Académique Documents
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DECISION
YNARES-SANTIAGO, J.:
This is a petition for review under Rule 45 of the 1997 Revised Rules of Civil
Procedure assailing the Decision dated March 7, 2003 of the Court of Appeals
in CA-G.R. SP No. 73102 which affirmed the Resolution dated April 2, 2002 of
the National Labor Relations Commission.
Petitioner was employed by respondent company Lamadrid Bearing and
Parts Corporation sometime in June 1985 as a salesman earning a commission
of 3% of the total paid-up sales covering the whole area of Mindanao. His
average monthly income was more or less P16,000.00, but later was increased
to approximately P20,269.50. Aside from selling the merchandise of
respondent corporation, he was also tasked to collect payments from his
various customers. Respondent corporation had complete control over his work
because its President, respondent Jose Lamadrid, frequently directed him to
report to a particular area for his sales and collection activities, and occasionally
required him to go to Manila to attend conferences regarding product
competition, prices, and other market strategies.
Sometime in 1998, petitioner encountered five customers/clients with bad
accounts, namely:
Customers/Clients Amount
1) A&B Engineering Services P 86,431.20
2) Emmanuel Engineering Services 126,858.50
3) Panabo Empire Marketing 226,458.76
4) Southern Fortune Marketing 191,208.00
5) Alreg Marketing 56, 901.18
Less Returns: 691.02 56, 210.16
Total Bad Accounts P 687,166.62
Petitioner was confronted by respondent Lamadrid over the bad accounts
and warned that if he does not issue his own checks to cover the said bad
accounts, his commissions will not be released and he will lose his job. Despite
serious misgivings, he issued his personal checks in favor of respondent
corporation on condition that the same shall not be deposited for clearing and
that they shall be offset against his periodic commissions. [1]
Not contented with the issuance of the foregoing checks as security for the
bad accounts, respondents tricked petitioner into signing two documents, which
he later discovered to be a Promissory Note and a Deed of Real Estate
[2]
Mortgage. [3]
Pursuant to the parties agreement that the checks would not be deposited,
as their corresponding values would be offset from petitioners sales
commissions, respondents returned the same to petitioner as evidenced by the
undeposited checks and respondent Lamadrids computations of petitioners
commissions. [4]
This has reference to your demand letter dated March 22, 2001 which I received
on March 30, 2001, relative to the checks I issued to my employer LAMADRID
BEARING PARTS CORPORATION.
Sir, kindly convey my good faith to your client and my employer, as is shown by my
willingness to continue working as Commission Salesman, having served the
Company for the last sixteen (16) years.
This is to inform your good office that if you pursue the case against me, I may refer
this problem to Mr. Paul Dominguez and Atty. Jesus Dureza to solicit proper legal
advice. I may also file counter charges against your company of (sic) unfair labor
practice and unfair compensation of 3% commission to my sales and commissions of
more or less 90,000,000.00 (all collected and covered with cleared check payments)
for 16 years working with your company up to the present year 2001.
If I am not wrong your company did not exactly declare the correct amount of
P90,000,000.00 more or less representing my sales and collections (all collected and
covered with cleared check payments to the Bureau of Internal Revenue [BIR] for tax
declaration purposes). In short your company profited large amount of money
to (sic) the above-mentioned sales and collections of P90,000,000.00 more or less for
16 years working with your company.
I remember that upon my employment with your company last 1985 up to the present
year 2001 as commission basis salesman, I have not signed any contract with your
company stating that all uncollected accounts including bounced checks from
Lamadrid Bearing & Parts Corp. will be charged to me. I wonder why your company
forcibly instructed me to secure checking account to pay and issue check payment of
P15,000.00 per month to cover your companys bad accounts in which this amount is
too heavy on my part paying a total bad accounts of more than P650,000.00 for my 16
years employment with your company as commission basis salesman.
Recalling your visit here at my Davao City residence, located at Zone 1 2nd Avenue,
San Vicente Buhangin Davao City, way back 1998, you even forced me to sign
mortgage contract of my house and lot located at Zone 1 2nd Avenue, San Vicente,
Buhangin, Davao City, according to Mr. Jose Lamadrid this mortgage contract of my
house and lot will serve as guarantee to the uncollected and bounced checks from
Lamadrid Bearing and Parts Corp., customers. I have asked 1 copy of the mortgage
contract I have signed but Mr. Jose C. Lamadrid never furnished me a copy.
Finding no necessity for further hearing the case after the parties submitted
their respective position papers, the Labor Arbiter rendered a decision dated
November 29, 2001, the decretal portion of which reads: [9]
SO ORDERED.
SO ORDERED.
Petitioner challenged the decision of the NLRC before the Court of Appeals,
which rendered the assailed judgment on March 7, 2003, the dispositive portion
of which reads: [11]
SO ORDERED.
Upon denial of his motion for reconsideration, petitioner filed the instant
appeal based on the following grounds:
I
II
III
(2) Private respondents had complete control over the work of the petitioner. From
time to time, respondent JOSE LAMADRID was directing him to report to a
particular area in Mindanao for his sales and collection activities, and sometimes he
was required to go to Manila for a conference regarding competitions, new prices (if
any), special offer (if competitors gave special offer or discounts), and other
selling/marketing strategy. In other words, respondent JOSE LAMADRID was
closely monitoring the sales and collection activities of the petitioner.
Petitioner further contends that it was illogical for the appellate court to
conclude that since he was not required to report for work on a daily basis, the
power of control is absent. He reasons that being a field personnel, as defined
under Article 82 of the Labor Code, who is covering the Mindanao area, it would
be impractical for him to report to the respondents office in Manila in order to
keep tab of his actual working hours.
Well-entrenched is the doctrine that the existence of an employer-employee
relationship is ultimately a question of fact and that the findings thereon by the
Labor Arbiter and the National Labor Relations Commission shall be accorded
not only respect but even finality when supported by substantial evidence. The
decisive factor in such finality is the presence of substantial evidence to support
said finding, otherwise, such factual findings cannot be accorded finality by this
Court. Considering the conflicting findings of fact by the Labor Arbiter and the
[12]
NLRC as well as the Court of Appeals, there is a need to reexamine the records
to determine with certainty which of the propositions espoused by the
contending parties is supported by substantial evidence.
We are called upon to resolve the issue of whether or not petitioner, as a
commission salesman, is an employee of respondent corporation. To ascertain
the existence of an employer-employee relationship, jurisprudence has
invariably applied the four-fold test, namely: (1) the manner of selection and
engagement; (2) the payment of wages; (3) the presence or absence of the
power of dismissal; and (4) the presence or absence of the power of control. Of
these four, the last one is the most important. The so-called control test is
[13]
of the Labor Code was construed as being included in the definition of the term
wage available to employees, there is no categorical pronouncement that the
payment of compensation on commission basis is conclusive proof of the
existence of an employer-employee relationship. After all, commission, as a
form of remuneration, may be availed of by both an employee or a non-
employee.
Petitioner decried the alleged intimidation and trickery employed by
respondents to obtain from him a Promissory Note and to issue forty-seven
checks as security for the bad accounts incurred by five customers.
