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Prof. Joselito Guianan Chan's The Labor Code of the Philippines, Annotated Labor Standards & Social Legislation Volume I of a 3-Volume Series 2019 Edition (3rd Revised Edition)
 

 
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UNITED STATES SUPREME COURT JURISPRUDENCE
 

 
PHILIPPINE SUPREME COURT JURISPRUDENCE
 

   
July-1997 Jurisprudence                 

  • G.R. No. 96649-50 July 1, 1997 - PEOPLE OF THE PHIL. v. LYNDON V. MACOY

  • G.R. No. 109660 July 1, 1997 - PEOPLE OF THE PHIL. v. ROMEO NELL

  • G.R. No. 124914 July 2, 1997 - JESUS UGADDAN v. COURT OF APPEALS, ET AL.

  • G.R. No. 123074 July 4, 1997 - PEOPLE OF THE PHIL. v. FERNANDO M. FERNANDEZ

  • Adm. Matter No. MTJ-94-1017 July 7, 1997 - OSCAR B. LAMBINO v. AMADO A. DE VERA

  • Adm. Matter No. P-97-1245 July 7, 1997 - BENIGNO G. GAVIOLA v. NOEL NAVARETTE

  • G.R. No. 105760 July 7, 1997 - PNB v. COURT OF APPEALS, ET AL.

  • G.R. No. 107193 July 7, 1997 - EUGENIO TENEBRO v. COURT OF APPEALS, ET AL.

  • G.R. No. 112006 July 7, 1997 - PEOPLE OF THE PHIL. v. ROBERTO S. DE VERA

  • G.R. No. 114275 July 7, 1997 - IÑIGO F. CARLET v. COURT OF APPEALS, ET AL.

  • G.R. No. 116962 July 7, 1997 - MARIA SOCORRO CACA v. COURT OF APPEALS, ET AL.

  • G.R. Nos. 118940-41 & 119407 July 7, 1997 - PEOPLE OF THE PHIL. v. GREGORIO MEJIA, ET AL.

  • G.R. No. 119872 July 7, 1997 - REMEDIOS NAVOA RAMOS v. COURT OF APPEALS, ET AL.

  • G.R. No. 122206 July 7, 1997 - RAFAEL ARCEGA, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 105284 July 8, 1997 - PEOPLE OF THE PHIL. v. IGNACIO ZUMIL

  • G.R. No. 106099 July 8, 1997 - PEOPLE OF THE PHIL. v. AGUSTIN SOTTO, ET AL.

  • G.R. No. 109814 July 8, 1997 - PEOPLE OF THE PHIL. v. FERNANDO MAALAT

  • G.R. No. 112797 July 8, 1997 - PEOPLE OF THE PHIL. v. NIDA ALEGRO

  • G.R. No. 114265 July 8, 1997 - PEOPLE OF THE PHIL. v. GREGORIO MAGALLANES

  • G.R. No. 115307 July 8, 1997 - MANUEL LAO v. COURT OF APPEALS, ET AL.

  • G.R. No. 115703 July 8, 1997 - EPIFANIO L. CASOLITA, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 117501 July 8, 1997 - SOLID HOMES, INC. v. COURT OF APPEALS, ET AL.

  • G.R. No. 122308 July 8, 1997 - PURITA S. MAPA, ET AL. v. COURT OF APPEALS, ET AL.

  • Adm. Matter No. SC-96-1 July 10, 1997 - DAMASO S. FLORES v. BERNARDO P. ABESAMIS

  • Adm. Matter No. P-97-1236 July 11, 1997 - MADONNA MACALUA v. DOMINGO TIU, JR.

  • Adm. Matter No. P-97-1249 July 11, 1997 - PACITA SY TORRES v. FROILAN S. CABLING

  • G.R. No. 104865 July 11, 1997 - PEOPLE OF THE PHIL. v. VICTORIANO PONTILAR, JR.

  • G.R. Nos. 113511-12 July 11, 1997 - PEOPLE OF THE PHIL. v. DANILO SINOC

  • G.R. No. 115033 July 11, 1997 - PONCIANO T. MATANGUIHAN, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 123204 July 11, 1997 - NATIONWIDE SECURITY AND ALLIED SERVICES, INC. v. NLRC, ET AL.

  • Adm. Matter No. P-95-1158 July 14, 1997 - EUFEMIA BERCASIO v. HERBERTO BENITO, ET AL.

  • G.R. No. 106153 July 14, 1997 - FLORENCIO G. BERNARDO v. COURT OF APPEALS, ET AL.

  • G.R. No. 108838 July 14, 1997 - PAGCOR v. COURT OF APPEALS, ET AL.

  • G.R. Nos. 116528-31 July 14, 1997 - PEOPLE OF THE PHIL. v. MARIETO ADORA

  • G.R. No. 108492 July 15, 1997 - PEOPLE OF THE PHIL. v. NOEL BANIEL, ET AL.

  • G.R. No. 118078 July 15, 1997 - PEOPLE OF THE PHIL. v. OSCAR VILLANUEVA

  • G.R. No. 123379 July 15, 1997 - BAROTAC SUGAR MILLS, INC. v. COURT OF APPEALS, ET AL.

