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It is then evident that the CA erred in reversing the NLRC’s ruling that favored
Cosare solely on the ground that the dispute was an intra-corporate controversy
within the jurisdiction of the regular courts.
Manila Electric Company v Jan Carlo Gala no control in the disposition of company supplies and materials. He
G.R. Nos. 191288 & 191304 | March 7, 2012 maintained that his mere presence at the scene of the incident was not
BRION, J.:
sufficient to hold him liable as a conspirator.
Grp. 5 | Orias Despite Galas explanation, Meralco proceeded with the investigation and
eventually terminated his employment on July 27, 2006.Gala responded by
Topic: Technical rules, not binding filing an illegal dismissal complaint against Meralco.
Petitioner: MANILA ELECTRIC COMPANY, Compulsory Arbitration Rulings: dismissed the complaint for lack of merit
Respondent: JAN CARLO GALA NLRC: reversed the labor arbiters ruling; no concrete proof of complicity;
reinstatement only until end of probationary period
Facts CA: denied Meralco’s petition for lack of merit and partially granted Gala’s
petition; Gala was illegally dismissed; reinstatement with full back wages and
benefits
Jan Carlo Gala commenced employment with the petitioner Meralco Electric
Company (Meralco) as a probationary lineman and was assigned to its
Valenzuela Sector Procedural defects of the petition:
Barely four months on the job, Gala was dismissed for alleged complicity in
pilferages of Meralcos electrical supplies, particularly, for the incident which The Verification and Certification, Secretary’s Certificate, and Affidavit of
took place on May 25, 2006. Service (submitted by Meralco) do NOT contrain the details of the
o On that day, Gala and other Meralco workers were instructed to replace Community Residence Tax Certificates of affiants, in violation of Sec. 6
a worn-out electrical pole at the Pacheco Subdivision in Valenzuela City. CA 645
Gala and the other linemen were directed to join Truck No. 1891, under Lawyers who signed the petition failed to indicate their updated MCLE
the supervision of Foreman Nemecio Hipolito. certificate numbers
o When they arrived at the worksite, Gala and the other workers saw that
Truck No. 1837, supervised by Zuniga, was already there. The linemen Issue: W/N Gala was illegally dismissed - NO
of Truck No. 1837 were already at work. Gala and the other members of Ruling: petition granted
the crew of Truck No. 1891 were instructed to help in the digging of a
hole for the pole to be installed. Ratio
o While the Meralco crew was at work, one Noberto Bing Llanes, a
non-Meralco employee, arrived. He appeared to be known to the It is the spirit and intention of labor legislation that the NLRC and the labor
Meralco foremen as they were seen conversing with him. Llanes arbiters shall use every reasonable means to ascertain the facts in each
boarded the trucks, without being stopped, and took out what were later case speedily and objectively, without regard to technicalities of law or
found as electrical supplies. procedure, provided due process is duly observe
o Aside from Gala, the foremen and the other linemen who were at the In keeping with this policy and in the interest of substantial justice, the
worksite when the pilferage happened were later charged with Court deems it proper to give due course to the petition, especially in view
misconduct and dishonesty for their involvement in the incident. of the conflict between the findings of the labor arbiter, on the one hand,
o Unknown to Gala and the rest of the crew, a Meralco surveillance task and the NLRC and the CA, on the other.
force was monitoring their activities and recording everything with a Sony o S.S. Ventures International, Inc. v. S.S. Ventures Labor Union:
video camera. The task force was composed of Joseph Aguilar, Ariel the application of technical rules of procedure in labor cases
Dola and Frederick Riano. Meralco called for an investigation of the may be relaxed to serve the demands of substantial justice.
incident and asked Gala to explain. Contrary to the conclusions of the CA and the NLRC, there is substantial
Gala denied involvement in the pilferage, contending that even if his superiors evidence supporting Meralco’s position that Gala had become unfit to continue
might have committed a wrongdoing, he had no participation in what they did his employment with the company.
