FIRST DIVISION
[G.R. No. 128003. July 26, 2000]
RUBBERWORLD
[PHILS.], INC., and JULIE YAO ONG, petitioner, vs. NATIONAL LABOR
RELATIONS COMMISSION, AQUINO MAGSALIN, PEDRO MAŅIBO, RICARDO BORJA, ALICIA M.
SAN PEDRO AND FELOMENA B. TOLIN, respondents.
D E C I S I O N
PARDO, J.:
What is before the
Court for resolution is a petition to annul the resolution of the National
Labor Relations Commission (NLRC),[1] affirming the labor-arbiter's award but deleting the
moral and exemplary damages.
The facts are as
follows:
Petitioner
Rubberworld (Phils.), Inc. [hereinafter Rubberworld], a corporation established
in 1965, was engaged in manufacturing footwear, bags and garments.
Aquilino Magsalin,
Pedro Manibo, Ricardo Borja, Benjamin Camitan, Alicia M. San Pedro, and Felomena
Tolin were employed as dispatcher, warehouseman, issue monitor, foreman, jacks
cementer and outer sole attacher, respectively.
On August 26, 1994,
Rubberworld filed with the Department of Labor and Employment a notice of
temporary shutdown of operations to take effect on September 26, 1994. Before
the effectivity date, however, Rubberworld was forced to prematurely shutdown
its operations.
On November 11,
1994, private respondents filed with the National Labor Relations Commission a
complaint[2] against petitioner for illegal dismissal and
non-payment of separation pay.
On November 22,
1994, Rubberworld filed with the Securities and Exchange Commission (SEC) a
petition for declaration of suspension of payments with a proposed
rehabilitation plan.[3]
On December 28,
1994, SEC issued the following order:
"Accordingly,
with the creation of the Management Committee, all actions for claims against
Rubberworld Philippines, Inc. pending before any court, tribunal, office,
board, body, Commission or sheriff are hereby deemed SUSPENDED.
"Consequently,
all pending incidents for preliminary injunctions, writ or attachments,
foreclosures and the like are hereby rendered moot and academic.
"SO
ORDERED."[4]
On January 24,
1995, petitioners submitted to the labor arbiter a motion to suspend the
proceedings invoking the SEC order dated December 28, 1994. The labor arbiter
did not act on the motion and ordered the parties to submit their respective
position papers.
On December 10,
1995, the labor arbiter rendered a decision, which provides:
"In the light
of the foregoing, respondents are hereby declared guilty of ILLEGAL SHUTDOWN
and that respondents are ordered to pay complainants their separation pay
equivalent to one (1) month pay for every year of service.
Considering the malicious
act of closing the business precipitately without due regard to the rights of
complainants, moral damages and exemplary damage in the sum of P 50,000.00 and
P 30,000.00 respectively is hereby awarded for each of the complainants.
Finally 10 % of all
sums owing to complainants is hereby adjudged as attorney's fees.
SO ORDERED."[5]
On February 5,
1996, petitioners appealed to the National Labor Relations Commission (NLRC)
alleging abuse of discretion and serious errors in the findings of facts of the
labor arbiter.
On August 30, 1996,
NLRC issued a resolution, the dispositive portion of which reads:
"PREMISES
CONSIDERED, the decision appealed from is hereby, AFFIRMED with MODIFICATION in
that the award of moral and exemplary damages is hereby, DELETED.
SO ORDERED."[6]
On November 20,
1996, NLRC denied petitioners' motion for reconsideration.
Hence, this
petition.[7]
The issue is
whether or not the Department of Labor and Employment, the Labor Arbiter and
the National Labor Relations Commission may legally act on the claims of
respondents despite the order of the Securities and Exchange Commission
suspending all actions against a company under rehabilitation by a management
committee created by the Securities and Exchange Commission.
Presidential Decree
No. 902-A is clear that "all actions for claims against corporations,
partnerships or associations under management or receivership pending before
any court, tribunal, board or body shall be suspended accordingly." The
law did not make any exception in favor of labor claims.[8]
"The
justification for the automatic stay of all pending actions for claims is to
enable the management committee or the rehabilitation receiver to effectively
exercise its/his powers free from any judicial or extra judicial interference
that might unduly hinder or prevent the 'rescue' of the debtor company. To
allow such other actions to continue would only add to the burden of the
management committee or rehabilitation receiver, whose time, effort and
resources would be wasted in defending claims against the corporation instead
of being directed toward its restructuring and rehabilitation."[9]
Thus, the labor
case would defeat the purpose of an automatic stay. To rule otherwise would
open the floodgates to numerous claims and would defeat the rescue efforts of
the management committee.
Besides, even if an
award is given to private respondents, the ruling could not be enforced as long
as petitioner is under management committee.[10]
This finds
ratiocination in that the power to hear and decide labor disputes is deemed
suspended when the Securities and Exchange Commission puts the corporation
under rehabilitation.
Thus, when NLRC
proceeded to decide the case despite the SEC suspension order, the NLRC acted
without or in excess of its jurisdiction to hear and decide cases. As a
consequence, any resolution, decision or order that it rendered or issued
without jurisdiction is a nullity.
WHEREFORE, the petition is hereby GRANTED. The decision of the
labor arbiter dated December 10, 1995 and the NLRC resolution dated August 30,
1996, are SET ASIDE.
No costs.
SO ORDERED.
Davide, Jr.,
C.J., (Chairman), Puno, Kapunan, and
Ynares-Santiago, JJ., concur.
[1] In NLRC NCR 00-11-08125-94 (NLRC CA No. 010142-96)
[2] Docketed as NLRC NCR Case 00-11-08125-94.
[3] Docketed as SEC Case No. 11-94-4920.
[4] Order, SEC Case No. 11-94-4920, December 28, 1994, Rollo,
pp. 55-59.
[5] Decision, Labor Arbiter Ariel Cadiente Santos, Rollo,
pp. 48-54.
[6] Rollo, pp. 35-45, Raul T. Aquino, Presiding Commissioner,
ponente, Commissioners Victoriano R. Calaycay and Rogelio I. Rayala,
concurring.
[7] Filed on February 18, 1997, Rollo, pp. 3-31.
On September 22, 1999, we gave due course to the petition, Rollo, pp.
174-175. We considered this case as an exception to the rule laid down in St.
Martin Funeral Home v. NLRC, 295 SCRA 494 (1998). The issue raised is purely
legal. Rather than refer the case to the Court of Appeals, whose decision would
be appealable to the Supreme Court, our ruling would finally put an end to the
litigation.
[8] PD 902-A, Section 6; Rubberworld v. NLRC, 305 SCRA
721 (1999), citing Barotac Sugar Mills v. Court of Appeals, 275 SCRA 497 (1997)
[9] Rubberworld v. NLRC, supra, citing BF
Homes, Inc. v. Court of Appeals, 190 SCRA 262 (1990)
[10] Ibid.