SECOND DIVISION
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ANTONIO A. ABOC, Petitioner, - versus - METROPOLITAN BANK AND TRUST COMPANY,
Respondent. x---------------------------------------------x METROPOLITAN BANK AND TRUST COMPANY, Petitioner, -
versus - ANTONIO A. ABOC, Respondent.
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G.R. Nos. 170542-43 G.R. No. 176460 Present: CARPIO, J., Chairperson, NACHURA, PERALTA, ABAD, and MENDOZA, JJ.
December 13, 2010 |
X ----------------------------------------------------------------------------------------------------- X
D E C I S I O N
MENDOZA, J.:
Assailed in these consolidated
petitions for review is the October 28, 2005 Decision[1]
of the Court of Appeals-Cebu City (CA) disposing two consolidated cases,
CA-G.R. SP. No. 80747 and CA-G.R. SP. No. 81363. The CA Decision affirmed the
Decision[2] of
the National Labor Relations Commission (NLRC) which reversed the
Decision[3] of
the Labor Arbiter (LA) finding Antonio A. Aboc (Aboc) to have
been illegally dismissed by the Metropolitan Bank and Trust Company (Metrobank).
These two cases stemmed from a complaint
for illegal dismissal and damages filed by Aboc against Metrobank on
In his position paper,[4] Aboc,
the Regional Operations Coordinator of Metrobank in P11,980.00,
alleged that on
Aboc wrote a letter[6] to
Metrobank explaining that he had no interest whatsoever in the lending business
of Chua because it was solely owned by the latter. He admitted, however, that he did some acts
for Chua in connection with his lending activity. He did so because he could
not say “no” to Chua because of the latter’s influence and ascendancy over him
and because of his “utang na loob”
(debt of gratitude).[7]
His participation in the lending
activity was limited to ministerial acts such as the preparation of deposit and
withdrawal slips and the typing of statement of accounts for some clients of
Chua. In fact, Chua wrote a letter to
Metrobank absolving him of any responsibility and participation in his lending
activities. Despite the same, Metrobank still dismissed him on
Metrobank, on the other hand, replied
that sometime in November 1995, Chua, Judith Eva Cabrido (assistant manager), Arthur
Arcepi (accountant), and Aboc organized a credit union known as Cebu North Road
Investment (CNRI). Said officers and
employees used Metrobank’s premises, equipment and facilities in their lending
business. Apparently, its head office was not informed of the organization of
CNRI. Had it been informed of the organization of said credit union, it would not
have tolerated or approved of it because the nature of its business would be in
conflict, inimical, and in competition with its banking business. Moreover, they did not register CNRI with the
Securities and Exchange Commission (SEC) and with the Department of
Trade and Industry (DTI). The lending and investment business of CNRI
was confined not only to the employees of Metrobank but also to outsiders,
including clients of the bank.[8]
Metrobank also disclosed that on
August 13, 1996, Aboc and his companions created another credit union, the
First Fund Access (FFA), which opened accounts with Metrobank under
fictitious names. Again, it was not informed of the existence of this credit
union.
In September 1997, Chua and Aboc were
observed to have openly convinced outsiders and clients of Metrobank to
patronize their lending and investment business. During the investigation conducted
by Metrobank on
During the administrative
investigation, Metrobank likewise discovered that Aboc committed the following
acts:
1. Preparation of all necessary documents on
deposits/placements and loans of said lending activities.
2. Preparation of checks and acting as co-signatory of
Chua in payment for matured deposits/placements or proceeds of loans to the
damage and prejudice of Metrobank.
