Calalang vs. Williams G.R. No. 47800 December 2, 1940 Petitioner: Maximo CalalangRespondents: A.D. Williams, Et al.

Ponente: Laurel, J: Facts: Maximo Calalang in his capacity as a private citizen and a taxpayer of Manila filed apetition for a writ of prohibition against the respondents.It is alleged in the petition that the National Traffic Commission, in its resolution of July 17, 1940, resolved to recommend to the Director of the Public Works and to the Secretary of Public Works and Communications that animal-drawn vehicles be prohibited from passingalong Rosario Street extending from Plaza Calderon de la Barca to Dasmarias Street from 7:30Am to 12:30 pm and from 1:30 pm to 530 pm; and along Rizal Avenue extending from therailroad crossing at Antipolo Street to Echague Street from 7 am to 11pm for a period of one yearfrom the date of the opening of the Colgante Bridge to traffic.The Chairman of the National Traffic Commission on July 18, 1940 recommended to theDirector of Public Works with the approval of the Secretary of Public Works the adoption of themeasure proposed in the resolution aforementioned in pursuance of the provisions of theCommonwealth Act No. 548 which authorizes said Director with the approval from theSecretary of the Public Works and Communication to promulgate rules and regulations toregulate and control the use of and traffic on national roads.On August 2, 1940, the Director recommended to the Secretary the approval of therecommendations made by the Chairman of the National Traffic Commission withmodifications. The Secretary of Public Works approved the recommendations on August 10,1940.The Mayor of Manila and the Acting Chief of Police of Manila have enforced and causedto be enforced the rules and regulation. As a consequence, all animal-drawn vehicles are notallowed to pass and pick up passengers in the places above mentioned to the detriment not only of their owners but of the riding public as well. Issue: 1. Whether the rules and regulations promulgated by the respondentspursuant to the provisions of Commonwealth Act NO. 548 constitutean unlawful inference with legitimate business or trade and abridgedthe right to personal liberty and freedom of locomotion?2. Whether the rules and regulations complained of infringe upon theconstitutional precept regarding the promotion of social justice toinsure the well-being and economic security of all the people? Held: 1. No. The promulgation of the Act aims to promote safe transit upon and avoidobstructions on national roads in the interest and convenience of the public. Inenacting said law, the National Assembly was prompted by considerations of public convenience and welfare. It was inspired by the desire to relievecongestion of traffic, which is a menace to the public safety. Public welfare liesat the bottom of the promulgation of the said law and the state inorder to promote the general welfare may interfere with personalliberty, with property, and with business and occupations . Persons andproperty may be subject to all kinds of restraints and burdens in order to securethe general comfort, health, and prosperity of the State. To this fundamentalaims of the government, the rights of the individual are subordinated. Liberty isa blessing which should not be made to prevail over authority because society will fall into anarchy. Neither should authority be made to prevail over liberty

because then the individual will fall into slavery. The paradox lies in the factthat the apparent curtailment of liberty is precisely the very means of insuring its preserving. 2. No. Social justice means the promotion of the welfare of all the people, theadoption by the Government of measures calculated to insure economic stability of all the competent elements of society, through the maintenance of a propereconomic and social equilibrium in the interrelations of the members of thecommunity, constitutionally, through the adoption of measures legally justifiable,or extra-constitutionally, through the exercise of powers underlying the existenceof all governments on the time-honored principles of salus populi estsuprema lex. Social justice must be founded on the recognition of the necessity of interdependence among divers and diverse units of a society and of theprotection that should be equally and evenly extended to all groups as acombined force in our social and economic life, consistent with the fundamentaland paramount objective of the state of promoting health, comfort and quiet of all persons, and of bringing about the greatest good to the greatest number. THE PETITION IS DENIED WITH COSTS AGAINST THE PETITIONE

SPECIAL

SECOND

DIVISION

[G.R. No. 155109, March 14, 2012] C. ALCANTARA & SONS, INC., PETITIONER, VS. COURT OF APPEALS,. For resolution are the (1) Motion for Partial Reconsideration[1] filed by C. Alcantara & Sons, Inc. (CASI) and (2) Motion for Reconsideration[2] filed by Nagkahiusang Mamumuo sa Alsons-SPFL (the Union) and the Union officers[3] and their striking members[4] of the Courts Decision[5] dated September 29, 2010. In a Resolution[6] dated December 13, 2010, the parties were required to submit their respective Comments. After several motions for extension, the parties submitted the required comments. Hence, this resolution. For a proper perspective, we state briefly the facts of the case. The negotiation between CASI and the Union on the economic provisions of the Collective Bargaining Agreement (CBA) ended in a deadlock prompting the Union to stage a strike,[7] but the strike was later declared by the Labor Arbiter (LA) to be illegal having been staged in violation of the CBAs no strike-no lockout provision.[8] Consequently, the Union officers were deemed to have forfeited their employment with the company and made them liable for actual damages plus interest and attorneys fees, while the Union members were ordered to be reinstated without backwages there being no proof that they actually committed 1

illegal

acts

during

the

strike.[9]

Notwithstanding the provision of the Labor Code mandating that the reinstatement aspect of the decision be immediately executory, the LA refused to reinstate the dismissed Union members. On November 8, 1999, the NLRC affirmed the LA decision insofar as it declared the strike illegal and ordered the Union officers dismissed from employment and liable for damages but modified the same by considering the Union members to have been validly dismissed from employment for committing prohibited and illegal acts.[10] On petition for certiorari, the Court of Appeals (CA) annulled the NLRC decision and reinstated that of the LA. Aggrieved, CASI, the Union and the Union officers and members elevated the matter to this Court. The cases were docketed as G.R. Nos. 155109 and 155135.[11] During the pendency of the cases, the affected Union members (who were ordered reinstated) filed with the LA a motion for reinstatement pending appeal and the computation of their backwages. Instead of reinstating the Union members, the LA awarded separation pay and other benefits.[12] On appeal, the NLRC denied the Union members claim for separation pay, accrued wages and other benefits.[13] When elevated to the CA, the appellate court held that reinstatement pending appeal applies only to illegal dismissal cases under Article 223 of the Labor Code and not to cases under Article 263.[14] Hence, the petition by the Union and its officers and members in G.R. No. 179220. G.R. Nos. 155109, 155135, and 179220 were consolidated. On September 29, 2010, the Court rendered a decision the dispositive portion of which reads: WHEREFORE, the Court DENIES the petition of the Nagkahiusang Mamumuo sa Alsons-SPFL and its officers and members in G.R. No. 155135 for lack of merit, and REVERSES and SETS ASIDE the decision of the Court of Appeals in CA-G.R. SP 59604 dated March 20, 2002. The Court, on the other hand, GRANTS the petition of C. Alcantara & Sons, Inc. in G.R. 155109 and REINSTATES the decision of the National Labor Relations Commission in NLRC CA M-004996-99 dated November 8, 1999. Further, the Court PARTIALLY GRANTS the petition of the Nagkahiusang Mamumuo sa Alsons-SPFL and their dismissed members in G.R. No. 179220 and ORDERS C. Alcantara & Sons, Inc. to

