1. AFP mutual benefit association inc.

vs nlrc
THIRD DIVISION
[.R. No. 1!"1##. $anuar% "&' 1##()
AFP *+T+A, -.N.FIT ASSO/IATION' IN/.' 0etitioner' vs.
NATIONA, ,A-OR R.,ATIONS /O**ISSION an1 .+TI2+IO
-+STA*ANT.' res0on1ents.
D . / I S I O N
PANANI-AN' $.3
T4e 1etermination of t4e 0ro0er forum is crucial because t4e filin5 of
t4e 0etition or com0laint in t4e 6ron5 court or tribunal is fatal' even for
a 0atentl% meritorious claim. *ore s0ecificall%' labor arbiters an1 t4e
National ,abor Relations /ommission 4ave no 7uris1iction to entertain
an1 rule on mone% claims 64ere no em0lo%er8em0lo%ee relations is
involve1. T4us' an% suc4 a6ar1 ren1ere1 6it4out 7uris1iction is a
nullit%.
T4is 0etition for certiorari un1er Rule 9:' Rules of /ourt see;s to
annul t4e Resolution[1) of t4e National ,abor Relations /ommission'
0romul5ate1 Se0tember "(' 1##1' in N,R/8N/R /ase No. !!8!"8
!11#98#!' entitle1 <.uti=uio -ustamante vs. AFP *utual -enefit
Association' Inc.'< affirmin5 t4e 1ecision of t4e labor arbiter 64ic4
or1ere1 0a%ment of t4e amount of P>1#'(#9.!! as insurance
commissions to 0rivate res0on1ent.
T4e Antece1ent Facts
T4e facts are sim0le. Private res0on1ent .uti=uio -ustamante 4a1
been an insurance un1er6riter of 0etitioner AFP *utual -enefit
Association' Inc. since 1#(:. T4e Sales A5ent?s A5reement bet6een
t4em 0rovi1e13[")
<-. Duties an1 Obli5ations3
1. Durin5 t4e lifetime of t4is A5reement' t4e SA,.S A.NT
@0rivate res0on1entA s4all solicit eBclusivel% for AFP*-AI @0etitionerA'
an1 s4all be boun1 b% t4e latter?s 0olicies' memo circulars' rules an1
re5ulations 64ic4 it ma% from time to time' revise' mo1if% or cancel to
serve its business interests.
". T4e SA,.S A.NT s4all confine 4is business activities for
AFP*-AI 64ile insi1e an% militar% cam0' installation or resi1ence of
militar% 0ersonnel. He is free to solicit in t4e area for 64ic4 4eCs4e is
license1 an1 as aut4oriDe1' 0rovi1e1 4o6ever' t4at AFP*-AI ma%
from time to time' assi5n 4im a s0ecific area of res0onsibilit% an1 a
0ro1uction =uota on a case to case basis.leB
B B B B B B B B B
/. /ommission
1. T4e SA,.S A.NT s4all be entitle1 to t4e commission 1ue for
all 0remiums actuall% 1ue an1 receive1 b% AFP*-AI out of life
insurance 0olicies solicite1 an1 obtaine1 b% t4e SA,.S A.NT at t4e
rates set fort4 in t4e a00licant?s commission sc4e1ules 4ereto
attac4e1.
B B B B B B B B B
D. eneral Provisions
1. T4ere s4all be no em0lo%er8em0lo%ee relations4i0 bet6een t4e
0arties' t4e SA,.S A.NT bein5 4ereb% 1eeme1 an in1e0en1ent
contractor.<
As com0ensation' 4e receive1 commissions base1 on t4e follo6in5
0ercenta5es of t4e 0remiums 0ai13[>)
<>!E of 0remium 0ai1 6it4in t4e first %earF
1!E of 0remium 0ai1 6it4 t4e secon1 %earF
:E of t4e 0remium 0ai1 1urin5 t4e t4ir1 %earF
>E of t4e 0remium 0ai1 1urin5 t4e fourt4 %earF an1
1E of t4e 0remium 0ai1 1urin5 t4e fift4 %ear u08to t4e tent4 %ear.G
On $ul% :' 1#&#' 0etitioner 1ismisse1 0rivate res0on1ent for
misre0resentation an1 for simultaneousl% sellin5 insurance for anot4er
life insurance com0an% in violation of sai1 a5reement.
