Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 146989 February 7, 2007
MELENCO G!"REL, re#re$e%&e' by $ur()()%* $#ou$e, FLOR+EL,! -.
G!"REL, Petitioner,
vs.
NELSON "LON, !NGEL "R!,L !N+ ERNESTO P!G!.G!., Respondents.
D ! I S I O N
!,CUN!, J.:
This is a petition for revie" on certiorari
#
assailin$ the Decision and Resolution of the
!ourt of %ppeals, respectivel& dated %u$ust ', ())) and Februar& *, ())#, in !%+,.R.
SP No. -())# entitled .Nelson /ilon, et al. v. National 0abor Relations !o11ission, et
al..
The challen$ed decision reversed and set aside the decision
(
of the National 0abor
Relations !o11ission 2N0R!3 dis1issin$ respondents4 co1plaint for ille$al dis1issal
and ille$al deductions, and reinstatin$ the decision of the 0abor %rbiter findin$ petitioner
$uilt& of ille$al dis1issal but not of ille$al deductions sub5ect to the 1odification that
respondents be i11ediatel& reinstated to their for1er positions "ithout loss of seniorit&
ri$hts and privile$es instead of bein$ paid separation pa&.
Petitioner, represented b& his survivin$ spouse, Flordeli6a V. ,abriel, "as the o"ner+
operator of a public transport business, .,abriel 7eepne&,. "ith a fleet of -' 5eepne&s
pl&in$ the /aclaran+Divisoria+Tondo route. Petitioner had a pool of drivers, "hich
included respondents, operatin$ under a .boundar& s&ste1. of P')) per da&.
The facts
8
are as follo"s9
On Nove1ber #-, #::-, respondents filed their separate co1plaints for ille$al dis1issal,
ille$al deductions, and separation pa& a$ainst petitioner "ith the National 0abor
Relations !o11ission 2N0R!3. These "ere consolidated and doc;eted as N0R!+N!R
!ase No. ))+##+)*'()+:-.
'

On Dece1ber #-, #::-, the co1plaint "as a1ended, i1pleadin$ as part& respondent
the /acoor Transport Service !ooperative, Inc., as both parties are 1e1bers of the
cooperative.
Respondents alle$ed the follo"in$9
#3 That the& "ere re$ular drivers of ,abriel 7eepne&, drivin$ their respective
units bearin$ Plate Nos. P<= --8, N>? #--, and N== --*, under a
boundar& s&ste1 of P')) per da&, pl&in$ /aclaran to Divisoria via Tondo, and
vice versa, since Dece1ber #::), Nove1ber #:@' and Nove1ber #::#,
respectivel&, up to %pril 8), #::-,
-
drivin$ five da&s a "ee;, "ith avera$e dail&
earnin$s of P'))A
(3 That the& "ere reBuiredCforced to pa& additional P--.)) per da& for the
follo"in$9 a3 P().)) police protectionA b3 P().)) "ashin$A c3 P#).)) depositA
and Dd3E P-.)) $ara$e feesA
83 That there is no la" providin$ the operator to reBuire the drivers to pa&
police protection, deposit, "ashin$, and $ara$e fees.
'3 That on %pril 8), #::-, petitioner told the1 not to drive an&1ore, and "hen
the& "ent to the $ara$e to report for "or; the neFt da&, the& "ere not $iven a
unit to driveA and
-3 That the boundar& drivers of passen$er 5eepne&s are considered re$ular
e1plo&ees of the 5eepne& operators. /ein$ such, the& are entitled to securit&
of tenure. Petitioner, ho"ever, dis1issed the1 "ithout factual and le$al basis,
and "ithout due process.
On his part, petitioner contended that9
#3 <e does not re1e1ber if the respondents "ere ever under his e1plo& as
drivers of his passen$er 5eepne&s. !ertain, ho"ever, is the fact that neither the
respondents nor other drivers "ho "or;ed for hi1 "ere ever dis1issed b& hi1.