pay the terminated Union members backwages for four (4) months and nine (9) days and separation pays equivalent to one-half month salary for every year of service to the company up to the date of their termination, with interest of 12% per annum from the time this decision becomes final and executory until such backwages and separation pays are paid. The Court DENIES all other claims. SO ORDERED.[15] The Court agreed with the CA on the illegality of the strike as well as the termination of the Union officers, but disagreed with the CA insofar as it affirmed the reinstatement of the Union members. The Court, instead, sustained the dismissal not only of the Union officers but also the Union members who, during the illegal strike, committed prohibited acts by threatening, coercing, and intimidating non-striking employees, officers, suppliers and customers; obstructing the free ingress to and egress from the company premises; and resisting and defying the implementation of the writ of preliminary injunction issued against the strikers.[16] The Court further held that the terminated Union members, who were ordered reinstated by the LA, should have been immediately reinstated due to the immediate executory nature of the reinstatement aspect of the LA decision. In view, however, of CASIs failure to reinstate the dismissed employees, the Court ordered CASI to pay the terminated Union members their accrued backwages from the date of the LA decision until the eventual reversal by the NLRC of the order of reinstatement.[17] In addition to the accrued backwages, the Court awarded separation pay as a form of financial assistance to the Union members equivalent to one-half month salary for every year of service to the company up to the date of their termination.[18] Not satisfied, CASI filed a Motion for Partial Reconsideration of the above decision based on the following grounds: I. IT IS RESPECTFULLY SUBMITTED THAT A PRECEDENT SETTING RULING OF THIS HONORABLE COURT IN ESCARIO V. NLRC [G.R. No. 160302, 27 SEPTEMBER 2010] PARTICULARLY ON THE PROPER APPLICATION OF ARTICLES 264 AND 279 OF THE LABOR CODE SUPPORTS THE AFFIRMATION AND NOT THE REVERSAL OF THE FINDINGS OF THE COURT OF APPEALS 2

[CA], AND NEGATES THE ENTITLEMENT TO ACCRUED WAGES OF THE UNION MEMBERS WHO COMMITTED ILLEGAL ACTS DURING THE ILLEGAL STRIKE, NOTWITHSTANDING THAT THE LABOR ARBITER AWARDED THE SAME. II. IT IS RESPECTFULY SUBMITTED THAT THIS HONORABLE COURT ERRED WHEN IT RESOLVED TO GRANT SEPARATION PAY TO THE UNION MEMBERS WHO COMMITTED ILLEGAL ACTS DURING THE ILLEGAL STRIKE CONSIDERING THAT JURISPRUDENCE CITED TO JUSTIFY THE GRANT OF SEPARATION PAY DO NOT APPLY TO THE PRESENT CASE AS IT APPLIES ONLY TO DISMISSALS FOR A JUST CAUSE.[19] The Union, its officers and members likewise filed their separate motion for reconsideration assailing the Courts conclusions that: (1) the strike is illegal; (2) that the officers of the Union and its appointed shop stewards automatically forfeited their employment status when they participated in the strike; (3) that the Union members committed illegal acts during the strike and are deemed to have lost their employment status; and (4) that CASI is entitled to actual damages and attorneys fees.[20] They also fault the Court in not finding that: (1) CASI and its officers are guilty of acts of unfair labor practice or violation of Article 248 of the Labor Code; (2) the lockout declared by the company is illegal; (3) CASI and its officers committed acts of discrimination; (4) CASI and its officers violated Article 254 of the Labor Code; and (5) CASI and its officers are liable for actual, moral, and exemplary damages to the Union, its officers and members.[21] Simply stated, CASI only questions the propriety of the award of backwages and separation pay, while the Union, its officers and members seek the reversal of the Courts conclusions on the illegality of the strike, the validity of the termination of the Union officers and members, and the award of actual damages and attorneys fees as well as the denial of their counterclaims against CASI. After a careful review of the records of the case, we find it necessary to reconsider the Courts September 29, 2010 decision, but only as to the award of separation pay. The LA, the NLRC, the CA and the Court are one in saying that the strike staged by the Union, participated in by the Union officers and members, is illegal being in violation of the no strike-no lockout provision of the

CBA which enjoined both the Union and the company from resorting to the use of economic weapons available to them under the law and to instead take recourse to voluntary arbitration in settling their disputes.[22] We, therefore, find no reason to depart from such conclusion. Article 264 (a) of the Labor Code lays down the liabilities of the Union officers and members participating in illegal strikes and/or committing illegal acts, to wit: ART. 264. PROHIBITED ACTIVITIES (a) x x x

Any worker whose employment has been terminated as a consequence of an unlawful lockout shall be entitled to reinstatement with full backwages. Any Union officer who knowingly participates in an illegal strike and any worker or Union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike. Thus, the above-quoted provision sanctions the dismissal of a Union officer who knowingly participates in an illegal strike or who knowingly participates in the commission of illegal acts during a lawful strike.[23] In this case, the Union officers were in clear breach of the above provision of law when they knowingly participated in the illegal strike.[24] As to the Union members, the same provision of law provides that a member is liable when he knowingly participates in the commission of illegal acts during a strike. We find no reason to reverse the conclusion of the Court that CASI presented substantial evidence to show that the striking Union members committed the following prohibited acts: They threatened, coerced, and intimidated non-striking employees, officers, suppliers and customers; They obstructed the free ingress to and egress from the company premises; and They resisted and defied the implementation of the writ of preliminary injunction issued against the strikers.[25] The commission of the above prohibited acts by the striking Union members warrants their dismissal from employment. As clearly narrated earlier, the LA found 3

