretary of Labor in rendering his decision, dated
23 April 1990, revoking petitioner Cone's Alien Employment
Permit.
The alleged failure to notify petitioners of the appeal filed by
private respondent BCAP was cured when petitioners were
allowed to file their Motion for Reconsideration before respondent
Secretary of Labor.1
Petitioner GMC's claim that hiring of a foreign coach is an
employer's prerogative has no legal basis at all. Under Article 40 of
the Labor Code, an employer seeking employment of an alien must
first obtain an employment permit from the Department of Labor.
Petitioner GMC's right to choose whom to employ is, of course,
limited by the statutory requirement of an alien employment
permit.
Petitioners will not find solace in the equal protection clause of the
Constitution. As pointed out by the Solicitor-General, no
comparison can be made between petitioner Cone and Mr. Norman
Black as the latter is "a long time resident of the country," and
thus, not subject to the provisions of Article 40 of the Labor Code
which apply only to "non-resident aliens." In any case, the term
"non-resident alien" and its obverse "resident alien," here must be
given their technical connotation under our law on immigration.
Neither can petitioners validly claim that implementation of
respondent Secretary's decision would amount to an impairment of
the obligations of contracts. The provisions of the Labor Code and
its Implementing Rules and Regulations requiring alien
employment permits were in existence long before petitioners
entered into their contract of employment. It is firmly settled that
provisions of applicable laws, especially provisions relating to
matters affected with public policy, are deemed written into
contracts.2 Private parties cannot constitutionally contract away the
otherwise applicable provisions of law.
Petitioners' contention that respondent Secretary of Labor should
have deferred to the findings of Commission on Immigration and
Deportation as to the necessity of employing petitioner Cone, is,
again, bereft of legal basis. The Labor Code itself specifically
empowers respondent Secretary to make a determination as to the
availability of the services of a "person in the Philippines who is
competent, able and willing at the time of application to perform
the services for which an alien is desired."3
In short, the Department of Labor is the agency vested with
jurisdiction to determine the question of availability of local
workers. The constitutional validity of legal provisions granting
such jurisdiction and authority and requiring proof of non-
availability of local nationals able to carry out the duties of the
position involved, cannot be seriously questioned.
Petitioners apparently also question the validity of the
Implementing Rules and Regulations, specifically Section 6 (c),
Rule XIV, Book I of the Implementing Rules, as imposing a
condition not found in the Labor Code itself. Section 6 (c), Rule
XIV, Book I of the Implementing Rules, provides as follows:
Section 6. Issuance of Employment Permit –– the
Secretary of Labor may issue an employment permit to
the applicant based on:
a) Compliance by the applicant and his employer with
the requirements of Section 2 hereof;
b) Report of the Bureau Director as to the availability or
non-availability of any person in the Philippines who is
competent and willing to do the job for which the
services of the applicant are desired.
(c) His assessment as to whether or not the employment
of the applicant will redound to the national interest;
(d) Admissibility of the alien as certified by the
Commission on Immigration and Deportation;
(e) The recommendation of the Board of Investments or
other appropriate government agencies if the applicant
will be employed in preferred areas of investments or in
accordance with the imperative of economic
development;
64
 xxx xxx xxx xxx xxx xxx

(Emphasis supplied) Thus, we find petitioners' arguments on the above points of

constitutional law too insubstantial to require further
consideration.1avvphi1
Article 40 of the Labor Code reads as follows:

