Republic of the
Supreme Court
THIRD DIVISION
COMPOSITE
ENTERPRISES, INC., G.R.
NO. 159919
Petitioner,
Present:
YNARES-SANTIAGO,
J.,
Chairperson,
- versus - AUSTRIA-MARTINEZ,
CHICO-NAZARIO,
and
NACHURA,
JJ.
EMILIO
M. CAPAROSO and
JOEVE
QUINDIPAN, Promulgated:
Respondents. August 8, 2007
x-
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D E C I S I O N
AUSTRIA-MARTINEZ,
J.:
Before
the Court is a Petition for Review on Certiorari under Rule 45 of the
Revised Rules of Court assailing the Resolution[1]
dated November 18, 2002 of the Court of Appeals (CA) in CA-G.R. SP No. 73791
which dismissed the Petition for Certiorari of Composite Enterprises,
Inc. (petitioner) and the CA Resolution dated
The facts:
Petitioner
is engaged in the distribution and/or supply of confectioneries to various
retail establishments within the
Respondents
filed a complaint for illegal dismissal against petitioner with the National
Labor Relations Commission (NLRC). Petitioner denied that respondents were
illegally dismissed, alleging that they were employed on a month-to-month basis
and that they were terminated as a result of the expiration of their contracts
of employment.
On
WHEREFORE, premises considered, judgment is hereby rendered declaring complainants to have been illegally dismissed from employment and consequently, respondent COMPOSITE ENTERPRISES CORPORATION is hereby ordered to immediately reinstate complainants to their respective former position without loss of seniority rights and other privileges, with full backwages from the date of dismissal up to the actual date of reinstatement which, as of this date, amounts to P93,155.36, as above computed.
SO ORDERED.[4]
On
On
On
On
On
Meanwhile,
in a Decision dated
On
In
an Order dated P143,355.52,
covering the period from
On
In
an Order dated June 28, 2002, the NLRC affirmed the Labor Arbiter's Order dated
June 14, 2001, holding that the reversal on appeal of the Labor Arbiter's
Decision dated June 15, 2000 did not affect respondents' entitlement to accrued
salaries pending appeal, pursuant to Article 223 of the Labor Code; that only
respondent's entitlement to backwages was forfeited; and
that there was no merit to petitioner's insistence on paying separation pay to
respondents, since that there was no strong basis for petitioner's contention
that reinstatement was physically impossible due to petitioner's implementation
of a retrenchment program.[10]
Petitioner
filed a Motion for Reconsideration[11]
but it was denied by the NLRC in a Resolution dated
Four
days later, or on
In
a Resolution[14] dated
Within
the 60-day reglementary period from date of receipt
of the NLRC Resolution denying the motion for reconsideration, petitioner,
instead of filing a motion for reconsideration with the CA's Special Sixteenth
Division, filed on
In
a Resolution dated
On
In
a Resolution[20] dated
September 4, 2003, the CA denied petitioner's Motion for Reconsideration,
holding that resort to the second petition for certiorari was no longer
available due to res judicata,
since the dismissal order dated October 24, 2002 in the first petition for certiorari
had already become final and executory; that minute
resolutions of the court denying due course to petitions, or dismissing cases
summarily for failure to comply with the formal or substantial requirements
laid down therefor by law, were actually dispositions
on the merits constituting res judicata, citing Bernarte
v. Court of Appeals.[21]
Hence,
the present petition.
Petitioner contends that the
dismissal of the first petition was not a judgment on the merits as to
constitute res judicata;
that Bernarte v. Court of Appeals finds
no application to the instant case; and that the dismissal of the first
petition was not a dismissal with prejudice as provided by Section 5, Rule 7 of
the Revised Rules of Court.
Respondents,
on the other hand, contend that petitioner's procedural lapses in filing the
first and second special civil actions for certiorari are irreversible
and there is nothing on record to show that the petitioner at least attempted
or subsequently made a substantial compliance with the formal or substantial
requirements laid down by law; and that petitioner's gross and utter disregard
of the rules cannot justly be rationalized by harking on the policy of liberal
construction.
The petition is impressed with merit.
Contrary to the CA's
ruling, failure to comply with the non-forum shopping requirements in Section 5,
Rule 7 of the Revised Rules of Court, does not automatically warrant the
dismissal of the case with prejudice. The second paragraph of Section 5, Rule 7,
is pertinent:
Section 5. Certification against
forum shopping. – x x x
Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or other initiatory pleading but shall be cause for the dismissal of the case without prejudice, unless otherwise provided, upon motion and after hearing. The submission of a false certification or non-compliance with any of the undertakings therein shall constitute indirect contempt of court, without prejudice to the corresponding administrative and criminal actions. If the acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the same shall be ground for summary dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions. (Emphasis supplied)
The Rule clearly states
that the dismissal is without prejudice unless otherwise stated by the court;[22]
and the dismissal may be deemed with prejudice only upon proper motion and hearing. Since the dismissal was without prejudice, it
did not bar petitioner from refiling the petition for
so long as it was made within the 60-day reglementary
period for filing the petition for certiorari.