Metrobank required
Aboc to submit a written explanation why he should not be dismissed for cause
and attend a conference in the morning of
Thereafter, Metrobank found that Aboc’s actions
constituted serious misconduct and a breach of trust and confidence. On
Ruling of the Labor Arbiter
After the parties had submitted
their respective position papers, the LA rendered her decision on
WHEREFORE, VIEWED FROM
THE FOREGOING, judgment is hereby rendered declaring complainant Antonio Aboc
to have been illegally dismissed from the service by respondent Metropolitan
Bank and Trust Company (Metrobank). Consequently, same respondent Metrobank is
hereby ordered to reinstate complainant Aboc to his former position or to a
substantially equivalent position without loss of seniority rights and other
privileges, and to pay said complainant the following, to wit:
1. Backwages
P11, 980.00 x 18 months
…………………..P215, 640.00
13th month =
1 yr ……….P11, 980.00
5 mons ……P 4, 991.66
P 16,
971.66
Service Incentive Leave
(P11, 980.00 divided
by 26 = P460.76 x
5 ………………2,303.80 P19,275.46 P234, 915.46
2. 10% Attorney’s
Fees……………………………………..P
23, 491.54
GRAND TOTAL AWARD---------------------------------P258,
407.00[9]
The LA reasoned out that Metrobank
failed to prove by clear and convincing evidence the charges of serious
misconduct, breach of trust and loss of confidence against Aboc. His lending
activities were not foreign to Metrobank in the sense that credit unions
commonly existed in its other branches and that said credit unions were handled
by its high ranking employees.
The LA added that Aboc’s participation
in the lending activities was due to “force of circumstance.” He was an
“unwilling participant” in the business of his superior because he could not just say “no” to Chua in view of
the latter’s moral ascendancy over him. In fact, Chua vouched for his non-participation
in the lending business. According to the LA, to sanction the penalty of dismissal
against Aboc would be unfair.[10]
Moreover, the LA ruled that Metrobank
did not comply with the due process requirement in dismissing Aboc because no
hearing was conducted after he was required to explain. He was never informed that
he was going to be investigated in connection with the charges being leveled
against him. The conference set up by Metrobank could not be considered a
substitute to the actual holding of a hearing.
Ruling
of the National
Labor
Relations Commission
On December 11, 2002, the NLRC set
aside the decision of the LA but ordered Metrobank to pay Aboc reinstatement
wages from July 12, 1999 to September 16, 1999; salary increase from January
2000 to June 2001; Christmas bonus for the year 2000; 13th month pay
differential for the year 2000; and salary differential for July and August
2001. The dispositive portion of the NLRC Decision reads:
WHEREFORE, premises
considered, the decision of the Labor Arbiter is hereby set aside and vacated
and a new one entered dismissing the complaint. However, respondent
Metropolitan Bank and Trust Company is hereby ordered to pay the following
amounts with respect to complainant’s reinstatement pending appeal:
1.
Reinstatement
Wages (
P11,
980.00) P23,
960.00
2.
Salary
Increase from January 2000 to
June 2001 at P1, 500.00/month 27, 000.00
3.
Christmas Bonus CY 2000 18, 030.00
4.
13th Month Pay Differential for CY 2000 1, 500.00
5.
Salary Diff’l for July & Aug. 2001 7,
200.00
Total P77, 690.00
SO ORDERED.[11]
The NLRC ruled that Aboc was guilty
of serious misconduct and breach of trust and loss of confidence based on the
following overt acts:
1.
Complainant (Aboc) was an
organizer of both CNRI and FFA, business entities which directly competed with
the line of business of respondent (Metrobank);
2.
Complainant was a responsible officer of
both credit unions and actively participated in their transactions, using the
respondent bank’s office, facilities, and equipments.
3.
Complainant, as bank officer, had the
serious responsibility of reporting to respondent the establishment of CNRI and
FFA but he deliberately failed to do so.
4.
Petitioner admits having opened new
accounts bearing fictitious names knowing fully well that it was against bank
policy.
The
NLRC wrote that Aboc’s loyalty should be first and foremost to Metrobank. This
consideration should be over and above whatever personal debts of gratitude he
owed Chua.
On
due process, the NLRC ruled that Metrobank fully complied with the two-notice
rule under the Labor Code. It sent an
inter-office letter dated
On
the monetary awards, the NLRC explained that Aboc was entitled to receive them because
he was included in the payroll by Metrobank as he was ordered reinstated by the
LA.