the strike illegal and sustained the dismissal of the Union officers, but ordered the reinstatement of the striking Union members for lack of evidence showing that they committed illegal acts during the illegal strike. This decision, however, was later reversed by the NLRC. Pursuant to Article 223[26] of the Labor Code and wellestablished jurisprudence,[27] the decision of the LA reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall immediately be executory, pending appeal. [28] The employee shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal or separation, or, at the option of the employee, merely reinstated in the payroll. [29] It is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court.[30] If the employer fails to exercise the option of re-admitting the employee to work or to reinstate him in the payroll, the employer must pay the employees salaries during the period between the LAs order of reinstatement pending appeal and the resolution of the higher court overturning that of the LA.[31] In this case, CASI is liable to pay the striking Union members their accrued wages for four months and nine days, which is the period from the notice of the LAs order of reinstatement until the reversal thereof by the NLRC.[32] Citing Escario v. National Labor Relations Commission (Third Division),[33] CASI claims that the award of the four-month accrued salaries to the Union members is not sanctioned by jurisprudence. In Escario, the Court categorically stated that the strikers were not entitled to their wages during the period of the strike (even if the strike might be legal), because they performed no work during the strike. The Court further held that it was neither fair nor just that the dismissed employees should litigate against their employer on the latters time.[34] In this case, however, the four-month accrued salaries awarded to the Union members are not the backwages referred to in Escario. To be sure, the awards were not given as their salaries during the period of the strike. Rather, they constitute the employers liability to the employees for its failure to exercise the option of actual reinstatement or payroll reinstatement following the LAs decision to reinstate the Union members as mandated by Article 223 of the Labor Code adequately discussed earlier. In other words, such monetary award refers to the Union members accrued salaries by reason of the reinstatement order of the LA

the

four-month

accrued

salaries.

Finally, as regards the separation pay as a form of financial assistance awarded by the Court, we find it necessary to reconsider the same and delete the award pursuant to prevailing jurisprudence. Separation pay may be given as a form of financial assistance when a worker is dismissed in cases such as the installation of labor-saving devices, redundancy, retrenchment to prevent losses, closing or cessation of operation of the establishment, or in case the employee was found to have been suffering from a disease such that his continued employment is prohibited by law.[36] It is a statutory right defined as the amount that an employee receives at the time of his severance from the service and is designed to provide the employee with the wherewithal during the period that he is looking for another employment.[37] It is oriented towards the immediate future, the transitional period the dismissed employee must undergo before locating a replacement job.[38] As a general rule, when just causes for terminating the services of an employee exist, the employee is not entitled to separation pay because lawbreakers should not benefit from their illegal acts.[39] The rule, however, is subject to exceptions.[40] The Court, in Philippine Long Distance Telephone Co. v. NLRC,[41] laid down the guidelines when separation pay in the form of financial assistance may be allowed, to wit: We hold that henceforth separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. Where the reason for the valid dismissal is, for example, habitual intoxication or an offense involving moral turpitude, like theft or illicit sexual relations with a fellow worker, the employer may not be required to give the dismissed employee separation pay, or financial assistance, or whatever other name it is called, on the ground of social justice. A contrary rule would, as the petitioner correctly argues, have the effect, of rewarding rather than punishing the erring employee for his offense. And we do not agree that the punishment is his dismissal only and that the separation pay has nothing to do with the wrong he has committed x x x.[42] We had the occasion to resolve the same issue in Toyota Motor Phils. Corp. Workers 4

Association (TMPCWA) v. National Labor Relations Commission.[43] Following the declaration that the strike staged by the Union members is illegal, the Union officers and members were considered validly dismissed from employment for committing illegal acts during the illegal strike. The Court affirmed the CAs conclusion that the commission of illegal acts during the illegal strike constituted serious misconduct.[44] Hence, the award of separation pay to the Union officials and members was not sustained.[45] Indeed, we applied social justice and equity considerations in several cases to justify the award of financial assistance. In Piero v. National Labor Relations Commission,[46] the Court declared the strike to be illegal for failure to comply with the procedural requirements. We, likewise, sustained the dismissal of the Union president for participating in said illegal strike. Considering, however, that his infraction is not so reprehensible and unscrupulous as to warrant complete disregard of his long years of service, and considering further that he has no previous derogatory records, we granted financial assistance to support him in the twilight of his life after long years of service.[47] The same compassion was also applied in Aparente, Sr. v. NLRC[48] where the employee was declared to have been validly terminated from service after having been found guilty of driving without a valid drivers license, which is a clear violation of the companys rules and regulations.[49] We, likewise, awarded financial assistance in Salavarria v. Letran College[50] to the legally dismissed teacher for violation of school policy because such infraction neither amounted to serious misconduct nor reflected that of a morally depraved person. However, in a number of cases cited in Toyota Motor Phils. Corp. Workers Association (TMPCWA) v. National Labor Relations Commission,[51] we refrained from awarding separation pay or financial assistance to Union officers and members who were separated from service due to their participation in or commission of illegal acts during the strike.[52] In Pilipino Telephone Corporation v. Pilipino Telephone Employees Association (PILTEA), [53] the strike was found to be illegal because of procedural infirmities and for defiance of the Secretary of Labors assumption order. Hence, we upheld the Union officers dismissal without granting financial assistance. In Sukhotai Cuisine and Restaurant v. Court of Appeals,[54] and Manila Diamond Hotel and Resort, Inc. (Manila Diamond Hotel) v. Manila Diamond Hotel Employees Union,[55] the Union

illegal strike were deemed to have lost their employment status and were not awarded financial assistance. In Telefunken Semiconductors Employees Union v. Court of Appeals,[56] the Court held that the strikers open and willful defiance of the assumption order of the Secretary of Labor constitute serious misconduct and reflective of their moral character, hence, granting of financial assistance to them cannot be justified. In Chua v. National Labor Relations Commission,[57] we disallowed the award of financial assistance to the dismissed employees for their participation in the unlawful and violent strike which resulted in multiple deaths and extensive property damage because it constitutes serious misconduct on their part. Here, not only did the Court declare the strike illegal, rather, it also found the Union officers to have knowingly participated in the illegal strike. Worse, the Union members committed prohibited acts during the strike. Thus, as we concluded in Toyota, Telefunken, Chua and the other cases cited above, we delete the award of separation pay as a form of financial assistance. WHEREFORE, premises considered, the motion for reconsideration of the Union, its officers and members are DENIED for lack of merit, while the motion for partial reconsideration filed by C. Alcantara & Sons, Inc. is PARTLY GRANTED. The Decision of the Court dated September 29, 2010 is hereby PARTLY RECONSIDERED by deleting the award of separation pay. SO ORDERED. EN BANC WILLIAM C. DAGAN, CARLOS G.R. No. 175220 H. REYES, NARCISO MORALES, BONIFACIO MANTILLA, Present: CESAR AZURIN, WEITONG LIM, MA. TERESA TRINIDAD, MA. PUNO, C.J., CARMELITA FLORENTINO, QUISUMBING, Petitioners, YNARES-SANTIAGO, CARPIO, AUSTRIA-MARTINEZ, CORONA, 5