%s a 1atter of fact, so1e of his for1er drivers 5ust stopped reportin$ for "or;,
either because the& found so1e other e1plo&1ent or drove for other
operators, and li;e the respondents, the neFt ti1e he heard fro1 the1 "as
"hen the& started fabricatin$ unfounded co1plaints a$ainst hi1A
(3 <e 1ade sure that none of the 5eepne&s "ould sta& idle even for a da& so
he could collect his earnin$sA hence, it had been his practice to establish a
pool of drivers. <ad respondents 1anifested their desire to drive his units, it
1
"ould have been i11aterial "hether the& "ere his for1er drivers or not. %s
lon$ as the& obtained the necessar& licenses and references, the& "ould have
been acco11odated and placed on scheduleA
83 =hile he "as penali6ed or 1ade to pa& a certain a1ount in connection "ith
si1ilar co1plaints b& other drivers in a previous case before this, it "as not
because his culpabilit& "as established, but due to technicalities involvin$
oversi$ht and ne$li$ence on his part b& not participatin$ in an& sta$e of the
investi$ation thereofA and
'3 Respondents4 clai1 that certain a1ounts, as enu1erated in the co1plaint,
"ere deducted fro1 their da&4s earnin$s is preposterous. Indeed, there "ere
ti1es "hen deductions "ere 1ade fro1 the da&4s earnin$s of so1e drivers,
but such "ere install1ent pa&1ents for the a1ount previousl& advanced to
the1. Most drivers, "hen the& $ot involved in accidents or violations of traffic
re$ulations, 1ana$ed to settle the1, and in the process the& had to spend
so1e 1one&, but 1ost of the ti1e the& did not have the needed a1ount so
the& secured cash advances fro1 hi1, "ith the understandin$ that the sa1e
should be paid bac; b& install1ents throu$h deductions fro1 their dail&
earnin$s or boundar&.
On the other hand, /acoor Transport Service !ooperative, Inc. 2/TS!I3 declared that it
should not be 1ade a part& to the case because9 #3 DIEt has nothin$ to do "ith the
e1plo&1ent of its 1e1ber+drivers. The 1atter is bet"een the 1e1ber+operator and
their respective 1e1ber+drivers. The 1e1ber+drivers4 tenure of e1plo&1ent,
co1pensation, "or; conditions, and other aspects of e1plo&1ent are 1atters of
arran$e1ent bet"een the1 and the 1e1ber+operators concerned, and the /TS!I has
nothin$ to do "ith it, as can be inferred fro1 the Mana$e1ent %$ree1ent bet"een
/TS!I and the 1e1ber+operatorsA and (3 DTEhe a1ount alle$edl& deducted fro1
respondents and the purpose for "hich the& "ere applied "ere 1atters that the
cooperative "as not a"are of, and 1uch less i1posed on the1.
On Septe1ber #*, #::G, respondents filed a 1otion to re+raffle the case for the reason
that the 0abor %rbiter 2<on. Roberto I. Santos3 failed .to render his decision "ithin thirt&
28)3 calendar da&s, "ithout eFtension, after the sub1ission of the case for decision..
On Septe1ber #@, #::G, said 0abor %rbiter inhibited hi1self fro1 further handlin$ the
case due to .personal reasons..
On Nove1ber @, #::G, 0abor %rbiter Ricardo !. Nora, to "ho1 the case "as re+raffled,
ordered the parties to file their respective 1e1oranda "ithin ten da&s, after "hich the
case "as dee1ed sub1itted for resolution.
On March #*, #::*, the 0abor %rbiter 2<on. Ricardo !. Nora3 handed do"n his
decision, the dispositive portion of "hich is "orded as follo"s9
=<RFOR, pre1ises considered, 5ud$1ent is hereb& rendered declarin$ the
ille$alit& of Drespondents4E dis1issal and orderin$ DpetitionerE Melencio ,abriel to pa& the
DrespondentsE the total a1ount of ON MI00ION T<IRTH FO?R T<O?S%ND PSOS
DP#,)8',))),E representin$ Drespondents4E bac;"a$es and separation pa& as follo"s9
#. Nelson /ilon
/ac;"a$es P (@',@))
Separation Pa& (G,')) P 8(#,())
(. %n$el /ra6il
/ac;"a$es P (:',@))
Separation Pa& :G,@)) 8:#,G))
8. rnesto Pa$a&$a&
/ac;"a$es P (:',@))
Separation Pa& (G,')) 8(#,())
P #,)8',)))
DPetitionerE Melencio ,abriel is li;e"ise ordered to pa& attorne&4s fees eBuivalent to five
percent 2-I3 of the 5ud$1ent a"ard or the a1ount of P-#,*)) "ithin ten 2#)3 da&s fro1
receipt of this Decision.