Both
Aboc and Metrobank were not satisfied with the NLRC Decision. The former filed
a motion for reconsideration[12] while
the latter filed a motion for partial reconsideration[13] on
the monetary award.
On
Aggrieved,
Metrobank challenged the grant of monetary award in a petition[15] before
the CA, docketed as CA-G.R. SP. No. 80747, while Aboc questioned the validity
of his dismissal in a petition,[16]
docketed as CA-G.R.SP. No. 81363. The two petitions were consolidated by the CA
because they involved the same parties and intertwined issues.
Ruling
of the Court of Appeals
On
WHEREFORE, judgment is
hereby rendered as follows:
1. In CA-G.R. No.
807407, the petition is partially granted insofar as the finding of public
respondent on the validity and legality of the dismissal of private respondent
Antonio A. Aboc.
2. In CA-G.R. No. 81363,
the petition is partially granted insofar as the grant of the monetary award in
favor of petitioner Antonio A. Aboc.
No pronouncement as to
costs.
SO ORDERED.[17]
The CA wrote that Aboc’s participation in the
organization of two (2) credit unions operating inside Metrobank without its
knowledge and consent was inimical to the welfare of the bank. The lending and
investment transactions of the credit unions directly competed with the business
of Metrobank. Aboc held a position that
required loyalty and exercise of sound judgment.
The
CA also agreed with the NLRC that Aboc was duly afforded ample opportunity to
defend himself during the conference conducted on February 10, 1998 reasoning
that a formal trial-type hearing was not, at all times, essential to due
process. Aboc was able to explain his side and submit evidence during the
conference.
On
the monetary award, as Aboc was ordered reinstated as an employee of Metrobank pending
appeal, the CA held that he was entitled to receive his monetary claims.
Dissatisfied
with the assailed CA Decision, both parties filed their respective petitions
before this Court. Aboc’s petition was docketed as G.R. No. 170542-43 and Metrobank’s
petition as G.R. No. 176460. On
ISSUES
1. Whether or not the
Court of Appeals erred in ruling that Antonio A. Aboc was validly dismissed by
the Metropolitan Bank and Trust Company.
2. Whether or not the
Court of Appeals erred in ruling that the Metropolitan Bank and Trust Company
was liable to pay the monetary award claimed by Antonio A. Aboc.
Position
of Aboc
Aboc basically
contends that:
1. Metrobank’s CA
petition should have been dismissed for being filed out of time and for failing
to comply with the procedural requirements. Metrobank’s counsel of record, E.F.
Rosello and Associates Law Office, received a copy of the September 17, 2003 CA
Resolution on September 26, 2003. Therefore,
it had until November 25, 2003 within which to file its petition. The petition,
however, was filed after November 25, 2003 only because the Verification and
Certification of Non-Forum Shopping therein was notarized only on November 27,
2003. Moreover, the petition did not
contain a Statement of Material Dates and Proof of Service thereof on the
opposing party.
2. He was
illegally dismissed as he was not guilty of serious misconduct and breach of
trust. Being “an organizer” of credit
unions like CNRI and FFA did not necessarily make him guilty of serious misconduct
or breach of trust and confidence because the operation of credit unions and
cooperatives were not prohibited or, at the very least, tolerated by Metrobank.
In fact, all Metrobank branches practically maintained credit unions of their
own. Metrobank even “failed to present a single written rule or regulation that
suggested even remotely that credit unions were prohibited.”[19]
3. He was effectively deprived of his rights to
due process because the interrogation conducted by Metrobank’s representatives
at its head office in Manila clearly smacked of oppression, intimidation and
coercion. Metrobank exerted moral coercion, undue ascendancy and undue
influence over him, a hapless and helpless employee.
Position of Metrobank
Metrobank
argues that:
1. The date
of the filing of its petition should be reckoned from September 29, 2003, the
date the law firm of Rayala Alonso and Partners received the September 17, 2003
CA Resolution because said law firm took active participation in the
proceedings while the law office of E.F. Rosello and Associates had already
ceased taking active part.
