FIRST DIVISION
[G.R.
No. 159890.
EMPERMACO B. ABANTE, JR., petitioner, vs. LAMADRID
BEARING & PARTS CORP. and JOSE LAMADRID, President, respondents.
D E C I S I O N
YNARES-SANTIAGO, J.:
This is a petition for review under Rule 45 of the 1997 Revised
Rules of Civil Procedure assailing the Decision dated
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
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[2] and a Deed of Real Estate Mortgage.[3]
Pursuant to the parties’ agreement that the checks would not be deposited, as their corresponding values would be offset from petitioner’s sales commissions, respondents returned the same to petitioner as evidenced by the undeposited checks and respondent Lamadrid’s computations of petitioner’s commissions.[4]
Due to financial difficulties, petitioner inquired about his membership with the Social Security System in order to apply for a salary loan. To his dismay, he learned that he was not covered by the SSS and therefore was not entitled to any benefit. When he brought the matter of his SSS coverage to his employer, the latter berated and hurled invectives at him and, contrary to their agreement, deposited the remaining checks which were dishonored by the drawee bank due to “Account Closed.”
On
This has reference to your demand letter dated
May I respectfully request for a consideration as to the payment of the amount covered by the said checks, as follows:
1. I have an earned commission in the amount of P33,412.39 as shown in the hereto attached Summary of Sales as of February 28, 2001 (P22,748.60) and as of March 31, 2001 (P10,664.79), which I offer to be charged or deducted as partial payment thereof;
2. I hereby commit One Hundred Percent (100%) of all my commission to be directly charged or deducted as payment, from date onward, until such time that payment will be completed;
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.
I’m sincerely appealing to my employer, through you, Sir, to settle these accountabilities which all resulted from the checks issued by my customers which bounced and later charged to my account, in the manner afore-cited.
May this request merit your kindest consideration, Sirs.
Thank you very much.
On
Dear Mr. Lamadrid,
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 company’s 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.
Very truly yours,
(Sgd) Empermaco B. Abante, Jr.
While doing his usual rounds as commission salesman, petitioner was handed by his customers a letter from the respondent company warning them not to deal with petitioner since it no longer recognized him as a commission salesman.
In the interim, petitioner received a subpoena from the Office of the City Prosecutor of Manila for violations of Batas Pambansa Blg. 22 filed by respondent Lamadrid.
Petitioner thus filed a complaint for illegal dismissal with
money claims against respondent company and its president, Jose Lamadrid,
before the NLRC Regional Arbitration Branch No. XI,
By way of defense, respondents countered that petitioner was not its employee but a freelance salesman on commission basis, procuring and purchasing auto parts and supplies from the latter on credit, consignment and installment basis and selling the same to his customers for profit and commission of 3% out of his total paid-up sales. Respondents cite the following as indicators of the absence of an employer-employee relationship between them:
(1) petitioner constantly admitted in all his acts, letters, communications with the respondents that his relationship with the latter was strictly commission basis salesman;
(2) he does not have a monthly salary nor has he received any benefits accruing to regular employment;
(3) he was not required to report for work on a
daily basis but would occasionally drop by the
(4) he was not given the usual pay-slip to show his monthly gross compensation;
(5) neither has the respondent withheld his taxes nor was he enrolled as an employee of the respondent under the Social Security System and Philhealth;
(6) he was in fact working as commission salesman of five other companies, which are engaged in the same line of business as that of respondent, as shown by certifications issued by the said companies;[7]
(7) if respondent owed petitioner his alleged commissions, he should not have executed the Promissory Note and the Deed of Real Estate Mortgage.[8]
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]
WHEREFORE, premises considered judgment is hereby rendered DECLARING respondents LAMADRID BEARING & PARTS CORPORATION AND JOSE LAMADRID to pay jointly and severally complainant EMPERMACO B. ABANTE, JR., the sum of PESOS ONE MILLION THREE HUNDRED THIRTY SIX THOUSAND SEVEN HUNDRED TWENTY NINE AND 62/100 ONLY (P1,336,729.62) representing his awarded separation pay, back wages (partial) unpaid commissions, refund of deductions, damages and attorney’s fees.
SO ORDERED.
On appeal, the National Labor Relations Commission reversed the
decision of the Labor Arbiter in a Resolution dated
WHEREFORE, the Appeal is GRANTED. Accordingly, the appealed decision is Set Aside and Vacated. In lieu thereof, a new judgment is entered dismissing the instant case for lack of cause of action.
SO ORDERED.
Petitioner challenged the decision of the NLRC before the Court
of Appeals, which rendered the assailed judgment on
WHEREFORE, premises considered, petition is hereby DENIED. Let the supersedeas bond dated
SO ORDERED.
Upon denial of his motion for reconsideration, petitioner filed the instant appeal based on the following grounds:
I
THE HONORABLE COURT OF APPEALS IN GRAVE ABUSE OF DISCRETION “MODIFIED” THE IMPORT OF THE “RELEVANT ANTECEDENTS” AS ITS PREMISE IN ITS QUESTIONED DECISION CAUSING IT TO ARRIVE AT ERRONEOUS CONCLUSIONS OF FACT AND LAW.
II
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN APPRECIATING THE TRUE FACTS OF THIS CASE THEREBY IT MADE A WRONG CONCLUSION BY STATING THAT THE FOURTH ELEMENT FOR DETERMINING EMPLOYER-EMPLOYEE RELATIONSHIP, WHICH IS THE “CONTROL TEST,” IS WANTING IN THIS CASE.
III
THE HONORABLE COURT OF APPEALS IS AT WAR WITH THE EVIDENCE PRESENTED IN THIS CASE AS WELL AS WITH THE APPLICABLE LAW AND ESTABLISHED RULINGS OF THIS HONORABLE COURT.