At t4e time of 4is 1ismissal' 0rivate res0on1ent 6as entitle1 to
accrue1 commissions e=uivalent to t6ent% four @"HA mont4s 0er t4e
Sales A5ent A5reement an1 as state1 in t4e account summar% 1ate1
$ul% :' 1#&#' a00rove1 b% Retire1 -ri5. en. Rosalino Al=uiDa'
0resi1ent of 0etitioner8com0an%. Sai1 summar% s4o6e1 t4at 0rivate
res0on1ent 4a1 a total commission receivable of PH>&'&>:.!!' of
64ic4 onl% P(&'!>#.&# 4a1 been 0ai1 to 4im.
Private res0on1ent 6rote 0etitioner see;in5 t4e release of 4is
commissions for sai1 "H mont4s. Petitioner' t4rou54 *ar;etin5
*ana5er $uan /once0cion' re0lie1 t4at 4e 6as entitle1 to onl%
P(:'!!!.!! to P1!!'!!!.!!. Hence' believin5 /once0cion?s
com0utations' 0rivate res0on1ent si5ne1 a =uitclaim in favor of
0etitioner.
Sometime in October 1#&#' 0rivate res0on1ent 6as informe1 t4at 4is
c4ec; 6as rea1% for release. In collectin5 4is c4ec;' 4e 1iscovere1
from a 1ocument @account summar%A attac4e1 to sai1 c4ec; t4at 4is
total commissions for t4e "H mont4s actuall% amounte1 to
P>:H'(#9.!#. Sai1 1ocument state13[H)
<9. T4e total receivable for *r. -ustamante out of t4e rene6als an1
ol1 business 5enerate1 since 1#&> 5rosses PH>&'&>:.!! less 4is
outstan1in5 obli5ation in t4e amount of P(&'!>#.&# as of $une >!'
1#&#' total eB0ecte1 commission 6oul1 amount to P>:H'(#9.!#.
From t4at fi5ure at a 1:E com0romise settlement t4is 6oul1 mean
P:>'"1#.H1 1ue 4im to settle 4is claim.<
Private res0on1ent' 4o6ever' 6as 0ai1 onl% t4e amount of
P>:'!!!.!!.
On November ">' 1#&#' 0rivate res0on1ent file1 a com0laint 6it4 t4e
Office of t4e Insurance /ommissioner 0ra%in5 for t4e 0a%ment of t4e
correct amount of 4is commission. Att%. erman /. Ale7an1ria' /4ief
of t4e Public Assistance an1 Information Division' Office of t4e
Insurance /ommissioner' a1vise1 0rivate res0on1ent t4at it 6as t4e
De0artment of ,abor an1 .m0lo%ment t4at 4a1 7uris1iction over 4is
com0laint.
On Februar% "9' 1##!' 0rivate res0on1ent file1 4is com0laint 6it4 t4e
De0artment of ,abor claimin53 @1A commission for " %ears from
termination of em0lo%ment e=uivalent to >!E of 0remiums remitte1
1urin5 em0lo%mentF @"A P>:H'(#9.!! as commission earne1 from
rene6als an1 ol1 business 5enerate1 since 1#&>F @>A P1!!'!!!.!! as
moral 1ama5esF an1 @HA P1!!'!!!.!! as eBem0lar% 1ama5es.