and that his mere presence at the scene of the incident was not sufficient to o Gala was found, after an administrative investigation, to have failed to
hold him liable as a conspirator. He claimed that: meet the standards expected of him to become a regular employee and
o (1) he was at some distance away from the trucks when the pilferage this failure was mainly due to his undeniable knowledge, if not
happened; participation, in the pilferage activities done by their group, all to the
o (2) he did not have an inkling that an illegal activity was taking place prejudice of the Company’s interests.
since his supervisors were conversing with Llanes, giving him the As a probationary employee, his overall job performance and his behavior
impression that they knew him; were being monitored and measured in accordance with the standards (i.e.,
o (3) he did not call the attention of his superiors because he was not in a the terms and conditions) laid down in his probationary employment
position to do so as he was a mere lineman; and agreement.
o (4) he was just following instructions in connection with his work and had o Under paragraph 8 of the agreement, he was subject to strict compliance
with, and non- violation of the Company Code on Employee Discipline, o IPGC notified ITC of the expiration of the lease contract in
Safety Code, rules and regulations and existing policies. August 1990 and its intention not to renew the same.
o Par. 10 required him to observe at all times the highest degree of o ITC notified the DOLE and its workers of the plants shutdown
transparency, selflessness and integrity in the performance of his duties due to the non-renewal of anti-pollution permit that expired in
and responsibilities, free from any form of conflict or contradicting with April 1990.
his own personal interest. The non-renewal of permit and the alleged lack of logs for milling
The evidence on record established Galas presence in the worksite where the constrained ITC to lay off all its workers until further notice.
pilferage of company property happened. It also established that it was not o Advices for all the workers to collect the benefits due them under
only on May 25, 2006 that Llanes, the pilferer, had been seen during a Meralco the law and CBA
operation. He had been previously noticed by Meralco employees, including IPGC took over the plywood plant after it was issued a wood processing
Gala (based on his admission),in past operations. If Gala had seen Llanes in permit, which included the anti-pollution permit, by the DENR,
earlier projects or operations of the company, it is incredulous for him to say coincidentally on the same day the ITC ceased operation of the plant.
that he did not know why Llanes was there or what Zuiga and Llanes were This action led to the workers (Virgilio Ababon, et al.) to file a
talking about. complaint against ITC and IPGC for illegal dismissal, unfair labor
The Court finds that Gala he was complicit in its commission, if not by direct practice and damages. They alleged, among others, that:
participation, certainly, by his inaction while it was being perpetrated and by o The cessation of ITCs operation was intended to bust the union;
not reporting the incident to company authorities. and
Thus, we find substantial evidence to support the conclusion that Gala does o Both corporations are one and the same entity being controlled
not deserve to remain in Meralco’s employ as a regular employee. by one owner
o He violated his probationary employment agreement, especially the LA: upheld the validity of the closure; not enough evidence to prove it
requirement for him to observe at all times the highest degree of
was used to perpetrate fraud or illegal act; and ordered ITC to pay
transparency, selflessness and integrity in the performance of their
separation pay of month for every year of service
duties and responsibilities. He failed to qualify as a regular employee.
NLRC: set aside the decision of the Labor Arbiter and ordered the
reinstatement of the employees to their former positions, and the payment
of full back wages, damages and attorney’s fees
o ITC and IPGC filed a Motion for Reconsideration. However, it
INDUSTRIAL TIMBER CORPORATION v. ABABON was dismissed for being filed out of time having been filed
G.R. Nos. 164518 & 164965 | January 25, 2006 Group 6 Dela Cruz only on the date of actual receipt by the NLRC on June 29, 1993,
three days after the last day of the reglamentary period.
PETITIONER: Industrial Timber Corporation (ITC), Industrial Plywood Group o Thus, they filed a Petition for Relief from Resolution, which was
Corporation (IPGC), Tomas Tangsoc, Jr., Lorenzo Tangsoc and Tomas Tan (first treated as a 2nd motion for reconsideration by the NLRC and
G.R. No.; the other way for the 2nd) dismissed for lack of merit in a Resolution.
