FIRST
DIVISION
COMMANDER REALTY, INC., G.R. No. 167945
Petitioner,
Present:
- versus
- PANGANIBAN,
C.J., Chairperson,
YNARES-SANTIAGO,
AUSTRIA-MARTINEZ,
CALLEJO, SR., and
FREDDIE FERNANDEZ, CHICO-NAZARIO,
JJ.
FRANCISCO BASA,
SALVADOR BASA,
EDUARDO EISMA, RUEL
EISMA, LAMBERTO
ENRIQUEZ, ANANIAS
GABAS
GABORNE, DENNIS
GEA,
JOHN GEA, MARLON
GEA, NOEL GEA,
JONATHAN GELLADULLA,
EUSEBIO GELONGA,
SALVADOR JOMOCAN,
ROLANDO MARILAG,
ANGELICO PASAPORTE,
RICARDO PASAPORTE,
ROGELIO PASAPORTE,
ROGER PLACER, EFREN
RAGANAS, RUBEN
SANDAGON, RENE
SAQUITAL, RUDY SECUGAL,
RONNEL SECUGAL,
RONNY SECUGAL, DANDIL
SOLEDAD, PEDRO SUERTE,
PIO TAGCOS, RUDY
TAGCOS, ELMO VARGAS Promulgated:
and JIMMY VILLANUEVA,
Respondents.
x - -
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - x
D E C I S I O N
CALLEJO, SR., J.:
Respondents Freddie Fernandez, Francisco Basa, Salvador
Basa, Eduardo Eisma, Ruel Eisma, Lamberto Enriquez, Ananias Gabas Gaborne,
Dennis Gea, John Gea, Marlon Gea, Noel Gea, Jonathan Gelladulla, Eusebio
Gelonga, Salvador Jomocan, Rolando Marilag, Angelico Pasaporte, Ricardo
Pasaporte, Rogelio Pasaporte, Roger Placer, Efren Raganas, Ruben Sandagon, Rene
Saquital, Rudy Secugal, Ronnel Secugal, Ronny Secugal, Dandil Soledad, Pedro
Suerte, Pio Tagcos, Rudy Tagcos, Elmo Vargas and Jimmy Villanueva filed an
Amended Petition dated August 29, 2001, before the Social Security Commission
(SSC), against petitioner Commander Realty, Inc. (CRI) and/or its president, Francisco
M. Villanueva. They alleged, inter alia, that they were employees of petitioner,
which had failed to register with the Social Security System (SSS) as a
member-employer and remit the monthly SSS contributions of its employees, thereby
depriving them of the benefits under Republic Act (R.A.) No. 1161, as amended
by R.A. No. 8282. They claimed that they were dismissed from their employment when
they made demands for petitioner to register with the SSS. Respondents appended to their petition copies
of assorted documents to prove their claim that they were employees of petitioner
CRI.
The
Amended Petition contained the following prayer:
5. WHEREFORE, premises considered, petitioners respectfully prayed (sic) of this Honorable Commission, that after due notice and hearing, to require:
a. Respondent to register to the SSS as member-employer;
b. Respondent to remit to the SSS the SS contributions due for and in behalf of herein petitioners including the employer’s and employees’ shares;
c. Respondent to pay the penalty to the SSS for the later payment/remittance due herein petitioners.
Petitioners pray such other reliefs
and remedies just and equitable under the premises.[1]
In its
Answer to the petition, petitioner CRI insisted that respondents were not its
employees and narrated the factual antecedents that led to the filing of the
case as follows:
Commander Realty, Inc. is a
corporation that was organized on
As the family patriarch, Francisco
Villanueva was elected as the founding president of the corporation. On
Attached hereto as Annex “1” and made as an integral portion hereof is a copy of the Certificate of Death of Francisco Villanueva.
At present, the company president is Wilhelmina V. Andrada.
In 1986, Wilhelmina V. Andrada
needed to undertake major repairs on her residence located at
The property owner had no hand in the hiring of the workers who will collaborate in the repair works.