- versus CARPIO MORALES, AZCUNA, TINGA, CHICO-NAZARIO, VELASCO, JR., PHILIPPINE RACING COMMISSION, NACHURA, MANILA JOCKEY CLUB, INC., and LEONARDO DE CASTRO, PHILIPPINE RACING CLUB, INC., BRION, and Respondents PERALTA, JJ. Promulgated: February 12, 2009 x ---------------------------------------------------------------------------------- x DECISION TINGA, J.: The subject of this petition for certiorari is the decision1[1] of the Court of Appeals in CA-G.R. SP No. 95212, affirming in toto the judgment2[2] of the Regional Trial Court of Makati in Civil Case No. 04-1228. The controversy stemmed from the 11 August 2004 directive3[3] issued by the Philippine Racing Commission (Philracom) directing the Manila Jockey Club, Inc. (MJCI) and Philippine Racing Club, Inc. (PRCI) to immediately come up with their respective Clubs House Rule to address Equine Infectious Anemia (EIA)4[4] problem and to rid their facilities of horses infected with EIA. Said directive was issued pursuant to Administrative Order No. 55[5] dated 28 March 1994 by the Department of Agriculture declaring it unlawful for any person, firm or corporation to ship, drive, or transport horses from any locality or place except when accompanied by a 1 2 3 4 5

certificate issued by the authority of the Director of the Bureau of Animal Industry (BAI).6[6] In compliance with the directive, MJCI and PRCI ordered the owners of racehorses stable in their establishments to submit the horses to blood sampling and administration of the Coggins Test to determine whether they are afflicted with the EIA virus. Subsequently, on 17 September 2004, Philracom issued copies of the guidelines for the monitoring and eradication of EIA.7[7]

Petitioners and racehorse owners William Dagan (Dagan), Carlos Reyes, Narciso Morales, Bonifacio Montilla, Cezar Azurin, Weitong Lim, Ma. Teresa Trinidad and Ma. Carmelita Florentino refused to comply with the directive. First, they alleged that there had been no prior consultation with horse owners. Second, they claimed that neither official guidelines nor regulations had been issued relative to the taking of blood samples. And third, they asserted that no documented case of EIA had been presented to justify the undertaking.8[8] Despite resistance from petitioners, the blood testing proceeded. The horses, whose owners refused to comply were banned from the races, were removed from the actual day of race, prohibited from renewing their licenses or evicted from their stables. When their complaint went unheeded, the racehorse owners lodged a complaint before the Office of the President (OP) which in turn issued a directive instructing Philracom to investigate the matter. For failure of Philracom to act upon the directive of the OP, petitioners filed a petition for injunction with application for the issuance of a temporary restraining order (TRO). In an order9[9] dated 11 November 2004, the trial court issued a TRO.

Dagan refused to comply with the directives because, according to him, the same are unfair as there are no 6 7 8 9 6

implementing rules on the banning of sick horses from races. Consequently, his horses were evicted from the stables and transferred to an isolation area. He also admitted that three of his horses had been found positive for EIA.10[10] Confronted with two issues, namely: whether there were valid grounds for the issuance of a writ of injunction and whether respondents had acted with whim and caprice in the implementation of the contested guideline, the trial court resolved both queries in the negative. The trial court found that most racehorse owners, except for Dagan, had already subjected their racehorses to EIA testing. Their act constituted demonstrated compliance with the contested guidelines, according to the trial court. Hence, the acts sought to be enjoined had been rendered moot and academic. With respect to the subject guidelines, the trial court upheld their validity as an exercise of police power, thus: The Petitioners submission that the subject guidelines are oppressive and hence confiscatory of proprietary rights is likewise viewed by this Court to be barren of factual and legal support. The horseracing industry, needless to state, is imbued with public interest deserving of utmost concern if not constant vigilance. The Petitioners do not dispute this. It is because of this basic fact that respondents are expected to police the concerned individuals and adopt measures that will promote and protect the interests of all the stakeholders starting from the moneyed horse-owners, gawking bettors down to the lowly maintainers of the stables. This is a clear and valid exercise of police power with the respondents acting for the State. Participation in the business of horseracing is but a privilege; it is not a right. And no clear acquiescence to this postulation can there be than the Petitioners' own undertaking to abide by the rules and conditions issued and imposed by the respondents as specifically shown by their contracts of lease with MCJI.11[11] Petitioners appealed to the Court of Appeals. In its Decision dated 27 October 2006, the appellate court affirmed in toto the decision of the trial court. 10 11

The appellate court upheld the authority of Philracom to formulate guidelines since it is vested with exclusive jurisdiction over and control of the horse-racing industry per Section 8 of Presidential Decree (P.D.) No. 8. The appellate court further pointed out that P.D. No. 420 also endows Philracom with the power to prescribe additional rules and regulations not otherwise inconsistent with the said presidential decree12[12] and to perform such duties and exercise all powers incidental or necessary to the accomplishment of its aims and objectives.13[13] It similarly concluded that the petition for prohibition should be dismissed on the ground of mootness in light of evidence indicating that petitioners had already reconsidered their refusal to have their horses tested and had, in fact, subsequently requested the administration of the test to the horses.14[14] Aggrieved by the appellate courts decision, petitioners filed the instant certiorari petition15[15] imputing grave abuse of discretion on the part of respondents in compelling petitioners to subject their racehorses to blood testing. In their amended petition,16[16] petitioners allege that Philracoms unsigned and undated implementing guidelines suffer from several infirmities. They maintain that the assailed guidelines do not comply with due process requirements. Petitioners insist that racehorses already in the MJCI stables were allowed to be so quartered because the individual horse owners had already complied with the Philracom regulation that horses should not bear any disease. There was neither a directive nor a rule that racehorses already lodged in the stables of the racing clubs should again be subjected to the collection of blood samples preparatory to the conduct of the EIA tests,17[17] petitioners note. Thus, it came as a surprise to horse owners when told about the administration of a new Coggins Tests on old horses since the matter had not been taken up with them.18 [18] No investigation or at least a 12 13 14 15 16 17 18 7

