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[G.R. No. 138840. November 22, 2000]

LA CAMPA�A FABRICA DE TABACOS INC. vs. BAUTISTA BALAIS, et al.

FIRST DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated NOV 22 2000.

G.R. No. 138840 (La Campa�a Fabrica de Tabacos Inc. vs. Bautista Balais, et al.)

Petitioner La Campa�a is a corporation engaged in the business of manufacturing cigarettes and other tobacco products. On July 8, 1999, petitioner was granted permit by Makati Revenue District Office to transfer three (3) cigarette-making machines from its compound to that of Mighty Corporation, another corporation engaged in the tobacco manufacturing business. Several months thereafter, it was observed that other machineries were transferred under the cover of nighttime.

The General Information Sheets of both corporations reveal that both have the same set of stockholders, directors and officers, among other similarities.

On October 13, 1994, petitioner gave notice to the Department of Labor and Employment that it is closing its business operations allegedly due to serious financial losses/reverses. Subsequently, private respondents who were employees of La Campa�a, were given Notice of Separation From Employment and offered a package of financial benefits on a "take it or leave it" basis. Upon acceptance of these benefits, private respondents were made to sign quitclaims or waivers.

In the complaint for illegal dismissal with monetary claims filed by petitioner's former employees, the Labor Arbiter ruled:

WHEREFORE, premises considered, judgment is hereby rendered ordering respondent LCF to pay each complainant one month salary for every year of service as separation pay, the monetary equivalent of their unused vacation and sick leaves, deficiencies in the payment of their 13 th month pay, the amount of NINE THOUSAND ONE HUNDRED TWENTY SEVEN & 30/100 (P9,127.30) pesos, as retirement pay of complainant Demetria Ramirez, five thousand (P5,000.00) each for complainants as moral damages and ten percent (10%) of the total award of complainants as attorney's fees, the amounts due each of the complainants are as follows: xxx.

On appeal, the NLRC affirmed the above judgment with modification, thus:

WHEREFORE, the Decision dated May 23, 1997 is hereby AFFIRMED as regard(s) the award for full payment of separation pay equivalent to one month salary for every year of service. The monetary equivalent of the unused vacation and sick leave and 13 th month pay is SET ASIDE for lack of basis. The award for moral damages and attorney's fees is AFFIRMED.

The company filed a petition for certiorari with the Supreme Court. In line with the holding in the case of St. Martin Funeral Homes v. NLRC (295 SCRA 494 [1998]), the Supreme Court referred the petition to the Court of Appeals.

The Court of Appeals denied the petition and affirmed the decision of the NLRC in toto.

Petitioner comes to this Court assailing the decision of the Court of Appeals which awarded to the respondents separation pay, moral damages and attorney's fees. Petitioner submits as ground for review, to wit, whether petitioner's closure of business operation was due to serious business losses and financial reverses. The petition thus raises only questions of fact. The Labor Arbiter, the NLRC and the Court of Appeals found that the closure for business reverses was not bona fide considering the facts and circumstances indicating bad faith on the part of petitioner. It is well settled that findings of fact by the NLRC, especially when affirmed by the Court of Appeals, are binding upon this Court if supported by substantial evidence. While there are exceptions to this rule, such as when there is a misapprehension of facts, this case does not come under the exception, petitioner's claims to the contrary notwithstanding.

As to the issue of whether the NLRC and the Court of Appeals were correct in applying the doctrine of piercing the evil of corporate fiction, suffice it to state that this Court had the occasion to rule that the application of the doctrine is proper in cases where a corporation is merely an adjunct, a business conduit or an alter ego of another corporation or where it is utilized to defeat public convenience, justify wrong, protect fraud, or defend crime.

This Court Resolves to DENY the petition for failure to show extraordinary circumstances justifying a departure from the established doctrine that findings of fact of the NLRC and the Court of Appeals are well-nigh conclusive on this Court and will not be reviewed or disturbed on appeal.

ACCORDINGLY, the petition is DENIED.

Very truly yours,

(Sgd.) VIRGINIA ANCHETA-SORIANO

Clerk of Court�

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