Later, the residential house located
at
Sometime in 1992, Wilhelmina Andrada wanted to construct a house intended for residential purposes. She entered into an agreement with Simplicio Abiera, who undertook the construction work on the property. Again, the property owner had no participation in the selection of the skilled workers who will render service on the different phases of the construction job. The house and lot were, likewise, sold.
In 1999, Wilhelmina Andrada decided
to develop two (2) idle parcels of land which are situated in
Attached hereto as Annexes “2” and “3” and made as integral portions hereof are a copy each (sic) of Transfer Certificates of Title Nos. N-154876 and N-173207, respectively.
On P1,200,000.00.
Attached hereto as Annex “4” and made as an integral part hereof is a copy of the February 8, 1999 Contract for the proposed two-storey house located at No. 29 Marang Street, Project 2, Quezon City.
On P950,000.00 to the contractor for the labor segment of the
construction project.
Attached hereto as Annex “5” and made as an integral portion hereof is a copy of the March 1, 1999 Contract for the proposed two-storey house located at No. 13 Mapagkumbaba Street, Sikatuna Village, Quezon City.
Each of the construction projects is
covered by a building permit that was issued by the building official of
Attached hereto as Annexes “6” and
“7” and made as integral portions hereof are a copy each of Building Permit No.
99-101939 dated
Complainants instituted this action
claiming that they are employees of Respondent Commander Realty, Inc. These Complainants are claiming that they
should have been given compulsory Social Security coverage.[2]
The case was docketed as SSC Case No. 2-14995-2000. The SSS intervened in the case and in its
Position Paper alleged that while petitioner CRI was not registered with it and
did not make any monthly remittances, respondents for their part failed to
submit proof that they were employees of petitioner CRI.
Respondents
also filed complaints against petitioner CRI and Wilhelmina Andrada in the
National Labor Relations Commission (NLRC) for illegal dismissal, non-payment
of premium pay for holiday, rest day, and service incentive leave pay and 13th
month pay. The complaints were docketed as NLRC Case Nos. 00-01-00322-2000,
00-01-00440-2000 and 00-03-01808-2000. Respondents alleged therein that they
were employees of petitioner CRI. On
Records show that the complainants performed work in the different construction projects which were owned by respondent Andrada. Let it be underscored that all the Certificate of Titles were owned by respondent Wilhelmina V. Andrada. As admitted, Wilhelmina Andrada is the President of Commander Realty, Inc. It is settled that a corporation is clothed with a personality separate and distinct from that of the person composing it. It may not generally be held liable for the personal indebtedness of its stockholders or those of the entities connected with it. Conversely, a stockholder cannot be made to answer for any of its financial obligations even if he should be its President (Laperal Development Corp. v. CA, 223 SCRA 261, citing Phil. Bank of Communication v. CA, 195 SCRA 567).
Complainants insisted that they were employees of Commander Realty, Inc. by submitting list of projects around 37 of them done and/or constructed by them. Although these projects were admitted by Wilhelmina Andrada, she rebutted by saying that these were not projects of Commander Realty, Inc. Neither did she hired (sic) the complainants as her construction workers.
Perusing the records, respondent Wilhelmina V. Andrada presented several contracts executed by Simplicio P. Abiera, Manuel Eva, Romy Yape and the Square Meter Co. and the latter as contractors for the construction, repairs, renovation or remodeling of residential units, apartments, etc. of the former.
As previously mentioned, the power to control the employees’ conduct is the most important element for the existence of employer-employee relationship.
Record is bereft of any evidence that would tend to prove that such employer-employee relationship existed between the complainants and the herein respondents. This claim of the existence of employer-employee relationship is vehemently denied by the respondents. Moreover, while it is true that in this jurisdiction, the burden of proof lies in the party against whom the allegation lies. However, this doctrine does not apply in case the party (in the instant case, the respondents) denies such fact or allegation of employer-employee relationship. In the latter case, the burden of evidence is momentarily shifted to the complainants until they have shown sufficient facts establishing their allegation that they were employees of respondents.