While petitioner may have been coerced into executing force to issue the
said documents, it may equally be true that petitioner did so in recognition of a
valid financial obligation. He who claims that force or intimidation was employed
upon him lies the onus probandi. He who asserts must prove. It is therefore
incumbent upon petitioner to overcome the disputable presumption that private
transactions have been prosecuted fairly and regularly, and that there is
sufficient consideration for every contract. A fortiori, it is difficult to imagine that
[20]
DECISION
QUISUMBING, J.:
This petition for certiorari seeks to set aside the Decision of National Labor
[1]
Relations Commission (Fifth Division) promulgated on November 21, 1994, and its
Resolution dated June 7, 1995, which denied petitioners motion for reconsideration.
Private respondent Peter Mejila worked as barber on a piece rate basis at Dinas Barber
Shop. In 1970, the owner, Dina Tan, sold the barbershop to petitioners Paz Martin Jo
and Cesar Jo. All the employees, including private respondent, were absorbed by the
new owners. The name of the barbershop was changed to Windfield Barber Shop.
The owners and the barbers shared in the earnings of the barber shop. The barbers got
two-thirds (2/3) of the fee paid for every haircut or shaving job done, while one-third
(1/3) went to the owners of the shop.
In 1977, petitioners designated private respondent as caretaker of the shop because the
former caretaker became physically unfit. Private respondents duties as caretaker, in
addition to his being a barber, were: (1) to report to the owners of the barbershop
whenever the airconditioning units malfunctioned and/or whenever water or electric
power supply was interrupted; (2) to call the laundry woman to wash dirty linen; (3)
to recommend applicants for interview and hiring; (4) to attend to other needs of the
shop. For this additional job, he was given an honorarium equivalent to one-third (1/3)
of the net income of the shop.
When the building occupied by the shop was demolished in 1986, the barbershop
closed. But soon a place nearby was rented by petitioners and the barbershop resumed
operations as Cesars Palace Barbershop and Massage Clinic. In this new location,
private respondent continued to be a barber and caretaker, but with a fixed monthly
honorarium as caretaker, to wit: from February 1986 to 1990 - P700; from February
1990 to March 1991 - P800; and from July 1992 P1,300.
In November 1992, private respondent had an altercation with his co-barber, Jorge
Tinoy. The bickerings, characterized by constant exchange of personal insults during
working hours, became serious so that private respondent reported the matter to Atty.
Allan Macaraya of the labor department. The labor official immediately summoned
private respondent and petitioners to a conference. Upon investigation, it was found
out that the dispute was not between private respondent and petitioners; rather, it was
between the former and his fellow barber. Accordingly, Atty. Macaraya directed
petitioners counsel, Atty. Prudencio Abragan, to thresh out the problem.
During the mediation meeting held at Atty. Abragans office a new twist was added.
Despite the assurance that he was not being driven out as caretaker-barber, private
respondent demanded payment for several thousand pesos as his separation pay and
other monetary benefits. In order to give the parties enough time to cool off, Atty.
Abragan set another conference but private respondent did not appear in such meeting
anymore.
Meanwhile, private respondent continued reporting for work at the barbershop. But,
on January 2, 1993, he turned over the duplicate keys of the shop to the cashier and
took away all his belongings therefrom. On January 8, 1993, he began working as a
regular barber at the newly opened Goldilocks Barbershop also in Iligan City.
On January 12, 1993, private respondent filed a complaint for illegal dismissal with
[2]
prayer for payment of separation pay, other monetary benefits, attorneys fees and
damages. Significantly, the complaint did not seek reinstatement as a positive relief.
In a Decision dated June 15, 1993, the Labor Arbiter found that private respondent
was an employee of petitioners, and that private respondent was not dismissed but had
left his job voluntarily because of his misunderstanding with his co-worker. The
[3]
Labor Arbiter dismissed the complaint, but ordered petitioners to pay private
respondent his 13th month pay and attorneys fees.
Both parties appealed to the NLRC. In a Decision dated November 21, 1994, it set
aside the labor arbiters judgment. The NLRC sustained the labor arbiters finding as to
the existence of employer-employee relationship between petitioners and private
respondent, but it ruled that private respondent was illegally dismissed. Hence, the
petitioners were ordered to reinstate private respondent and pay the latters backwages,
13th month pay, separation pay and attorneys fees, thus:
SO ORDERED." [4]
Its motion for reconsideration having been denied in a Resolution dated June 7, 1995,
petitioners filed the instant petition.
Petitioners contend that public respondent gravely erred in declaring that private
respondent was their employee. They claim that private respondent was their "partner
in trade" whose compensation was based on a sharing arrangement per haircut or
shaving job done. They argue that private respondents task as caretaker could be
considered an employment because the chores are very minimal.
Absent a clear showing that petitioners and private respondent had intended to pursue
a relationship of industrial partnership, we entertain no doubt that private respondent
was employed by petitioners as caretaker-barber. Initially, petitioners, as new owners
of the barbershop, hired private respondent as barber by absorbing the latter in their
employ. Undoubtedly, the services performed by private respondent as barber is
related to, and in the pursuit of the principal business activity of petitioners. Later on,
petitioners tapped private respondent to serve concurrently as caretaker of the shop.
Certainly, petitioners had the power to dismiss private respondent being the ones who
engaged the services of the latter. In fact, private respondent sued petitioners for
illegal dismissal, albeit contested by the latter. As a caretaker, private respondent was
paid by petitioners wages in the form of honorarium, originally, at the rate of one-
third (1/3) of the shops net income but subsequently pegged at a fixed amount per
month. As a barber, private respondent earned two-thirds (2/3) of the fee paid per
haircut or shaving job done. Furthermore, the following facts indubitably reveal that
petitioners controlled private respondents work performance, in that: (1) private
respondent had to inform petitioners of the things needed in the shop; (2) he could
only recommend the hiring of barbers and masseuses, with petitioners having the final
decision; (3) he had to be at the shop at 9:00 a.m. and could leave only at 9:00 p.m.
because he was the one who opened and closed it, being the one entrusted with the
key. These duties were complied with by private respondent upon instructions of
[7]
petitioners. Moreover, such task was far from being negligible as claimed by
petitioners. On the contrary, it was crucial to the business operation of petitioners as
shown in the preceding discussion. Hence, there was enough basis to declare private
respondent an employee of petitioners. Accordingly, there is no cogent reason to
disturb the findings of the labor arbiter and NLRC on the existence of employer-
employee relationship between herein private parties.
With regard to the second issue, jurisprudence has laid out the rules regarding
abandonment as a just and valid ground for termination of employment. To constitute
abandonment, there must be concurrence of the intention to abandon and some overt
acts from which it may be inferred that the employee concerned has no more interest
in working. In other words, there must be a clear, deliberate and unjustified refusal to
[8]
In the case at bar, the labor arbiter was convinced that private respondent was not
dismissed but left his work on his own volition because he could no longer bear the
incessant squabbles with his co-worker. Nevertheless, public respondent did not give
credence to petitioners claim that private respondent abandoned his job. On this score,
public respondent gravely erred as hereunder discussed.