2. Bank
employees, as per Bank Policy, were prohibited from engaging in informal credit
union activities. Aboc engaged in an irregular activity for profit, which
directly competed with Metrobank’s business. The acts committed by Aboc -
organizing and acting as auditor of the CNRI and FFA credit unions; opening the
accounts of CNRI and FFA with Metrobank under his name and his companions; soliciting
investors including the clients of Metrobank; opening accounts for the credit
unions under fictitious names to hide the lending and investment activities of
said credit unions; and inducing a respondent bank’s client to withdraw her
account with Metrobank and to invest it instead with CNRI- constituted wrong
and improper conduct warranting dismissal for serious misconduct and loss of
trust and confidence.
3. The
dispositive portion of the reversed decision of the LA merely made mention of
reinstatement, payment of backwages, 13th month pay, service incentive leave
pay, and attorney’s fees. It was silent on the salary increase from January
2000 to June 2001, salary increase differentials, 13th month pay, and award of
bonuses. Therefore, these should have been deleted and no other monetary awards
should have been given to Aboc.
4. The computation of Aboc’s backwages should be limited to the
rate of wage at the time of his separation from the service, excluding the
salary increases and those under the collective bargaining agreement. Since the salary increase from January 2000 to
June 2001 would have the effect of increasing
Aboc’s base salary, it should not have been awarded. If he was not entitled to salary increases,
he should not be awarded salary increase differentials or wage differentials as
well as 13th month pay differentials.
5. The granting of a bonus is a
management prerogative. Aboc is not
entitled to receive bonuses because he participated in activities competing
with Metrobank’s main business instead of remaining loyal to it.
The Court’s Ruling
After an assiduous assessment of
the records, the Count finds no cogent reason to disturb the subject decision
of the CA.
On the procedural issue raised by
Aboc regarding Metrobank’s alleged belated filing of its petition before the CA,
the records show that all pleadings filed by Metrobank, since the filing of its
Motion For Partial Reconsideration dated
It appears that Rayala Alonso and
Partners received a copy of the
Nonetheless, granting that
Metrobank belatedly filed its petition, a delay of just two (2) days should not
be fatal. Litigations should be decided on the merits of the case, not on mere
technicalities.
The court has the discretion to dismiss or not to dismiss an
appellant's appeal. It is a power conferred on the court, not
a duty. The discretion must be a sound one, to be exercised in accordance with
the tenets of justice and fair play, having in mind the
circumstances obtaining in each case. Technicalities, however, must be avoided.
The law abhors technicalities that impede the cause of justice.
The court's primary duty is to render or dispense justice.
Litigations must be decided on their merits and not on technicality.
Every party litigant must be afforded the amplest opportunity for the proper
and just determination of his cause, free from the unacceptable plea of
technicalities. Thus, dismissal of appeals purely on technical grounds is
frowned upon where the policy of the court is to encourage hearings of appeals
on their merits and the rules of procedure ought not to be applied in a very
rigid, technical sense; rules of procedure are used only to help secure, not
override substantial justice. It is a far
better and more prudent course of action for the court to excuse a technical
lapse and afford the parties a review of the case on appeal
to attain the ends of justice rather than dispose of the case
on technicality and cause a grave injustice to the parties, giving a false
impression of speedy disposal of cases while actually resulting in more delay, if not a miscarriage of justice.[20]
On Aboc’s termination, Article 282
of the Labor Code states:
ART. 282. TERMINATION BY EMPLOYER. - An employer may terminate an
employment for any of the following causes:
(a) Serious misconduct or
willful disobedience by the employee of the lawful orders of his employer or
representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud
or willful breach by the employee of the trust
reposed in him by his employer or duly authorized representative;
(d) Commission of a crime or offense by the employee against the person of his
employer or any immediate member of his family or his duly authorized
representative; and
(e) Other causes analogous to the foregoing.
In termination cases, the burden of
proof rests on the employer to show that the dismissal was for a just cause or authorized
cause. An employee's dismissal due to serious misconduct and loss of trust and confidence must be supported by substantial evidence.