Petitioners have very recently manifested to this Court that public

Art. 40. Employment per unit of non-resident aliens. ––
respondent Secretary of Labor has reversed his earlier decision and
Any alien seeking admission to the Philippines for
has issued an Employment Permit to petitioner Cone. Petitioners
employment purposes and any domestic or foreign
seek to withdraw their Petition for Certiorari on the ground that it
employer who desires to engage an alien for
has become moot and academic.
employment in the Philippines shall obtain an
employment permit from the Department of Labor.
While ordinarily this Court would dismiss a petition that clearly
appears to have become moot and academic, the circumstances of
The employment permit may be issued to a non-resident
this case and the nature of the questions raised by petitioners are
alien or to the applicant employer after a determination
such that we do not feel justified in leaving those questions
of the non-availability of a person in the Philippines
unanswered.4
who is competent, able and willing at the time of
application to perform the services for which the alien
is desired. Moreover, assuming that an alien employment permit has in fact
been issued to petitioner Cone, the basis of the reversal by the
Secretary of Labor of his earlier decision does not appear in the
For an enterprise registered in preferred areas of
record. If such reversal is based on some view of constitutional law
investments, said employment permit may be issued
or labor law different from those here set out, then such
upon recommendation of the government agency
employment permit, if one has been issued, would appear open to
charged with the supervision of said registered
serious legal objections.
enterprise. (Emphasis supplied)

ACCORDINGLY, the Court Resolved to DISMISS the Petition

Petitioners apparently suggest that the Secretary of Labor is not
for certiorari for lack of merit. Costs against petitioners.
authorized to take into account the question of whether or not
employment of an alien applicant would "redound to the national
interest" because Article 40 does not explicitly refer to such Fernan, C.J., Bidin and Davide, Jr., JJ., concur.
assessment. This argument (which seems impliedly to concede that Gutierrez, Jr., J., in the result.
the relationship of basketball coaching and the national interest is
tenuous and unreal) is not persuasive. In the first place, the second
G.R. No. 100641 June 14, 1993
paragraph of Article 40 says: "[t]he employment permit may be
issued to a non-resident alien or to the applicant employer after a
determination of the non-availability of a person in the Philippines FARLE P. ALMODIEL, petitioner,
who is competent, able and willing at the time of application to vs.
perform the services for which the alien is desired." The NATIONAL LABOR RELATIONS COMMISSION (FIRST
permissive language employed in the Labor Code indicates that the DIVISION), RAYTHEON PHILS., INC., respondents.
authority granted involves the exercise of discretion on the part of
the issuing authority. In the second place, Article 12 of the Labor
Code sets forth a statement of objectives that the Secretary of Apolinario Lomabao, Jr. for petitioner.
Labor should, and indeed must, take into account in exercising his
authority and jurisdiction granted by the Labor Code, Vicente A. Cruz, Jr., for private respondent.

Art. 12. Statement of Objectives. –– It is the policy of

the State:
a) To promote and maintain a state of full employment
through improved manpower training, allocation and
utilization;
xxx xxx xxx
c) To facilitate a free choice of available employment
by persons seeking work in conformity with the
national interest;
d) To facilitate and regulate the movement of workers
in conformity with the national interest;
e) To regulate the employment of aliens, including the
establishment of a registration and/or work permit
system;
NOCON, J.:
Subject of this petition for certiorari is the decision dated March
21, 1991 of the National Labor Relations Commission in NLRC
Case No.
00-00645-89 which reversed and set aside the Labor Arbiter's
decision dated September 27, 1989 and ordered instead the
payment of separation pay and financial assistance of P100,000.00.
Petitioner imputes grave abuse of discretion on the part of the
Commission and prays for the reinstatement of the Labor Arbiter's
decision which declared his termination on the ground of
redundancy illegal.
Petitioner Farle P. Almodiel is a certified public accountant who
was hired in October, 1987 as Cost Accounting Manager of
respondent Raytheon Philippines, Inc. through a reputable
placement firm, John Clements Consultants, Inc. with a starting
monthly salary of P18,000.00. Before said employment, he was the