  • G.R. Nos. 115439-41 July 16, 1997 - PEOPLE OF THE PHIL. v. SANDIGANBAYAN, ET AL.

  • G.R. Nos. 120437-41 July 16, 1997 - PEOPLE OF THE PHIL. v. ARMANDO ALVARIO

  • Adm. Matter No. RTJ-97-1382 July 17, 1997 - REXEL M. PACURIBOT v. RODRIGO F. LIM, JR.

  • G.R. No. 105002 July 17, 1997 - PEOPLE OF THE PHIL. v. DIARANGAN DANSAL

  • G.R. No. 108634 July 17, 1997 - ANTONIO P. TAN v. COURT OF APPEALS, ET AL.

  • G.R. No. 111165 July 17, 1997 - PEOPLE OF THE PHIL. v. ROGELIO MERCADO, ET AL.

  • G.R. No. 113257 July 17, 1997 - PEOPLE OF THE PHIL. v. JOHNNY LASCOTA

  • G.R. No. 114742 July 17, 1997 - CARLITOS E. SILVA v. COURT OF APPEALS, ET AL.

  • G.R. No. 118860 July 17, 1997 - ROLINDA B. PONO v. NLRC, ET AL.

  • G.R. No. 120262 July 17, 1997 - PAL, INC. v. COURT OF APPEALS, ET AL.

  • G.R. No. 125195 July 17, 1997 - SAMAHAN NG MGA MANGGAGAWA SA BANDOLINO, ET AL. v. NLRC, ET AL.

  • Adm. Matter No. RTJ-96-1362 July 18, 1997 - DSWD, ET AL. v. ANTONIO M. BELEN, ET AL.

  • Adm. Matter No. RTJ-95-1283 July 21, 1997 - DAVID C. NAVAL, ET AL. v. JOSE R. PANDAY, ET AL.

  • G.R. No. 108488 July 21, 1997 - PEOPLE OF THE PHIL. v. RODENCIO NARCA, ET AL.

  • G.R. No. 111002 July 21, 1997 - PACIFIC MARITIME SERVICES, INC., ET AL. v. NICANOR RANAY, ET AL.

  • G.R. No. 117402 July 21, 1997 - PEOPLE OF THE PHIL. v. ROLLIE L. ALVARADO

  • G.R. No. 119184 July 21, 1997 - HEIRS OF FELICIDAD CANQUE v. COURT OF APPEALS, ET AL.

  • G.R. No. 121768 July 21, 1997 - PEOPLE OF THE PHIL. v. DOMINGO CASTILLO, JR.

  • G.R. Nos. 122250 & 122258 July 21, 1997 - EDGARDO C. NOLASCO v. COMELEC, ET AL.

  • G.R. No. 124347 July 21, 1997 - CMS STOCK BROKERAGE, INC. v. COURT OF APPEALS, ET AL.

  • G.R. No. 125510 July 21, 1997 - PEOPLE OF THE PHIL. v. RENATO LISING

  • G.R. No. 111933 July 23, 1997 - PLDT v. NLRC, ET AL.

  • G.R. Nos. 112429-30 July 23, 1997 - PEOPLE OF THE PHIL. v. RODOLFO P. CAYETANO

  • G.R. Nos. 118736-37 July 23, 1997 - PEOPLE OF THE PHIL. v. TANG WAI LAN

  • Adm. Matter No. P-96-1205 July 24, 1997 - OSCAR P. DE LOS REYES v. ESTEBAN H. ERISPE, JR.

  • Adm. Matter No. RTJ-97-1383 July 24, 1997 - JOSE LAGATIC v. JOSE PEÑAS, JR., ET AL.

  • G.R. No. 104663 July 24, 1997 - PEOPLE OF THE PHIL. v. DAVID SALVATIERRA

  • G.R. No. 105004 July 24, 1997 - PEOPLE OF THE PHIL. v. DIONISIO MAROLLANO

  • G.R. No. 107723 July 24, 1997 - EMS MANPOWER & PLACEMENT SERVICES v. NLRC, ET AL.

  • G.R. No. 111211 July 24, 1997 - ABS-CBN EMPLOYEES UNION, ET AL., v. NLRC, ET AL.

  • G.R. No. 113235 July 24, 1997 - VICTORINA MEDINA, ET AL. v. CITY SHERIFF, MANILA, ET AL.

  • G.R. Nos. 113366-68 July 24, 1997 - GREGORIO ISABELO, ET AL. v. NLRC, ET AL.

  • G.R. No. 116635 July 24, 1997 - CONCHITA NOOL, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 116736 July 24, 1997 - PEOPLE OF THE PHIL. v. BENJAMIN ORTEGA, ET AL.

  • G.R. No. 118458 July 24, 1997 - PEOPLE OF THE PHIL. v. RICKY DELA CRUZ

  • G.R. No. 120276 July 24, 1997 - SINGA SHIP MANAGEMENT PHILS., INC. v. NLRC, ET AL.

  • G.R. No. 121075 July 24, 1997 - DELTA MOTORS CORP. v. COURT OF APPEALS, ET AL.