DEFENDANT: Virgilio Ababon plus 96 other workers (wow sipag ni Ma’am From said dismissal, petitioners filed a Notice of Appeal with the
magbilang) Supreme Court. Subsequently, they filed a Motion for
PONENTE: Ynares-Santiago, J. Reconsideration/Second Petition for Relief with the NLRC.
The SC dismissed the Notice of Appeal for being a wrong mode of
Topic: appeal from the NLRC decision.
Technical rules, not blinding → Liberality in application of rules (important
On the other hand, the NLRC granted the Second Petition for Relief
part starts at NLRC stage)
and set aside all its prior decision and resolutions.
Article 227 (221 before) of the Labor Code
Ababon, et al. filed a Petition for Certiorari with the SC. However,
Facts and Procedural History: pursuant to the ruling in St. Martins Funeral Home v. NLRC, SC referred
the petition to the CA for appropriate action and disposition.
Industrial Plywood Group Corporation (IPGC) is the owner of a plywood
plant located at Butuan City, leased to Industrial Timber Corporation (ITC) CA: rendered a decision setting aside the May 24, 1995 decision of the
on August 30, 1985 for a period of five years. Thereafter, ITC commenced NLRC (NLRC granting 2nd petition for relief and setting aside all its prior
operation of the plywood plant and hired 387 workers. decisions and resolutions) and reinstated its May 20, 1993 (NLRC
o In 1990, ITC notified the DOLE and its workers that effective reinstating employees and granting wages) decision and September 29,
March 19, 1990 it will undergo a no plant operation due to lack 1993 resolution (NLRC dismissing petition for lack of merit)
of raw materials and will resume only after it can secure logs for Both parties filed their respective motions for reconsideration which were
milling. denied. Hence, the present consolidated petitions for review.
Issue: SANTOS V LITTON MILLS
1. Whether the CA erred in liberally applying the rules of procedure with
respect to respondents but being rigid in its application as regards G.R. No. 170646 | June 22, 2011 | Del Castillo C2020 Digest
petitioners – YES (in G.R. No. 164518 only; the other issue is irrelevant)
Ratio: Topic: Technical rules, not binding; substantial compliance with rules
1. Yes. The Court has the power to except a particular case from the
operation of the rule whenever the purposes of justice requires it because Facts
what should guide judicial action is that a party is given the fullest
opportunity to establish the merits of his action or defense rather than for Litton Mills is a company engaged in the business of manufacturing textile
him to lose life, honor, or property on mere technicalities. materials. Petitioner Santos is a clerk under the Plant Administration and Services
Department, selling sludge oil and other waste materials. Santos was accused of
Ordinarily, once a judgment has become final and executory, it can no engaging in an unauthorized engagement with a waste buyer. He was accused of
longer be disturbed, altered or modified. However, this rule admits of demanding money from Leonardo Concepcion every time Concepcion would buy
exceptions in cases of special and exceptional nature. from the company, threatening to withhold the release of the purchased materials
o Industrial Timber Corporation v. NLRC: It is true that after a by delaying the release of official delivery receipt and gate pass if he wouldn’t
judgment has become final and executory, it can no longer be oblige.
modified or otherwise disturbed. However, this principle admits
of exceptions, as where facts and circumstances transpire which A criminal complaint for robbery/ extortion was filed in the RTC. Santos received a
render its execution impossible or unjust and it therefore letter of termination from his employers, for violating the company’s Code of
becomes necessary, in the interest of justice, to direct its Conduct. He then filed a complaint for illegal dismissal.
