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Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 102358 November 19, 1992

SPOUSES VICENTE and GLORIA MANALO, petitioners,

vs.
HON. NIEVES ROLDAN-CONFESOR, in her capacity as Undersecretary of Labor and
Employment, JOSE SARMIENTO as POEA Administrator, CAREERS PLANNERS
SPECIALISTS INTERNATIONAL, INC., and SPOUSES VICTOR and ELNORA
FERNANDEZ, respondents.

BELLOSILLO, J.:

The Court views with grave concern the alarming incidents of illegal recruitment which demonstrate
all too clearly that overseas employment has fast developed into a major source not only of much-
needed foreign exchanged but also, for the cunning and the crafty, of easy money.

In response to a newspaper advertisement looking for a couple to work as driver and tutor cum baby
sitter, petitioners Vicente and Gloria Manalo went to Career Planners Specialists International, Inc.
(CPSI), a licensed service contracting firm owned by private respondents, the spouses Victor and
Elnora Fernandez. After the requisite interview and testing, they were hired to work for a family in
Saudi Arabia for a monthly salary of US$350.00 each. According to petitioners, a placement fee of
P40,000.00 was imposed as a precondition for the processing of their papers. They paid only
P30,000.00 in cash and executed a promissory note for the balance. Then they were allowed by
respondent Elnora Fernandez to sign their contract papers but did not issue a receipt for the
placement fee despite demand.

Shortly before boarding their flight to Saudi Arabia, petitioners were handed their contracts.
According to Gloria, she was surprised to discover that her position had been changed to that of
domestic help. However, a CPSI employee assured her that the change was only for the purpose of
facilitating her departure and did not in any way alter her employment as tutor. Incidentally, CPSI
provided petitioners with the Travel Exit Pass (TEP) of Filipino Manpower Services, Inc. (FILMAN), a
duly licensed recruitment agency.

Contrary to the representation of her recruiter, Gloria was actually hired as a domestic help and not
as a tutor, so that after working for only twenty-five (25) days in Jeddah, she returned to Manila.
Soon after, Vicente also resigned from his work and followed her home. He could not stand the
unbearable working conditions of his employment. However, before leaving, he had to execute a
promissory note to cover his plane fare which respondent Victor Fernandez advanced. Vicente also
had to sign a quitclaim in favor of CPSI and his employer.

On 29 February 1988, petitioners sued private respondents before the Philippines Overseas
Employment Administration (POEA) charging them with illegal exaction, 1 false adverstisement, 2 and
violation of other pertinents laws, rules and regulations. They demanded the refund of the amount
exacted from them, plus payment of moral damages and the imposition of administrative sanctions. 3

Private respondents countered: (1) that Gloria applied as domestic help fully aware that she could
not be a tutor since she did not speak Arabic; (2) that the promissory note for P10,000.00 was
required of petitioners because they were hired without paying placement fees; (3) that it was
unlikely for petitioners, who were mature, educated and experienced in overseas work, to part with
P30,000.00 without securing a receipt; (4) that Vicente executed a quitclaim in favor of CPSI duly
authenticated by embassy officials in Saudi Arabia; (5) that there was no impropriety in having the
employment papers of petitioners processed by FILMAN because it was a sister company of CPSI,
and private respondents Victor and Elnora were officers in both agencies.

Private respondents prayed for the disqualification of petitioners from overseas employment, and
sought to recover from them the SR 1,150 plane fare advanced by Victor for Vicente, P10,000.00 as
placement fee evidenced by a promissory note, and attorney's fees.

Mainly, on the basis of the transcripts of petitioners' testimonies in the clarificatory questioning
before the Rizal Provincial Prosecutor in a related criminal case,4 the POEA issued its Order of 7
May 1990 giving more weight and credence to petitioners' version thus —

After a careful evaluation of the facts and the evidence presented, we are
more inclined to give weight to complainants' posture. Complainants' version
of the case spontaneously presented in their pleadings is, to our mind, more
convincing than respondent's stand. Moreover, the manner by which
complainants narrated the whole incident inspired belief in the allegation that
respondent Career is indeed guilty of illegal exaction. Thus, the actual
expenses incurred by herein complainants computed hereinbelow less the
allowable fees of P3,000.00 (P1,500.00 per worker, respondent being a
service contractor) should be returned to them.