At the outset, we must stress that where the findings of the NLRC contradict those of
the labor arbiter, the Court, in the exercise of its equity jurisdiction, may look into the
records of the case and reexamine the questioned findings. [10]
surrendered the shops keys and took away all his things from the shop. Third, he did
not report anymore to the shop without giving any valid and justifiable reason for his
absence. Fourth, he immediately sought a regular employment in another barbershop,
despite previous assurance that he could remain in petitioners employ. Fifth, he filed a
complaint for illegal dismissal without praying for reinstatement.
Moreover, public respondents assertion that the institution of the complaint for illegal
dismissal manifests private respondents lack of intention to abandon his job is [12]
untenable. The rule that abandonment of work is inconsistent with the filing of a
complaint for illegal dismissal is not applicable in this case. Such rule applies where
the complainant seeks reinstatement as a relief. Corollarily, it has no application
where the complainant does not pray for reinstatement and just asks for separation pay
instead as in the present case. It goes without saying that the prayer for separation
[13]
stance. That he was illegally dismissed is belied by his own pleadings as well as
contemporaneous conduct.
We are, therefore, constrained to agree with the findings of the Labor Arbiter that
private respondent left his job voluntarily for reasons not attributable to petitioners. It
was error and grave abuse of discretion for the NLRC to hold petitioners liable for
illegal dismissal of private respondent.
WHEREFORE, the petition is GRANTED. The assailed Decision and Resolution of
public respondent NLRC are reversed and set aside. The decision of the Labor Arbiter
dated June 15, 1993, is hereby reinstated. No costs.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
The private respondents, heirs of the late Potenciano Kapunan, seek reconsideration of the decision
rendered by this Court on October 16, 1990 (Filamer Christian Institute v. Court of Appeals, 190
SCRA 477) reviewing the appellate court's conclusion that there exists an employer-employee
relationship between the petitioner and its co-defendant Funtecha. The Court ruled that the petitioner
is not liable for the injuries caused by Funtecha on the grounds that the latter was not an authorized
driver for whose acts the petitioner shall be directly and primarily answerable, and that Funtecha was
merely a working scholar who, under Section 14, Rule X, Book III of the Rules and Regulations
Implementing the Labor Code is not considered an employee of the petitioner.
The private respondents assert that the circumstances obtaining in the present case call for the
application of Article 2180 of the Civil Code since Funtecha is no doubt an employee of the
petitioner. The private respondents maintain that under Article 2180 an injured party shall have
recourse against the servant as well as the petitioner for whom, at the time of the incident, the
servant was performing an act in furtherance of the interest and for the benefit of the petitioner.
Funtecha allegedly did not steal the school jeep nor use it for a joy ride without the knowledge of the
school authorities.
After a re-examination of the laws relevant to the facts found by the trial court and the appellate
court, the Court reconsiders its decision. We reinstate the Court of Appeals' decision penned by the
late Justice Desiderio Jurado and concurred in by Justices Jose C. Campos, Jr. and Serafin E.
Camilon. Applying Civil Code provisions, the appellate court affirmed the trial court decision which
ordered the payment of the P20,000.00 liability in the Zenith Insurance Corporation policy,
P10,000.00 moral damages, P4,000.00 litigation and actual expenses, and P3,000.00 attorney's
fees.
It is undisputed that Funtecha was a working student, being a part-time janitor and a scholar of
petitioner Filamer. He was, in relation to the school, an employee even if he was assigned to clean
the school premises for only two (2) hours in the morning of each school day.
Having a student driver's license, Funtecha requested the driver, Allan Masa, and was allowed, to
take over the vehicle while the latter was on his way home one late afternoon. It is significant to note
that the place where Allan lives is also the house of his father, the school president, Agustin Masa.
Moreover, it is also the house where Funtecha was allowed free board while he was a student of
Filamer Christian Institute.
Allan Masa turned over the vehicle to Funtecha only after driving down a road, negotiating a sharp
dangerous curb, and viewing that the road was clear. (TSN, April 4, 1983, pp. 78-79) According to
Allan's testimony, a fast moving truck with glaring lights nearly hit them so that they had to swerve to
the right to avoid a collision. Upon swerving, they heard a sound as if something had bumped
against the vehicle, but they did not stop to check. Actually, the Pinoy jeep swerved towards the
pedestrian, Potenciano Kapunan who was walking in his lane in the direction against vehicular
traffic, and hit him. Allan affirmed that Funtecha followed his advise to swerve to the right. (Ibid., p.
79) At the time of the incident (6:30 P.M.) in Roxas City, the jeep had only one functioning headlight.
Allan testified that he was the driver and at the same time a security guard of the petitioner-school.
He further said that there was no specific time for him to be off-duty and that after driving the
students home at 5:00 in the afternoon, he still had to go back to school and then drive home using
the same vehicle.
Driving the vehicle to and from the house of the school president where both Allan and Funtecha
reside is an act in furtherance of the interest of the petitioner-school. Allan's job demands that he
drive home the school jeep so he can use it to fetch students in the morning of the next school day.
It is indubitable under the circumstances that the school president had knowledge that the jeep was
routinely driven home for the said purpose. Moreover, it is not improbable that the school president
also had knowledge of Funtecha's possession of a student driver's license and his desire to undergo
driving lessons during the time that he was not in his classrooms.
In learning how to drive while taking the vehicle home in the direction of Allan's house, Funtecha
definitely was not having a joy ride. Funtecha was not driving for the purpose of his enjoyment or for
a "frolic of his own" but ultimately, for the service for which the jeep was intended by the petitioner
school. (See L. Battistoni v. Thomas, Can SC 144, 1 D.L.R. 577, 80 ALR 722 [1932]; See also
Association of Baptists for World Evangelism, Inc. v. Fieldmen's Insurance Co., Inc. 124 SCRA 618
[1983]). Therefore, the Court is constrained to conclude that the act of Funtecha in taking over the
steering wheel was one done for and in behalf of his employer for which act the petitioner-school
cannot deny any responsibility by arguing that it was done beyond the scope of his janitorial duties.
The clause "within the scope of their assigned tasks" for purposes of raising the presumption of
liability of an employer, includes any act done by an employee, in furtherance of the interests of the
employer or for the account of the employer at the time of the infliction of the injury or damage.
(Manuel Casada, 190 Va 906, 59 SE 2d 47 [1950]) Even if somehow, the employee driving the
vehicle derived some benefit from the act, the existence of a presumptive liability of the employer is
determined by answering the question of whether or not the servant was at the time of the accident
performing any act in furtherance of his master's business. (Kohlman v. Hyland, 210 NW 643, 50
ALR 1437 [1926]; Jameson v. Gavett, 71 P 2d 937 [1937])
Section 14, Rule X, Book III of the Rules implementing the Labor Code, on which the petitioner
anchors its defense, was promulgated by the Secretary of Labor and Employment only for the
purpose of administering and enforcing the provisions of the Labor Code on conditions of
employment. Particularly, Rule X of Book III provides guidelines on the manner by which the powers
of the Labor Secretary shall be exercised; on what records should be kept; maintained and
preserved; on payroll; and on the exclusion of working scholars from, and inclusion of resident
physicians in the employment coverage as far as compliance with the substantive labor provisions
on working conditions, rest periods, and wages, is concerned.