  • G.R. No. 121867 July 24, 1997 - SMITH KLINE & FRENCH LAB., LTD. v. COURT OF APPEALS, ET AL.

  • G.R. No. 127262 July 24, 1997 - HUBERT WEBB, ET AL. v. PEOPLE OF THE PHIL., ET AL.

  • Adm. Matter Nos. 95-6-55-MTC & P-96-1173 July 28, 1997 - REPORT ON AUDIT IN THE MTC OF PEÑARANDA, NUEVA ECIJA

  • G.R. No. 102858 July 28, 1997 - DIRECTOR OF LANDS v. COURT OF APPEALS, ET AL.

  • G.R. No. 103209 July 28, 1997 - APOLONIO BONDOC, ET AL. v. NLRC, ET AL.

  • G.R. No. 110823 July 28, 1997 - PEOPLE OF THE PHIL. v. ROCHEL TRAVERO

  • G.R. No. 112323 July 28, 1997 - HELPMATE, INC. v. NLRC, ET AL.

  • G.R. No. 113344 July 28, 1997 - PEOPLE OF THE PHIL. v. ATANACIO LUTO

  • G.R. No. 116668 July 28, 1997 - ERLINDA A. AGAPAY v. CARLINA V. PALANG, ET AL.

  • G.R. No. 116726 July 28, 1997 - PEOPLE OF THE PHIL. v. LEONARDO P. DE LA CRUZ

  • G.R. No. 118822 July 28, 1997 - G.O.A.L., INC. v. COURT OF APPEALS, ET AL.

  • G.R. No. 119000 July 28, 1997 - ROSA UY v. COURT OF APPEALS, ET AL.

  • G.R. No. 119649 July 28, 1997 - RICKY GALICIA, ET AL. v. NLRC, ET AL.

  • G.R. No. 119868 July 28, 1997 - PAL, INC. v. NLRC, ET AL.

  • G.R. No. 120072 July 28, 1997 - PEOPLE OF THE PHIL. v. FLORENTINO I. MESA

  • G.R. No. 123361 July 28, 1997 - TEOFILO CACHO v. COURT OF APPEALS, ET AL.

  • G.R. No. 126556 July 28, 1997 - NELSON C. DAVID v. COURT OF APPEALS, ET AL.

  • G.R. No. 117742 July 29, 1997 - GEORGE M. TABERRAH v. NLRC, ET AL.

  • SBC Case No. 519 July 31, 1997 - PATRICIA FIGUEROA v. SIMEON BARRANCO, JR.

  • G.R. No. 97369 July 31, 1997 - P.I. MANPOWER PLACEMENTS, INC. v. NLRC, ET AL.

  • G.R. No. 99030 July 31, 1997 - PLDT v. NLRC, ET AL.

  • G.R. No. 106582 July 31, 1997 - PEOPLE OF THE PHIL. v. RUPERTO BALDERAS

  • G.R. No. 107802 July 31, 1997 - PEOPLE OF THE PHIL. v. JASON NAREDO

  • G.R. No. 108399 July 31, 1997 - RAFAEL M. ALUNAN III, ET AL. v. ROBERT MIRASOL, ET AL.

  • G.R. No. 108619 July 31, 1997 - EPIFANIO LALICAN v. FILOMENO A. VERGARA, ET AL.

  • G.R. No. 113689 July 31, 1997 - PEOPLE OF THE PHIL. v. FELIPE SANGIL, SR.

  • G.R. No. 113958 July 31, 1997 - BANANA GROWERS COLLECTIVE, ET AL. v. NLRC, ET AL.

  • G.R. No. 116060 July 31, 1997 - PEOPLE OF THE PHIL. v. CLEMENTE DE LA PEÑA

  • G.R. No. 116292 July 31, 1997 - PEOPLE OF THE PHIL. v. JIMMY PEÑERO

  • G.R. No. 119068 July 31, 1997 - PEOPLE OF THE PHIL. v. DANTE CASTRO, ET AL.

  • G.R. No. 121027 July 31, 1997 - CORAZON DEZOLLER TISON, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 121157 July 31, 1997 - HEIRS OF SEGUNDA MANINGDING, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 123561 July 31, 1997 - DELIA R. NERVES v. CSC, ET AL.

  • G.R. No. 124678 July 31, 1997 - DELIA BANGALISAN, ET AL. v. COURT OF APPEALS, ET AL.

  •  





     
     

    G.R. No. 117742   July 29, 1997 - GEORGE M. TABERRAH v. NLRC, ET AL.

     
    PHILIPPINE SUPREME COURT DECISIONS

    FIRST DIVISION

    [G.R. No. 117742. July 29, 1997.]

    GEORGE M. TABERRAH, Petitioner, v. NATIONAL LABOR RELATIONS COMMISSION, CALTEX (PHIL.), INC. and WILLIAM TIFFANY, Respondents.

    Martinez & Perez Law Offices for Petitioner.

    Platon, Martinez, Flors, San Pedro & Leaño for Private Respondents.