Actual Expenses —

P30,000.00 — placement fees

14.00 — application form
300.00 — psychological test
1,400.00 — medical exam
P31,000.00 — total

less 3,000.00 — processing fees at

P1,500.00 per applicant
 P28,714.00 — amount to be refunded

It appearing, however, that only respondent Career Planners Specialist(s)

Int'l. Inc., took part in the collection of the aforesaid amount, the same should
be solely held liable.

We cannot likewise give credence to the Final Quitclaim signed by

complainant Vicente Manalo before he left for the Philippines and presented
by respondent as defense. While its genuineness may not be in question, we
believe that it has no bearing on the issue at bar. The aforesaid Quitclaim
deals more with matters concerning complainants' employment abroad.
However, the subject of the instant claim is the refund of complainants'
expenses prior to their deployment to Saudi Arabia.

On the other hand, we hold FILMAN liable for allowing its document such as
the TEP to be used by other agency. Respondent's defense that there is
nothing wrong in this because FILMAN is a sister company of CAREER does
not merit consideration because such practice is not allowed under the POEA
Rules and Regulations. A check with our records, however, showed that
respondent FILMAN had been put in the list of forever banned agencies
effective April 5, 1989.

Anent the claim for moral damages, this Office has no jurisdiction to entertain
the same.

WHEREFORE, . . . the Authority of Career Planners Specialist(s)

International is hereby suspended for four (4) months or in lieu thereof, a fine
of P40,000.00 is hereby imposed for illegal exaction on two counts plus
restitution of the amount of P28,714.00 to herein complainants in both
instances.

Filipino Manpower Services, Inc. is hereby meted a fine of P40,000.00 for

two counts of misrepresentation. Its perpetual disqualification from
recruitment activities is hereby reiterated.

The claim for moral damages is dismissed for lack of jurisdiction.

Respondent Career's counterclaim is likewise dismissed or lack of merit. 5

Private respondents filed a motion for reconsideration and on 4 February 1991, POEA issued a
resolution setting arise its earlier order stating that —

It is worth mentioning at this point that our sole basis for holding respondent
Career liable for illegal exaction was the uncorroborated testimony of the
complainants.

As we have consistently held, (the) charge of illegal exaction is a serious

charge which may cause the suspension or cancellation of the authority or
license of the offending agency. Hence, it should be proven and
substantiated by a clear and convincing evidence. Mere allegation of
complainant that the agency charged more than the authorized fee will not
 suffice to indict the agency for illegal exaction unless the allegation is
supported by other corroborative circumstantial evidence.

Thus, for lack of concrete evidence or proof to support our initial findings, we
are inclined to reconsider the penalty imposed upon respondent.

Foregoing premises, the penalty of suspension imposed upon respondent

Career Planners Specialist(s) International, Inc. pursuant to our Order dated
May 7, 1990 is hereby LIFTED.

Accordingly, the alternative fine of P40,000.00 which was paid under protest
by respondent is hereby ordered refunded to them. 6

Petitioners appealed to the Secretary of Labor. On 5 July 1991, then Undersecretary of Labor Ma.
Nieves Roldan-Confesor (now Secretary of Labor) sustained the reconsideration of POEA. Her
Order reads in part —

We find . . . no cogent reason or sufficient justification to reverse or modify

the assailed Order.

Records reveal that the only basis for holding respondent Career Planners
Specialist(s) International, Inc., liable for illegal exaction, as held in the
previous POEA Order dated May 7, 1990 was the uncorroborated testimony
of the complainants. There was no concrete evidence or proof to support the
POEA Administrator's initial findings.

We take this opportunity to inform the complainants that the charge of illegal
exaction is a serious charge which may cause the suspension or cancellation
of the authority or license of a recruitment agency. Therefore, said charge
must be proven and substantiated by clear and convincing evidence. A mere
allegation will not suffice to find an agency liable for illegal exaction unless
said allegation is supported by other corroborative circumstantial evidence. In
this connection, records show that complainants could not narrate the
specific circumstances surrounding their alleged payment of the amount of
P30,000.00. They could not even remember the specific date when said
amount was paid to respondent agency. In addition, when complainants were
separately questioned as to how the money was kept bundled together prior
to being handed to respondent agency for payment, Gloria Manalo said it
was wrapped in a piece of paper while Vicente Manalo said it was placed
inside an envelope. 7

On the charge of petitioners that they were given jobs (driver/domestic help) different from those
advertised by private respondents, the Undersecretary ruled that there was no misrepresentation by
way of false advertisement because it was established that private respondents also caused to be
printed in the same newspaper page a second box looking for a couple driver/domestic help.