65
accounts executive of Integrated Microelectronics, Inc. for several
years. He left his lucrative job therein in view of the promising
career offered by Raytheon. He started as a probationary or
temporary employee. As Cost Accounting Manager, his major
duties were: (1) plan, coordinate and carry out year and physical
inventory; (2) formulate and issue out hard copies of Standard
Product costing and other cost/pricing analysis if needed and
required and (3) set up the written Cost Accounting System for the
whole company. After a few months, he was given a regularization
increase of P1,600.00 a month. Not long thereafter, his salary was
increased to P21,600.00 a month.
On August 17, 1988, he recommended and submitted a Cost
Accounting/Finance Reorganization, affecting the whole finance
group but the same was disapproved by the Controller. However,
he was assured by the Controller that should his position or
department which was apparently a one-man department with no
staff becomes untenable or unable to deliver the needed service
due to manpower constraint, he would be given a three (3) year
advance notice.
In the meantime, the standard cost accounting system was installed
and used at the Raytheon plants and subsidiaries worldwide. It was
likewise adopted and installed in the Philippine operations. As a
consequence, the services of a Cost Accounting Manager allegedly
entailed only the submission of periodic reports that would use
computerized forms prescribed and designed by the international
head office of the Raytheon Company in California, USA.
On January 27, 1989, petitioner was summoned by his immediate
boss and in the presence of IRD Manager, Mr. Rolando Estrada, he
was told of the abolition of his position on the ground of
redundancy. He pleaded with management to defer its action or
transfer him to another department, but he was told that the
decision of management was final and that the same has been
conveyed to the Department of Labor and Employment. Thus, he
was constrained to file the complaint for illegal dismissal before
the Arbitration Branch of the National Capital Region, NLRC,
Department of Labor and Employment.
On September 27, 1989, Labor Arbiter Daisy Cauton-Barcelona
rendered a decision, the dispositive portion of which reads as
follows:
WHEREFORE, judgment is hereby rendered
declaring that complainant's termination on
the ground of redundancy is highly irregular
and without legal and factual basis, thus
ordering the respondents to reinstate
complainant to his former position with full
backwages without lost of seniority rights
and other benefits. Respondents are further
ordered to pay complainant P200,000.00 as
moral damages and P20,000.00 as
exemplary damages, plus ten percent (10%)
of the total award as attorney's fees.1
Raytheon appealed therefrom on the grounds that the Labor Arbiter
committed grave abuse of discretion in denying its rights to
dismiss petitioner on the ground of redundancy, in relying on
baseless surmises and self-serving assertions of the petitioner that
its act was tainted with malice and bad faith and in awarding moral
and exemplary damages and attorney's fees.
On March 21, 1991, the NLRC reversed the decision and directed
Raytheon to pay petitioner the total sum of P100,000.00 as
separation pay/financial assistance. The dispositive portion of
which is hereby quoted as follows:
WHEREFORE, the appealed decision is
hereby set aside. In its stead, Order is hereby
issued directing respondent to pay
complainant the total separation
pay/financial assistance of One Hundred
Thousand Pesos (P100,000.00).
SO ORDERED.2
From this decision, petitioner filed the instant petition averring
that:
The public respondent committed grave
abuse of discretion amounting to (lack of) or
in excess of jurisdiction in declaring as valid
and justified the termination of petitioner on
the ground of redundancy in the face of
clearly established finding that petitioner's
termination was tainted with malice, bad
faith and irregularity.3
Termination of an employee's services because of redundancy is
governed by Article 283 of the Labor Code which provides as
follows:
Art. 283. Closure of establishment and
reduction of personnel. — The employer
may also terminate the employment of any
employee due to installation of labor-saving
devices, redundancy, retrenchment to
prevent losses or the closing or cessation of
operation of the establishment or
undertaking unless the closing is for the
purpose of circumventing the provisions of
this Title, by serving a written notice on the
worker and the Department of Labor and
Employment at least one (1) month before
the intended date thereof. In case of
termination due to installation of labor-
saving devices or redundancy, the worker
affected thereby shall be entitled to a
separation pay equivalent to at least one (1)
month pay for every year of service,
whichever is higher. In case of retrenchment
to prevent losses and in cases of closure or