    SYNOPSIS


    Petitioner worked for Caltex for 19 years. In 1993, while occupying the position of Senior Manager of the Supply and Distribution Department of Caltex an anonymous letter was circulated against petitioner on contracting certain anomalous transactions and other irregularities. Due to the gravity of the accusation, petitioner was placed under preventive suspension and informed of a scheduled formal investigation which petitioner did not attend and instead filed a complaint for illegal suspension and illegal dismissal. Ex-parte ruling of the formal investigation dismissed him on ground of breach of trust and loss of confidence.

    In the complaint for illegal suspension and dismissal filed by Petitioner against Caltex, the Labor Arbiter denied the motion of Caltex for a trial on the merits and rendered judgment based on the pleadings and other documentary evidence. The Labor Arbiter found the dismissal of petitioner illegal, and ordered Caltex to reinstate petitioner with full backwages and to pay moral and exemplary damages.

    On appeal to the NLRC, Caltex instead of posting an appeal bond, attached to its Memorandum of Appeal a Motion to Fix Appeal Bond alleging that the Labor Arbiter did not contain a computation of the award. Subsequently, the NLRC issued an order fixing the appeal bond and gave Caltex an additional period to post the required bond.

    Meanwhile, petitioner filed several motions for execution with the NLRC which refused to act thereon. Finally, the NLRC reversed the decision of the Labor Arbiter and dismissed the complaint. Hence, this recourse.

    The Supreme Court held that it is the Labor Arbiter, not the NLRC, who has authority to issue writ of execution of the reinstatement aspect of the decision; that Labor Arbiter enjoys wide discretion in determining whether there is need for formal hearing in a given case; that the requirement of posting an appeal bond within the reglementary period has been relaxed in line with the principle that substantial justice is better served by allowing appeal to be resolved on the merits rather than dismissing it based on technicality; continued recognition of the right of the employer to dismiss an employee on ground of breach of trust and loss of confidence which must not be exercised arbitrarily and without just cause; and finally while award of moral and exemplary damages is discretionary upon Labor Arbiter, the amount thereof must be reasonable and justified.


    SYLLABUS


    1. LABOR AND SOCIAL LEGISLATION; LABOR CODE; APPEAL; LABOR ARBITER — NOT THE NLRC — HAS THE AUTHORITY TO ISSUE THE WRIT OF EXECUTION OF THE REINSTATEMENT ASPECT OF THE DECISION EVEN IF THE CASE IS ALREADY PENDING APPEAL. — It is clear that it is the Labor Arbiter — not the NLRC — that has the authority to issue the writ of execution of the reinstatement aspect of the decision even if the case is already pending appeal. Since it was the Labor Arbiter who issued the decision sought to be executed, the motion for execution should also be filed with the Labor Arbiter. Furthermore, as correctly ruled by respondent NLRC, appellate courts cannot by themselves issue a writ of execution but that the same may only be issued by the hearing officer of the court of origin. In this regard, however, to obviate delay, the NLRC should have forthwith directed the Labor Arbiter to issue the corresponding writ prayed for.

    2. ID.; ID.; ID.; THE LABOR ARBITER ENJOYS WIDE DISCRETION IN DETERMINING WHETHER THERE IS A NEED FOR A FORMAL HEARING IN A GIVEN CASE. — The Labor Arbiter enjoys wide discretion in determining whether there is need for a formal hearing in a given case. If in his opinion there is no necessity for a formal hearing he may decide the case on the basis of the pleadings and other documentary evidence presented by the parties. This is in consonance with Art. 221 of the Labor Code according to which technical rules of evidence prevailing in courts of law or equity shall not be controlling in any proceeding before the Labor Arbiter or the Commission, subject to the requirements of due process. The Labor Arbiter shall use every and all reasonable means to ascertain the facts of each case without regard to technicalities. In the absence of clear abuse of discretion on the part of the Labor Arbiter, the NLRC must respect the method adopted by him in deciding cases.

    3. ID.; ID.; A FORMAL OR TRIAL-TYPE HEARING IS NOT AT ALL TIMES AND IN ALL INSTANCES ESSENTIAL TO DUE PROCESS THE REQUIREMENTS OF WHICH ARE SATISFIED WHERE THE PARTIES ARE AFFORDED FAIR AND REASONABLE OPPORTUNITY TO EXPLAIN THEIR SIDE OF THE CONTROVERSY. — A formal or trial-type hearing is not at all times and in all instances essential to due process the requirements of which are satisfied where the parties are afforded fair and reasonable opportunity to explain their side of the controversy. Thus, the NLRC committed grave abuse of discretion when it ruled that respondent CALTEX was denied due process where the records show that in response to petitioner’s complaint and before the Labor Arbiter rendered his decision. respondent company submitted a position paper, complete with annexes where they set out and argued the factual as well as the legal basis of their position.