Substantial evidence is that amount of relevant evidence as a reasonable mind
might accept as adequate to support a conclusion, even if other minds, equally
reasonable, might conceivably opine otherwise.[21]
In the case at bench, Metrobank’s
evidence clearly shows that the acts of Aboc in helping Chua organize the CNRI
and FFA credit unions and in the operations thereof constituted serious
misconduct or breach of trust and
confidence. In response to the inter-office letter[22]
sent by Metrobank on
During the investigation conducted
on
1. He was one of the organizers of the CNRI and
FFA credit unions and acted as auditor of said credit unions.
2. He and his co-organizers did not inform
Metrobank about the existence of said credit unions.
3. CNRI and FFA opened an account with
Metrobank under the names Wynster Chua, Judith Eva Cabrido and Antonio Aboc.
4. He solicited investors including Metrobank
clients for said credit unions, and signed as one of the signatories in the
Trust Certificate of Marlyn Belleza and Grace Lim.
5. He and Chua opened accounts for the said
credit unions under the fictitious names of Vicente Belocura and Romeo
Gonzales, respectively.
6. He induced a certain Nerinilda Arcipe (Nerinilda),
a non-employee of Metrobank, to withdraw her UNISA account with Metrobank and
invest it with CNRI.
7. The regional and local checks in the names
of Belocura, John BK Chua, John AJ. Jazal, and Wynster Chua, issued in
connection with the business activities of CNRI and FFA were treated as bills
purchases and the proceeds thereof were immediately withdrawn without waiting
for three (3) to five (5) days clearing in violation of Metrobank’s control
system.
Indeed, Aboc’s participation in the
lending and investment activities of CNRI and FFA was highly irregular and
clearly in conflict with Metrobank’s business. The irregularity of his act was evident
from the fact that he deliberately failed to inform Metrobank about the
existence of CNRI and FFA. Though he expressed apprehension and was not pleased
with the way Chua was running the lending business, he never informed or, at
least, sought advice from his employer. Instead of doing so, he actively
participated in the business of Chua which competed against that of Metrobank.
Moreover, Aboc knew about the
subject credit union’s non-registration with the Central Bank or any proper
government institution. Being an experienced banker, he should have known that
the lending activities of the subject credit unions were questionable, if not,
illegal, due to its non-registration. Again, Aboc chose not to inform his
employer about this and, instead, participated in the operations of the subject
credit unions.
The fact that Aboc opened accounts
for the subject credit unions under fictitious names can only mean that the
group had something to hide.
Under the above circumstances, the
Court cannot subscribe to the assertion that he was just an “unwilling
participant” doing a “ministerial” job for the subject credit unions. Certainly,
the acts of 1) opening an account under fictitious names; 2) solicitation of
Metrobank clients to invest in their credit union; 3) co-signing of trust
receipts; and 4) inducement of an investor to withdraw her account and transfer
it to the subject credit unions, were certainly not “ministerial” tasks of an “unwilling
participant.” He was just not a runner
doing errands for Chua; he was the auditor for CNRI and FFA and actively participated
in their lending activities.
Aboc cannot be saved by Chua’s
letter[24]
dated February 17, 1998 explaining that Aboc had no participation whatsoever in
said lending activities. Metrobank was his employer, not Chua. Most important,
Metrobank was paying his salary and other benefits in exchange for his services.
Therefore, Aboc’s loyalty should first and foremost be to Metrobank. Ironically,
Aboc did not return the favor. He chose his personal interest over that of
Metrobank.
The Court cannot give weight to the
argument that Metrobank was aware of the proliferation of credit unions in
practically all of its branches and did not prohibit the operation thereof.