modification in order to harmonize the disposition with the
prevailing circumstances
A careful scrutiny of the facts and circumstances of these Procedural History
consolidated cases warrants liberality in the application of technical
rules and procedure. LA: Dismissed the complaint, just cause for dismissal
o NLRC is right when it said that substantial justice is best o Relied on the pendency of the criminal case saying that it’s an
served by allowing the petition for relief despite procedural indication that there’s sufficient evidence that Santos is
defect of filing the motion for reconsideration three days responsible for the offense charged (only substantial evidence
late, for to rule otherwise, a greater injustice would be done and not proof beyond reasonable doubt is nec for a valid
to ITC by ordering it to reinstate the employees to their former dismissal)
positions that no longer exist due to valid and legitimate NLRC: Affirmed the findings of the LA despite the decision of the RTC
cessation of business and pay huge judgment award. acquitting her of the criminal charge, declaring that she merely demanded
o Legal basis: Article 221 (now 227) of the Labor Code payment for a loan
The real purpose behind the limitation of the period is to forestall or o Held that the acquittal in the criminal case has no bearing on the
avoid an unreasonable delay in the administration of justice, from illegal dismissal
which the NLRC absolved ITC and IPGC because the filing of their motion Petition for Certiorari with the CA
for reconsideration three days later than the prescribed period was due CA: Dismissed the petition for failure of Santos to indicate in the petition
to excusable negligence. the actual addresses of the parties and to state in the Verification and
o Sec. 14 of Rule VII of the New Rules of Procedure of the Certification of non-forum shopping that there were no other pending
NLRC: a motion for reconsideration of any order, resolution or cases between the parties at the time of filing
decision of the Commission shall not be entertained except
when based on palpable or patent errors, provided that the
motion is under oath and filed within 10 calendar days from Issue: WN the CA erred in dismissing the petition
receipt of the order, resolution or decision -> should not be
interpreted as to sacrifice substantial justice to technicality Ratio
YES
Judgment:
o CA decision and resolution REVERSED Rules of procedure should be relaxed when there is substantial and
o Decision of NLRC is AFFIRMED WITH MODIFICATIONS. subsequent compliance.
Petitioner failed to indicate the actual addresses of the parties in the
petition, but she clearly mentioned that they may be served through their
respective counsels whose addresses were specified.
• On another date granted by LA, instead of submitting the position paper, P
o Court: This constitutes substantial compliance with the moved for an issuance directing R to furnish him with a complete copy of the
investigation regarding his dismissal
requirements under Section 3, Rule 46, ROC
o At any rate, she fully complied when she indicated in her MR the • LA finally issued an Order dismissing the case for lack of interest
actual addresses of the parties.
With regards to her Verification and Certification of non-forum shopping, • P received a copy of the Order
a reading shows that she nonetheless certified that: - About 8 months after, P again filed a Complaint with RAB for illegal dismissal
o I certify that I have not caused the filing to the Court of Appeals, with money claims containing the same allegations in his first complaint
to the Supreme Court or to any other Court or body of a case
similar to the instant petition and should I learn that the existence
• R filed a Motion to Dismiss on the ground of res judicata, pointing out that the
first complaint was dismissed for P failing to submit his position paper despite
or pendency of a similar case at the Court of Appeals, the
ample opportunity and that P should have appealed from the First Order
Supreme Court or any other Court or body, I undertake to inform
instead of filing a new complaint
this Court within five (5) days from knowledge.
o Court considers this substantial compliance. • P says that his failure to submit the position paper was because R refused to
It has been held that with respect to the contents of the certification, the furnish him with complete documents. He also alleged that the First Order
rule of substantial compliance may be availed of. was dismissed without prejudice, thus, he could either a file an MoR or re-file
o Besides, in her MR, she rectified such to: a case within 10 days from receipt of Order
o I certify that I have not theretofore commenced any action or
filed any claim involving the same issues in any court, tribunal • LA affirmed the First Order
or quasi-judicial agency and to the best of my knowledge, no - The previous Dismissal is with prejudice* considering that the First Order
such other action is pending therein and should I learn that the did not qualify the nature of the dismissal of the first complaint
same or similar action or claim has been filed or is pending, I - P filed a petition for certiorari with the CA for grave abuse of discretion of NLRC
[shall] immediately inform this Honorable Court within five (5)
days from knowledge or notice. • CA denied the petition
Subsequent and substantial compliance may call for the relaxation of
the rules of procedure. The Court has time and again relaxed the rigid ISSUE & RATIO:
application of the rules to offer full opportunity for parties to ventilate their Was the dismissal of P's first complaint, on the ground of lack of interest on
causes and defenses in order to promote rather than frustrate the ends his part to prosecute the same, bar the filing of another complaint for illegal
of justice. dismissal against R for based on the same allegations?