Complainants, in order to establish the fact that they were employees of the respondents, submitted payrolls (Annexes “S,” “S-1,” “S-2” and “S-3,” Complainants’ Position Paper). But these payrolls fail to prove that they were payrolls of the respondents. There is no iota of indication that the same were payrolls of the respondents, thus, it could not be given probative value.
In like manner that complainant Ruel Eisma presented a Certificate of Employment issued by the respondent Commander Realty, Inc. However, this Certification of Employment was refuted by the respondents by saying that said Ruel Eisma pleaded that he be issued a Certificate for the purpose of presenting and submitting to the recruitment agency for employment abroad. Respondents argued that the issuance of such certificate was for accommodation only in order to help and assist a co-Filipino who was in need of employment overseas. This explanation of the respondents was never denied nor rebutted by the complainants, hence, the defense of respondents is given merit.
The complainants, likewise, introduced several alleged payslips. Perusing the same documentary exhibits failed to show that the same were issued by the respondents. Thus, this Arbitration Branch cannot give credence to the said evidence.
The Affidavit of Manuel Eva stating that he is a contractor who offered his services to various clients and one of whom was Wilhelmina Andrada who contracted his services to work on projects is appreciated and with probative value for failure of the complainants to deny. It was further agreed that he (Manuel Eva) will be the one to hire the workers for the projects and among those hired were Salvador Jomocan, Ricardo Pasaporte, Rogelio Pasaporte, Jonathan Gelladula, Ronnie Secugal, Salvador Basa, Pio Tacgos, Rudy Secugal and Francisco Basa. Affiant, likewise, said that as contractor, he was the one who engaged the services of the persons who will work on the project and he was the one who paid for the salaries of his workers and responsible in giving work assignments. Accordingly, the concern of the owner (Ms. Andrada) was when the project will be finished or completed, whether or not the building specifications were carried out. All these allegations of the respondent’s witness were never denied by the complainants.
Considering that there is no
employer-employee relationship that existed between the parties, the subsequent
issues become moot.[3]
Respondents appealed the decision of the Labor Arbiter to
the NLRC.
In the
meantime, on
WHEREFORE, PREMISES CONSIDERED, this
Commission hereby orders respondent Commander Realty, Inc. to pay to the SSS,
within thirty (30) days from receipt of this Resolution, the unremitted SS
contributions in favor of the petitioners (Mauricio Gea and Felix Jomocan
excluded), in the amount of P1,249,278.00, plus the 3% per month penalty
for late payment thereof in the amount of P2,985,985.16, computed as of
November 15, 2002 plus the additional penalty accruing thereafter and damages
in the amount of P134,160.00, pursuant to Section 24(a) of R.A. 1161, as
amended, for failure to report petitioner Lamberto Enriquez for SS coverage
prior to his retirement on April 16, 1996, it appearing from the records that
the latter was born on April 16, 1936.
The SSS, on the other hand, is ordered to pay petitioner Lamberto Enriquez the appropriate retirement pension benefit, subject to its existing rules and regulations, and to inform this Commission of its compliance herewith.
SO ORDERED.[4]
Petitioner CRI moved to have the resolution reconsidered, but
the SSC resolved to deny the motion in an Order dated
Thus, while the SSC ruled that petitioner CRI was the
employer of respondents, the Labor Arbiter, on the other hand, ruled that no
such employer-employee relationship existed between petitioner CRI and respondents.
Petitioner
CRI filed a Petition for Review with the Court of Appeals (CA), seeking the
reversal of the Resolution and Order of the SSC in SSC Case No. 2-14995-2000. The case was docketed as CA-G.R. SP No.
78298.
On
This time,
respondents filed a Petition for Certiorari
with the CA, docketed as CA-G.R. SP No. 83561, seeking the nullification of the
NLRC
decision. On
1. The verification and certification of non-forum shopping attached to the petition does not fully comply with Sec. 4, Rule 7 of the Rules of Court because it failed to give the assurance that the allegations of the petition are true and correct based on authentic records.