    4. ID.; ID.; ID.; RESPONDENT CANNOT BE EXPECTED TO POST AN APPEAL BOND EQUIVALENT TO THE AMOUNT OF THE MONETARY AWARD WHEN THE AMOUNT THEREOF WAS NOT INCLUDED IN THE DECISION OF THE LABOR ARBITER. — We sustain respondent CALTEX on the argument that there being no computation in the decision of the Labor Arbiter of the actual amount of back wages which was the basis of the appeal bond, the appeal it filed was duly perfected when it manifested its readiness and willingness to post such bond upon the proper computation of the back wages. In National Federation of Labor Unions v. Ladrido III, a similar problem confronted this Court. In that case, the Labor Arbiter’s decision did not contain a computation of the monetary award. . . . The Court made the following pronouncement: The labor arbiter clearly erred in issuing a writ of execution on July 5, 1990. In said order, the arbiter observed that private respondents "have not as yet perfected their appeal for failure to post cash bond or surety bond" implying that the decision appealed from has become final, thus entitling petitioner to the issuance of the writ of execution. But precisely, as contended by private respondents, "the computation of the corporate auditing examiner was not attached to the decision." Private respondents cannot be expected to post such appeal bond equivalent to the amount of the monetary award when the amount thereof was not included in the decision of the labor arbiter. Article 223 of the Labor Code . . . presupposes that the amount of the monetary award is stated in the judgment or at least attached to the judgment.

    5. ID.; ID.; TERMINATION OF EMPLOYMENT; LOSS OF CONFIDENCE AS A GROUND FOR VALIDLY DISMISSING AN EMPLOYEE SHOULD NOT BE SIMULATED. — While this Court has continually recognized the right of the employer to dismiss an employee on the ground of breach of trust and loss of confidence, such right must not be exercised arbitrarily and without just cause. Loss of confidence as a ground for validly dismissing an employee should not be simulated. It should not be used as a subterfuge for causes which are improper, illegal and unjustified. Loss of confidence may not be arbitrarily asserted in the face of overwhelming evidence to the contrary. It must be genuine, not a mere afterthought to justify an earlier action taken in bad faith.

    6. ID.; ID.; DAMAGES; THE AWARD THEREOF IS EXCESSIVE AND UNCONSCIONABLE; CASE AT BAR. — While it may be true that the award of moral and exemplary damages is discretionary upon the Labor Arbiter, the amount thereof must be reasonable and justified. In the present case, we find the award of damages excessive and unconscionable. Consequently, we reduce the award of P5 million for moral damages to P1 million and the P2 million for exemplary damages to P0.2 million. The attorney’s fees of ten percent (10%) is maintained but based on the amounts of damages as herein modified.


    D E C I S I O N


    BELLOSILLO, J.:


    GEORGE M. TABERRAH was the Senior Manager of the Supply and Distribution Department, CALTEX PHILIPPINES, INC. (CALTEX, for brevity). He worked for the company for nineteen (19) years starting in 1974 until his dismissal in 1993.

    On 9 November 1992, while TABERRAH was on his annual vacation leave, an anonymous letter authored by a certain "Mr. Caltexman" was circulated containing malicious imputations against TABERRAH attacking his personal life and accusing him of contracting certain anomalous transactions and other irregularities in the company. 1 In view of the gravity of the accusations, CALTEX convened a fact-finding committee to ferret out the truth. On 25 January 1993 TABERRAH was informed of the charges against him by furnishing him a memorandum of the results of the fact-finding investigation. He was simultaneously placed under preventive suspension and required to submit a written explanation within seventy-two (72) hours from receipt of the memorandum. 2 CALTEX subsequently notified him that a formal investigation would be conducted on 10 February 1993 and advised him to seek the assistance of counsel. 3

    TABERRAH informed CALTEX that he was not attending the scheduled investigation and that he had already filed a complaint for illegal suspension and illegal dismissal with claim for moral and exemplary damages plus attorney’s fees before the Labor Arbiter. According to TABERRAH the formal investigation was a mere afterthought and part of a grand design to justify the constructive termination of his employment. 4

    Nonetheless a formal investigation proceeded as scheduled in the absence of TABERRAH after which an ex parte ruling was issued dismissing him on the ground of breach of trust and loss of confidence.

    After the parties submitted their respective position papers, reply, rejoinder and other pleadings pertinent to the complaint filed by TABERRAH, Labor Arbiter Eduardo J. Carpio, "finding no necessity to try the case on the merits," ordered the parties instead to file their respective memoranda within twenty (20) days from receipt thereof after which the case would be deemed submitted for decision.

    Respondent CALTEX moved for reconsideration contending that there remained material disputes and inconsistencies in the facts presented by the parties hence the proper resolution could best be made only through a trial on the merits where the parties could be afforded full opportunity to present their evidence. 5

    The Labor Arbiter denied the motion and decided the case on the basis of the pleadings and other documentary evidence submitted by the parties. 6 The dispositive portion of his decision reads:chanrob1es virtual 1aw library

    WHEREFORE, finding the dismissal of complainant George Taberrah to be without just cause and in violation of his right to due process, effected with malice, bad faith, and ill will, respondent Caltex Philippines, Inc., is hereby ordered to reinstate complainant immediately to his former position with full back wages, without loss of seniority rights and other benefits and privileges attendant therewith, and pay complainant moral damages in the amount of P5 Million and exemplary damages in the amount of P2 Million and the equivalent of 10% of the total award as attorney’s fees.

