SECOND DIVISION

PHILIPPINE AIRLINES, INC., Petitioner,	G.R. No. 164267
- versus - HEIRS OF BERNARDIN J. ZAMORA,* Respondents.	Present: Quisumbing, J., Chairperson, Carpio, Carpio Morales, Tinga, and VELASCO, JR., JJ. Promulgated: November 23, 2007

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RESOLUTION

QUISUMBING, J.:

Before us is a petition for review of the Decision[1] dated April 27, 2004, as well as the Resolution[2] dated June 29, 2004 of the Court of Appeals in CA-G.R. SP No. 56428 dismissing petitioner’s appeal from the Decision[3] dated July 26, 1999, of the National Labor Relations Commission (NLRC) which ordered Bernardin J. Zamora’s immediate reinstatement to his former position as cargo representative and the payment of his backwages and allowances.

Zamora was a cargo representative assigned at the International Cargo Operations - Import Operations Division (ICO-IOD) of petitioner Philippine Airlines, Inc. He alleged that sometime in December 1993, his immediate supervisor, Ricardo D. Abuyuan, instructed him to alter some entries in the Customs Boatnote and Inbound Handling Report to conceal Abuyuan’s smuggling and pilferage activities. When he refused to follow this order, Abuyuan concocted charges of insubordination and neglect of customers against him.

On November 6, 1995, Zamora received a Memorandum informing him of his temporary transfer to the Domestic Cargo Operations (DCO) effective November 13, 1995. Zamora refused to follow the directive because: first, there was no valid and legal reason for his transfer; second, the transfer violated the collective bargaining agreement between the management and the employees union that no employee shall be transferred without just and proper cause; and third, the transfer did not comply with the 15-day prior notice rule.

Meantime, Zamora wrote to the management requesting that an investigation be conducted on the smuggling and pilferage activities. He disclosed that he has a telex from Honolulu addressed to Abuyuan to prove Abuyuan’s illegal activities.[4] As a result, the management invited Zamora to several conferences to substantiate his allegations. Zamora claimed that during these conferences, he was instructed to continue reporting to the ICO-IOD to observe the activities therein. Even so, his salaries were withheld starting December 15, 1995.

For its part, petitioner Philippine Airlines, Inc. claimed that sometime in October 1995, Zamora had an altercation with Abuyuan to the point of a fistfight. The management requested Zamora to explain in writing the incident. It found his explanation unsatisfactory.[5]

To diffuse the tension between the parties, the management decided to temporarily transfer Zamora to the DCO. It issued several directives informing Zamora of his transfer. However, Zamora refused to receive these and continued reporting to the ICO-IOD. Consequently, he was reported absent at the DCO since November 13, 1995. His salaries were subsequently withheld. He also ignored the management’s directive requiring him to explain in writing his continued absence.

Meanwhile, the management acted on Zamora’s letter exposing the smuggling and pilferage activities. Despite several notices, however, Zamora failed to appear during the conferences.

On February 22, 1996, the management served Zamora a Notice of Administrative Charge for Absence Without Official Leave (AWOL). Then on January 30, 1998, he was informed of his termination due to Insubordination/Neglect of Customer, Disrespect to Authority, and AWOL.

On March 12, 1996, Zamora filed an action for illegal dismissal, unfair labor practice, non-payment of wages, and damages.[6]

On September 28, 1998, the Labor Arbiter dismissed the complaint for lack of merit.[7] He ruled that Zamora’s transfer was temporary and intended only to diffuse the tension between Zamora and Abuyuan. He also said that the 15-day prior notice did not apply to Zamora since it is required only in transfers involving change of domicile. He further ruled that Zamora’s refusal to report to the DCO was a clear case of insubordination and utter disregard of the management’s directive. Thus, the Labor Arbiter ordered Zamora to report to his new assignment at the DCO.[8]

On July 26, 1999, the NLRC reversed the Labor Arbiter’s decision and declared Zamora’s transfer illegal.[9] It ruled that there was no valid and legal reason for the transfer other than Zamora’s report of the smuggling and pilferage activities. The NLRC disposed as follows:

WHEREFORE, in the light of the foregoing, the instant appeal is hereby GRANTED. The assailed Decision dated September 28, 1998 is hereby ordered SET ASIDE and a new one is hereby entered declaring complainant’s transfer at the Domestic Cargo Operations on November 13, 1996 illegal.

Moreover, respondents are hereby ordered to immediately reinstate complainant Bernardin J. Zamora to his former position as Cargo Representative at the Import Operations Division of respondent PAL without loss of seniority rights and other privileges and to pay him salaries and backwages beginning December 15, 1995 until his actual reinstatement, inclusive of allowances and other benefits and increases thereto.

All other reliefs herein sought and prayed for are hereby DENIED for lack of merit.

SO ORDERED.[10]

On appeal, the Court of Appeals affirmed the decision of the NLRC. In the instant petition, petitioner Philippine Airlines, Inc. raises the following issues:

THE PROCEDURAL ISSUES:

I.

Whether or not the Court of Appeals seriously erred in holding that the 26 July 1999 NLRC decision became final and executory based solely on the certifications issued by the Deputy Executive Clerk of the NLRC.

II.