%ll other issues are dis1issed for lac; of 1erit.
SO ORDRD.
G

Incidentall&, on %pril ', #::*, petitioner passed a"a&. On %pril #@, #::*, a cop& of the
above decision "as delivered personall& to petitioner4s house. %ccordin$ to
respondents, petitioner4s survivin$ spouse, Flordeli6a ,abriel, and their dau$hter, after
2
readin$ the contents of the decision and after the& had spo;en to their counsel, refused
to receive the sa1e. Nevertheless, /ailiff %lfredo V. stonactoc left a cop& of the
decision "ith petitioner4s "ife and her dau$hter but the& both refused to si$n and
ac;no"led$e receipt of the decision.
*

The labor arbiter4s decision "as subseBuentl& served b& re$istered 1ail at petitioner4s
residence and the sa1e "as received on Ma& (@, #::*.
On Ma& #G, #::*, counsel for petitioner filed an entr& of appearance "ith 1otion to
dis1iss the case for the reason that petitioner passed a"a& last %pril ', #::*.
On 7une -, #::*, petitioner appealed the labor arbiter4s decision to the National 0abor
Relations !o11ission, First Division, contendin$ that the labor arbiter erred9
#. In holdin$ that DpetitionerE ,abriel dis1issed the co1plainants, %rb. Nora
co11itted a serious error in the findin$s of fact "hich, if not corrected, "ould
cause $rave or irreparable da1a$e or in5ur& to DpetitionerE ,abrielA
(. In holdin$ that Jstrained relations4 alread& eFist bet"een the parties,
5ustif&in$ an a"ard of separation pa& in lieu of reinstate1ent, %rb. Nora not
onl& co11itted a serious error in the findin$s of fact, but he also abused his
discretionA
8. In co1putin$ the a1ount of bac;"a$es alle$edl& due DrespondentsE fro1 8)
%pril #::- to #- March #::*, %rb. Nora abused his discretion, considerin$ that
the case had been sub1itted for decision as earl& as # March #::G and that
the sa1e should have been decided as earl& as 8# March #::GA
'. In usin$ JP')).))4 and J(( da&s4 as factors in co1putin$ the a1ount of
bac;"a$es alle$edl& due DrespondentsE, %rb. Nora abused his discretion and
co11itted a serious error in the findin$s of fact, considerin$ that there "as no
factual or evidentiar& basis thereforA
-. In usin$ J88.- 1onths4 as factor in the co1putation of the a1ount of
bac;"a$es alle$edl& due DrespondentsE, %rb. Nora co11itted a serious error in
the findin$s of factD,E because even if it is assu1ed that bac;"a$es are due
fro1 8) %pril #::- to #- March #::*, the period bet"een the t"o dates is onl&
((K 1onths, and not 88K 1onths as stated in the appealed decisionA and
G. In not dis1issin$ the caseD,E despite notice of the death of DpetitionerE
,abriel before final 5ud$1ent, %rb. Nora abused his discretion and co11itted a
serious error of la".
@

On 7ul& 8, #::*, respondents filed a 1otion to dis1iss petitioner4s appeal on the $round
that the .suret& bond is defective. and the appeal "as .filed out of ti1e,. "hich 1ove
"as opposed b& petitioner.
SubseBuentl&, on %pril (@, #::@, the N0R! pro1ul$ated its first decision, the dispositive
portion of "hich reads9
=<RFOR, pre1ises considered, the appealed decision is hereb& reversed and set
aside. The above+entitled case is hereb& dis1issed for lac; of e1plo&er+e1plo&ee
relationship.
SO ORDRD.