    On 22 February 1994 respondent CALTEX elevated the case to the NLRC. But instead of posting an appeal bond, it attached to its Memorandum of Appeal a Motion to Fix Appeal Bond alleging that the Labor Arbiter’s decision did not contain a computation of the award. On 25 March 1994 NLRC issued an Order fixing the appeal bond and allowing CALTEX an additional period of ten (10) days from receipt of said Order to post the required bond. Respondent received the Order on 5 April 1994 and posted the required bond on 13 April 1994.chanrobles.com : virtual lawlibrary

    In the meantime, TABERRAH filed with the NLRC several motions for execution of the decision of the Labor Arbiter pursuant to Art. 223 of the Labor Code which mandates that the reinstatement aspect of the decision shall be immediately executory. The NLRC refused to act on said motions claiming that it is an appellate body with no power to issue writs of execution.

    On 12 July 1994 the NLRC reversed the decision of the Labor Arbiter and dismissed the complaint. Hence, the instant petition.

    Petitioner contends that respondent NLRC acted with grave abuse of discretion amounting to lack or excess of jurisdiction (1) when it refused to allow the issuance of a writ of execution on the reinstatement aspect of the decision of the Labor Arbiter pending appeal; (2) when it sustained the position of respondent company that it was denied due process when the Labor Arbiter decided the case on the basis of the pleadings without trial on the merits; (3) when it allowed respondent company an extension of the period within which to perfect the appeal; and, (4) when it reversed the decision of the Labor Arbiter.

    Article 223, third par., of the Labor Code provides —

    In any event, the decision of the Labor Arbiter reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall be immediately executory, even pending appeal. 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 employer, merely reinstated in the payroll. The posting of a bond by the employer shall not stay the execution for reinstatement provided herein.

    Under Rule V, third par., of Sec. 16 of the Rules Implementing the Labor Code —

    In case the decision includes an order of reinstatement, the Labor Arbiter shall direct the employer to immediately reinstate the dismissed or separated employee even pending appeal. The order of reinstatement shall indicate that 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 employer, merely reinstated in the payroll.

    It is clear from the foregoing that it is the Labor Arbiter — not the NLRC — who has the authority to issue the writ of execution of the reinstatement aspect of the decision even if the case is already pending appeal. Since it was the Labor Arbiter who issued the decision sought to be executed, the motion for execution should also be filed with the Labor Arbiter. 7 Furthermore, as correctly ruled by respondent NLRC, appellate courts cannot by themselves issue a writ of execution but that the same may only be issued by the hearing officer of the court of origin. In this regard, however, to obviate delay, the NLRC should have forthwith directed the Labor Arbiter to issue the corresponding writ prayed for.

    On the second issue, the following are the pertinent provisions of the Rules Implementing the Labor Code relative to proceedings before the Labor Arbiter —

    SEC. 4. Determination of Necessity of Hearing. — Immediately after the submission by the parties of their position papers/memoranda, the Labor Arbiter shall motu propio determine whether there is a need for a formal trial or hearing. At this stage, he may at his discretion and for the purpose of making such determination ask clarificatory questions to further elicit facts or information including but not limited to the subpoena of relevant documentary evidence, if any, from any party or witness.

    SEC. 5. Period to Decide Cases. — . . . (b) If the Labor Arbiter finds no necessity of further hearing after the parties have submitted their position papers and supporting documents, he shall issue an order to that effect and shall inform the parties, stating the reasons thereof. In any event, he shall render his decision in the case within the same period provided in paragraph (a) hereof.

    The Labor Arbiter enjoys wide discretion in determining whether there is need for a formal hearing in a given case. If in his opinion there is no necessity for a formal hearing he may decide the case on the basis of the pleading and other documentary evidence presented by the parties. This is in consonance with Art. 221 of the Labor Code according to which technical rules of evidence prevailing in courts of law or equity shall not be controlling in any proceeding before the Labor Arbiter or the Commission, subject to the requirements of due process. The Labor Arbiter shall use all reasonable means to ascertain the facts of each case without regard to technicalities. In the absence of clear abuse of discretion on the part of the Labor Arbiter, the NLRC must respect the method adopted by him in deciding cases.

    Moreover, a formal or trial-type hearing is not at all times and in all instances essential to due process the requirements of which are satisfied where the parties are afforded fair and reasonable opportunity to explain their side of the controversy. Thus, the NLRC committed grave abuse of discretion when it ruled that respondent CALTEX was denied due process where the records show that in response to petitioner’s complaint and before the Labor Arbiter rendered his decision, respondent company submitted a position paper, complete with annexes where it set out and argued the factual as well as the legal basis of its position. 8

    On the third issue, petitioner postulates that the appeal of respondent CALTEX to the NLRC was not perfected seasonably as the posting of the appeal bond within the reglementary period was a mandatory requirement for the perfection of the appeal. Respondent CALTEX, on the other hand, argues that there being no computation in the decision of the Labor Arbiter of the actual amount of back wages which was the basis of the appeal bond, the appeal it filed was duly perfected when it manifested its readiness and willingness to post such bond upon the proper computation of the back wages.