Initially, petitioner challenged the statement by the appellate
court that “petitioner, who was contracted a 3% of the total gross sales as his
commission, was tasked to sell private respondent’s merchandise in the
Petitioner likewise disputes the finding of the appellate court that no employer-employee relationship exists between him and respondent corporation since the power of control, which is the most decisive element to determine such relationship, is wanting. He argues that the following circumstances show that he was in truth an employee of the respondent corporation:
(1) As salesman of the private respondents, petitioner was also the one collecting payment of his sales from various customers. Thus, he was bringing with him Provisional Receipts, samples of which are attached to his Position Paper filed with the Labor Arbiter.
(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
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.[12] Considering the conflicting findings of fact by the Labor Arbiter and the 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.[13] The so-called “control test” is commonly regarded as the most crucial and determinative indicator of the presence or absence of an employer-employee relationship. Under the control test, an employer-employee relationship exists where the person for whom the services are performed reserves the right to control not only the end achieved, but also the manner and means to be used in reaching that end.
Applying the aforementioned test, an employer-employee relationship
is notably absent in this case. It is
undisputed that petitioner Abante was a commission salesman who received 3%
commission of his gross sales. Yet no
quota was imposed on him by the respondent; such that a dismal performance or
even a dead result will not result in any sanction or provide a ground for
dismissal. He was not required to
report to the office at any time or submit any periodic written report on his
sales performance and activities.
Although he had the whole of
In Encyclopedia Britannica (Philippines), Inc. v. NLRC,[16] we reiterated the rule that there could be no employer-employee relationship where the element of control is absent. Where a person who works for another does so more or less at his own pleasure and is not subject to definite hours or conditions of work, and in turn is compensated according to the result of his efforts and not the amount thereof, no relationship of employer-employee exists.
We do not agree with petitioner’s contention that Article 280[17] is a crucial factor in determining the existence of an employment relationship. It merely distinguishes between two kinds of employees, i.e., regular employees and casual employees, for purposes of determining their rights to certain benefits, such as to join or form a union, or to security of tenure. Article 280 does not apply where the existence of an employment relationship is in dispute.[18]
Neither can we subscribe to petitioner’s misplaced reliance on the case of Songco v. NLRC.[19] While in that case the term “commission” under Article 96 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.[20] A fortiori, it is difficult to imagine that petitioner, a salesman of long standing, would accede without raising a protest to the patently capricious and oppressive demand by respondent of requiring him to assume bad accounts which, as he contended, he had not incurred. This lends credence to the respondent’s assertion that petitioner procured the goods from the said company on credit, consignment or installment basis and then sold the same to various customers. In the scheme of things, petitioner, having directly contracted with the respondent company, becomes responsible for the amount of merchandise he took from the respondent, and in turn, the customer/s would be liable for their respective accounts to the seller, i.e., the petitioner, with whom they contracted the sale.
All told, we sustain the factual and legal findings of the appellate court and accordingly, find no cogent reason to overturn the same.
WHEREFORE, in view of
the foregoing, the Decision of the Court of Appeals dated
SO ORDERED.
Panganiban, (Working Chairman), Carpio, and Azcuna, JJ., concur.
Davide, Jr., C.J., (Chairman), on official leave.
[1] Check No. Date Amount
1. 3320013401
2.
3320013402
3.
3320013403
4.
3320013404
5.
3320013405
6.
3320013501
7.
3320013502
8.
3320013503
9.
3320013504
10. 3320013505
11. 3320013506
12. 3320013507
13. 3320013508
14. 3320013509
15. 3320013510
16. 3320013511
17. 3320013512
18. 3320013513
19. 3320013514
20. 3320013515
21. 3320013516
22. 3320013517
23. 3320013518
24. 3320013519
25. 3320013520
26. 3320013521
27. 3320013522
28. 3320013523
29. 3320013524
30. 3320013525
31. 3320013526
32. 3320013527
33. 3320013528
34. 3320013529
35. 3320013530
36. 3320013531
37. 3320013532
38. 3320013533
39. 3320013534
40. 3320013535
[2]
Annex “4” to Affidavit of Jose Lamadrid dated
[3]
Annex “5” to Affidavit of Jose Lamadrid dated
[4] See Annexes “F” to “P”.
[5] CA Records, p. 153.
[6]
Annex “7” to Jose Lamadrid’s Affidavit dated
[7] Annexes “G to J”.
[8] Annexes “D & E”.
[9] Decision penned by Labor Arbiter Arturo L. Gamolo.
[10] Decision penned by Commissioner Leon G. Gonzaga, Jr., concurred in by Acting Presiding Commissioner Oscar N. Abella, Fifth Division NLRC.
[11] Decision penned by Associate Justice Buenaventura J. Guerrero, concurred in by Associate Justices Teodoro P. Regino and Mariano C. Del Castillo, Court of Appeals- Second Division.
[12]
AFP Mutual Benefit Association, Inc. v. NLRC, G.R. No. 102199,
[13] Ushio Marketing v. NLRC, G.R. No. 124551, 28 August 1998, 294 SCRA 673; Insular Life Assurance Co., Ltd. v. NLRC, G.R. No. 119930, 12 March 1998, 287 SCRA 476.
[14] Rollo, p. 72.
[15] Supra note 5.
[16]
G.R. No. 87098,
[17] Art. 280. Regular and Casual Employment. — The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer, except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season.
[18]
Singer Sewing Machine Company v.
Drilon, G.R. No. 91307,
[19]
G.R. Nos. 50999-51000,
[20] Revised Rules on Evidence, Rule 131, Section 3, pars. P & Q.