:

Respondents filed a 1otion for reconsideration. The& clai1ed that the decision did not
discuss the issue of the ti1eliness of the appeal. The lac; of e1plo&er+e1plo&ee
relationship "as 1entioned in the dispositive portion, "hich issue "as not raised before
the labor arbiter or discussed in the bod& of the Buestioned decision. In vie" of the
issues raised b& respondents in their 1otion, the N0R! rendered its second decision on
October (:, #::@. The pertinent portions are hereb& Buoted thus9
L In the case at bar, DpetitionerE Melencio ,abriel "as not represented b& counsel
durin$ the pendenc& of the case. % decision "as rendered b& the 0abor %rbiter a quo on
March #*, #::* "hile Mr. ,abriel passed a"a& on %pril ', #::* "ithout havin$ received
a cop& thereof durin$ his lifeti1e. The decision "as onl& served on %pril #@, #::* "hen
he "as no lon$er around to receive the sa1e. <is survivin$ spouse and dau$hter
cannot auto1aticall& substitute the1selves as part& respondents. Thus, "hen the bailiff
tendered a cop& of the decision to the1, the& "ere not in a position to receive the1.
The reBuire1ent of leavin$ a cop& at the part&4s residence is not applicable in the
instant case because this presupposes that the part& is still livin$ and is 5ust not
available to receive the decision.
The precedin$ considered, the decision of the labor arbiter has not beco1e final
because there "as no proper service of cop& thereof to DpetitionerE L.
?ndoubtedl&, this case is for recover& of 1one& "hich does not survive, and
considerin$ that the decision has not beco1e final, the case should have been
dis1issed and the appeal no lon$er entertainedL.
=<RFOR, in vie" of the fore$oin$, the Decision of %pril (@, #::@ is set aside and
vacated. Further1ore, the instant case is dis1issed and co1plainants are directed to
pursue their clai1 a$ainst the proceedin$s for the settle1ent of the estate of the
deceased Melencio ,abriel.
3
SO ORDRD.
#)

%$$rieved b& the decision of the N0R!, respondents elevated the case to the !ourt of
%ppeals 2!%3 b& "a& of a petition for certiorari. On %u$ust ', ())), the !% reversed the
decisions of the N0R!9
L
%rticle ((8 of the 0abor !ode cate$oricall& 1andates that .an appeal b& the e1plo&er
1a& be perfected only upon the postin$ of a cash bond or suret& bond F F F.. It is
be&ond peradventure then that the non+co1pliance "ith the above conditio sine qua
non, plus the fact that the appeal "as filed be&ond the re$le1entar& period, should
have been enou$h reasons to dis1iss the appeal.
In an& event, even concedin$ ex gratia that such procedural infir1it& D"ereE ineFistent,
this petition "ould still be tenable based on substantive aspects.
The public respondent4s decision, dated %pril (@, #::@, is e$re$iousl& "ron$ insofar as
it "as anchored on the absence of an e1plo&er+e1plo&ee relationship. =ell+settled is
the rule that the boundar& s&ste1 used in 5eepne& and 2taFi3 operations presupposes an
e1plo&er+e1plo&ee relationship 2National 0abor ?nion v. Din$lasan, :@ Phil. G':3 L.
The N0R! ostensibl& tried to redee1 itself b& vacatin$ the decision %pril (@, #::@L. /&
so doin$, ho"ever, it did not actuall& resolve the 1atter definitivel&. It 1erel& relieved
itself of such burden b& su$$estin$ that the petitioners .pursue their clai1 a$ainst the
proceedin$s for the settle1ent of the estate of the deceased Melencio ,abrielL..
In the instant case, the decision 2dated March #*, #::*3 of the 0abor %rbiter beca1e
final and eFecutor& on account of the failure of the private respondent to perfect his
appeal on ti1eL.
Thus, "e disa$ree "ith the ratiocination of the N0R! that the death of the private
respondent on %pril ', #::* ipso facto ne$ates recover& of the 1one& clai1 a$ainst the
successors+in+interest L. Rather, this situation co1es "ithin the ae$is of Section 8,
Rule III of the N0R! Manual on Fecution of 7ud$1ent, "hich provides9
S!TION 8. Execution in Case of Death of Party. M =here a part& dies after the finalit&
of the decisionCentr& of 5ud$1ent of order, eFecution thereon 1a& issue or one alread&
issued 1a& be enforced in the follo"in$ cases9
a3 F F F A
b3 In case of death of the losin$ part&, a$ainst his successor+in+interest,
eFecutor or ad1inistratorA
c3 In case of death of the losin$ part& after eFecution is actuall& levied upon
an& of his propert&, the sa1e 1a& be sold for the satisfaction thereof, and the
sheriff 1a;in$ the sale shall account to his successor+in+interest, eFecutor or
ad1inistrator for an& surplus in his hands.