Furthermore, Bernarte v. Court of Appeals finds no
application to the instant case. Bernarte is
cast under an entirely different factual milieu. There, the Court denied the first petition
for non-compliance with Section 4 of Circular No. 1-88, which requires a
verified statement of material dates; and the second petition was filed one
year after the dismissal of the first petition.
Unlike in Bernarte, the second
petition in the present case was refiled immediately
after the first petition was dismissed and within the 60-day reglementary period.
With respect
to the non-attachment of the affidavit of service in the second petition, it
was not fatal to the petition. The registry receipts attached to the petition
clearly show that respondents were served copies of the petition and its
annexes.[23]
Thus, the demands of substantial justice were satisfied by the actual receipt
of the petition.[24]
Verily, litigation is not
a game of technicalities. While the swift unclogging of court dockets is a
laudable objective, granting substantial justice is an even more urgent ideal.[25]
Indeed, on numerous occasions, this Court has relaxed the rigid
application of the rules to
afford the parties the opportunity to fully ventilate their cases on the
merits. This is in line with the time-honored principle that cases should be
decided only after giving all parties the chance to argue their causes and
defenses. Technicality and procedural imperfection should thus not serve as
basis of decisions.[26]
Technicalities should never be used to defeat the substantive rights of the other
party.[27]
Every party-litigant must be afforded the amplest opportunity for the proper
and just determination of his cause, free from the constraints of
technicalities.[28] In that way, the ends of justice would be better
served.[29]
For, indeed, the general objective of procedure is to facilitate the
application of justice to the rival claims of contending parties, bearing
always in mind that procedure is not to hinder but to promote the
administration of justice.[30]
Ordinarily, the case
should be remanded to the CA for proper disposition of the petition for certiorari
on the merits;[31] but
that would further delay the case. Considering that the lone issue raised can
be readily resolved in this instance, the Court deems it more practical and in
the greater interest of justice not to remand the
case to the CA
but, instead, to resolve this case once and for all.[32]
Petitioner anchored its Petition
for Certiorari before the CA on the ground that the NLRC gravely abused
its discretion in affirming the Order dated
The Court is not
persuaded.
Article 223 (3rd paragraph) of the Labor Code,[33] as amended by Section 12 of Republic Act (R.A.) No. 6715,[34] and Section 2 of the NLRC Interim Rules on Appeals under R.A. No. 6715, Amending the Labor Code,[35] provide that an order of reinstatement by the Labor Arbiter is immediately executory even pending appeal. The Court explained the rationale of the law in Aris (Phil.) Inc. v. National Labor Relations Commission:[36]
In authorizing execution pending appeal of the reinstatement aspect of a decision of the Labor Arbiter reinstating a dismissed or separated employee, the law itself has laid down a compassionate policy which, once more, vivifies and enhances the provisions of the 1987 Constitution on labor and the working man.
x x x x
These duties and responsibilities of the State are imposed not so much to express sympathy for the workingman as to forcefully and meaningfully underscore labor as a primary social and economic force, which the Constitution also expressly affirms with equal intensity. Labor is an indispensable partner for the nation’s progress and stability.
x x x x
x x x In short, with respect to decisions reinstating employees, the law itself has determined a sufficiently overwhelming reason for its execution pending appeal.