2. The petition is not accompanied by copies of certain pleadings and documents relevant and pertinent thereto, i.e., complaint, private respondents’ position paper and the decision rendered by the Labor Arbiter (Sec. 1, Rule 65, Rules of Court).
3. Petitioners
did not file a motion for reconsideration of the impugned decision and
resolution. A motion for reconsideration
is an equally speedy and adequate remedy and is a condition sine qua non to a petition for certiorari (Plaza v. Mencias, G.R. No. L-182152,
Respondents filed a motion for reconsideration, which the appellate
court denied on
Respondents
then filed a Petition for Review on Certiorari
in the Supreme Court, assailing the CA resolution in CA-G.R. SP No. 83561. The same was docketed as G.R. No.
164399. On
(a) insufficient or defective verification under Sec. 4, Rule 7, as amended; and
(b) defective or insufficient certification against forum shopping in that it is not made by the principal parties or petitioners themselves, in violation of Sec. 5, Rule 7, as not all the petitioners signed the verification/certification of non-forum shopping.
In any event, petitioners failed to
sufficiently show that the Court of Appeals committed any reversible error in
the challenged resolutions as to warrant the exercise by this Court of its
discretionary appellate jurisdiction in this case and for being frivolous, the
same having been decided by three (3) other courts. (emphasis supplied)[8]
Respondents filed a motion for reconsideration of the said Resolution.
In the meantime,
on
x x x x
8. That
it may be added that the Respondents had instituted an action in the National
Labor Relations Commission against Commander Realty, Incorporated and
Wilhelmina V. Andrada. The complaint was
dismissed by Hon. Ermita T. Abrasaldo-Cuyuca, Labor Arbiter, in a DECISION that
was rendered on
Attached hereto as Annex “1” and
made as an integral part hereof is a copy of the
The herein Respondents elevated the
controversy to this Honorable Court, which in a RESOLUTION that was promulgated
by the Honorable Court’s Special Fourteenth Division on May 18, 2004 dismissed
the petition in CA-G.R. SP No. 83561 entitled SALVADOR JOMOCAN, FREDDIE
FERNANDEZ, et al., Petitioners versus NATIONAL LABOR RELATIONS COMMISSION,
COMMANDER REALTY, INC., et al., Respondents.
Likewise, this Honorable Court (Former Special Fourteenth Division) had
denied the herein Respondents’ motion for reconsideration in a RESOLUTION that
was promulgated on
Attached hereto as Annexes “2” and
“3” made, respectively, as integral parts hereof are a copy each of the
In the decisions by the labor
tribunals, it was held that there was no employer-employee relationship that
existed between the herein Petitioner and the herein Respondents. And, this Honorable Court dismissed the
herein Respondents’ petition for certiorari
and, thereafter, denied the herein Respondents’ motion for reconsideration for
being time barred. Hence, the ruling
that there was no employer-employee relationship that existed between Commander
Realty, Inc. and the herein Respondents is final and immutable.[10]
Petitioner CRI also filed a motion in CA-G.R. SP No. 78298,
on the following allegations:
9. That, in the event that the Honorable Supreme Court denies the herein Respondents’ motion for reconsideration in G.R. No. 164399, then, the rulings of the Labor Arbiter and of the National Labor Relations Commission, as well as the dismissal by the Special Fourteenth Division of this Honorable Court of herein Respondents’ petition for certiorari would be affirmed with finality. As a necessary consequence, the finding that there was no employer-employee relationship that existed between Commander Realty, Inc. and the herein Respondents would also become final and binding on the parties herein, thus constituting res judicata as between them;
10. That
a final determination of the absence of employer-employee relationship between
the parties herein would deprive the appealed ruling of the Social Security
Commission of any legal support.