Not"ithstandin$ the fore$oin$ disBuisition thou$h, =e are not entirel& in accord "ith the
labor arbiter4s decision a"ardin$ separation pa& in favor of the petitioners. In this
re$ard, it DisE "orth 1entionin$ that in Kiamco v. NLRC,
##
citin$ Globe-Mackay Cable
and Radio Corp. v. NLRC,
#(
the Supre1e !ourt Bualified the application of the
.strained relations. principle "hen it held ++
.If in the "isdo1 of the !ourt, there 1a& be a $round or $rounds for the non+application
of the above+cited provision 2%rt. (*:, 0abor !ode3 this should be b& "a& of eFception,
such as "hen the reinstate1ent 1a& be inad1issible due to ensuin$ strained relations
bet"een the e1plo&er and e1plo&ee.
In such cases, it should be proved that the e1plo&ee concerned occupies a position
"here he en5o&s the trust and confidence of his e1plo&er, and that it is li;el& that if
reinstated, an at1osphere of antipath& and anta$onis1 1a& be $enerated as to
adversel& affect the efficienc& and productivit& of the e1plo&ee concerned F F F
Obviousl&, the principle of Jstrained relations4 cannot be applied indiscri1inatel&.
Other"ise, reinstate1ent can never be possible si1pl& because so1e hostilit& is
invariabl& en$endered bet"een the parties as a result of liti$ation. That is hu1an
nature.
/esides, no strained relations should arise fro1 a valid le$al act of assertin$ one4s ri$htA
other"iseD,E an e1plo&ee "ho shall assert his ri$ht could be easil& separated fro1 the
service b& 1erel& pa&in$ his separation pa& on the preteFt that his relationship "ith his
e1plo&er had alread& beco1e strained..
%nent the a"ard of bac;"a$es, the 0abor %rbiter erred in co1putin$ the sa1e fro1 the
date the petitioners "ere ille$all& dis1issed 2i.e. %pril 8), #::-3 up to March #-, #::*,
that is t"o 2(3 da&s prior to the rendition of his decision 2i.e. March #*, #::*3.
L
=<RFOR, pre1ises considered, the petition is ,R%NTD, hereb& RVRSIN,
and STTIN, %SID the assailed decisions of the National 0abor Relations
!o11ission, dated %pril (@, #::@ ans October (:, #::@. !onseBuentl&, the decision of
4
the 0abor %rbiter, dated March #*, #::*, is hereb& RINST%TD, sub5ect to the
MODIFI!%TION that the private respondent is ORDRD to i11ediatel& RINST%T
petitioners Nelson /ilon, %n$el /ra6il and rnesto Pa$a&$a& to their for1er position
"ithout loss of seniorit& ri$hts and privile$es, "ith full bac;"a$es fro1 the date of their
dis1issal until their actual reinstate1ent. !osts a$ainst private respondent.
SO ORDRD.
#8

Petitioner filed a 1otion for reconsideration but the sa1e "as denied b& the !% in a
resolution dated Februar& *, ())#.
<ence, this petition raisin$ the follo"in$ issues9
#'

I
T< !O?RT OF %PP%0S RRD IN FINDIN, T<%T PTITIONR4S %PP%0 TO
T< N%TION%0 0%/OR R0%TIONS !OMMISSION =%S FI0D O?T OF TIM.
II
T< !O?RT OF %PP%0S RRD IN <O0DIN, T<%T T< %00,D DF!TS IN
PTITIONR4S %PP%0 /OND =R OF S?!< ,R%VITH %S TO PRVNT T<
%PP%0 FROM /IN, PRF!TD.
III
T< !O?RT OF %PP%0S RRD IN ,R%NTIN, RSPONDNTS4 PTITION FOR
!RTIOR%RI DSPIT T< F%!T T<%T T< S%M %SS%I0D % D!ISION =<I!<
<%D /N V%!%TD IN F%VOR OF % N= ON =<I!<, IN T?RN, <%S SO0ID
0,%0 /%SIS.