summary proceeding was conducted affording petitioners an opportunity to be heard.19[19] Petitioners also aver that the assailed guidelines are ultra vires in that the sanctions imposed for refusing to submit to medical examination are summary eviction from the stables or arbitrary banning of participation in the races, notwithstanding the penalties prescribed in the contract of lease.20[20] In its Comment,21[21] the PRCI emphasizes that it merely obeyed the terms of its franchise and abided by the rules enacted by Philracom.22[22] For its part, Philracom, through the Office of the Solicitor-General (OSG), stresses that the case has become moot and academic since most of petitioners had complied with the guidelines by subjecting their race horses to EIA testing. The horses found unafflicted with the disease were eventually allowed to join the races.23[23] Philracom also justified its right under the law to regulate horse racing.24[24] MJCI adds that Philracom need not delegate its rule-making power to the former since MJCIs right to formulate its internal rules is subsumed under the franchise granted to it by Congress.25[25] In their Reply,26[26] petitioners raise for the first time the issue that Philracom had unconstitutionally delegated its rulemaking power to PRCI and MJCI in issuing the directive for them to come up with club rules. In response to the claim that respondents had merely complied with their duties under their franchises, petitioners counter that the power granted to PRCI and MJCI under their respective franchises is limited to: (1) the construction, operation and maintenance of racetracks; (2) the establishment of branches for booking purposes; and (3) the conduct of horse races. It appears on record that only Dagan had refused to comply with the orders of

respondents. Therefore, the case subsists as regards Dagan. Petitioners essentially assail two issuances of Philracom; namely: the Philracom directive27[27] and the subsequent guidelines addressed to MJCI and PRCI. The validity of an administrative issuance, such as the assailed guidelines, hinges on compliance with the following requisites: 1. Its promulgation must be authorized by the legislature; 2. It must be promulgated in accordance with the prescribed procedure; 3. It must be within the scope of the authority given by the legislature; 4. It must be reasonable.28[28] All the prescribed requisites are met as regards the questioned issuances. Philracoms authority is drawn from P.D. No. 420. The delegation made in the presidential decree is valid. Philracom did not exceed its authority. And the issuances are fair and reasonable.

19 20 21 22 23 24 25 26

The rule is that what has been delegated cannot be delegated, or as expressed in the Latin maxim: potestas delegate non delegare potest. This rule is based upon the ethical principle that such delegated power constitutes not only a right but a duty to be performed by the delegate by the instrumentality of his own judgment acting immediately upon the matter of legislation and not through the intervening mind of another.29[29] This rule however admits of recognized exceptions30[30] such as the grant of rule-making power to administrative agencies. They have been granted by Congress with the authority to issue rules to regulate the implementation of a law entrusted to them. Delegated rule-making has become a practical necessity in modern governance due to the increasing complexity and variety of public functions.31[31] However, in every case of permissible delegation, there must be a showing that the delegation itself is valid. It is valid only 27 28 29 30 31 8

if the law (a) is complete in itself, setting forth therein the policy to be executed, carried out, or implemented by the delegate; and (b) fixes a standardthe limits of which are sufficiently determinate and determinableto which the delegate must conform in the performance of his functions. A sufficient standard is one which defines legislative policy, marks its limits, maps out its boundaries and specifies the public agency to apply it. It indicates the circumstances under which the legislative command is to be effected.32 [32] P.D. No. 420 hurdles the tests of completeness and standards sufficiency. Philracom was created for the purpose of carrying out the declared policy in Section 1 which is to promote and direct the accelerated development and continued growth of horse racing not only in pursuance of the sports development program but also in order to insure the full exploitation of the sport as a source of revenue and employment. Furthermore, Philracom was granted exclusive jurisdiction and control over every aspect of the conduct of horse racing, including the framing and scheduling of races, the construction and safety of race tracks, and the security of racing. P.D. No. 420 is already complete in itself. Section 9 of the law fixes the standards and limitations to which Philracom must conform in the performance of its functions, to wit: Section 9. Specific Powers. Specifically, the Commission shall have the power: a. To enforce all laws, decrees and executive orders relating to horseracing that are not expressly or implied repealed or modified by this Decree, including all such existing rules and regulations until otherwise modified or amended by the Commission; b. To prescribe additional rules and regulations not otherwise inconsistent with this Decree; c. To register race horses, horse owners or associations or federations thereof, and to regulate the construction of race tracks and to grant permit for the holding of races; d. To issue, suspend or revoke permits and licenses and to impose or collect fees for the issuance of such licenses and permits to persons required to obtain the same; 32

e. To review, modify, approve or disapprove the rules and regulations issued by any person or entity concerning the conduct of horse races held by them; f. To supervise all such race meeting to assure integrity at all times. It can order the suspension of any racing event in case of violation of any law, ordinance or rules and regulations; g. To prohibit the use of improper devices, drugs, stimulants or other means to enhance or diminish the speed of horse or materially harm their condition; h. To approve the annual budget of the omission and such supplemental budgets as may be necessary; i. To appoint all personnel, including an Executive Director of the Commission, as it may be deem necessary in the exercise and performance of its powers and duties; and j. To enter into contracts involving obligations chargeable to or against the funds of the Commission. (Emphasis supplied) Clearly, there is a proper legislative delegation of rule-making power to Philracom. Clearly too, for its part Philracom has exercised its rule-making power in a proper and reasonable manner. More specifically, its discretion to rid the facilities of MJCI and PRCI of horses afflicted with EIA is aimed at preserving the security and integrity of horse races. Petitioners also question the supposed delegation by Philracom of its rule-making powers to MJCI and PRCI. There is no delegation of power to speak of between Philracom, as the delegator and MJCI and PRCI as delegates. The Philracom directive is merely instructive in character. Philracom had instructed PRCI and MJCI to immediately come up with Clubs House Rule to address the problem and rid their facilities of horses infected with EIA. PRCI and MJCI followed-up when they ordered the racehorse owners to submit blood samples and subject their race horses to blood testing. Compliance with the Philracoms directive is part of the mandate of PRCI and MJCI under Sections

133[33] of R.A. No. 795334[34] and Sections 135[35] and 236[36] of 8407.37[37]

As correctly proferred by MJCI, its duty is not derived from the delegated authority of Philracom but arises from the franchise granted to them by Congress allowing MJCI to do and carry out all such acts, deeds and things as may be necessary to give effect to the foregoing.38[38] As justified by PRCI, obeying the terms of the franchise and abiding by whatever rules enacted by Philracom is its duty.39[39] More on the second, third and fourth requisites. As to the second requisite, petitioners raise some infirmities relating to Philracoms guidelines. They question the supposed belated issuance of the guidelines, that is, only after the collection of blood samples for the Coggins Test was ordered. While it is conceded that the guidelines were issued a month after Philracoms directive, this circumstance does not render the directive nor the guidelines void. The directives validity and effectivity are not dependent on any supplemental guidelines. Philracom has every right to issue directives to MJCI and PRCI with respect to the conduct of horse racing, with or without implementing guidelines. Petitioners also argue that Philracoms guidelines have no force and effect for lack of publication and failure to file copies with the University of the Philippines (UP) Law Center as required by law. As a rule, the issuance of rules and regulations in the exercise of an administrative agency of its quasilegislative power does not require notice 7and hearing.40[40] In Abella, Jr. v. Civil Service Commission,41[41] this Court had the occasion to rule that prior notice and 33 34 35 36 37 38 39 40 41