After submission of 0osition 0a0ers' ,abor Arbiter $ose . 1e Vera
ren1ere1 4is 1ecision' 1ate1 Au5ust "H' 1##!' t4e 1is0ositive 0ortion
of 64ic4 rea1s3[:)
<IH.R.FOR.' all t4e fore5oin5 0remises bein5 consi1ere1'
7u15ment is 4ereb% ren1ere1 1eclarin5 t4e 1ismissal of t4e
com0lainant as 7ust an1 vali1' an1 conse=uentl%' 4is claim for
se0aration 0a% is 1enie1. On 4is mone% claim' t4e res0on1ent
com0an% is 4ereb% or1ere1 to 0a% com0lainant t4e sum of
P>1#'(#9.!! 0lus attorne%?s fees in t4e amount of P>1'#(9.9!.
All ot4er claims of t4e com0lainant are 1ismisse1 for 6ant of merit.<
T4e labor arbiter relie1 on t4e Sales A5ent?s A5reement 0roviso t4at
0etitioner coul1 assi5n 0rivate res0on1ent a s0ecific area of
res0onsibilit% an1 a 0ro1uction =uota' an1 rea1 it as si5nalin5 t4e
eBistence of em0lo%er8em0lo%ee relations4i0 bet6een 0etitioner an1
0rivate res0on1ent.
On a00eal' t4e Secon1 Division[9) of t4e res0on1ent /ommission
affirme1 t4e 1ecision of t4e ,abor Arbiter. In t4e assaile1 Resolution'
res0on1ent /ommission foun1 no reason to 1isturb sai1 rulin5 of t4e
labor arbiter an1 rule13[()
<IH.R.FOR.' in vie6 of t4e fore5oin5 consi1erations' t4e sub7ect
a00eal s4oul1 be as it is 4ereb%' 1enie1 an1 t4e 1ecision a00eale1
from affirme1.
SO ORD.R.D.<
Hence' t4is 0etition.
T4e Issue
Petitioner conten1s t4at res0on1ent /ommission committe1 5rave
abuse of 1iscretion in rulin5 t4at t4e labor arbiter 4a1 7uris1iction over
t4is case. At t4e 4eart of t4e controvers% is t4e issue of 64et4er t4ere
eBiste1 an em0lo%er8em0lo%ee relations4i0 bet6een 0etitioner an1
0rivate res0on1ent.
Petitioner ar5ues t4at' 1es0ite 0rovisions -@1A an1 @"A of t4e Sales
A5ent?s A5reement' t4ere is no em0lo%er8em0lo%ee relations4i0
bet6een 0rivate res0on1ent an1 itself. Hence' res0on1ent
commission 5ravel% abuse1 its 1iscretion 64en it 4el1 t4at t4e labor
arbiter 4a1 7uris1iction over t4e case.
T4e /ourt?s Rulin5
T4e 0etition is meritorious.
First Issue3 Not All T4at litters Is /ontrol
Iell8settle1 is t4e 1octrine t4at t4e eBistence of an em0lo%er8
em0lo%ee relations4i0 is ultimatel% a =uestion of fact an1 t4at t4e
fin1in5s t4ereon b% t4e labor arbiter an1 t4e National ,abor Relations
/ommission s4all be accor1e1 not onl% res0ect but even finalit% 64en
su00orte1 b% substantial evi1ence.[&) T4e 1eterminative factor in suc4
finalit% is t4e 0resence of substantial evi1ence to su00ort sai1 fin1in5'
ot4er6ise' suc4 factual fin1in5s cannot bin1 t4is /ourt.
Res0on1ent /ommission concurre1 6it4 t4e labor arbiter?s fin1in5s
t4at3[#)
<B B B T4e com0lainant?s 7ob as sales insurance a5ent is usuall%
necessar% an1 1esirable in t4e usual business of t4e res0on1ent
com0an%. +n1er t4e Sales A5ents A5reement' t4e com0lainant 6as
re=uire1 to solicit eBclusivel% for t4e res0on1ent com0an%' ?an1 4e
6as boun1 b% t4e com0an% 0olicies' memo circulars' rules an1
re5ulations 64ic4 6ere issue1 from time to time. -% suc4 re=uirement
to follo6 strictl% mana5ement 0olicies' or1ers' circulars' rules an1
re5ulations' it onl% s4o6s t4at t4e res0on1ent 4a1 control or reserve1
t4e ri54t to control t4e com0lainant?s 6or; as solicitor. /om0lainant
6as not an in1e0en1ent contractor as 4e 1i1 not carr% on an
in1e0en1ent business ot4er t4an t4at of t4e com0an%?s B B B.<
To t4is' res0on1ent /ommission a11e1 t4at t4e Sales A5ent?s
A5reement s0ecificall% 0rovi1e1 t4at 0etitioner ma% assi5n 0rivate
res0on1ent a s0ecific area of res0onsibilit% an1 a 0ro1uction =uota.