IV
T< !O?RT OF %PP%0S RRD IN %PP0HIN, S!TION 8, R?0 III, OF T<
M%N?%0 ON >!?TION OF 7?D,MNT OF T< N%TION%0 0%/OR R0%TIONS
!OMMISSION =<I!<, /H ITS O=N >PRSS TRMS, IS NOT %PP0I!%/0.
% resolution of the case reBuires a brief discussion of t"o issues "hich touch upon the
procedural and substantial aspects of the case thus9 a3 "hether petitioner4s appeal "as
filed out of ti1eA and b3 "hether the clai1 survives.
%s re$ards the first issue, the !ourt considers the service of cop& of the decision of the
labor arbiter to have been validl& 1ade on Ma& (@, #::* "hen it "as received throu$h
re$istered 1ail. %s correctl& pointed out b& petitioner4s "ife, service of a cop& of the
decision could not have been validl& effected on %pril #@, #::* because petitioner
passed a"a& on %pril ', #::*.
Section ', Rule III of the Ne" Rules of Procedure of the N0R! provides9
S!. '. Ser()/e o0 No&)/e$ a%' Re$o1u&)o%$. M 2a3 Notices or su11ons and copies of
orders, resolutions or decisions shall be served on the parties to the case personall& b&
the bailiff or authori6ed public officer "ithin three 283 da&s fro1 receipt thereof or b&
re$istered 1ailA Provided, That "here a part& is represented b& counsel or authori6ed
representative, service shall be 1ade on such counsel or authori6ed representativeA
Provided further, That in cases of decision and final a"ards, copies thereof shall be
served on both parties and their counsel L.
For the purpose of co1putin$ the period of appeal, the sa1e shall be counted fro1
receipt of such decisions, a"ards or orders b& the counsel of record.
2b3 The bailiff or officer personall& servin$ the notice, order, resolution or decision shall
sub1it his return "ithin t"o 2(3 da&s fro1 date of service thereof, statin$ le$ibl& in his
return, his na1e, the na1es of the persons served and the date of receipt "hich return
shall be i11ediatel& attached and shall for1 part of the records of the case. If no
service "as effected, the servin$ officer shall state the reason therefore in the return.
Section G, Rule #8 of the Rules of !ourt "hich is suppletor& to the N0R! Rules of
Procedure states that9 .DsEervice of the papers 1a& be 1ade b& deliverin$ personall& a
cop& to the part& or his counsel, or b& leavin$ it in his office "ith his cler; or "ith a
person havin$ char$e thereof. If no person is found in his office, or his office is not
;no"n, or he has no office, then b& leavin$ the cop&, bet"een the hours of ei$ht in the
1ornin$ and siF in the evenin$, at the part&4s or counsel4s residence, if ;no"n, "ith a
person of sufficient a$e and discretion then residin$ therein..
The fore$oin$ provisions conte1plate a situation "herein the part& to the action is alive
upon the deliver& of a cop& of the tribunal4s decision. In the present case, ho"ever,
petitioner died before a cop& of the labor arbiter4s decision "as served upon hi1.
<ence, the above provisions do not appl&. %s aptl& stated b& the N0R!9
L In the case at bar, respondent Melencio ,abriel "as not represented b& counsel
durin$ the pendenc& of the case. % decision "as rendered b& the 0abor %rbiter a quo on
March #*, #::* "hile Mr. ,abriel passed a"a& on %pril ', #::*, "ithout havin$
received a cop& thereof durin$ his lifeti1e. The decision "as onl& served on %pril #@,
5
#::* "hen he "as no lon$er around to receive the sa1e. <is survivin$ spouse and
dau$hter cannot auto1aticall& substitute the1selves as part& respondents. Thus, "hen
the bailiff tendered a cop& of the decision to the1, the& "ere not in a position to receive
the1. The reBuire1ent of leavin$ a cop& at the part&4s residence is not applicable in the
instant case because this presupposes that the part& is still livin$ and is not 5ust
available to receive the decision.
The precedin$ considered, the decision of the 0abor %rbiter has not beco1e final
because there "as no proper service of cop& thereof to part& respondentL.