In other words, Rule X is merely a guide to the enforcement of the substantive law on labor. The
Court, thus, makes the distinction and so holds that Section 14, Rule X, Book III of the Rules is not
the decisive law in a civil suit for damages instituted by an injured person during a vehicular accident
against a working student of a school and against the school itself.
The present case does not deal with a labor dispute on conditions of employment between an
alleged employee and an alleged employer. It invokes a claim brought by one for damages for injury
caused by the patently negligent acts of a person, against both doer-employee and his employer.
Hence, the reliance on the implementing rule on labor to disregard the primary liability of an
employer under Article 2180 of the Civil Code is misplaced. An implementing rule on labor cannot be
used by an employer as a shield to avoid liability under the substantive provisions of the Civil Code.
There is evidence to show that there exists in the present case an extra-contractual obligation
arising from the negligence or reckless imprudence of a person "whose acts or omissions are
imputable, by a legal fiction, to other(s) who are in a position to exercise an absolute or limited
control over (him)." (Bahia v. Litonjua and Leynes, 30 Phil. 624 [1915])
Funtecha is an employee of petitioner Filamer. He need not have an official appointment for a
driver's position in order that the petitioner may be held responsible for his grossly negligent act, it
being sufficient that the act of driving at the time of the incident was for the benefit of the petitioner.
Hence, the fact that Funtecha was not the school driver or was not acting within the scope of his
janitorial duties does not relieve the petitioner of the burden of rebutting the presumption juris
tantum that there was negligence on its part either in the selection of a servant or employee, or in
the supervision over him. The petitioner has failed to show proof of its having exercised the required
diligence of a good father of a family over its employees Funtecha and Allan.
The Court reiterates that supervision includes the formulation of suitable rules and regulations for the
guidance of its employees and the issuance of proper instructions intended for the protection of the
public and persons with whom the employer has relations through his employees. (Bahia v. Litonjua
and Leynes, supra, at p. 628; Phoenix Construction, v. Intermediate Appellate Court, 148 SCRA 353
[1987])
An employer is expected to impose upon its employees the necessary discipline called for in the
performance of any act indispensable to the business and beneficial to their employer.
In the present case, the petitioner has not shown that it has set forth such rules and guidelines as
would prohibit any one of its employees from taking control over its vehicles if one is not the official
driver or prohibiting the driver and son of the Filamer president from authorizing another employee to
drive the school vehicle. Furthermore, the petitioner has failed to prove that it had imposed sanctions
or warned its employees against the use of its vehicles by persons other than the driver.
The petitioner, thus, has an obligation to pay damages for injury arising from the unskilled manner by
which Funtecha drove the vehicle. (Cangco v. Manila Railroad Co., 38 Phil. 768, 772 [1918]). In the
absence of evidence that the petitioner had exercised the diligence of a good father of a family in the
supervision of its employees, the law imposes upon it the vicarious liability for acts or omissions of
its employees. (Umali v. Bacani, 69 SCRA 263 [1976]; Poblete v. Fabros, 93 SCRA 200 [1979];
Kapalaran Bus Liner v. Coronado, 176 SCRA 792 [1989]; Franco v. Intermediate Appellate Court,
178 SCRA 331 [1989]; Pantranco North Express, Inc. v. Baesa, 179 SCRA 384 [1989]) The liability
of the employer is, under Article 2180, primary and solidary. However, the employer shall have
recourse against the negligent employee for whatever damages are paid to the heirs of the plaintiff.
It is an admitted fact that the actual driver of the school jeep, Allan Masa, was not made a party
defendant in the civil case for damages. This is quite understandable considering that as far as the
injured pedestrian, plaintiff Potenciano Kapunan, was concerned, it was Funtecha who was the one
driving the vehicle and presumably was one authorized by the school to drive. The plaintiff and his
heirs should not now be left to suffer without simultaneous recourse against the petitioner for the
consequent injury caused by a janitor doing a driving chore for the petitioner even for a short while.
For the purpose of recovering damages under the prevailing circumstances, it is enough that the
plaintiff and the private respondent heirs were able to establish the existence of employer-employee
relationship between Funtecha and petitioner Filamer and the fact that Funtecha was engaged in an
act not for an independent purpose of his own but in furtherance of the business of his employer. A
position of responsibility on the part of the petitioner has thus been satisfactorily demonstrated.
WHEREFORE, the motion for reconsideration of the decision dated October 16, 1990 is hereby
GRANTED. The decision of the respondent appellate court affirming the trial court decision is
REINSTATED.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
QUISUMBING, J.:
This special civil action for certiorari seeks to annul the decision1 of public respondent promulgated
on October 28, 1994, in NLRC NCR CA No. 003883-92, and its resolution2 dated December 13,
1994 which denied petitioners motion for reconsideration.
Petitioners were drivers of private respondent, Philjama International Inc., a domestic corporation
engaged in the operation of "Goodman Taxi." Petitioners used to drive private respondent's taxicabs
every other day on a 24-hour work schedule under the boundary system. Under this arrangement,
the petitioners earned an average of P400.00 daily. Nevertheless, private respondent admittedly
regularly deducts from petitioners, daily earnings the amount of P30.00 supposedly for the washing
of the taxi units. Believing that the deduction is illegal, petitioners decided to form a labor union to
protect their rights and interests.
Upon learning about the plan of petitioners, private respondent refused to let petitioners drive their
taxicabs when they reported for work on August 6, 1991, and on succeeding days. Petitioners
suspected that they were singled out because they were the leaders and active members of the
proposed union. Aggrieved, petitioners filed with the labor arbiter a complaint against private
respondent for unfair labor practice, illegal dismissal and illegal deduction of washing fees. In a
decision3 dated August 31, 1992, the labor arbiter dismissed said complaint for lack of merit.
On appeal, the NLRC (public respondent herein), in a decision dated April 28, 1994, reversed and
set aside the judgment of the labor arbiter. The labor tribunal declared that petitioners are
employees of private respondent, and, as such, their dismissal must be for just cause and after due
process. It disposed of the case as follows:
WHEREFORE, in view of all the foregoing considerations, the decision of the Labor Arbiter
appealed from is hereby SET ASIDE and another one entered:
1. Declaring the respondent company guilty of illegal dismissal and accordingly it is directed
to reinstate the complainants, namely, Alberto A. Gonzales, Joel T. Morato, Gavino
Panahon, Demetrio L. Calagos, Sonny M. Lustado, Romeo Q. Clariza, Luis de los Angeles,
Amado Centino, Angel Jardin, Rosendo Marcos, Urbano Marcos, Jr., and Joel Ordeniza, to
their former positions without loss of seniority and other privileges appertaining thereto; to
pay the complainants full backwages and other benefits, less earnings elsewhere, and to
reimburse the drivers the amount paid as washing charges; and
2. Dismissing the charge of unfair [labor] practice for insufficiency of evidence.
SO ORDERED.4
Private respondent's first motion for reconsideration was denied. Remaining hopeful, private
respondent filed another motion for reconsideration. This time, public respondent, in its
decision5 dated October 28, 1994, granted aforesaid second motion for reconsideration. It ruled that
it lacks jurisdiction over the case as petitioners and private respondent have no employer-employee
relationship. It held that the relationship of the parties is leasehold which is covered by the Civil Code
rather than the Labor Code, and disposed of the case as follows:
VIEWED IN THE LIGHT OF ALL THE FOREGOING, the Motion under reconsideration is
hereby given due course.