From t4ere' it conclu1e1 t4at a00arentl% t4ere is t4at eBercise of
control b% t4e em0lo%er 64ic4 is t4e most im0ortant element in
1eterminin5 em0lo%er8em0lo%ee relations4i0.[1!)
Ie 4ol1' 4o6ever' t4at res0on1ent /ommission misa00reciate1 t4e
facts of t4e case. Time an1 a5ain' t4e /ourt 4as a00lie1 t4e <four8
fol1< test in 1eterminin5 t4e eBistence of em0lo%er8em0lo%ee
relations4i0. T4is test consi1ers t4e follo6in5 elements3 @1A t4e
0o6er to 4ireF @"A t4e 0a%ment of 6a5esF @>A t4e 0o6er to 1ismissF an1
@HA t4e 0o6er to control' t4e last bein5 t4e most im0ortant element.
[11)
T4e 1ifficult% lies in correctl% assessin5 if certain factors or elements
0ro0erl% in1icate t4e 0resence of control. Anent t4e issue of
eBclusivit% in t4e case at bar' t4e fact t4at 0rivate res0on1ent 6as
re=uire1 to solicit business eBclusivel% for 0etitioner coul1 4ar1l% be
consi1ere1 as control in labor 7uris0ru1ence. +n1er *emo /irculars
No. "8&1[1") an1 "8&:' 1ate1 December 1(' 1#&1 an1 Au5ust (' 1#&:'
res0ectivel%' issue1 b% t4e Insurance /ommissioner' insurance
a5ents are barre1 from servin5 more t4an one insurance com0an%' in
or1er to 0rotect t4e 0ublic an1 to enable insurance com0anies to
eBercise eBclusive su0ervision over t4eir a5ents in t4eir solicitation
6or;. T4us' t4e eBclusivit% restriction clearl% s0rin5s from a re5ulation
issue1 b% t4e Insurance /ommission' an1 not from an intention b%
0etitioner to establis4 control over t4e met4o1 an1 manner b% 64ic4
0rivate res0on1ent s4all accom0lis4 4is 6or;. T4is feature is not
meant to c4an5e t4e nature of t4e relations4i0 bet6een t4e 0arties'
nor 1oes it necessaril% imbue suc4 relations4i0 6it4 t4e =ualit% of
control envisione1 b% t4e la6.
So too' t4e fact t4at 0rivate res0on1ent 6as boun1 b% com0an%
0olicies' memoCcirculars' rules an1 re5ulations issue1 from time to
time is also not in1icative of control. In its Re0l% to /om0lainant?s
Position Pa0er'[1>) 0etitioner alle5es t4at t4e 0olicies'
memoCcirculars' an1 rules an1 re5ulations referre1 to in 0rovision -@1A
of t4e Sales A5ent?s A5reement are onl% t4ose 0ertainin5 to 0a%ment
of a5ents? accountabilities' availment b% sales a5ents of cas4
a1vances for sorties' circulars on incentives an1 a6ar1s to be 5iven
base1 on 0ro1uction' an1 ot4er matters concernin5 t4e sellin5 of
insurance' in accor1ance 6it4 t4e rules 0romul5ate1 b% t4e Insurance
/ommission. Accor1in5 to t4e 0etitioner' insurance solicitors are
never affecte1 or covere1 b% t4e rules an1 re5ulations concernin5
em0lo%ee con1uct an1 0enalties for violations t4ereof' 6or;
stan1ar1s' 0erformance a00raisals' merit increases' 0romotions'
absenteeismCatten1ance' leaves of absence' mana5ement8union
matters' em0lo%ee benefits an1 t4e li;e. Since 0rivate res0on1ent
faile1 to rebut t4ese alle5ations' t4e same are 1eeme1 a1mitte1' or at
least 0roven' t4ereb% leavin5 not4in5 to su00ort t4e res0on1ent
/ommission?s conclusion t4at t4e fore5oin5 elements si5nifie1 an
em0lo%ment relations4i0 bet6een t4e 0arties.