#-

Thus, the appeal filed on behalf of petitioner on 7une -, #::* after receipt of a cop& of
the decision via re$istered 1ail on Ma& (@, #::* "as "ithin the ten+da& re$le1entar&
period prescribed under Section ((8 of the 0abor !ode.
On the Buestion "hether petitioner4s suret& bond "as defective, Section G, Rule VI of
the Ne" Rules of Procedure of the N0R! provides9
S!. G. "o%'. M In case the decision of a 0abor %rbiter L involves 1onetar& a"ard, an
appeal b& the e1plo&er shall be perfected onl& upon the postin$ of a cash or suret&
bond issued b& a reputable bondin$ co1pan& dul& accredited b& the !o11ission or the
Supre1e !ourt in an a1ount eBuivalent to the 1onetar& a"ard, eFclusive of 1oral and
eFe1plar& da1a$es and attorne&4s fees.
The e1plo&er as "ell as counsel shall sub1it a 5oint declaration under oath attestin$
that the suret& bond posted is $enuine and that it shall be in effect until final disposition
of the case.
The !o11ission 1a&, in 1eritorious cases and upon Motion of the %ppellant, reduce
the a1ount of the bond. 2%s a1ended on Nov. -, #::83.
The !ourt believes that petitioner "as able to co1pl& substantiall& "ith the
reBuire1ents of the above Rule. %s correctl& pointed out b& the N0R!9
=hile "e a$ree "ith co1plainants+appellees that the postin$ of the suret& bond is
5urisdictional, =e do not believe that the .defects. i1puted to the suret& bond posted for
and in behalf of respondent+appellant ,abriel are of such character as to affect the
5urisdiction of this !o11ission to entertain the instant appeal.
It 1atters not that, b& the ter1s of the bond posted, the .0iabilit& of the suret& herein
shall eFpire on 7une -, #::@ and this bond shall be auto1aticall& cancelled ten 2#)3
da&s after the eFpiration.. %fter all, the bond is acco1panied b& the 5oint declaration
under oath of respondent+appellant4s survivin$ spouse and counsel attestin$ that the
suret& bond is $enuine and shall be in effect until the final disposition of the case.
%nent co1plainants+appellees contention that the suret& bond posted is defective for
bein$ in the na1e of /TS!I "hich did not appeal and for havin$ been entered into b&
Mrs. ,abriel "ithout /TS!I4s authorit&, the sa1e has been rendered 1oot and
acade1ic b& the certification issued b& ,il !7. San 7uan, Vice+President of the bondin$
co1pan& to the effect that .astern %ssurance and Suret& !orporation /ond No. (*':
"as posted for and on behalf appellant Melencio ,abriel andCor his heirs. and that
.2T3he na1e ./acoor Transport Service !ooperative, Inc.. "as indicated in said bond
due 1erel& in 2sic3 advertence..
%t an& rate, the Supre1e !ourt has ti1e and a$ain ruled that "hile %rticle ((8 of the
0abor !ode, as a1ended reBuirin$ a cash or suret& bond in the a1ount eBuivalent to
the 1onetar& a"ard in the 5ud$1ent appealed fro1 for the appeal to be perfected, 1a&
be considered a 5urisdictional reBuire1ent, nevertheless, adherin$ to the principle that
substantial 5ustice is better served b& allo"in$ the appeal on the 1erits threshed out b&
this <onorable !o11ission, the fore$oin$ reBuire1ent of the la" should be $iven a
liberal interpretation 2Pantranco North Fpress, Inc. v. Sison, #': S!R% (8@A !.=. Tan
Mf$. v. N0R!, #*) S!R% (')A H/0 v. N0R!, #:) S!R% #G)A Rada v. N0R!, ()- S!R%
G:A Star %n$el <andicraft v. N0R!, (8G S!R% -@)3.