In her Order of 9 October 1991, then Undersecretary Ma. Nieves Roldan-Confesor denied
petitioners' motion for reconsideration. 8

In the present recourse, petitioners claim that public respondent POEA committed a fatal jurisdictional error when it resolved private
respondents' motion for reconsideration in violation of Rule V, Book VI of the 1985 POEA Rules and Regulations directing the transmittal of
motions for reconsideration to the National Labor Relations Commission (NLRC) for determination. Consequently, for want of legal
competence to act on said motion, the Order of 4 February 1991, as well as the subsequent orders of public respondent Undersecretary of
Labor dated 5 July 1991 and 9 October 1991, is null and void.

In Aguinaldo Industries Corporation v. Commissioner of Internal Revenue 9 We ruled —

To allow a litigant to assume a different posture when he comes before the

court and challenge the position he had accepted at the administrative level,
would be to sanction a procedure whereby the court — which is supposed
to review administrative determinations — would not review, but determine
and decide for the first time, a question not raised at the administrative forum.
This cannot be permitted, for the same reason that underlies the requirement
of prior exhaustion of administrative remedies to give administrative
authorities the prior opportunity to decide controversies within its
competence, and in much the same way that, on the judicial level, issues not
raised in the lower court cannot be raised for the first time on appeal.

The alleged procedural lapse by respondent POEA was raised by petitioners only before Us,
notwithstanding that such ground was already existing when they appealed to the Secretary of
Labor. Ironically, petitioners now question the jurisdiction of the Secretary of Labor over the appeal
which they themselves elevated to that office. When petitioners filed their motion for reconsideration
with the Undersecretary of Labor, this procedural issue was not even mentioned. Clearly, it would be
the height of unfairness and inequity if We now allow petitioners to backtrack after getting an
unfavorable verdict from public respondents whose authority they themselves involved. In Tijam
v. Sibonghanoy 10 We said: ". . . we frown upon the "undesirable practice" of a party submitting his
case for decision and then accepting the judgment, only if favorable, and attacking it for lack of
jurisdiction, when adverse . . . ."

In this regard, however, We find no procedural infirmity constituting reversible error.

The 1985 POEA Rules and Regulations 11 is divided into eight (8) Books. Book VI, cited by
petitioners, is entitled "Adjudication Rules". The procedure outlined therein relates to the original and
exclusive jurisdiction exercised by POEA through its Adjudication Department "to hear and decide all
cases involving employer-employee relations arising out of or by virtue of a law or contact involving
Filipino workers for overseas employment," involving "[v]iolation of the terms and conditions of
employment . . . . [d]isputes relating to the implementation and interpretation of employment
contracts . . . [m]oney claims of workers against their employers and/or their duly authorized agents
in the Philippines or vice versa . . . . [c]laims for death, disability and other benefits arising out of
employment . . . . and . . . . [v]iolations of our non-compliance with any compromise agreement
entered into by and between the parties in an overseas employment contract."

On the other hand, Book II entitled "Licensing and Regulations" of the 1985 POEA Rules and
Regulations, notably Rule VI cited by private respondents, refers particularly to the procedure for
suspension, cancellation and revocation of Authority or License 12 through the POEA Licensing and
Regulation Office (LRO).

The controversy in the present case centers on the liability of private respondents for illegal exaction,
false advertisement and violation of pertinent laws and rules on recruitment of overseas workers and
the resulting imposition of penalty of suspension of the Authority of respondent CPSI. Quite plainly,
We are not concerned here with employer-employee relations, the procedure of which is outlined in
Book VI; rather, with the suspension or revocation of Authority embodied in Book II.