Otherwise stated, the burden imposed by the Social Security Commission
on Commander Realty, Inc., for the latter to remit social security
contributions pertaining to the herein Respondents who were considered as
employees of the Petitioner, in the sum P2,985,985.16, plus the 3% per
month penalty for late payment thereof, computed as of November 15, 2002, would
then be taken off Petitioner’s back, so to speak, once the lack of
employer-employee relationship between the herein parties is ruled upon with
finality;
11. That,
with due respect, a need to defer action on Petitioner’s motion for
reconsideration, arises, if only to avoid conflicting rulings on the issue of
the existence of employer-employee relationship. It would be unwise to have a Supreme Court
decision holding that there was absence of employer-employee relationship
between the parties herein and a ruling of this Honorable Court upholding the
Social Security Commission’s decision
which is founded and reliant on the existence or presence of such relationship.[11]
Petitioner CRI prayed that the action on its motion for
reconsideration be held in abeyance until such time when the Court shall have
resolved herein respondents’ motion for reconsideration in G.R. No. 164399
entitled
On
However, on
Petitioner CRI thus filed the instant petition for review
of the decision and resolution of the CA in CA-G.R. SP No. 78298. It alleges that in light of the decision of
the CA in CA-G.R. SP No. 83561 dismissing the petition of respondents, as well
as the resolution of the Supreme Court in G.R. No. 164399 affirming the
decision of the Labor Arbiter and the NLRC, the CA erred in affirming the
resolution and order of the SSC. It
points out that the appellate court, in CA-G.R. SP No. 78298, held that there
was no employer-employee relationship between it and respondents.
The issue is whether the CA erred in not holding in
abeyance its resolution of the motion for reconsideration filed by petitioner
of its decision until after the resolution of this Court in G.R. No. 164399
shall have become final and executory, and in not granting such motion on the
ground of res judicata.
The petition is meritorious.
Decisive of the issue in this case is the ruling of this
Court in Smith Bell & Co., Inc. v.
Court of Appeals.[15] In that case, private respondents filed a
complaint against Smith Bell & Co. with the SSC seeking to compel the
corporation to report them for SSS coverage and remit in their behalf SSS contributions. Private respondents alleged that they were
employees of the corporation. The SSS intervened.
In a Decision dated
PREMISES CONSIDERED, this Commission finds and so hold respondent Smith Bell and Company, Inc. to be the employer of herein petitioners. Respondent is hereby directed to report all the petitioners to the SSS for coverage and to pay all SSS contributions due in their behalf, covering their respective periods of employment.
Accordingly, the SSS is hereby
directed to assess the respondent of its contribution and penalty liabilities
within fifteen (15) days from receipt of a copy of this Resolution, and to send
immediately the Notice of Assessment to the respondent, who is hereby ordered
to pay its obligation to the SSS within thirty (30) days from receipt thereof.[16]
Private respondents therein had also filed a complaint with
the NLRC Regional Office for illegal dismissal, and the arbitrator, on
Meantime, the corporation appealed the decision of the SSC
to the CA, which rendered a decision affirming the SSC. On a petition for review in this Court, Smith
Bell & Co. invoked the resolution of this Court in G.R. No. L-44620 and
moved for the dismissal of the petition.
The Court granted the petition and ruled that the motion of private
respondents in the SSC was barred by the NLRC decision, which was affirmed by
the Secretary of Labor and Employment and the Supreme Court. The pertinent portion of the decision
follows:
In the petition at bar, petitioner
invokes the resolution dated
Because of petitioner’s above
argument, we examined the records in G.R. No. L-44620 and determined its impact
on the present controversy. In G.R. No. L-44620 entitled, “Mamerto Besol, Vicente Jaloag, Antonio
Besol, Hilarion Roga, Arsenio Besol, Jolito Alcain, Jose Alcain, Dino
Evangelista, Manuel Penaverde, Jayme Alcain and Rodolfo Roga (petitioners)
versus Honorable Blas Ople, Secretary of Labor, and Smith Bell and Co., Inc. (respondents),” petitioners therein (now
all private respondents in the present petition) assailed the resolution dated
“x x x it is most respectfully prayed of this Honorable Court that judgment be rendered declaring as NULL and VOID the Resolution of respondent Secretary of Labor, Blas Ople, dated July 25, 1975 (Annex “F”) and his Order dated July 23, 1976 (Annex “H”) affirming the Decision of the NLRC dated May 27, 1974 (Annex “D”) and instead to declare herein petitioners employees of private respondent Smith Bell & Co., Inc., and as such entitled to full termination pay benefits as provided for in Sec. 9, Rule 1, Book VI, of the New Labor Code to be computed up to the time such payment is to be made (not only up to the date of their illegal dismissal on April 16, 1973) with legal interests thereon. x x x”
The resolution and order of the Secretary of Labor assailed in G.R. No. L-44620 read in full as follows:
Resolution dated
“RESOLUTION
After a review of the entire records
of this case in relations (sic) to
the grounds raised by the complainants in their appeal, we find no
justification to alter/modify the Decision of the National Labor Relations
Commission dated
WHEREFORE, complainant’s (sic) appeal should be, as it is hereby, Dismissed for lack of merit.