In re5ar1 to t4e territorial assi5nments 5iven to sales a5ents' t4is too
cannot be 4el1 as in1icative of t4e eBercise of control over an
em0lo%ee. First of all' t4e 0lace of 6or; in t4e business of solicitin5
insurance 1oes not fi5ure 0rominentl% in t4e e=uation. An1 more
si5nificantl%' 0rivate res0on1ent faile1 to rebut 0etitioner?s alle5ation
t4at it 4a1 never issue1 4im an% territorial assi5nment at all.
Obviousl%' t4is /ourt cannot 1ra6 t4e same inference from t4is
feature as 1i1 t4e res0on1ent /ommission.
To restate' t4e si5nificant factor in 1eterminin5 t4e relations4i0 of t4e
0arties is t4e 0resence or absence of su0ervisor% aut4orit% to control
t4e met4o1 an1 t4e 1etails of 0erformance of t4e service bein5
ren1ere1' an1 t4e 1e5ree to 64ic4 t4e 0rinci0al ma% intervene to
eBercise suc4 control. T4e 0resence of suc4 0o6er of control is
in1icative of an em0lo%ment relations4i0' 64ile absence t4ereof is
in1icative of in1e0en1ent contractors4i0. In ot4er 6or1s' t4e test to
1etermine t4e eBistence of in1e0en1ent contractors4i0 is 64et4er one
claimin5 to be an in1e0en1ent contractor 4as contracte1 to 1o t4e
6or; accor1in5 to 4is o6n met4o1s an1 6it4out bein5 sub7ect to t4e
control of t4e em0lo%er eBce0t onl% as to t4e result of t4e 6or;.[1H)
Suc4 is eBactl% t4e nature of t4e relations4i0 bet6een 0etitioner an1
0rivate res0on1ent.
Furt4er' not ever% form of control t4at a 0art% reserves to 4imself over
t4e con1uct of t4e ot4er 0art% in relation to t4e services bein5
ren1ere1 ma% be accor1e1 t4e effect of establis4in5 an em0lo%er8
em0lo%ee relations4i0. T4e facts of t4is case fall s=uarel% 6it4 t4e
case of Insular ,ife Assurance /o.' ,t1. vs. N,R/. In sai1 case' 6e
4el1 t4at3
<,o5icall%' t4e line s4oul1 be 1ra6n bet6een rules t4at merel% serve
as 5ui1elines to6ar1s t4e ac4ievement of t4e mutuall% 1esire1 result
6it4out 1ictatin5 t4e means or met4o1s to be em0lo%e1 in attainin5 it'
an1 t4ose t4at control or fiB t4e met4o1olo5% an1 bin1 or restrict t4e
0art% 4ire1 to t4e use of suc4 means. T4e first' 64ic4 aim onl% to
0romote t4e result' create no em0lo%er8em0lo%ee relations4i0 unli;e
t4e secon1' 64ic4 a11ress bot4 t4e result an1 t4e means use1 to
ac4ieve it. T4e 1istinction ac=uires 0articular relevance in t4e case of
an enter0rise affecte1 6it4 0ublic interest' as is t4e business of
insurance' an1 is on t4at account sub7ect to re5ulation b% t4e State
6it4 res0ect' not onl% to t4e relations bet6een insurer an1 insure1 but
also to t4e internal affairs of t4e insurance com0an%. Rules an1
re5ulations 5overnin5 t4e con1uct of t4e business are 0rovi1e1 for in
t4e Insurance /o1e an1 enforce1 b% t4e Insurance /ommissioner. It
is' t4erefore' usual an1 eB0ecte1 for an insurance com0an% to