Evidently, no jurisdictional error was accordingly committed because in cases affecting suspension,
revocation or cancellation of Authority, the POEA has authority under Sec. 18, Rule VI, Book II, to
resolve motions for reconsideration which may thereafter be appealed to the Secretary of Labor.
Section 18, provides: "A motion for reconsideration of an order o suspension (issued by POEA) or an
appeal to the Minister (now Secretary of Labor) from an order cancelling a license or authority may
be entertained only when filed with the LRO within ten (10) working days from the service of the
order or decision" (parenthesis supplied).

Petitioners also argue that public respondents gravely abused their discretion when they violated
petitioners' right to administrative due process by requiring clear and convincing evidence to
establish the charge illegal exaction. This point is well taken. There was grave abuse of discretion.

In the administrative proceedings for cancellation, revocation or suspension of Authority or License,

no rule requires that testimonies of complainants be corroborated by documentary evidence, if the
charge of unlawful exaction is substantially proven. All administrative determinations require only
substantial proof and not clear and convincing evidence as erroneously contended by pubic
respondents.

Clear and convincing proof is ". . . more than mere preponderance, but not to extent of such certainty
as is required beyond reasonable doubt as in criminal cases . . ." 13 while substantial evidence ". . .
consists of more than a mere scintilla of evidence but may be somewhat less than a preponderance
. . . ." 14 Consequently, in the hierarchy of evidentiary values, We find proof beyond reasonable doubt
at the highest level, followed by clear and convincing evidence, preponderance of evidence, and
substantial evidence, in that order.

That the administrative determination of facts may result in the suspension or revocation of the
authority of CPSI does not require a higher degree of proof. The proceedings are administrative, and
the consequent imposition of suspension/revocation of Authority/License does not make the
proceedings criminal. Moreover, the sanctions are administrative and, accordingly, their infliction
does not give rise to double jeopardy when a criminal action is instituted for the same act.

Thus We held in Atlas Consolidated Mining and Development Corporation v. Factoran, Jr. 15 —

. . . it is sufficient that administrative findings of fact are supported by

evidence, or negatively stated, it is sufficient that findings of fact are not
shown to be unsupported by evidence. Substantial evidence is all that is
needed to support an administrative finding of fact, and substantial evidence
is such relevant evidence as a reasonable mind might accept as adequate to
support a conclusion (Ang Tibay v. Court of Industrial Relations, 69 Phil. 635,
642; Police Commission v. Lood, 127 SCRA 762 [1984].

The POEA, after assessing the evidence of both parties, found that private respondents collected
from petitioners P30,000.00 as placement fees; consequently, it ruled that there was illegal exaction.
Surprisingly, without altering its findings of fact, POEA reconsidered its order. It held that
uncorroborated testimonies were not enough to conclude that illegal exaction was committed,
particularly so that this might result in the suspension or revocation of respondents' authority to
engage in recruitment activities. The premise that testimonies of petitioners should be supported by
some other form of evidence is, to say the least, fallacious. In Castillo v. Court of Appeals, 16 where
the appellate court reversed the findings of fact of the trial court by requiring a higher degree of
proof, We held —

. . . we find no strong and cogent reason which justifies the appellate court's
deviation from the findings and conclusions of the trial court. As pointed out
in Hernandez v. Intermediate Appellate Court (189 SCRA 758 [1990]), in
 agrarian cases, all that is required is mere substantial evidence. Hence, the
agrarian court's findings of fact which went beyond the minimum evidentiary
support demanded by law, that is, supported by substantial evidence, are
final and conclusive and cannot be reversed by the appellate tribunal.

The seeming discrepancy in the statements of the witnesses (one saying the money was wrapped in
paper, the other, that the money was in an envelope; neither testified on the specific date of the
exaction), refers only to minor details. Perhaps it would be different if the variance refers to essential
points, e.g., whether the amount of P30,000.00 was actually paid by petitioners to private
respondents. Consequently, whether the money was wrapped in paper, or placed in an envelope, or
unwrapped or whether the parties could not recall when there payment was effected is unimportant.
After all, the money could have been wrapped in paper and placed in the envelope, or placed in the
envelope without being wrapped, or wrapped with use of an unpasted envelope that appeared to be
the envelope itself. In either case, petitioners, could have viewed them differently; but the difference
is ultimately inconsequential. The crucial point to consider is that the petitioners categorically and
unequivocally testified that respondents collected from them the amount of P30,000.00 as their
placement fees and that they paid the amount demanded. In this regard, it may be worth to
emphasize that only substantial evidence, not necessarily clear and convincing evidence, is
required. Moreover, when confronted with conflicting assertions, the rule that "as between a positive
and categorical testimony which has a ring of truth on one hand, and a bare denial on the other, the
former is generally held to prevail . . . ." 17 applies.