Accordingly, the Resolution of August 10, 1994, and the Decision of April 28, 1994 are
hereby SET ASIDE. The Decision of the Labor Arbiter subject of the appeal is likewise SET
ASIDE and a NEW ONE ENTERED dismissing the complaint for lack of jurisdiction.
No costs.
SO ORDERED.6
Expectedly, petitioners sought reconsideration of the labor tribunal's latest decision which was
denied. Hence, the instant petition.
In this recourse, petitioners allege that public respondent acted without or in excess of jurisdiction, or
with grave abuse of discretion in rendering the assailed decision, arguing that:
II
III
IN ANY CASE, EXISTING JURISPRUDENCE ON THE MATTER SUPPORTS THE VIEW THAT
PETITIONERS-TAXI DRIVERS ARE EMPLOYEES OF RESPONDENT TAXI COMPANY.7
The phrase "grave abuse of discretion amounting to lack or excess of jurisdiction" has settled
meaning in the jurisprudence of procedure. It means such capricious and whimsical exercise of
judgment by the tribunal exercising judicial or quasi-judicial power as to amount to lack of power.8 In
labor cases, this Court has declared in several instances that disregarding rules it is bound to
observe constitutes grave abuse of discretion on the part of labor tribunal.
In Garcia vs. NLRC,9 private respondent therein, after receiving a copy of the labor arbiter's decision,
wrote the labor arbiter who rendered the decision and expressed dismay over the judgment. Neither
notice of appeal was filed nor cash or surety bond was posted by private respondent. Nevertheless,
the labor tribunal took cognizance of the letter from private respondent and treated said letter as
private respondent's appeal. In a certiorari action before this Court, we ruled that the labor tribunal
acted with grave abuse of discretion in treating a mere letter from private respondent as private
respondent's appeal in clear violation of the rules on appeal prescribed under Section 3(a), Rule VI
of the New Rules of Procedure of NLRC.
In Philippine Airlines Inc. vs. NLRC,10 we held that the labor arbiter committed grave abuse of
discretion when he failed to resolve immediately by written order a motion to dismiss on the ground
of lack of jurisdiction and the supplemental motion to dismiss as mandated by Section 15 of Rule V
of the New Rules of Procedure of the NLRC.
In Unicane Workers Union-CLUP vs. NLRC,11 we held that the NLRC gravely abused its discretion
by allowing and deciding an appeal without an appeal bond having been filed as required under
Article 223 of the Labor Code.
In Mañebo vs. NLRC,12 we declared that the labor arbiter gravely abused its discretion in
disregarding the rule governing position papers. In this case, the parties have already filed their
position papers and even agreed to consider the case submitted for decision, yet the labor arbiter
still admitted a supplemental position paper and memorandum, and by taking into consideration, as
basis for his decision, the alleged facts adduced therein and the documents attached thereto.
In Gesulgon vs. NLRC,13 we held that public respondent gravely abused its discretion in treating the
motion to set aside judgment and writ of execution as a petition for relief of judgment. In doing so,
public respondent had, without sufficient basis, extended the reglementary period for filing petition
for relief from judgment contrary to prevailing rule and case law.
In this case before us, private respondent exhausted administrative remedy available to it by seeking
reconsideration of public respondent's decision dated April 28, 1994, which public respondent
denied. With this motion for reconsideration, the labor tribunal had ample opportunity to rectify errors
or mistakes it may have committed before resort to courts of justice can be had.14 Thus, when private
respondent filed a second motion for reconsideration, public respondent should have forthwith
denied it in accordance with Rule 7, Section 14 of its New Rules of Procedure which allows only one
motion for reconsideration from the same party, thus:
Sec. 14. Motions for Reconsideration. — Motions for reconsideration of any order, resolution
or 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 ten (10) calendar days
from receipt of the order, resolution or decision with proof of service that a copy of the same
has been furnished within the reglementary period the adverse party and provided further,
that only one such motion from the same party shall be entertained. [Emphasis supplied]
The rationale for allowing only one motion for reconsideration from the same party is to assist the
parties in obtaining an expeditious and inexpensive settlement of labor cases. For obvious reasons,
delays cannot be countenanced in the resolution of labor disputes. The dispute may involve no less
than the livelihood of an employee and that of his loved ones who are dependent upon him for food,
shelter, clothing, medicine, and education. It may as well involve the survival of a business or an
industry.15
As correctly pointed out by petitioner, the second motion for reconsideration filed by private
respondent is indubitably a prohibited pleading16 which should have not been entertained at all.
Public respondent cannot just disregard its own rules on the pretext of "satisfying the ends of
justice",17 especially when its disposition of a legal controversy ran afoul with a clear and long
standing jurisprudence in this jurisdiction as elucidated in the subsequent discussion. Clearly,
disregarding a settled legal doctrine enunciated by this Court is not a way of rectifying an error or
mistake. In our view, public respondent gravely abused its discretion in taking cognizance and
granting private respondent's second motion for reconsideration as it wrecks the orderly procedure in
seeking reliefs in labor cases.
But, there is another compelling reason why we cannot leave untouched the flip-flopping decisions of
the public respondent. As mentioned earlier, its October 28, 1994 judgment is not in accord with the
applicable decisions of this Court. The labor tribunal reasoned out as follows:
On the issue of whether or not employer-employee relationship exists, admitted is the fact
that complainants are taxi drivers purely on the "boundary system". Under this system the
driver takes out his unit and pays the owner/operator a fee commonly called "boundary" for
the use of the unit. Now, in the determination the existence of employer-employee
relationship, the Supreme Court in the case of Sara, et al., vs. Agarrado, et al. (G.R. No.
73199, 26 October 1988) has applied the following four-fold test: "(1) the selection and
engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4)
the power of control the employees conduct."
"Among the four (4) requisites", the Supreme Court stresses that "control is deemed the
most important that the other requisites may even be disregarded". Under the control test, an
employer-employee relationship exists if the "employer" has reserved the right to control the
"employee" not only as to the result of the work done but also as to the means and methods
by which the same is to be accomplished. Otherwise, no such relationship exists. (Ibid.)
Applying the foregoing parameters to the case herein obtaining, it is clear that the
respondent does not pay the drivers, the complainants herein, their wages. Instead, the
drivers pay a certain fee for the use of the vehicle. On the matter of control, the drivers, once
they are out plying their trade, are free to choose whatever manner they conduct their trade
and are beyond the physical control of the owner/operator; they themselves determine the
amount of revenue they would want to earn in a day's driving; and, more significantly aside
from the fact that they pay for the gasoline they consume, they likewise shoulder the cost of
repairs on damages sustained by the vehicles they are driving.