    We sustain respondent CALTEX on this score. In National Federation of Labor Unions v. Ladrico III, 9 a similar problem confronted this Court. In that case, the Labor Arbiter’s decision did not contain a computation of the monetary award. When the employer failed to file the necessary cash or surety bond within the period for appeal, the employees sought to execute the decision, which the Labor Arbiter granted. It appears that the employer filed a Memorandum of Appeal (within the reglementary period) stating, among others, that the bond could not be posted on time because the amount of the monetary award was still being computed by the Corporate Auditing Examiner. The Court made the following pronouncement:chanrob1es virtual 1aw library

    The labor arbiter clearly erred in issuing a writ of execution on July 5, 1990. In said order, the arbiter observed that private respondents "have not as yet perfected their appeal for failure to post cash bond or surety bond," implying that the decision appealed from has become final, thus entitling petitioner to the issuance of the writ of execution. But precisely, as contended by private respondents, "the computation of the corporate auditing examiner was not attached to the decision." Private respondents cannot be expected to post such appeal bond equivalent to the amount of the monetary award when the amount thereof was not included in the decision of the labor arbiter. Article 223 of the Labor Code . . . presupposes that the amount of the monetary award is stated in the judgment or at least attached to the judgment.

    x       x       x


    In the order of public respondent NLRC dated 10 August 1990, it is stated that "the policy of the Commission in situations like this (and the labor arbiter should have been aware of this) is for the labor arbiter to forward the records to the Commission [and that] thereafter, the Commission will cause the computation of the awards and issue an order directing the appellant to file the required bond." This appears to be a practice of the NLRC to allow a belated filing of the required appeal bond, in the instance when the decision of the labor arbiter involves a monetary award that has not yet been computed, considering that the computation will still have to be made by that office. It is understood of course that appellant has filed the appeal on time as in this case.

    x       x       x


    One last word — the plight of labor must always be considered in any case. However, such a case must be handled with an even hand. More so when the amount of the monetary award runs to millions that will substantially paralyze the employer if not drive it to penury. The immediate execution of the judgment should be undertaken only when the monetary award had been carefully and accurately determined by the NLRC and only after the employer is given the opportunity to be heard and to raise objections to the computation."cralaw virtua1aw library

    As a rule, compliance with the requirements for the perfection of an appeal within the reglementary period 10 is mandatory and jurisdictional. 11 However, in National Federation of Labor Unions v. Ladrico III as well as in several other cases, 12 this Court relaxed the requirement of the posting of an appeal bond within the reglementary period as a condition for perfecting the appeal. This is in line with the principle that substantial justice is better served by allowing the appeal to be resolved on the merits rather than dismissing it based on a technicality.

    The instant case likewise calls for a liberal application of the rule in the interest of justice. There is a compelling need to reduce the excessive and unconscionable amount of damages awarded by the Labor Arbiter. But unless it is held that CALTEX was able to perfect its appeal on time, the Labor Arbiter’s decision is final and executory and therefore cannot be modified in any respect. 13

    Coming now to the fourth issue, we nonetheless find the instant petition to be impressed with merit as to warrant a reversal of the NLRC decision. The conclusions of the NLRC based on practically the same facts established before the Labor Arbiter are clearly contrary to the evidence.

    The employment of petitioner was terminated for alleged breach of trust and confidence, or more specifically, for (a) violation of the 14 January 1992 Memo for Board Approval which prescribed that a time charter contract with MIS Supply Corporation should only be for a maximum period of five (5) years. Petitioner issued Letters of Intent (LOIs) to MIS Supply Corporation for a contract period of seven (7) years plus three (3) years; (b) non-compliance/inadequate compliance with procedures for the reconciliation reports resulting in accumulated in-transit losses or outstanding stock balances amounting to at least P100 Million for the period January 1990 to December 1991; and, (3) violation of control procedure in the conduct of the bidding for the sale of company assets in Aparri which consisted of non-publication of bid solicitations. Instead, petitioner simply personally invited five (5) companies to submit their bids.

    As for the first ground, the NLRC ruled that the LOIs issued by petitioner did not bear the imprimatur of any CALTEX official and that they were solely signed by petitioner without any authority. But the evidence shows that while the LOIs were signed by petitioner alone the same were accompanied by a request for release, which request was approved by the top officials of CALTEX as shown by their signatures in a memorandum dated 10 April 1992. 14 In addition, a cursory reading of the memorandum readily shows that it specifically mentions the terms of the contract, i.e., seven (7) years plus three (3) years extension at charterer’s option, which means that if CALTEX thought that there was violation of company rules concerning the chartering of vessels then its top officials would not have approved the request for release of the questioned LOIs.