But even on the supposition that there was no payment of P30,000.00, it cannot be denied that
private respondents required petitioners to execute a promissory note for P10,000.00 purportedly
because petitioners were hired without paying placement fees. The mere charging of P10,000.00,
standing alone, is enough to hold private respondents answerable for illegal exaction because the
allowable amount to be collected per contract worker according to respondent POEA was only
P1,500.00, or P3,000.00 for both petitioners.

WHEREFORE, the petition is GRANTED. The challenged Orders of respondent Undersecretary of

Labor dated 5 July 1991 and 9 October 1991, as well as the Resolution of respondent POEA dated 4
February 1991, having been issued with grave abuse of discretion amounting to lack or excess of
jurisdiction are SET ASIDE, and the original Order of respondent POEA dated 7 May 1990 is
ordered REINSTATED and AFFIRMED.

SO ORDERED.

Cruz, Padilla and Griño-Aquino, JJ., concur.

Footnotes

1 Charging or accepting, directly or indirectly, any amount greater than that

specified in the schedule of allowable fees (Art. 34, par. [a], P.D. 442, as
amended, known as the Labor Code of the Philippines); imposing or
accepting, directly or indirectly, any amount of money, goods or services, or
any fee or bond in excess of what is prescribed by the POEA (Sec. 2, par.
[a], Rule VI, Book II, 1985 POEA Rules and Regulations).

2 Engaging in act(s) of misrepresentation, such as publication or

advertisement of false or deceptive notices or information in relation to the
 recruitment and placement of worker (Sec. 2, par. [b], Ibid.).

3 Petition, Annex "A", Rollo, p. 30.

4 I.S. No. 88-647, "Gloria Manalo v. Victor Fernandez and Elnora

Fernandez", and I.S. No. 88-718, "Vicente Manalo v. Victor Manalo v. Victor
Fernandez and Elnora Fernandez", both for estafa/illegal recruitment.

5 Petition, Annex "E", Rollo, pp. 122-124.

6 Petition, Annex "G", Rollo, pp. 133-134.

7 Petition, Annex "I", Rollo, pp. 138-139.

8 Petition, Annex "K", Rollo, p. 166.

9 No. L-29790, 25 February 1982; 112 SCRA 136, 140.

10 No. L-21450, 15 April 1968, 23 SCRA 29, 36, citing a number of related
cases.

11 The 1985 POEA Rules and Regulations was then in effect during the
proceedings before POEA. However, it is now superseded by the 1991
POEA Rules and Regulations promulgated 31 May 1991.

12 "Authority" is a document issued by the Minister (now Secretary of Labor)

to a private recruitment entity authorized to deploy its own workers for its
project overseas (Sec. 1, par. [d], Rule II Book I, 1985 POEA Rules and
Regulations. "License" is a document issued by the Minister (now Secretary
of Labor) to an agency authorizing it to recruit and hire Filipino workers for
overseas employment (Sec. 1, par. [q], Ibid. Public respondent POEA
appears to confuse Authority with License, for while POEA refers to CPSI, a
licensed service contractor, what it suspended actually was the Authority of
CPSI.

13 Black's Law Dictionary, 5th Ed., p. 227, citing Fred C. Walker C. Walker
Agency, Inc. v. Lucas, 215 Va. 535, 211 S.E. 2d 88, 92.

14 Ibid., p. 1281, citing Marker v. Finch, D.C. Del., 322 F. Supp. 905, 910.

15 G. R. No. 75501, 15 September 1987; 154 SCRA 49, 54.

16 G. R. No. 98028, 27 January 1992; 205 SCRA 529, 535.

17 People v. Caballes, G. R. Nos. 93437-45, 12 July 1991; 199 SCRA 152,

167.

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