Whether or not the NLRC may take cognizance of a seasonably filed motion for reconsideration from a decision a copy of which was previously stamped “moved” and “return to sender” but was thereafter officially served and officially received by the party seeking reconsideration.

III.

MAY a counsel for justifiable reason defer the filing of a notice of change of address.

THE SUBSTANTIVE ISSUES[:]

I.

may an employer be required to state in writing the reason for transferring an employee despite the absence of such requirement in the CBA.

II.

may an employer be required to observe a 15-day prior notice before effecting an employee transfer notwithstanding the fact that under the CBA said notice is required only in case the transfer involves a change in domicile.

III.

MAY an employer seeking to transfer an employee for the purpose of diffusing escalating hostility between an employee and his supervisor be required to wait for fifteen (15) days before effecting the employee transfer.

IV.

may a court validly order the reinstatement of an employee as well as grant monetary award notwithstanding the absence of factual finding as to the legality or illegality of the dismissal in the decision itself.[11]

Simply, the issues are: (1) whether the decision of the NLRC had become final and executory; and (2) whether Zamora’s transfer was legal.

Incidentally, the Court’s Third Division rendered a Resolution dated February 6, 2007 in G.R. No. 166996 entitled Philippine Airlines, Inc., et al. v. Bernardin J. Zamora. The petition stemmed from the same set of facts between substantially the same parties and raised the following issues: (1) whether the Court of Appeals erred in declaring respondent’s dismissal illegal and the NLRC decision final and executory; (2) whether the Court of Appeals erred in ordering petitioner to pay respondent separation pay in lieu of reinstatement due to respondent’s incarceration; and (3) whether the Court of Appeals erred in ordering respondent to present his monetary claim to petitioner’s rehabilitation receiver.[12]

In resolving the petition, the Court noted that petitioner had been placed by the Securities and Exchange Commission (SEC) under a Permanent Rehabilitation Receiver. Such being the case, a suspension of all actions for claims against petitioner pending before any court, tribunal or board was, ipso jure, in order. The Court likewise took note of the fact that such suspension of actions was observed in some other cases against petitioner.[13]

We shall defer to these determinations. To reiterate, the suspension of all actions for claims against a corporation embraces all phases of the suit, be it before the trial court or any tribunal or before this Court.[14] No other action may be taken, including the rendition of judgment during the state of suspension. It must be stressed that what are automatically stayed or suspended are the proceedings of a suit and not just the payment of claims during the execution stage after the case had become final and executory.[15] Once the process of rehabilitation, however, is completed, this Court will proceed to complete the proceedings on the suspended actions.

Furthermore, the actions that are suspended cover all claims against the corporation whether for damages founded on a breach of contract of carriage, labor cases, collection suits or any other claims of a pecuniary nature.[16] No exception in favor of labor claims is mentioned in the law.[17]

More importantly, as the instant case involves essentially the same facts, parties, and issues as G.R. No. 166996 entitled Philippine Airlines, Inc., et al. v. Bernardin J. Zamora, we find it unnecessary to make further pronouncements which might otherwise conflict with the disposition made by the Court’s Third Division therein.

WHEREFORE, the herein proceedings are SUSPENDED until further notice from this Court. Meanwhile, petitioner is urgently DIRECTED to update the Court as to the status of the completion of its rehabilitation within a period of fifteen (15) days from notice hereof. No costs.

SO ORDERED.

LEONARDO A. QUISUMBING

Associate Justice

WE CONCUR:

ANTONIO T. CARPIO Associate Justice
CONCHITA CARPIO MORALES Associate Justice	DANTE O. TINGA Associate Justice
PRESBITERO J. VELASCO, JR. Associate Justice

A T T E S T A T I O N

I attest that the conclusions in the above Resolution had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

LEONARDO A. QUISUMBING

Associate Justice

Chairperson

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, I certify that the conclusions in the above Resolution 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

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* Rollo, pp. 691-692. Died on January 9, 2005 due to cardio pulmonary arrest and was substituted by his wife, Marlyn T. Zamora, and children, Moshe Dayan T. Zamora and Jessamyn T. Zamora.

[1] Id. at 11-24. Penned by Associate Justice Roberto A. Barrios, with Associate Justices Sergio L. Pestaño and Vicente Q. Roxas concurring.

[2] Id. at 34-35. Penned by Associate Justice Roberto A. Barrios, with Associate Justices Edgardo P. Cruz and Vicente Q. Roxas concurring.

[3] CA rollo, pp. 32-55.

[4] Id. at 143-144, 203.

[5] Id. at 140-141.

[6] Id. at 72-73.

[7] Id. at 62-70.

[8] Id. at 69.

[9] Supra note 3.

[10] Id. at 53-54.

[11] Rollo, pp. 716-717.

[12] Philippine Airlines, Inc. v. Zamora, G.R. No. 166996, February 6, 2007, pp. 13-14.

[13] Id. at 18-20.

[14] Id. at 20.

[15] Philippine Airlines, Inc. v. Court of Appeals, G.R. No. 123238, July 11, 2005 (Resolution).

[16] Philippine Airlines, Inc. v. Zamora, supra at 20.

[17] Rubberworld (Phils.), Inc. v. NLRC, G.R. No. 126773, April 14, 1999, 305 SCRA 721, 729.