Contrary to Aboc’s position, Metrobank issued notices to all its employees
regarding the prohibition on the practice of borrowing and lending money among its
officers, employees, and bank clients. Metrobank’s
notices were dated June 15, 1988[25]
and August 30, 1995.[26]
Aboc’s highly irregular participation in the
lending business of CNRI and FFA jeopardized the business of Metrobank. CNRI
and FFA were practically competing with the business of Metrobank by soliciting
investors including clients of the bank for their credit unions. Aboc admitted that he was able to induce
Nerinilda, the widow of a former branch accountant of Metrobank, to withdraw
her UNISA account with Metrobank and invest it with their credit union. This
was confirmed by Nerinilda herself in her affidavit[27]
dated
To extricate himself, Aboc also argues that
Metrobank failed to comply with the requirements of due process in dismissing
him because he was not properly investigated. According to him, the
interrogation conducted by Metrobank was done in an atmosphere of fear,
oppression, intimidation, and coercion.
The Court is not persuaded.
The evidence shows that he was
afforded due process. The essence of due process is an opportunity to be heard
or, as applied to administrative proceedings, an opportunity to explain one's
side. A formal or trial-type hearing is not essential.[28]
In this regard, the Court agrees with
the CA when it wrote:
Regarding the procedural requirements of notice and hearing, records show
Aboc was duly notified through the letter dated 29 January 1998 asking him to
explain why his services should not be terminated. In fact, Aboc replied to the
same by submitting a written explanation on
The Court, however, cannot also accommodate
Metrobank.
The monetary award granted to Aboc
was warranted under the law and jurisprudence. Article 223 of the Labor Code reads,
in part:
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.
In the case at bench, it cannot be
denied that Metrobank opted to reinstate Aboc in its payroll. Since Metrobank
chose payroll reinstatement for Aboc, the Court agrees with the CA that he then
became a reinstated regular employee. This
means that he was restored to his previous position as a regular employee
without loss of seniority rights and other privileges appurtenant thereto. His payroll
reinstatement put him on equal footing with the other regular Metrobank
employees insofar as entitlement to the benefits given under the Collective Bargaining
Agreement is concerned.
The fact that the decision of the LA
was reversed on appeal has no controlling significance. The rule is that even if the order of reinstatement of
the LA is reversed on appeal, it is obligatory on the part of the employer to reinstate
and pay the wages of the dismissed employee during the period of appeal
until final reversal by the higher court.[30]
WHEREFORE,
the October 28, 2005 Decision of the Court of Appeals is AFFIRMED.
SO ORDERED.
JOSE CATRAL
Associate
Justice
WE
CONCUR:
ANTONIO T. CARPIO
Associate Justice
Chairperson
ANTONIO EDUARDO B. NACHURA DIOSDADO M. PERALTA
Associate Justice Associate
Justice
ROBERTO A.
ABAD
Associate Justice
A T T E S T A T I O N
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.
ANTONIO T. CARPIO
Associate
Justice
Chairperson, Second 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, I certify 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.
RENATO
C. CORONA
Chief Justice
[1] Rollo (G.R. Nos. 170542-43), pp. 246-257. Penned by Associate Justice Pampio A. Abarintos with Associate Justice Mercedes Gozo-Dadole and Associate Justice Enrico A. Lanzanas, concurring.
[2] Rollo (G.R. Nos. 170542-43), pp. 441-455.
[3]
[4]
[5]
[6]
[7]
[8] Rollo (G.R. Nos. 170542-43), Position Paper for the Respondents, pp. 59-72, p. 60.
[9] Rollo (G.R. Nos. 170542-43), p. 100.
[10]
[11]
[12]
[13]
[14]
[15]
[16]
[17]
[18] Rollo
(G.R. No. 176460), p. 406.
[19] Rollo
(G.R. Nos. 170542-43), p. 28.
[20]
[21] Caltex (
[22] Rollo (G.R. Nos. 170542-43), p. 53.
[23] Id. at 54-56.
[24]
[25]
[26]
[27] Id. at 73-74.
[28] Maralit
v. Philippine National Bank, G.R. No. 163788, August 24, 2009, 596 SCRA
662, citing Philippine Long Distance Company v. Bolso, G.R. No. 159701,
17 August 2007, 530 SCRA 550, 564-565.
[29] Rollo (G.R. Nos. 170542-43), pp. 255-256.
[30]