Verily, all the foregoing attributes signify that the relationship of the parties is more of a
leasehold or one that is covered by a charter agreement under the Civil Code rather than the
Labor Code.18
In a number of cases decided by this Court,19 we ruled that the relationship between jeepney
owners/operators on one hand and jeepney drivers on the other under the boundary system is that
of employer-employee and not of lessor-lessee. We explained that in the lease of chattels, the lessor
loses complete control over the chattel leased although the lessee cannot be reckless in the use
thereof, otherwise he would be responsible for the damages to the lessor. In the case of jeepney
owners/operators and jeepney drivers, the former exercise supervision and control over the latter.
The management of the business is in the owner's hands. The owner as holder of the certificate of
public convenience must see to it that the driver follows the route prescribed by the franchising
authority and the rules promulgated as regards its operation. Now, the fact that the drivers do not
receive fixed wages but get only that in excess of the so-called "boundary" they pay to the
owner/operator is not sufficient to withdraw the relationship between them from that of employer and
employee. We have applied by analogy the abovestated doctrine to the relationships between bus
owner/operator and bus conductor,20 auto-calesa owner/operator and driver,21 and recently between
taxi owners/operators and taxi drivers.22 Hence, petitioners are undoubtedly employees of private
respondent because as taxi drivers they perform activities which are usually necessary or desirable
in the usual business or trade of their employer.
As consistently held by this Court, termination of employment must be effected in accordance with
law. The just and authorized causes for termination of employment are enumerated under Articles
282, 283 and 284 of the Labor Code. The requirement of notice and hearing is set-out in Article 277
(b) of the said Code. Hence, petitioners, being employees of private respondent, can be dismissed
only for just and authorized cause, and after affording them notice and hearing prior to termination.
In the instant case, private respondent had no valid cause to terminate the employment of
petitioners. Neither were there two (2) written notices sent by private respondent informing each of
the petitioners that they had been dismissed from work. These lack of valid cause and failure on the
part of private respondent to comply with the twin-notice requirement underscored the illegality
surrounding petitioners' dismissal.
Under the law, an employee who is unjustly dismissed from work shall be entitled to reinstatement
without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances,
and to his other benefits or their monetary equivalent computed from the time his compensation was
withheld from him up to the time of his actual reinstatement.23 It must be emphasized, though, that
recent judicial pronouncements24 distinguish between employees illegally dismissed prior to the
effectivity of Republic Act No. 6715 on March 21, 1989, and those whose illegal dismissals were
effected after such date. Thus, employees illegally dismissed prior to March 21, 1989, are entitled to
backwages up to three (3) years without deduction or qualification, while those illegally dismissed
after that date are granted full backwages inclusive of allowances and other benefits or their
monetary equivalent from the time their actual compensation was withheld from them up to the time
of their actual reinstatement. The legislative policy behind Republic Act No. 6715 points to "full
backwages" as meaning exactly that, i.e., without deducting from backwages the earnings derived
elsewhere by the concerned employee during the period of his illegal dismissal. Considering that
petitioners were terminated from work on August 1, 1991, they are entitled to full backwages on the
basis of their last daily earnings.
With regard to the amount deducted daily by private respondent from petitioners for washing of the
taxi units, we view the same as not illegal in the context of the law. We note that after a tour of duty,
it is incumbent upon the driver to restore the unit he has driven to the same clean condition when he
took it out. Car washing after a tour of duty is indeed a practice in the taxi industry and is in fact
dictated by fair play.25 Hence, the drivers are not entitled to reimbursement of washing charges. 1âwphi1.nêt
WHEREFORE, the instant petition is GRANTED. The assailed DECISION of public respondent
dated October 28, 1994, is hereby SET ASIDE. The DECISION of public respondent dated April 28,
1994, and its RESOLUTION dated December 13, 1994, are hereby REINSTATED subject to
MODIFICATION. Private respondent is directed to reinstate petitioners to their positions held at the
time of the complained dismissal. Private respondent is likewise ordered to pay petitioners their full
backwages, to be computed from the date of dismissal until their actual reinstatement. However, the
order of public respondent that petitioners be reimbursed the amount paid as washing charges is
deleted. Costs against private respondents.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
PARAS, J.:
This petition for review on certiorari seeks to reverse and set aside the decision* of the Court of
Appeals promulgated on February 1, 1989 in CA-G.R. SP No. 16071 entitled "Cecilio S. de Villa vs.
Judge Job B. Madayag, etc. and Roberto Z. Lorayes," dismissing the petition for certiorari filed
therein.
The factual backdrop of this case, as found by the Court of Appeals, is as follows:
On October 5, 1987, petitioner Cecilio S. de Villa was charged before the Regional Trial
Court of the National Capital Judicial Region (Makati, Branch 145) with violation of Batas
Pambansa Bilang 22, allegedly committed as follows:
That on or about the 3rd day of April 1987, in the municipality of Makati, Metro
Manila, Philippines and within the jurisdiction of this Honorable Court, the above-
named accused, did, then and there willfully, unlawfully and feloniously make or draw
and issue to ROBERTO Z. LORAYEZ, to apply on account or for value a Depositors
Trust Company Check No. 3371 antedated March 31, 1987, payable to herein
complainant in the total amount of U.S. $2,500.00 equivalent to P50,000.00, said
accused well knowing that at the time of issue he had no sufficient funds in or credit
with drawee bank for payment of such check in full upon its presentment which check
when presented to the drawee bank within ninety (90) days from the date thereof
was subsequently dishonored for the reason "INSUFFICIENT FUNDS" and despite
receipt of notice of such dishonor said accused failed to pay said ROBERTO Z.
LORAYEZ the amount of P50,000.00 of said check or to make arrangement for full
payment of the same within five (5) banking days after receiving said notice.
After arraignment and after private respondent had testified on direct examination, petitioner
moved to dismiss the Information on the following grounds: (a) Respondent court has no
jurisdiction over the offense charged; and (b) That no offense was committed since the check
involved was payable in dollars, hence, the obligation created is null and void pursuant to
Republic Act No. 529 (An Act to Assure Uniform Value of Philippine Coin and Currency).
On July 19, 1988, respondent court issued its first questioned orders stating:
Accused's motion to dismiss dated July 5, 1988, is denied for lack of merit.
Under the Bouncing Checks Law (B.P. Blg. 22), foreign checks, provided they are
either drawn and issued in the Philippines though payable outside thereof, or made
payable and dishonored in the Philippines though drawn and issued outside thereof,
are within the coverage of said law. The law likewise applied to checks drawn against
current accounts in foreign currency.
Petitioner moved for reconsideration but his motion was subsequently denied by respondent
court in its order dated September 6, 1988, and which reads:
Accused's motion for reconsideration, dated August 9, 1988, which was opposed by
the prosecution, is denied for lack of merit.1âwphi1
The Bouncing Checks Law is applicable to checks drawn against current accounts in
foreign currency (Proceedings of the Batasang Pambansa, February 7, 1979, p.
1376, cited in Makati RTC Judge (now Manila City Fiscal) Jesus F. Guerrero's The
Ramifications of the Law on Bouncing Checks, p. 5). (Rollo, Annex "A", Decision, pp.
20-22).