cessation of operations of establishment or
undertaking not due to serious business
losses or financial reverses, the separation
pay shall be equivalent to at least one (1)
month pay or 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 (1) whole year.
There is no dispute that petitioner was duly advised, one (1) month
before, of the termination of his employment on the ground of
redundancy in a written notice by his immediate superior, Mrs.
Magdalena B.D. Lopez sometime in the afternoon of January 27,
1989. He was issued a check for P54,863.00 representing
separation pay but in view of his refusal to acknowledge the notice
and the check, they were sent to him thru registered mail on
January 30, 1989. The Department of Labor and Employment was
served a copy of the notice of termination of petitioner in
66
accordance with the pertinent provisions of the Labor Code and the
implementing rules.
The crux of the controversy lies on whether bad faith, malice and
irregularity crept in the abolition of petitioner's position of Cost
Accounting Manager on the ground of redundancy. Petitioner
claims that the functions of his position were absorbed by the
Payroll/Mis/Finance Department under the management of Danny
Ang Tan Chai, a resident alien without any working permit from
the Department of Labor and Employment as required by law.
Petitioner relies on the testimony of Raytheon's witness to the
effect that corollary functions appertaining to cost accounting were
dispersed to other units in the Finance Department. And granting
that his department has to be declared redundant, he claims that he
should have been the Manager of the Payroll/Mis/Finance
Department which handled general accounting, payroll and
encoding. As a B. S. Accounting graduate, a CPA with M.B.A.
units, 21 years of work experience, and a natural born Filipino, he
claims that he is better qualified than Ang Tan Chai, a B.S.
Industrial Engineer, hired merely as a Systems Analyst
Programmer or its equivalent in early 1987, promoted as MIS
Manager only during the middle part of 1988 and a resident alien.
On the other hand, Raytheon insists that petitioner's functions as
Cost Accounting Manager had not been absorbed by Ang Tan
Chai, a permanent resident born in this country. It claims to have
established below that Ang Tan Chai did not displace petitioner or
absorb his functions and duties as they were occupying entirely
different and distinct positions requiring different sets of expertise
or qualifications and discharging functions altogether different and
foreign from that of petitioner's abolished position. Raytheon
debunks petitioner's reliance on the testimony of Mr. Estrada
saying that the same witness testified under oath that the functions
of the Cost Accounting Manager had been completely dispensed
with and the position itself had been totally abolished.
Whether petitioner's functions as Cost Accounting Manager have
been dispensed with or merely absorbed by another is however
immaterial. Thus, notwithstanding the dearth of evidence on the
said question, a resolution of this case can be arrived at without
delving into this matter. For even conceding that the functions of
petitioner's position were merely transferred, no malice or bad faith
can be imputed from said act. A survey of existing case law will
disclose that in Wiltshire File Co., Inc. v. NLRC,4 the position of
Sales Manager was abolished on the ground of redundancy as the
duties previously discharged by the Sales Manager simply added to
the duties of the General Manager to whom the Sales Manager
used to report. In adjudging said termination as legal, this Court
said that redundancy, for purposes of our Labor Code, exists where
the services of an employee are in excess of what is reasonably
demanded by the actual requirements of the enterprise. The
characterization of an employee's services as no longer necessary
or sustainable, and therefore, properly terminable, was an exercise
of business judgment on the part of the employer. The wisdom or
soundness of such characterization or decision was not subject to
discretionary review on the part of the Labor Arbiter nor of the
NLRC so long, of course, as violation of law or merely arbitrary
and malicious action is not shown.
In the case of International Macleod, Inc. v. Intermediate
Appellate Court,5 this Court also considered the position of
Government Relations Officer to have become redundant in view
of the appointment of the International Heavy Equipment
Corporation as the company's dealer with the government. It held
therein that the determination of the need for the phasing out of a
department as a labor and cost saving device because it was no
longer economical to retain said services is a management
prerogative and the courts will not interfere with the exercise
thereof as long as no abuse of discretion or merely arbitrary or
malicious action on the part of management is shown.
In the same vein, this Court ruled in Bondoc v. People's Bank and