YES
*with prejudice: a court case that is dismissed permanently, that the case is over
and done with, once and for all, and can't be brought back to court. 1. Paraghaph 1(k), IRR of PD 1123 has already been declared VOID in
Philippine Apparel Workers Union vs. National Labor Relations
Commission.
2. In that case, the Secretary of Labor exceeded his authority when he
Kapisanang Manggagawang Pinagyakap vs. National Labor Relations included paragraph 1(k) in the IRR.
Commission 3. "Section 1 of PD 1123 spells out the scope of its benefits, as follows:
No. L-60328 July 16, 1987 Group 3 (Oliquino)
'Section 1. In the Private Sector.—ln the private sector, an across-the-board
Petitioner: Kapisanang Manggagawang Pinagyakap
increase of sixty pesos (P60.00) in emergency allowance as provided in P.D. 525
Respondents: National Labor Relations Commission, Franklin Baker Company of shall be paid by all employers to their employees effective 1 May 1977…
the Philippines
Topic: Rule-making/Limitation
4. To implement the same, the Secretary of Labor was authorized in
Section 4 of the PD 1123 to issue appropriate rules and regulations
a. “Section 4. The Secretary of Labor and the Commissioner of
FACTS the Budget shall issue appropriate rules and regulations to
implement this Decree for their respective sectors. Under such
1. Labor Arbiter (LA) ruled that the negotiated daily wage increase of P1.33 rules and regulations, distressed employers whether public or
in the collective bargaining agreement between petitioner and private private may be exempted while in such condition in the interest
respondent could be credited to and deducted from the P60.00 of development and employment.”
monthly or P2.00 daily living allowance required by P.D. 1123
a. Contrary to ruling in Phil. Apparel Workers Union vs. NLRC and
Philippine Apparel, Inc.
b. It should be noted that ONLY those distressed employers b. "Where a decision may be made to rest on informed judgment
whether public or private may be exempted while in such rather than rigid rules, all the equities of the case must be
condition in the interest of development and employment accorded their due weight . . . labor determinations . . . should
5. However, the Secretary of Labor issued on May 1, 1977 a set of rules be not only secundum rationem but also secundum
which exempts not only distressed employers but also 'those who caritatem." (not only according to reason but also
have granted in addition to the allowance under P.D. 525, at least P60.00 according to charitable heart)
monthly wage increase on or after January 1, 1977, provided that those 4. It certainly would work against reason and compassion to hold that the
who paid less than this amount shall pay the difference hard-earned P1.33 daily wage increase finally negotiated and secured by
6. The LA totally ignored the petitioner’s logical plea stating that said petitioners-workers in the CBA was meant to be wiped out by the later
deduction is issuance of P.D. 1123 recognizing the need to grant the workers a P2.00
a. contrary to the spirit and intent of P.D. 1123 which is to protect daily cost of living allowance.
the wages against inflation 5. To repeat, P.D. 1123 did not authorize such a credit and deduction.
b. that the workers belong to the lowest income group a. It is clear that the living allowance decreed therein is over and
c. that what the workers obtained through a CBA should be above any wage increase contracted and agreed by the parties
protected and not be deducted from the decreed additional 6. TUPAS vs. NLRC: Paragraph (k) of the Rules Implementing P.D. 1123
P60.00 monthly (or P2.00 daily) living allowance being void, petitioner's claim must be granted as private respondent
would no longer have any basis for exemption."
7. IBAAEU vs. Inciong: It is elementary in the rules of statutory
II. W/N the failure of appellant to serve a copy of his memorandum construction that when the language of the law is clear and unequivocal
of appeal upon the appellee would warrant the dismissal of a the law must be taken to mean exactly what it says. All doubts in the
meritorious appeal (NO) (important part) implementation and interpretation of the provisions of this Code, including
its implementing rules and regulations, shall be resolved in favor of
labor."