A petition for certiorari seeking to declare the nullity of the aforequoted orders dated July 19,
1988 and September 6, 1988 was filed by the petitioner in the Court of Appeals wherein he
contended:
(a) That since the questioned check was drawn against the dollar account of
petitioner with a foreign bank, respondent court has no jurisdiction over the same or
with accounts outside the territorial jurisdiction of the Philippines and that Batas
Pambansa Bilang 22 could have not contemplated extending its coverage over dollar
accounts;
(b) That assuming that the subject check was issued in connection with a private
transaction between petitioner and private respondent, the payment could not be
legally paid in dollars as it would violate Republic Act No. 529; and
(c) That the obligation arising from the issuance of the questioned check is null and
void and is not enforceable with the Philippines either in a civil or criminal suit. Upon
such premises, petitioner concludes that the dishonor of the questioned check
cannot be said to have violated the provisions of Batas Pambansa Bilang 22. (Rollo,
Annex "A", Decision, p. 22).
On February 1, 1989, the Court of Appeals rendered a decision, the decretal portion of which
reads:
In its resolution dated November 13, 1989, the Second Division of this Court gave due
course to the petition and required the parties to submit simultaneously their respective
memoranda (Rollo, Resolution, p. 81).
The sole issue in this case is whether or not the Regional Trial Court of Makati has
jurisdiction over the case in question.
Jurisdiction is the power with which courts are invested for administering justice, that is, for
hearing and deciding cases (Velunta vs. Philippine Constabulary, 157 SCRA 147 [1988]).
Jurisdiction in general, is either over the nature of the action, over the subject matter, over
the person of the defendant, or over the issues framed in the pleadings (Balais vs. Balais,
159 SCRA 37 [1988]).
Jurisdiction over the subject matter is determined by the statute in force at the time of
commencement of the action (De la Cruz vs. Moya, 160 SCRA 538 [1988]).
The trial court's jurisdiction over the case, subject of this review, can not be questioned.
Sections 10 and 15(a), Rule 110 of the Rules of Court specifically provide that:
Sec. 10. Place of the commission of the offense. The complaint or information is
sufficient if it can be understood therefrom that the offense was committed or some
of the essential ingredients thereof occured at some place within the jurisdiction of
the court, unless the particular place wherein it was committed constitutes an
essential element of the offense or is necessary for identifying the offense charged.
Sec. 15. Place where action is to be instituted. (a) Subject to existing laws, in all
criminal prosecutions the action shall be instituted and tried in the court of the
municipality or territory where the offense was committed or any of the essential
ingredients thereof took place.
In the case of People vs. Hon. Manzanilla (156 SCRA 279 [1987] cited in the case of Lim vs.
Rodrigo, 167 SCRA 487 [1988]), the Supreme Court ruled "that jurisdiction or venue is
determined by the allegations in the information."
The information under consideration specifically alleged that the offense was committed in
Makati, Metro Manila and therefore, the same is controlling and sufficient to vest jurisdiction
upon the Regional Trial Court of Makati. The Court acquires jurisdiction over the case and
over the person of the accused upon the filing of a complaint or information in court which
initiates a criminal action (Republic vs. Sunga, 162 SCRA 191 [1988]).
Moreover, it has been held in the case of Que v. People of the Philippines (154 SCRA 160
[1987] cited in the case of People vs. Grospe, 157 SCRA 154 [1988]) that "the determinative
factor (in determining venue) is the place of the issuance of the check."
On the matter of venue for violation of Batas Pambansa Bilang 22, the Ministry of
Justice, citing the case of People vs. Yabut (76 SCRA 624 [1977], laid down the following
guidelines in Memorandum Circular No. 4 dated December 15, 1981, the pertinent portion of
which reads:
(1) Venue of the offense lies at the place where the check was executed and
delivered; (2) the place where the check was written, signed or dated does not
necessarily fix the place where it was executed, as what is of decisive importance is
the delivery thereof which is the final act essential to its consummation as an
obligation; . . . (Res. No. 377, s. 1980, Filtex Mfg. Corp. vs. Manuel Chua, October
28, 1980)." (See The Law on Bouncing Checks Analyzed by Judge Jesus F.
Guerrero, Philippine Law Gazette, Vol. 7. Nos. 11 & 12, October-December, 1983, p.
14).
It is undisputed that the check in question was executed and delivered by the petitioner to
herein private respondent at Makati, Metro Manila.
However, petitioner argues that the check in question was drawn against the dollar account
of petitioner with a foreign bank, and is therefore, not covered by the Bouncing Checks Law
(B.P. Blg. 22).
But it will be noted that the law does not distinguish the currency involved in the case. As the
trial court correctly ruled in its order dated July 5, 1988:
Under the Bouncing Checks Law (B.P. Blg. 22), foreign checks, provided they are
either drawn and issued in the Philippines though payable outside thereof . . . are
within the coverage of said law.
It is a cardinal principle in statutory construction that where the law does not distinguish
courts should not distinguish. Parenthetically, the rule is that where the law does not make
1âw phi 1
any exception, courts may not except something unless compelling reasons exist to justify it
(Phil. British Assurance Co., Inc. vs. IAC, 150 SCRA 520 [1987]).
More importantly, it is well established that courts may avail themselves of the actual
proceedings of the legislative body to assist in determining the construction of a statute of
doubtful meaning (Palanca vs. City of Manila, 41 Phil. 125 [1920]). Thus, where there is
doubts as to what a provision of a statute means, the meaning put to the provision during the
legislative deliberation or discussion on the bill may be adopted (Arenas vs. City of San
Carlos, 82 SCRA 318 [1978]).
The records of the Batasan, Vol. III, unmistakably show that the intention of the lawmakers is
to apply the law to whatever currency may be the subject thereof. The discussion on the floor
of the then Batasang Pambansa fully sustains this view, as follows:
MR. TUPAY. Mr. Speaker, it has been mentioned by one of the Gentlemen who
interpellated that any check may be involved, like U.S. dollar checks, etc. We are
talking about checks in our country. There are U.S. dollar checks, checks, in our
currency, and many others.
MR. MENDOZA. The bill refers to any check, Mr. Speaker, and this check may be a
check in whatever currency. This would not even be limited to U.S. dollar checks.
The check may be in French francs or Japanese yen or deutschunorhs. (sic.) If
drawn, then this bill will apply.
DECISION
BERSAMIN, J.:
Through his petition for review on certiorari, petitioner appeals the decision
promulgated by the Court of Appeals (CA) on February 27, 2004,[1] finding no
employee-employer relationship between him and respondents, thereby reversing
the ruling by the National Labor Relations Commission (NLRC) to the effect that he
was the employee of respondents.