SO ORDERED.
ORIGINAL SIGNED
BLAS F. OPLE
Secretary”
Order dated
“O R D E R
Complainants filed a motion seeking
reconsideration of the Resolution of the Secretary of Labor dated
After going over the record, we noted that the motion at bar raises the same issues which were already resolved earlier as stated. The arguments now advanced were the same arguments contained in complainants’ original appeal. No new matter relevant to the facts projected and the issues decided has been added in complainants’ motion to merit further consideration.
IN VIEW THEREOF, complainants’ Motion for Reconsideration is hereby denied for lack of merit.
SO ORDERED.
(ORIGINAL SIGNED))
(SGD) BLAS F. OPLE
Secretary”
In support of its argument as to the application of the principle of res judicata in the present controversy, petitioner contends as follows: that the parties in G.R. No. L-44620 (originating as NLRC Case No. RO-VII-153) are identical with the parties in SSC Case No. 2453, which gave rise to the present petition; that while in SSC Case No. 2453, private respondents sought to compel Smith Bell and Company, Inc. to report them to the Social Security Commission for coverage and to pay their SSS contributions, whereas, in NLRC Case No. RO-VII-153, private respondents had sought the declaration of their dismissal by the petitioner as illegal, the crucial issue in both proceedings was whether an employee-employer relationship existed between petitioner and private respondents; and that, the evidence presented by the parties in NLRC Case No. RO-VII-153 is the same evidence that was presented in SSC Case No. 2453.
It is also important to note that the records of this present petition and those of G.R. No. L-44620 disclose the following material facts:
1. That aside from filing Case No. 2453, private respondents also filed earlier before the NLRC Regional Office No. VII (Iloilo City) of the Department of Labor a complaint alleging therein that herein petitioner company illegally dismissed them from work on 16 April 1973; that, on 22 November 1973, the arbitrator acting on the said complaint rendered the decision against the petitioner company, to wit:
“WHEREFORE, it is hereby ordered
that respondent shall immediately reinstate all the complainant pakiao workers to their former work and
to pay the complainants the amount of P142.68 every month as their
backwages from
SO ORDERED.”
2. That on appeal (docketed NLRC Case No. RO-VII-153) to the NLRC, the same, in ruling that no employee-employer relationship existed between parties therein, rendered the decision dated 27 May 1974 reversing the arbitrator’s decision dated 22 November 1973, and thereby dismissing the appeal; that, subsequently, private respondents (complainants therein) appealed to the Office of the Secretary of Labor assailing the said NLRC decision, upon which appeal the Secretary of Labor acted by issuing the resolution dated 25 July 1975 dismissing the appeal for lack of merit; that the motion for reconsideration of the abovementioned resolution was also denied in resolution dated 23 July 1976 of the said Secretary; that, consequently, private respondents filed before the Supreme Court their petition for certiorari (docketed G.R. No. L-44620) questioning the said resolutions of the Secretary of Labor; that, in the resolution dated 26 January 1977, this Court dismissed the petition for lack of merit, to wit:
“L-44620 (Mamerto Besol, et al. v. Hon. Blas Ople, et al.). – Considering the
allegations contained, the issues raised and the arguments adduced in the
petition for certiorari, as well as
the respective comments of private respondent and the Solicitor General on the
said petition, the reply of petitioners to private respondent’s comment, the
rejoinder of private respondent to petitioners’ reply and the reply by way of
sur-rejoinder of petitioners to private respondent’s rejoinder, the Court
Resolved to DISMISS the petition for lack of merit, no abuse of discretion having
been shown.”