    With respect to the second ground for dismissal, it is unfair for CALTEX to blame petitioner for the accumulation of in-transit losses due to the non-reconciliation of stock balances. Records show that no reconciliation was done since November 1989. 15 The manager then responsible for the reconciliation process was a certain "Mr. A. A. Ng" who was replaced by petitioner only on 2 March 1992 16 in the midst of management efforts to solve the reconciliation problem. In other words, it was not petitioner who created the problem of non-reconciliation of stock balances. It was already existing and accumulating even before he was assigned to perform the formidable task of reconciliation. That petitioner was unable to complete the reconciliation for the years 1990 and 1991 as scheduled was due to the fact that CALTEX provided him with only two (2) assistants when he needed at least fifteen (15) to reconcile the stock balances. 17

    As regards the third ground, petitioner adequately explained that he dispensed with the public bidding to avoid projecting an image of massive pullout. Moreover, the bidders were invited individually and separately by virtue of their credentials as businessmen. And whether or not the bidders afterwards conspired to fraudulently manipulate the bid was not the business of petitioner and was in fact beyond his control. 18 His explanation was even adopted by his immediate superior, E.M. Cruz, in a memorandum dated 8 February 1991. 19chanrobles virtual lawlibrary

    The doctrine that the findings of fact of the NLRC are binding on this Court if supported by substantial evidence is well established. However, in the same way that the findings of fact unsupported by substantial and credible evidence do not bind this Court, we neither uphold the erroneous conclusions of the NLRC. 20

    While this Court has continually recognized the right of the employer to dismiss an employee on the ground of breach of trust and loss of confidence, such right must not be exercised arbitrarily and without just cause. Loss of confidence as a ground for validly dismissing an employee should not be simulated. It should not be used as a subterfuge for causes which are improper, illegal and unjustified. Loss of confidence may not be arbitrarily asserted in the face of overwhelming evidence to the contrary. It must be genuine, not a mere afterthought to justify an earlier action taken in bad faith. 21

    Finally, while it may be true that the award of moral and exemplary damages is discretionary upon the Labor Arbiter, the amount thereof must be reasonable and justified. In the present case, we find the award of damages excessive and unconscionable. Consequently, we reduce the award of P5 million for moral damages to P1 million and the P2 million for exemplary damages to P0.2 million. The attorney’s fees of ten percent (10%) is maintained but based on the amounts of damages as herein modified.

    WHEREFORE, the Decision of the National Labor Relations Commission is REVERSED and SET ASIDE and the Decision of the Labor Arbiter is REINSTATED, subject to the modification that the damages awarded therein are reduced to P1 Million for moral damages and P0.2 million for exemplary damages. The ten percent (10%) awarded for attorney’s fees shall accordingly be based on the amounts as herein modified. No costs.

    SO ORDERED.

    Padilla, Vitug and Kapunan, JJ., concur.

    Hermosisima, Jr., J., is on leave.

    Endnotes:



    1. Rollo, pp. 67-71.

    2. Records, pp. 156-157; Annex "G."cralaw virtua1aw library

    3. Id., p. 168; Annex "N."cralaw virtua1aw library

    4. Rollo, p. 128; Annex "Q."cralaw virtua1aw library

    5. Records, p. 297.

    6. The Labor Arbiter rendered his Decision on 7 February 1994 which CALTEX received on 16 February 1994.

    7. Callanta v. National Labor Relations Commission, G.R. No. 105083, 20 August 1993, 225 SCRA 526, 533.

    8. See Llora Motors, Inc. v. Franklin Drilon, G.R. No. 82895, 7 November 1989, 179 SCRA 175.

    9. G.R. Nos. 94540-41, 8 May 1991, 196 SCRA 833, 840-841, 845.

    10. Under the law, decisions, awards, or orders of the Labor Arbiter are appealable to the NLRC within ten (10) days from receipt thereof . If the arbiter’s decision involves monetary award, the appeal by the employer may be perfected only upon the posting of a bond equivalent to the monetary award. See Art. 223, first and second pars., Labor Code.

    11. See Italian Village Restaurant v. National Labor Relations Commission, G.R. No. 95594, 11 March 1992, 207 SCRA 204, 208.

    12. See Star Angel Handicraft v. National Relations Commission, G.R. No. 108914, 20 September 1994, 236 SCRA 581; Blancaflor v. National Labor Relations Commission, G.R. No. 101013, 2 February 1993, 218 SCRA 366; Rada v. National Labor Relations Commission, G.R. No. 96078, 9 January 1992, 295 SCRA 69; YBL (Your Bus Line) v. National Labor Relations Commission, G.R. No. 93381, 28 September 1990, 190 SCRA 160.

    13. Nunal v. Court of Appeals, G.R. No. 94005, 6 April 1993, 221 SCRA 26, 32.

    14. Records, p. 209; Annex "V."cralaw virtua1aw library

    15. Id., p. 80; Annex "2."cralaw virtua1aw library

    16. Rollo, p. 166; Annex "X."cralaw virtua1aw library

    17. Even Caltex Management stressed the need for more manpower to do the reconciliation. See Rollo, pp. 170-171; Annex "Z."cralaw virtua1aw library

    18. Rollo, pp. 176-177; Annex "BB."cralaw virtua1aw library

    19. Id., pp. 178-180; Annex "CC."cralaw virtua1aw library

    20. San Miguel Corporation v. National Labor Relations Commission, G.R. No. 50321, 31 March 1984, 128 SCRA 180, 186-187.

    21. Starlite Plastic Industrial Corp. v. National Labor Relations Commission, G.R. No. 78491, 16 March 1989, 171 SCRA 315, citing Central Bank and Trust Co. v. Court of Appeals, No. L-42724, 9 April 1985, 135 SCRA 569.

    G.R. No. 117742   July 29, 1997 - GEORGE M. TABERRAH v. NLRC, ET AL.


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