hearing are not essential to the validity of rules or regulations issued in the exercise of quasi-legislative powers since there is no determination of past events or facts that have to be established or 42 ascertained. [42] The third requisite for the validity of an administrative issuance is that it must be within the limits of the powers granted to it. The administrative body may not make rules and regulations which are inconsistent with the provisions of the Constitution or a statute, particularly the statute it is administering or which created it, or which are in derogation of, or defeat, the purpose of a statute.43[43] The assailed guidelines prescribe the procedure for monitoring and eradicating EIA. These guidelines are in accord with Philracoms mandate under the law to regulate the conduct of horse racing in the country. Anent the fourth requisite, the assailed guidelines do not appear to be unreasonable or discriminatory. In fact, all horses stabled at the MJCI and PRCIs premises underwent the same procedure. The guidelines implemented were undoubtedly reasonable as they bear a reasonable relation to the purpose sought to be accomplished, i.e., the complete riddance of horses infected with EIA. It also appears from the records that MJCI properly notified the racehorse owners before the test was conducted.44[44] Those who failed to comply were repeatedly warned of certain consequences and sanctions. Furthermore, extant from the records are circumstances which allow respondents to determine from time to time the eligibility of horses as race entries. The lease contract executed between petitioner and MJC contains a proviso reserving the right of the lessor, MJCI in this case, the right to determine whether a particular horse is a qualified horse. In addition, Philracoms rules and regulations on horse racing provide that horses must be free from any contagious disease or illness in order to be eligible as race entries. All told, we find no grave abuse of discretion on the part of Philracom in issuing the contested guidelines and on the 42 43 44 10

part MJCI and PRCI in complying with Philracoms directive. WHEREFORE, the petition is DISMISSED. Costs against petitioner William Dagan. SO ORDERED. Republic of the Philippines Supreme Court Manila

through Goyena Solis (Solis), conducted an investigation into alleged financial anomalies committed at the TBFO. In her investigation report, Solis stated that part of the funds allotted to the TBFO was missing or not properly accounted for. The report also stated that some of the receipts that the TBFO submitted to liquidate the organizations financial transactions were fictitious and manufactured.48[4] The PRRM management sent Pulgar a copy of the report, together with a memorandum, asking him to explain these findings.49[5]

THIRD DIVISION In a letter dated February 24, 1997, Pulgar admitted that TBFOs reported expenses PHILIPPINE RURAL G.R. No. 169227 did not reflect its actual expenses. He RECONSTRUCTION MOVEMENT explained that as field manager, he (PRRM), Present: presumed he had the discretion to Petitioner, determine when and how the funds would CARPIO MORALESlong as the use was devoted to be used, as BRION, implementation of TBFO projects. Thus, the versus BERSAMIN, were instances when he used the there funds ABAD, and intended for one project to sustain the activities of other projects. Pulgar VILLARAMA, JR., VIRGILIO E. PULGAR, further admitted that some of the receipts Respondent. he submitted to liquidate TBFOs expenses were not Promulgated: genuine; he claimed that he had to produce fake receipts to comply with the offices requirements and July 5,central 2010 deadlines, otherwise the release of TBFOs x----------------------------------------------------------------------------------------subsequent funds would be delayed. Pulgar DECISION also disclosed that he had, on his own initiative, opened a separate bank account BRION, J.: at the Capitol Bank50[6] for TBFOs savings; the account had a remaining balance of P206,958.50. Lastly, Pulgar manifested his Before us is the petition for review on 45 willingness to attend a meeting with the certiorari [1] filed by the Philippine Rural senior officers, scheduled on February 28, Reconstruction Movement (PRRM) to assail 1997, to further explain his side.51[7] the Court of Appeals (CA) decision, dated 46 May 25, 2005, [2] and its resolution, dated On March 4, 1997, Pulgar met with PRRM August 5, 2005,47[3] in CA-G.R. SP No. representatives to discuss the findings of 62036. The appellate court set aside the the investigation report. During the National Labor Relations Commissions meeting, Pulgar furnished these (NLRC) January 28, 2000 decision, and held representatives with a photocopy of a that PRRM illegally dismissed respondent savings account passbook with Virgilio Pulgar (Pulgar) from employment. Account Number 1103508 under BACKGROUND FACTS Pulgars name at the Cooperative Bank of Quezon. The passbook showed PRRM is a non-stock, non-profit, nonthat the account had a balance of governmental organization. Pulgar was the P207,693.10. According to Pulgar, this manager of PRRMs branch office the balance represented the TBFO savings he Tayabas Bay Field Office (TBFO) in mentioned in his response. At this point, Quezon Province. When Pulgar was two versions of the story develop. reassigned to PRRMs central office, PRRM, * 45 46 47 48 49 50 51 11

PRRM maintains that while the investigation was ongoing, Pulgar went on leave on March 3-10, March 20-25, and April 1-15, 1997. After the lapse of his last leave on April 15, 1997, Pulgar no longer reported to work, leading PRRM to believe that Pulgar had abandoned his work to evade any liability arising from the investigation. PRRM was therefore surprised to learn that Pulgar had filed an illegal dismissal case on April 3, 1997. Pulgar tells another tale. According to him, on March 17, 1997, he submitted a letter to PRRM to complain that he was not given the right to confront and question Solis,52[8] but his letter went unanswered. Thereafter, on March 31, 1997, he was not allowed to enter the premises of the organization. Pulgar also alleges that PRRMs representatives removed his personal properties and records from his office, placed them in boxes and kept them in storage. Believing he was constructively dismissed by PRRMs actions, Pulgar filed a complaint against PRRM on April 3, 1997 for illegal dismissal, illegal suspension, and nonpayment of service incentive leave pay and 13th month pay. Pulgar also asked for actual damages, moral damages, and attorneys fees. At the mandatory conferences before Labor Arbiter Pablo Espiritu, Jr. (Labor Arbiter), Pulgar dropped the illegal suspension charge, as well as his claim for payment of service incentive leave with pay.53[9] On March 31, 1999, the Labor Arbiter found in his decision54[10] that Pulgar had been illegally dismissed and ordered PRRM to pay Pulgar P319,387.50 as full backwages. However, the Labor Arbiter chose not to award Pulgar moral or exemplary damages after finding that PRRM had legitimate grounds to investigate Pulgar. Due to the strained relations between PRRM and Pulgar, the Labor Arbiter opted to award Pulgar separation pay instead of ordering his reinstatement. On appeal, the NLRC reversed the Labor Arbiter in its January 28, 2000 decision and dismissed Pulgars complaint,55[11] giving more weight to 52 53 54 55