3. That
in resolution dated
“L-44620 (Mamerto Besol, et al. v. Hon. Blas Ople, et al.). – Considering the
pleadings filed in this case, the Court Resolved. … (b) to DENY the motion
dated
4. That
the resolution dated
Based on the records of the case at
bar and those of G.R. No. L-44620, it is clear that the resolution of this
Court dated
The doctrine of res judicata is well discussed in Bienvenida Machoca Arcadio v. Carriaga, Jr., G.R. No. 75109-10,
“The principle of res judicata in actions in personam is found in Section 49(b) and (c), Rule 39 of the Rules of Court which provides:
‘Sec. 49. Effects of judgments. – The effect of a judgment or final order
rendered by a court or judge of the
x x x
(b) In other cases, the judgment or order is, with respect to the matter directly adjudged or as to any other matter that could have been raised in relation thereto, conclusive between the parties and their successors-in-interest by title subsequent to the commencement of the action or special proceeding, litigating for the same thing and under the same title and in the same capacity;
(c) In
any other litigation between the same parties or their successors-in-interest, that
only is deemed to have been adjudged in a former judgment which appears upon
its face to have been so adjudged, or which was actually and necessarily
included therein or necessary thereto.’
The doctrine of res judicata thus lays down two main rules which may be stated as follows: (1) The judgment or decree of a court of competent jurisdiction on the merits concludes the parties and their privies to the litigation and constitutes a bar to a new action or suit involving the same cause of action either before the same or any other tribunal; and (2) Any right, fact, or matter in issue directly adjudicated or necessarily involved in the determination of an action before a competent court in which a judgment or decree is rendered on the merits is conclusively settled by the judgment therein and cannot again be litigated between the parties and their privies whether or not the claim or demand, purpose, or subject matter of the two suits is the same. These two main rules mark the distinction between the principles governing the two typical cases in which a judgment may operate as evidence. In speaking of these cases, the first general rule above stated, and which corresponds to the aforequoted paragraph (b) of Section 49, is referred to as ‘bar by former judgment,’ while the second general rule, which is embodied in paragraph (c) of the same section, is known as ‘conclusiveness of judgment.’
Stated otherwise, when we speak of res judicata in its concept as a ‘bar by former judgment,’ the judgment rendered in the first case is an absolute bar to the subsequent action since said judgment is conclusive not only as to the matters offered and received to sustain that judgment but also as to any other matter which might have been offered for that purpose and which could have been adjudged therein. x x x
On the other hand, the less familiar concept or less terminological usage of res judicata as a rule on conclusiveness of judgment refers to the situation where the judgment in the prior action operates as an estoppel only as to the matters actually determined therein or which were necessarily included therein. x x x
At bottom, the other elements being
virtually the same, the fundamental difference between the rule of res judicata as a bar by former judgment
and as merely a rule on the conclusiveness of judgment is that, in the first,
there is an identity in the cause of action in both cases involved whereas, in
the second, the cause of action in the first case is different from that in the
second case.”
It is true that in SSC Case No. 2453, private respondents sought to enforce their alleged right to compulsory coverage by the SSS on the main allegation that they are employees of petitioner company. On the other hand, in NLRC Case No. RO-VII-153, private respondents, in order to support their position that they were illegally dismissed by petitioner company from their work, maintained that there was an employee-employer relationship existing between petitioner and private respondents at the time of such dismissal. In other words, the issue common to both cases is whether there existed an employee-employer relationship at the time of the occurrence of the acts complained of both in SSC Case No. 2453 and NLRC Case No. RO-VII-153.