Trust Co.,6 that the bank's board of directors possessed the power
to remove a department manager whose position depended on the
retention of the trust and confidence of management and whether
there was need for his services. Although some vindictive
motivation might have impelled the abolition of his position, this
Court expounded that it is undeniable that the bank's board of
directors possessed the power to remove him and to determine
whether the interest of the bank justified the existence of his
department.
Indeed, an employer has no legal obligation to keep more
employees than are necessary for the operation of its business.
Petitioner does not dispute the fact that a cost accounting system
was installed and used at Raytheon subsidiaries and plants
worldwide; and that the functions of his position involve the
submission of periodic reports utilizing computerized forms
designed and prescribed by the head office with the installation of
said accounting system. Petitioner attempts to controvert these
realities by alleging that some of the functions of his position were
still indispensable and were actually dispersed to another
department. What these indispensable functions that were
dispersed, he failed however, to specify and point out. Besides, the
fact that the functions of a position were simply added to the duties
of another does not affect the legitimacy of the employer's right to
abolish a position when done in the normal exercise of its
prerogative to adopt sound business practices in the management
of its affairs.
Considering further that petitioner herein held a position which
was definitely managerial in character, Raytheon had a broad
latitude of discretion in abolishing his position. An employer has a
much wider discretion in terminating employment relationship of
managerial personnel compared to rank and file employees.7 The
reason obviously is that officers in such key positions perform not
only functions which by nature require the employer's full trust and
confidence but also functions that spell the success or failure of an
enterprise.
Likewise destitute of merit is petitioner's imputation of unlawful
discrimination when Raytheon caused corollary functions
appertaining to cost accounting to be absorbed by Danny Ang Tan
Chai, a resident alien without a working permit. Article 40 of the
Labor Code which requires employment permit refers to non-
resident aliens. The employment permit is required for entry into
the country for employment purposes and is issued after
determination of the non-availability of a person in the Philippines
who is competent, able and willing at the time of application to
perform the services for which the alien is desired. Since Ang Tan
Chai is a resident alien, he does not fall within the ambit of the
provision.
Petitioner also assails Raytheon's choice of Ang Tan Chai to head
the Payroll/Mis/Finance Department, claiming that he is better
qualified for the position. It should be noted, however, that Ang
Tan Chai was promoted to the position during the middle part of
1988 or before the abolition of petitioner's position in early 1989.
Besides the fact that Ang Tan Chai's promotion thereto is a settled
matter, it has been consistently held that an objection founded on
the ground that one has better credentials over the appointee is
frowned upon so long as the latter possesses the minimum
qualifications for the position. In the case at bar, since petitioner
does not allege that Ang Tan Chai does not qualify for the position,
the Court cannot substitute its discretion and judgment for that
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which is clearly and exclusively management prerogative. To do so
would take away from the employer what rightly belongs to him as
aptly explained in National Federation of Labor Unions v. NLRC:8

It is a well-settled rule that labor laws do not

authorize interference with the employer's
judgment in the conduct of his business. The
determination of the qualification and fitness
of workers for hiring and firing, promotion
or reassignment are exclusive prerogatives
of management. The Labor Code and its
implementing Rules do not vest in the Labor
Arbiters nor in the different Divisions of the
NLRC (nor in the courts) managerial
authority. The employer is free to determine,
using his own discretion and business
judgment, all elements of employment,
"from hiring to firing" except in cases of
unlawful discrimination or those which may
be provided by law. There is none in the
instant case.

Finding no grave abuse of discretion on the part of the National

Labor Relations Commission in reversing and annulling the
decision of the Labor Arbiter and that on the contrary, the
termination of petitioner's employment was anchored on a valid
and authorized cause under Article 283 of the Labor Code, the
instant petition for certiorari must fail.

SO ORDERED.

Narvasa, C.J., Padilla and Regalado, JJ., concur.

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