PRRMs allegation that Pulgar abandoned his work. This prompted Pulgar to bring the matter to the CA via a petition for review on certiorari (should be petition for certiorari) under Rule 65 of the 1997 Rules on Civil Procedure.56[12] On May 25, 2005, the CA rendered the assailed decision,57[13] granting Pulgars petition and reinstating the Labor Arbiters decision. The appellate court noted that PRRM never rebutted Pulgars contentions that he had been prevented from entering the premises and that his personal effects were taken from his office and placed in storage. The CA further observed that PRRM presented no evidence to prove that Pulgar abandoned his job. Reasoning that filing an illegal dismissal complaint is inconsistent with the charge of abandonment, the appellate court concluded that Pulgar had been illegally dismissed. In the present petition, filed after the appellate court denied PRRMs Motion for Reconsideration, PRRM raises the issue of whether Pulgar was illegally dismissed from employment. PRRM posits that it did not dismiss Pulgar from employment. Rather, Pulgar chose not to return to work, after his leave of absence, to evade any criminal liability that might arise from the ongoing investigation PRRM was conducting regarding the alleged financial anomalies Pulgar committed when he was the field manager of the TBFO. PRRM opines that Pulgar filed the present illegal dismissal case as a diversionary tactic to avoid having to submit himself to PRRMs ongoing investigation. Lastly, PRRM asks this Court to order Pulgar to return the PRRM funds still in his custody amounting to P207,693.10. On the other hand, Pulgar claims that this Court should respect the Labor Arbiters factual finding that he was illegally dismissed since the Labor Arbiter had the opportunity to observe the actuations, behavior and demeanor of the parties. Pulgar further alleges that PRRM can no longer claim the PRRM funds in his possession since the Labor Arbiter had already ruled that PRRM failed to raise the award of these funds as a relief in its Position Paper. Since PRRM never appealed this part of the Labor Arbiters decision, it is now bound by these findings. 56 57 12

THE COURTS RULING We grant the petition. Procedural issue Under the Rules of Court and settled doctrine, a petition for review on certiorari under Rule 45 of the Rules of Court is limited to questions of law. As a rule, the findings of fact of the CA are final and conclusive, and this Court will not review them on appeal.58[14] This rule, however, is not absolute and admits of several exceptions.59[15] To resolve the issue of whether PRRM is guilty of illegal dismissal, we necessarily have to determine the veracity of the parties' allegations, a function we are ordinarily barred from performing when deciding a Rule 45 petition. However, due to the conflicting factual findings of the NLRC and the CA, as well as the presence of some relevant facts that, had they been considered by the CA, would have justified a different conclusion, we find the review of the evidence on record compelling and proper. The illegal dismissal issue In concluding that Pulgar was constructively dismissed from employment, the CA relied on two main factors: (a) Pulgars claim that he was barred from entering the premises on March 31, 1997; and (b) the fact that Pulgar immediately filed a complaint for illegal dismissal against PRRM. At first glance, the CAs decision appears correct. But the facts are not as simple as they appear to be. Primarily, we underscore the fact that when Pulgar filed an illegal dismissal complaint on April 3, 1997, he was still on leave from the organization. In other words, from PRRMs standpoint, Pulgar was still its employee when he filed the illegal dismissal case against the organization. Pulgar claims that he was forced to file an illegal dismissal complaint against PRRM while he was on leave because he was not allowed to enter the office premises on March 31, 1997. But aside from making this allegation, Pulgar failed to provide any other details on how he was prevented from entering the premises. Was he physically prevented from entering the 58 59

premises by a security guard? Did the senior officers of PRRM refuse to let him into the office when he reported to work? We are left to guess the particulars of how PRRM prevented Pulgar from entering the premises, leaving us to doubt the veracity of this allegation. To bolster his contention that he was constructively dismissed, Pulgar asserts that his personal things were taken from his office, placed in boxes and put in storage. To support this allegation, he attached three photographs.60[16] But the only thing seen in these photographs is a storage room with sealed boxes on the floor. Taken at face value, there is nothing in the photographs that proves that the boxes in the storage room even contain Pulgars personal things. Absent such proof, we cannot use these pictures to prove that Pulgar was constructively dismissed from employment. We further note that at the time PRRM was conducting an investigation into the alleged anomalies committed in the liquidation and use of PRRM funds at the TBFO during Pulgars management, Pulgar went on a number of leaves, specifically on March 3-10, 1997, then on March 20-25, 1997, and finally on April 1-15, 1997. The timing and frequency of these leaves, while not indicative of Pulgars intention to sever his employment, at the very least, imply Pulgars active efforts to evade the organizations ongoing investigation. Significantly, while Pulgar claims he was constructively dismissed when he was barred from the premises on March 31, 1997, he still filed his application for leave for April 1-15, 1997. The fact alone that Pulgar was able to return to the office to file his application for leave for April 1-15, 1997 raises doubt as to his purported ban from the premises. More importantly, if Pulgar truly believed that he had already been constructively dismissed on March 31, 1997, reason dictates that he would no longer bother to apply for a leave of absence from PRRM for April 1-15, 1997. The fact that he did belies his contention that he believed he had already been constructively dismissed on March 31, 1997. Also worth mentioning is the fact that Pulgar continued to receive his salary from PRRM even after March 31, 1997, or the date of his alleged constructive dismissal. In fact, Pulgar received his salary up until April 15, 1997, when his vacation and sick leaves had been consumed. 60 13

These circumstances, taken together, lead us to conclude that PRRM did not terminate Pulgars employment. On the contrary, what appears from the evidence is that it was Pulgar himself who terminated his employment with PRRM when he filed an illegal dismissal complaint against the organization while he was on leave. The key to understanding Pulgars motive in severing his employment with PRRM lies in Pulgars letter dated February 24, 1997, written in response to the investigation report that implicated him in these financial anomalies. He wrote: Noticing that even at the Central Office, project funds allotted for one field office or branch were used to sustain the operation of other on-going activities of another field office/branch or even of the Central Office, I presumed that the same is also applicable in the field office. That is, as field manager, it was to my discretion as to where and how the fund should be used so long as its utilization concerns the implementation of the project. With this in mind, I made some major decisions at the field office which I believe could be of great help make the operations smooth sailing. For instance, there were cases when funds for the FSP were used to finance the operations of the Community-based Mangrove and Community based Reforestation projects and other side activities (e.g. Rapid Site Assessment, election campaign) in order to accomplish the project/activity on time. Likewise, cost savings measures were undertaken so that funds could be made available to the office when the immediate need for the fund arises particularly during situations when the release from the Central Office were delayed. And since the implementing guidelines from the CO was silent on the maintenance of another account for savings made by the field office, I took the initiative to open a separate account for the field offices savings. By doing this, possible disruption of work at the field and the delay in the salary of the staff were prevented. As for the inconsistencies of the liquidation documents submitted, this was necessary in order to comply with the requirements and deadlines set by the Central Office, otherwise, the release for the succeeding quarter or period in questions will be put on hold. Given the situation and with the continuity of the field offices operation still in mind, I was forced to adjust the documents