It is well to note that the said issue
was adjudged with finality in G.R. No. L-44620, through this Court’s resolution
dated
The present controversy, therefore, squarely falls under the umbrage of res judicata, particularly, under the rule on “conclusiveness of judgment.” Following this rule, as stated in Bienvenida Machoca Arcadio v. Carriaga, Jr., we hold that the judgment in G.R. No. L-44620 bars SSC Case No. 2453, as the relief sought in the latter case is inextricably related to the ruling in G.R. No. L-44620 to the effect that private respondents are not employees of petitioner.
It is to be further observed that in
SSC Case No. 2453, in addition to herein petitioner and private respondents
being parties therein, the Social Security System was included as a
party-intervenor, whereas, in the earlier NLRC Case No. RO-VII-153, only herein
private respondents and petitioner company were the parties. However, this fact does not preclude the
application of the doctrine of res
judicata in the instant case, as it is a well settled rule that the
principle does not require absolute identity but only substantial identity of
parties, subject matter and issues.[17]
In this case, the barefaced fact that the SSS was not a
party before the Labor Arbiter, and that Wilhelmina Andrada was a party before
the Labor Arbiter but was not before the SSC, does not proscribe the
application of the principle of res
judicata. Respondents impleaded Wilhelmina Andrada before the Labor Arbiter
as party-respondent in her capacity as the president of petitioner CRI upon the
demise of Francisco Villanueva.
While the action
of respondents in the SSC differs in form and relief sought from that brought before
the Labor Arbiter, there is identity of the central issue in the two cases; that
is, whether respondents were the employees of petitioner CRI. A change in the
form of action or in the relief sought does not remove a proper case from the
application of res judicata. The courts
are not concerned so much with the form of the action or with its substance. Despite
a difference in the form of action, nevertheless, the doctrine of res judicata would be applied where the
parties in the two suits are litigating the same thing.[18]
The Labor Arbiter had ruled in NLRC Case Nos.
00-01-00322-2000, 00-01-00440-2000 and 00-03-01808-2000 that there was no
employer-employee relationship between petitioner CRI, on the one hand, and respondents,
on the other. The decision of the Labor
Arbiter was affirmed by the NLRC. The CA
dismissed the petition of respondents in CA-G.R. SP No. 83561, and, when
brought to this Court, was likewise dismissed on two grounds: for failure to
sufficiently show that the CA committed a reversible error in the assailed
resolution as to warrant the exercise of the Court’s discretionary appellate
jurisdiction; and for filing a frivolous appeal, the issues having been
resolved uniformly by the Labor Arbiter, the NLRC and the CA. The Court thus resolved with finality that,
after all, petitioner CRI was not the employer of respondents.
It bears stressing that petitioner CRI in its motion for
reconsideration in CA-G.R. SP No. 78298 apprised the appellate court that the
Labor Arbiter had ruled that it was not the employer of respondents; that the
NLRC and the CA had affirmed the ruling of the Labor Arbiter; and that this
Court had already dismissed the petition for review of respondents in G.R. No.
164399. It thus behooved the CA in the said
case to defer resolving the motion for reconsideration until after this Court
shall have resolved the pending motion for reconsideration of respondents in
G.R. No. 164399. By the time the CA denied
the motion on
IN LIGHT OF ALL THE
FOREGOING, the petition is GRANTED. The assailed Decision and Resolution of the
Court of Appeals in CA-G.R. SP No. 78298 are REVERSED AND SET ASIDE.
SO ORDERED.
ROMEO J.
CALLEJO, SR.
Associate Justice
WE CONCUR:
ARTEMIO V. PANGANIBAN
Chief Justice
Chairperson
CONSUELO YNARES-SANTIAGO MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
Pursuant to Section 13, Article VIII of the
Constitution, it is hereby certified that the conclusions in the above Decision
were reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
ARTEMIO
V. PANGANIBAN
Chief
Justice
[1] Rollo,
p. 145.
[2]
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
[11]
[12]
[13]
[14]
[15] G.R.
No. 59692,
[16]
[17]
[18] Medija v. Patcho, G.R. No. L-30310,