Cheyzer C. C. J.

Mendoza
Block B

Labor Law I
Atty. Miles

G.R. No. L-41182-3 April 16, 1988

DR. CARLOS L. SEVILLA and LINA O. SEVILLA, petitioners-appellants,
vs.
THE COURT OF APPEALS, TOURIST WORLD SERVICE, INC., ELISEO S.CANILAO, and SEGUNDINA
NOGUERA, respondents-appellees.
Facts: On October 19, 1960, a contract of lease was entered between Mrs. Segundina Noguera and Tourist World
Service, Inc. as represented by Mr. Eliseo Canilao. Petitioner Lina Sevilla held herself solidarily liable for the said
contract of lease. The premise leased was used as a branch office which was run and managed by petitioner Lina
Sevilla. When airline fare was brought in efforts of Lina Sevilla ,4% goes to her and 3% was to be withheld by the
Tourist World Service. On or about November 24, 1961, Tourist World Service was informed that Sevilla was
connected with the rival company, and due to the losses, the Tourist World Service considered closing down the
company. Thru the companys board of directors, the office of manager and vice-president were abolished and the
other authorized the corporate secretary to receive properties of Tourist World Service located in the said branch. And
to comply to the resolution, Gabino Canilao went over to the branch office, finding the premise locked, and , unable to
contact Lina Sevilla, he padlocked the premises to protect the interests of the Tourist World Service. It was also
alleged that the telephone connection was disconnected. When neither Lina Sevilla nor any of her employees can
enter the premise, she filed a complaint with a prayer of the issuance of mandatory preliminary injunction.
The trial court dismissed the case on the ground of lack of interest. Sevilla refiled her case against the appellees. She
invoked the provisions on human relations of the Civil Code. She claimed that there was a joint business venture
between her and TWS and the padlocking of the premises by TWS without her knowledge and consent entitles her
claim for damages. On the other hand, TWS contended that the appellant was an employee and was designated as
manager. The trial court found that it is TWS being the true lease has the prerogative to terminate the lease and
padlock the premise. They likewise found that petitioner Sevilla to be a mere employee of the said TWS and she was
bound by the acts of her employer. The Court of Appeal affirmed the decision.
Issue: Whether there is an employee-employer relationship when the person who works for the company was not in
the latters payroll; bound herself in solidum in a contract of lease covering the office; and was not subject to the
control of the company thereby gives her the right to claim damage when the said property was padlocked without
her knowledge and consent?
Held: The court held that there was no employer-employee relationship. Under the test of control, it is apparent that
Sevilla was not under the control of the company and she was pursuing the business relying on her own gifts and
capabilities. In addition to the test of control, the court also used certain economic parameters like the inclusion of the
employee in the payrolls. She was not included in the companys payrolls and she earned compensation thru the
booking success she brought to the company. Although she was titled as manager, it does not make her an
employee. As pronounced by the court, employment is determined by the right-of-control test and certain economic
parameters, and titles are weak indicators.
Although she was not an employee, the court also do not agree that there was a joint business venture because
Sevilla herself did not recognize the existence of such relationship as shown in her letter addressed to TWS. The
court pronounced that the relationship between the petitioner and TWS was a contract of agency. And such
relationship cannot be revoked at will. And the revocation complained entitles Sevilla to damages.