x x x x
x x x Then, by and pursuant to the
same power (police power), the State may authorize an immediate implementation,
pending appeal, of a decision reinstating a dismissed or separated employee
since that saving act is designed to stop, although temporarily since the
appeal may be decided in favor of the appellant, a continuing threat or danger
to the survival or even the life of the dismissed or separated employee and his
family.[37]
Reinstatement is the
restoration to a state or condition from which one has been removed or
separated.[38] The intent of the law in making a
reinstatement order immediately executory is much
like a return-to-work order, i.e., to restore the status quo in the workplace in the meantime
that the issues raised and the proofs presented by the contending parties have
not yet been finally resolved.[39]
It is a legal provision which is fair to both labor and management because
while execution of the order cannot be stayed by the posting of a bond by the
employer, the workers also cannot demand their physical reinstatement if the
employer opts to reinstate them only in the payroll.[40]
Payment of separation pay
as a substitute for reinstatement is allowed only under exceptional
circumstances, viz: (1) when reasons exist
which are not attributable to the fault or are beyond the control of the
employer, such as when the employer -- who is in severe financial strait, has
suffered serious business losses, and has ceased operations -- implements
retrenchment, or abolishes the position due to the installation of labor-saving
devices; (2) when the illegally dismissed employee has contracted
a disease and his
reinstatement will endanger the safety
of his co-employees; or, (3) where a strained relationship exists between
the employer and the dismissed
employee.[41]
As regards retrenchment, it is a management prerogative consistently recognized and affirmed by this Court. It is, however, subject to faithful compliance with the substantive and procedural requirements laid down by law and jurisprudence.[42] For retrenchment to be considered valid, the following substantial requirements must be met: (a) the losses expected should be substantial and not merely de minimis in extent; (b) the substantial losses apprehended must be reasonably imminent such as can be perceived objectively and in good faith by the employer; (c) the retrenchment must be reasonably necessary and likely to effectively prevent the expected losses; and (d) the alleged losses, if already incurred, and the expected imminent losses sought to be forestalled, must be proved by sufficient and convincing evidence.[43]
In the discharge of these requirements, it is the employer who has the onus, this being in the nature of an affirmative defense.[44] In other words, it is not enough for a company to merely declare that it has implemented a retrenchment program. It must produce adequate proof that such is the actual situation to justify the retrenchment of employees. Normally, the condition of business losses is shown by audited financial documents like yearly balance sheets, profit and loss statements and annual income tax returns. The financial statements must be prepared and signed by independent auditors, failing which these can be assailed as self-serving documents.[45]
In this case, petitioner
sought to justify the payment of separation pay instead of reinstatement on the
basis of its implementation of a retrenchment program for “serious and
persistent financial difficulties.”[46]
However, petitioner only submitted as evidence the notice of its intention to
implement a retrenchment program, which it sent to the Department of Labor and
Employment on
The Court finds that the
NLRC did not commit any grave abuse of discretion in issuing the Order dated
WHEREFORE, the petition
is GRANTED insofar as the Resolutions of the Court of Appeals dated
No costs.
MA. ALICIA AUSTRIA-MARTINEZ
Associate
Justice
WE CONCUR:
CONSUELO
YNARES-SANTIAGO
Associate Justice
Chairperson
MINITA V.
Associate Justice Associate Justice
ATTESTATION
I attest that the conclusions in the
above Decision had been reached in consultation before the case was assigned to
the writer of the opinion of the Court’s Division.
CONSUELO
YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
C
E R T I F I C A T I O N
Pursuant to Section 13, Article VIII
of the Constitution, and the Division Chairperson’s attestation, it is hereby
certified that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
REYNATO S. PUNO
Chief Justice
[1] Penned by Associate Justice Romeo A. Brawner (retired) and concurred in by Associate Justices Bienvenido L. Reyes and Danilo B. Pine (retired), CA rollo, p. 122.
[2]
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
[11]
[12]
[13]
[14]
[15] Penned by Justice Rebecca de Guia-Salvador and concurred in by Justices Bernardo P. Abesamis and Regalado E. Maambong.
[16] In Wack
Wack Golf & Country Club v. National Labor
Relations Commission, G.R. No. 149793, April 15, 2005, 456 SCRA 280, 293,
citing Novelty Philippines, Inc. v. Court of Appeals, 458 Phil. 36, 46
(2003), the Court recognized the authority of the general manager to sue on
behalf of the corporation and to sign the requisite verification and
certification of non-forum shopping since he is one person who is in the best
position to know the state of affairs of the corporation.
[17] CA rollo, p. 2.
[18]
[19]
[20]
[21] 331 Phil. 643, 659 (1996).
[22] Barroso v. Ampig Jr., 385 Phil. 237, 244 (2000); Sto. Domingo-David v. Guerrero, 357 Phil. 279, 284-285 (1998).
[23] CA rollo, p. 20.
[24] Philippine Amusement and Gaming Corporation v. Angara, G.R. No. 142937, November 15, 2005, 475 SCRA 41, 52. See also Gutierrez v. Secretary of the Department of Labor and Employment, G.R. No. 142248, December 16, 2004, 447 SCRA 107, 118; Añonuevo v. Court of Appeals, 458 Phil. 532, 539 (2003); Active Realty & Development Corporation v. Daroya, 431 Phil. 753, 758 (2002); Ace Navigation Co., Inc. v. Court of Appeals, 392 Phil. 606, 614 (2000).