1. Estrada vs. NLRC: The commission's dismissal of the employee's
appeal, on a motion for reconsideration (whereby it set aside its original
decision on appeal in favor of the employee on the mere ground of his HELD: Labor arbiter's Decision and Resolution dismissing the appeal are hereby
failure to furnish employer-employee with a copy of his SET ASIDE and Company is ordered to comply fully with the obligation imposed
memorandum of appeal), was based on mere procedural technicality upon it by P.D. 1123 and pay to all its workers the living allowance therein provided
and not a jurisdictional defect separately and distinctly from the wage increase agreed by it and embodied in the
a. "Considering that there is no basis for the dismissal of petitioner, CBA of March 7, 1977.
it would be inconsistent with the requirement of social
justice to terminate his employment on mere grounds of
technicality.”
2. Estrada v. NLRC: That respondent’s right to due process was violated by Phil Nat’l Oil Company Energy Development Corp. v. NLRC & Mercado
having been allegedly deprived of the opportunity to answer petitioner's
appeal on account of the latter's failure to furnish the former with a copy 1. In June 1985, Danilo Mercado (clerk, shipping clerk) was dismissed by
of his memorandum of appeal is unavailing. Phil. National Oil Company-Energy Development Corporation (PNOC-
a. Since the entire record of the case on appeal is open for review EDC) due to serious acts of dishonesty he allegedly committed
by the NLRC, the absence of an answer or opposition to the (Misappropriation of company funds, bought supplies for less than the
appeal would not really have a significant bearing on the agreed amount and then appropriated the excess; did not report
adjudication of the case. discounts obtained, etc.]
b. Respondent had already the opportunity to answer petitioner's 2. Danilo then filed a complaint for illegal dismissal against PNOC-EDC.
appeal when he filed a MOR of the earlier decision of the NLRC. 3. PNOC-EDC filed a motion to dismiss on the ground that the LA and/or
c. Respondent never touched on the merits of the case in his the NLRC has no jurisdiction over PNOC-EDC because it is a subsidiary
aforementioned MOR. Instead, it relied solely on technicality to of the Philippine National Oil Company (PNOC), a government owned or
oppose petitioner's appeal which thereby reasonably creates controlled corporation, and as a subsidiary, it is also a GOCC and as
the impression that its case is weak as in fact it is. such, the proper forum for Danilo’s suit is the Civil Service Commission.
3. Dismissal of petitioner's appeal on a purely technical ground is 4. LA: ruled in favor of Danilo
inconsistent with the constitutional mandate on protection to labor 5. NLRC: affirmed.
a. Where the rules are applied to labor cases, they must be
WON matters of employment affecting PNOC-EDC, a GOCC, are within the
interpreted with the liberal spirit of the labor laws.
jurisdiction of the LA and NLRC? YES
- The issue in this case has been decided already in the case of PNOC-
EDC vs Leogardo.
- It is true that PNOC is a GOCC and that PNOC-EDC, being a subsidiary
of PNOC, is likewise a GOCC.
- It is also true that under the 1973 Constitution, all GOCCs are under the
jurisdiction of the CSC.
- However, this has been supplanted by 1987 Constitution as it now
provides:
o The Civil Service embraces all branches, subdivisions,
instrumentalities and agencies of the Government, including
government-owned or controlled corporations with original
charters. (Article IX-B, Section 2 [1])
- Hence, the above provision sets the rule that the mere fact that a
corporation is a GOCC does not automatically place it under the CSC.
- Under this provision, the test in determining whether a GOCC is subject
to the Civil Service Law is the manner of its creation such that government
corporations created by special charter are subject to its provisions while
those incorporated under the general Corporation Law are not within its
coverage.
- In the case at bar, PNOC-EDC, even though it is a GOCC, was
incorporated under the general Corporation Law – it does not have its
own charter, hence, it is under the jurisdiction of the LA and NLRC
- Even though the facts of this case occurred while the 1973 Constitution
was still in force, the provisions of the 1987 Constitution regarding the
legal matters [procedural aspect] are applicable because it is the law in
force at the time of the decision.