submitted just to meet the deadlines and avoid disruption of work. However, never had I intentionally done this with malicious intent of, as Ms. Solis puts it, using the fund for personal gain. As I will explain later, funds were used to finance activities that were related to the operations of the field office and whatever savings were made remains in safekeeping for possible use of the offices operation. x x x With regard to the case of the AECI project, its account has been required to be closed and cash advances liquidated (with accompanying Official Receipts) by November 1996 or exactly by the end of its six months of implementation. This being the case, and with the slight delay met in the implementation of the project, adjustment in the documents became a necessary evil in order to comply with the requirements of the CO.61[17] [Emphasis supplied.] In the same letter, Pulgar manifested that the TBFO had savings in the amount of P206,958.50, which he deposited with Capitol Bank under Account No. 2-04200188-9.62[18] At the meeting with PRRM senior officers on March 4, 1997, Pulgar also admitted that the TBFOs savings in the amount of P207,693.10 were actually deposited with the Cooperative Bank of Quezon in an account under his name. From Pulgars own admissions, we consider the following facts to be established: First, Pulgar took funds intended for one activity or project and applied them to other activities/projects. Second, Pulgar took the savings from the TBFO and placed them in a bank account under his own name. To date, Pulgar has not turned over these funds to the PRRM. Third, Pulgar submitted manufactured and fake receipts to PRRM to liquidate TBFOs expenses. Noticeably, from Pulgars disclosures alone, a prima facie case for estafa can already be made out against Pulgar. With the danger of criminal prosecution hanging over his head, Pulgars abrupt decision to terminate his employment with PRRM becomes easily understandable. While we recognize the rule that in illegal dismissal cases, the employer bears the 61 62 14

burden of proving that the termination was for a valid or authorized cause, in the present case, however, the facts and the evidence do not establish a prima facie case that the employee was dismissed from employment. Before the employer must bear the burden of proving that the dismissal was legal, the employee must first establish by substantial evidence the fact of his dismissal from service. Logically, if there is no dismissal, then there can be no question as to its legality or illegality.63[19] Bare allegations of constructive dismissal, when uncorroborated by the evidence on record, cannot be given credence.64[20] As we said in Machica v. Roosevelt Services Center, Inc.:65[21] The rule is that one who alleges a fact has the burden of proving it; thus, petitioners were burdened to prove their allegation that respondents dismissed them from their employment. It must be stressed that the evidence to prove this fact must be clear, positive and convincing. The rule that the employer bears the burden of proof in illegal dismissal cases finds no application here because the respondents deny having dismissed the petitioners.66[22] [Emphasis supplied.] Although under normal circumstances, an employees act of filing an illegal dismissal complaint against his employer is inconsistent with abandonment; in the present case, we simply cannot use that one act to conclude that Pulgar did not terminate his employment with PRRM, and in the process ignore the clear, substantial evidence presented by PRRM that proves otherwise. Our ruling on this point in Leopard Integrated Services, Inc. v. Macalinao is very relevant. We said: 67[23] The fact that respondent filed a complaint for illegal dismissal, as noted by the CA, is not by itself sufficient indicator that respondent had no intention of deserting his employment since the totality of respondent's antecedent acts palpably display the contrary. In Abad v. Roselle Cinema, the Court ruled that:

The filing of a complaint for illegal dismissal should be taken into account together with the surrounding circumstances of a certain case. In ArcMen Food Industries Inc. v. NLRC, the Court ruled that the substantial evidence proffered by the employer that it had not, in the first place, terminated the employee, should not simply be ignored on the pretext that the employee would not have filed the complaint for illegal dismissal if he had not really been dismissed. This is clearly a non-sequitur reasoning that can never validly take the place of the evidence of both the employer and the employee.68[24] [Emphasis supplied.] While the Constitution is committed to the policy of social justice and the protection of the working class, it should not be supposed that every labor dispute will be automatically decided in favor of labor. Management also has its rights which are entitled to respect and enforcement in the interest of simple fair play. Out of its concern for those with less privileges in life, the Supreme Court has inclined, more often than not, toward the worker and upheld his cause in his conflicts with the employer. Such favoritism, however, has not blinded the Court to the rule that justice is in every case for the deserving, to be dispensed in the light of the established facts and the applicable law and doctrine.69[25] PRRMS monetary claim is belatedly raised Examining the records of the case, it appears that Pulgar has not yet returned the money he took from the TBFO and deposited in his name to PRRM. We have previously ruled on the Labor Arbiters jurisdiction to rule on all money claims, including those of the employer, arising out of the employeremployee relationship.70[26] Unfortunately for PRRM, it never raised as an issue the money allegedly still in Pulgars custody in the proceedings before the Labor Arbiter, or even before the NLRC. As the Labor Arbiter held: One final note. The Labor Code allows for claims made by employers against employees arising from employeremployee relations. In this case, the 68 69 70 15

63 64 65 66 67

records show that Pulgar holds the amount of P207,693.10 as alleged savings as manager of TBFO. PRRM attached Annex 11, which is a savings passbook of Pulgar with Cooperative Bank of Quezon Province, the existence of which was not denied by Pulgar before this Arbitration Branch. There is nothing on record which would show that this amount has been returned to PRRM. x x x However, a perusal of PRRMs pleadings would reveal that the latter does not raise as a relief an award for the return of the P207,693.10. [A]s it were, we cannot act on the same in view of PRRMs failure (for reasons known only to it) to pray for such award. [Emphasis supplied.]71[27] As a factual matter, this issue should have been raised at the earliest opportunity before the Labor Arbiter, to allow both parties to present their evidence. The rule is well-settled that points of law, theories, issues and arguments not adequately brought to the attention of the trial court need not be, and ordinarily will not be considered by a reviewing court as they cannot be raised for the first time on appeal72[28] because this would be offensive to the basic rules of fair play, justice and due process.73[29] WHEREFORE, premises considered, we GRANT the petition. The May 25, 2005 Decision and the August 5, 2005 Resolution of the Court of Appeals in CAG.R. SP No. 62036 are REVERSED and SET ASIDE. The January 28, 2000 Decision of the National Labor Relations Commission in NLRC NCR CA No. 01991499 is REINSTATED. SO ORDERED.

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