[25] Heirs of Agapito
T. Olarte v. Office of the President of the
Philippines, G.R. No. 165821, June 21, 2005, 460 SCRA 561, 568; Donato v. Court of Appeals, 462 Phil. 676,
692 (2003).
[26] Crystal
Shipping, Inc. v. Natividad, G.R. No. 154798,
[27] Dalton-Reyes v. Court of Appeals, G.R. No. 149580, March 16, 2005, 453 SCRA 498, 508.
[28] Philippine
Amusement and Gaming Corporation v.
[29] Heavylift Manila, Inc. v. Court of Appeals, G.R. No. 154410, October 20, 2005, 473 SCRA 541, 547.
[30] Asian
Spirit Airlines (Airline Employees Cooperative) v. Bautista, G.R. No.
164668,
[31] Garcia v. Philippine Airlines, Inc., G.R. No. 160798, June 8, 2005, 459 SCRA 768, 778; Vicar International Construction, Inc. v. FEB Leasing and Finance Corporation, G.R. No. 157195, April 22, 2005, 456 SCRA 588, 599; Donato v. Court of Appeals, supra note 25; BA Savings Bank v. Sia, 391 Phil. 370, 378 (2000).
[32] Philippine Amusement and Gaming Corporation v. Angara, supra note 24, at 54; Wack Wack Golf and Country Club v. National Labor Relations Commission, supra note 16, at 294.
[33] “In any event, the decision of the Labor Arbiter reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall immediately be executory, pending appeal. The employee shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal or separation or, at the option of the employer, merely reinstated in the payroll. The posting of a bond by the employer shall not stay the execution for reinstatement provided herein.”
[34]
[35] “Section 2. Order of Reinstatement and Effect of Bond – Insofar as the reinstatement aspect is concerned, the decision of the Labor Arbiter reinstating a dismissed or separated employee shall immediately be executory even pending appeal. x x x.”.
[36] G.R. No. 90501,
[37]
[38] Pheschem Industrial Corporation v. Moldez, G.R. No. 161158, May 9, 2005, 458 SCRA 339, 346; Gold City Integrated Port Service, Inc. v. National Labor Relations Commission, 315 Phil. 698, 711 (1995).
[39] Philippine Airlines, Inc. v. National Labor Relations Commission, 327 Phil. 876, 880 (1996).
[40]
[41] Pheschem Industrial Corporation v. Moldez, supra note 38; Pantranco North Express, Inc. v. National Labor Relations Commission, 322 Phil. 256, 265 (1996); Article 283 of the Labor Code; Section 4 (b), Rule 1, Book VI of the Implementing Rules and Regulations of the Labor Code; Oro Enterprises, Inc. v. National Labor Relations Commission, G.R. No. 110861, November 14, 1994, 238 SCRA 105, 110-111.
[42] San Miguel Corporation v. Aballa, G.R. No. 149011, June 28, 2005, 461 SCRA 392, 429; EMCO Plywood Corporation v. Abelgas, G.R. No. 148532, April 14, 2004, 427 SCRA 496, 511.
[43] San Miguel Corporation v. Aballa, id.; EMCO Plywood Corporation v. Abelgas, id.; Philippine Tobacco Flue-Curing & Redrying Corporation v. National Labor Relations Commission, 360 Phil. 218, 236-237 (1998); Somerville Stainless Steel Corporation v. National Labor Relations Commission, 350 Phil. 859, 869-870 (1998); Edge Apparel v. National Labor Relations Commission, 349 Phil. 972, 983-984 (1998); San Miguel Jeepney Service v. National Labor Relations Commission, 332 Phil. 804, 814 (1996); Catatista v. National Labor Relations Commission, 317 Phil. 54, 61 (1995).
[44] San Miguel Corporation v. Aballa, supra note 42; Somerville Stainless Steel Corporation v. National Labor Relations Commission, supra note 43, at 871; San Miguel Jeepney Service v. National Labor Relations Commission, supra note 43, at 815; Guerrero v. National Labor Relations Commission, 329 Phil. 1069, 1074-1075 (1996).
[45] Danzas Intercontinental, Inc. v. Daguman, G.R. No. 154368, April 15, 2005, 456 SCRA 382, 393; San Miguel Corporation v. Aballa, supra note 43, at 430; Asian Alcohol Corporation v. National Labor Relations Commission, 364 Phil. 912, 927-928 (1999); Polymart Paper Industries, Inc. v. National Labor Relations Commission, 355 Phil. 592, 602 (1998); Lopez Sugar Corporation v. Federation of Free Workers, G.R. Nos. 75700-01, August 30, 1990, 189 SCRA 179, 190.
[46] CA rollo, p. 48.
[47]