#G

On the other hand, "ith re$ard to the substantive aspect of the case, the !ourt a$rees
"ith the !% that an e1plo&er+e1plo&ee relationship eFisted bet"een petitioner and
respondents. In Martinez v. National Laor !elations Co""ission,
#*
citin$ National
Laor #nion v. Dinglasan,
#@
the !ourt ruled that9
DTEhe relationship bet"een 5eepne& o"nersCoperators and 5eepne& drivers under the
boundar& s&ste1 is that of e1plo&er+e1plo&ee and not of lessor+lessee because in the
lease of chattels the lessor loses co1plete control over the chattel leased althou$h the
lessee cannot be rec;less in the use thereof, other"ise he "ould be responsible for the
da1a$es to the lessor. In the case of 5eepne& o"nersCoperators and 5eepne& drivers,
the for1er eFercises supervision and control over the latter. The fact that the drivers do
not receive fiFed "a$es but $et onl& that in eFcess of the so+called .boundar&. DthatE
the& pa& to the o"nerCoperator is not sufficient to "ithdra" the relationship bet"een
the1 fro1 that of e1plo&er and e1plo&ee. Thus, private respondents "ere e1plo&ees
L because the& had been en$a$ed to perfor1 activities "hich "ere usuall& necessar&
or desirable in the usual business or trade of the e1plo&er.
#:

The sa1e principle "as reiterated in the case of Paguio $ransport Corporation v.
NL!C.
()

6
The !ourt also a$rees "ith the labor arbiter and the !% that respondents "ere ille$all&
dis1issed b& petitioner. Respondents "ere not accorded due process.
(#
Moreover,
petitioner failed to sho" that the cause for ter1ination falls under an& of the $rounds
enu1erated in %rticle (@(
2then %rticle (@83
((
of the 0abor !ode.
(8
!onseBuentl&, respondents are entitled to
reinstate1ent "ithout loss of seniorit& ri$hts and other privile$es and to their full
bac;"a$es co1puted fro1 the date of dis1issal up to the ti1e of their actual
reinstate1ent in accordance "ith %rticle (*: of the 0abor !ode.
Reinstate1ent is obtainable in this case because it has not been sho"n that there is an
ensuin$ .strained relations. bet"een petitioner and respondents. This is pursuant to the
principle laid do"n in %loe&Mac'ay Cale and !adio Corporation v. NL!C
('
as Buoted
earlier in the !% decision.
=ith re$ard to respondents4 1onetar& clai1, the sa1e shall be $overned b& Section ()
2then Section (#3, Rule 8 of the Rules of !ourt "hich provides9(a)phi(.net
S!. (). *ction on contractual "oney clai"s. M =hen the action is for recover& of
1one& arisin$ fro1 contract, eFpress or i1plied, and the defendant dies before entr& of
final 5ud$1ent in the court in "hich the action "as pendin$ at the ti1e of such death, it
shall not be dis1issed but shall instead be allo"ed to continue until entr& of final
5ud$1ent. % favorable 5ud$1ent obtained b& the plaintiff therein shall be enforced in the
1anner provided in these Rules for prosecutin$ clai1s a$ainst the estate of a deceased
person. 2(#a3
In relation to this, Section -, Rule @G of the Rules of !ourt states9
S!. -. !lai1s "hich 1ust be filed under the notice. If not filed, barred A eFceptions. M
%ll clai1s for 1one& a$ainst the decedent arisin$ fro1 contract, eFpress or i1plied,
"hether the sa1e be due, not due, or contin$ent, ... and 5ud$1ent for 1one& a$ainst
the decedent, 1ust be filed "ithin the ti1e li1ited in the noticeA other"ise the& are
barred forever, eFcept that the& 1a& be set forth as counterclai1s in an& action that the
eFecutor or ad1inistrator 1a& brin$ a$ainst the clai1antsL.
Thus, in accordance "ith the above Rules, the 1one& clai1s of respondents 1ust be
filed a$ainst the estate of petitioner Melencio ,abriel.
(-

=<RFOR, the petition is DNID. The Decision and Resolution of the !ourt of
%ppeals dated %u$ust ', ())) and Februar& *, ())#, respectivel&, in !%+,.R. SP No.
-())# are %FFIRMD but "ith the MODIFI!%TION that the 1one& clai1s of
respondents should be filed a$ainst the estate of Melencio ,abriel, "ithin such
reasonable ti1e fro1 the finalit& of this Decision as the estate court 1a& fiF.
No costs.
SO ORDRD.
7