Antecedents
Petitioner maintained that respondent BCC Product Sales Inc. (BCC) and its
President, respondent Terrance Ty (Ty), employed him as comptroller starting from
September 1995 with a monthly salary of P20,000.00 to handle the financial aspect
of BCCs business;[2] that on October 19,1995, the security guards of BCC, acting
upon the instruction of Ty, barred him from entering the premises of BCC where he
then worked; that his attempts to report to work in November and December 12,
1995 were frustrated because he continued to be barred from entering the premises
of BCC;[3] and that he filed a complaint dated December 28, 1995 for illegal
dismissal, reinstatement with full backwages, non-payment of wages, damages and
attorneys fees.[4]
Respondents countered that petitioner was not their employee but the employee of
Sobien Food Corporation (SFC), the major creditor and supplier of BCC; and that
SFC had posted him as its comptroller in BCC to oversee BCCs finances and
business operations and to look after SFCs interests or investments in BCC.[5]
Although Labor Arbiter Felipe Pati ruled in favor of petitioner on June 24,
[6]
1996, the NLRC vacated the ruling and remanded the case for further
proceedings.[7] Thereafter, Labor Arbiter Jovencio Ll. Mayor rendered a new
decision on September 20, 2001, dismissing petitioners complaint for want of an
employer-employee relationship between the parties.[8] Petitioner appealed
the September 20, 2001 decision of Labor Arbiter Mayor.
On July 31, 2002, the NLRC rendered a decision reversing Labor Arbiter
Mayors decision, and declaring that petitioner had been illegally dismissed. It
ordered the payment of unpaid salaries, backwages and 13 th month pay, separation
pay and attorneys fees.[9] Respondents moved for the reconsideration of the NLRC
decision, but their motion for reconsideration was denied on September 30,
2002.[10] Thence, respondents assailed the NLRC decision on certiorari in the CA.
Ruling of the CA
Apparently, in the case before us, all these four elements are absent. First,
there is no proof that the services of the private respondent were engaged
to perform the duties of a comptroller in the petitioner company. There is
no proof that the private respondent has undergone a selection procedure
as a standard requisite for employment, especially with such a delicate
position in the company. Neither is there any proof of his appointment nor
is there any showing that the parties entered into an employment contract,
stipulating thereof that he will receive P20,000.00/month salary as
comptroller, before the private respondent commenced with his work as
such. Second, as clearly established on record, the private respondent was
not included in the petitioner companys payroll during the time of his
alleged employment with the former. True, the name of the private
respondent Charlie Jao appears in the payroll however it does not prove
that he has received his remuneration for his services. Notably, his name
was not among the employees who will receive their salaries as
represented by the payrolls. Instead, it appears therein as a comptroller
who is authorized to approve the same. Suffice it to state that it is rather
obscure for a certified public accountant doing the functions of a
comptroller from September 1995 up to December 1995 not to receive his
salary during the said period. Verily, such scenario does not conform with
the usual and ordinary experience of man. Coming now to the most
controlling factor, the records indubitably reveal the undisputed fact that
the petitioner company did not have nor did not exercise the power of
control over the private respondent. It did not prescribe the manner by
which the work is to be carried out, or the time by which the private
respondent has to report for and leave from work. As already stated, the
power of control is such an important factor that other requisites may even
be disregarded. In Sevilla v. Court of Appeals, the Supreme Court
emphatically held, thus:
The control test, under which the person for whom the
services are rendered reserves the right to direct not only the
end to be achieved but also the means for reaching such end,
is generally relied on by the courts.
SO ORDERED.
After the CA denied petitioners motion for reconsideration on May 14, 2004,[12] he
filed a motion for extension to file petition for review, which the Court denied
through the resolution dated July 7, 2004 for failure to render an explanation on why
the service of copies of the motion for extension on respondents was not personally
made.[13] The denial notwithstanding, he filed his petition for review
on certiorari. The Court denied the petition on August 18, 2004 in view of the denial
of the motion for extension of time and the continuing failure of petitioner to render
the explanation as to the non-personal service of the petition on
respondents.[14]However, upon a motion for reconsideration, the Court reinstated the
petition for review on certiorari and required respondents to comment.[15]
Issue
Ruling
To prove his employment with BCC, petitioner offered the following: (a) BCC
Identification Card (ID) issued to him stating his name and his position as
comptroller, and bearing his picture, his signature, and the signature of Ty; (b) a
payroll of BCC for the period of October 1-15, 1996 that petitioner approved as
comptroller; (c) various bills and receipts related to expenditures of BCC bearing the
signature of petitioner; (d) various checks carrying the signatures of petitioner and
Ty, and, in some checks, the signature of petitioner alone; (e) a court order showing
that the issuing court considered petitioners ID as proof of his employment with
BCC; (f) a letter of petitioner dated March 1, 1997 to the Department of Justice on
his filing of a criminal case for estafa against Ty for non-payment of wages; (g)
affidavits of some employees of BCC attesting that petitioner was their co-employee
in BCC; and (h) a notice of raffle dated December 5, 1995 showing that petitioner,
being an employee of BCC, received the notice of raffle in behalf of BCC.[18]
Respondents denied that petitioner was BCCs employee. They affirmed that SFC
had installed petitioner as its comptroller in BCC to oversee and supervise SFCs
collections and the account of BCC to protect SFCs interest; that their issuance of
the ID to petitioner was only for the purpose of facilitating his entry into the BCC
premises in relation to his work of overseeing the financial operations of BCC for
SFC; that the ID should not be considered as evidence of petitioners employment
inBCC;[19] that petitioner executed an affidavit in March 1996,[20] stating, among
others, as follows:
Petitioner counters, however, that the affidavit did not establish the absence
of an employer-employee relationship between him and respondents because it had
been executed in March 1996, or after his employment with respondents had been
terminated on December 12, 1995; and that the affidavit referred to his subsequent
employment by SFC following the termination of his employment by BCC. [21]
It can be deduced from the March 1996 affidavit of petitioner that respondents
challenged his authority to deliver some 158 checks to SFC. Considering that he
contested respondents challenge by pointing to the existing arrangements between
BCC and SFC, it should be clear that respondents did not exercise the power of
control over him, because he thereby acted for the benefit and in the interest of SFC
more than of BCC.
Petitioners admission that he did not receive his salary for the three months of
his employment by BCC, as his complaint for illegal dismissal and non-payment of
wages[25] and the criminal case for estafa he later filed against the respondents for
non-payment of wages[26] indicated, further raised grave doubts about his assertion
of employment by BCC. If the assertion was true, we are puzzled how he could have
remained in BCCs employ in that period of time despite not being paid the first
salary of P20,000.00/month. Moreover, his name did not appear in the payroll of
BCC despite him having approved the payroll as comptroller.
Lastly, the confusion about the date of his alleged illegal dismissal provides another
indicium of the insincerity of petitioners assertion of employment by BCC. In the
petition for review on certiorari, he averred that he had been barred from entering
the premises of BCC on October 19, 1995,[27] and thus was illegally dismissed. Yet,
his complaint for illegal dismissal stated that he had been illegally dismissed on
December 12, 1995 when respondents security guards barred him from entering the
premises of BCC,[28] causing him to bring his complaint only on December 29, 1995,
and after BCC had already filed the criminal complaint against him. The wide gap
between October 19, 1995 and December 12, 1995 cannot be dismissed as a trivial
inconsistency considering that the several incidents affecting the veracity of his
assertion of employment by BCC earlier noted herein transpired in that interval.
With all the grave doubts thus raised against petitioners claim, we need not dwell at
length on the other proofs he presented, like the affidavits of some of the employees
of BCC, the ID, and the signed checks, bills and receipts. Suffice it to be stated that
such other proofs were easily explainable by respondents and by the aforestated
circumstances showing him to be the employee of SFC, not of BCC.
SO ORDERED.