0romul5ate a set of rules to 5ui1e its commission a5ents in sellin5 its
0olicies t4at t4e% ma% not run afoul of t4e la6 an1 64at it re=uires or
0ro4ibits. BBBB None of t4ese reall% inva1es t4e a5ent?s contractual
0rero5ative to a1o0t 4is o6n sellin5 met4o1s or to sell insurance at
4is o6n time an1 convenience' 4ence cannot 7ustifiabl% be sai1 to
establis4 an em0lo%er8em0lo%ee relations4i0 bet6een 4im an1 t4e
com0an%.<[1:)
Private res0on1ent?s contention t4at 4e 6as 0etitioner?s em0lo%ee is
belie1 b% t4e fact t4at 4e 6as free to sell insurance at an% time as 4e
6as not sub7ect to 1efinite 4ours or con1itions of 6or; an1 in turn 6as
com0ensate1 accor1in5 to t4e result of 4is efforts. -% t4e nature of
t4e business of solicitin5 insurance' a5ents are normall% left free to
1evise 6a%s an1 means of 0ersua1in5 0eo0le to ta;e out insurance.
T4ere is no 0ro4ibition' as conten1e1 b% 0etitioner' for 0rivate
res0on1ent to 6or; for as lon5 as 4e 1oes not violate t4e Insurance
/o1e. As 0etitioner eB0lains3
<@Private res0on1entA 6as free to solicit life insurance an%64ere 4e
6ante1 an1 4e 4a1 free an1 unfettere1 time to 0ursue 4is business.
He 1i1 not 4ave to 0unc4 in an1 0unc4 out t4e bun1% cloc; as 4e 6as
not re=uire1 to re0ort to t4e @0etitioner?sA office re5ularl%. He 6as not
covere1 b% an% em0lo%ee 0olicies or re5ulations an1 not sub7ect to
t4e 1isci0linar% action of mana5ement on t4e basis of t4e .m0lo%ee
/o1e of /on1uct. He coul1 5o out an1 sell insurance at 4is o6n
c4osen time. He 6as entirel% left to 4is o6n c4oices of areas or
territories' 6it4 no 1efinite' muc4 less su0ervise1' time sc4e1ule.
@Private res0on1entA 4a1 com0lete control over 4is occu0ation an1
@0etitionerA 1i1 not eBercise an% ri54t of /ontrol an1 Su0ervision over
4is 0erformance eBce0t as to t4e 0a%ment of commission t4e amount
of 64ic4 entirel% 1e0en1s on t4e sole efforts of @0rivate res0on1entA.
He 6as free to en5a5e in ot4er occu0ation or 0ractice ot4er
0rofession for as lon5 as 4e 1i1 not commit an% violation of t4e et4ical
stan1ar1s 0rescribe1 in t4e Sales A5ent?s A5reement.<[19)
Alt4ou54 0etitioner coul1 4ave' t4eoreticall%' 1isa00rove1 an% of
0rivate res0on1ent?s transactions' 64at coul1 be 1isa00rove1 6as
onl% t4e result of t4e 6or;' an1 not t4e means b% 64ic4 it 6as
accom0lis4e1.
T4e <control< 64ic4 t4e above factors in1icate 1i1 not sum u0 to t4e
0o6er to control 0rivate res0on1ent?s con1uct in an1 mo1e of
solicitin5 insurance. On t4e contrar%' t4e% clearl% in1icate t4at t4e
7uri1ical element of control 4a1 been absent in t4is situation. T4us'
t4e /ourt is constraine1 to rule t4at no em0lo%ment relations4i0 4a1
ever eBiste1 bet6een t4e 0arties.
Secon1 Issue3 $uris1iction of Res0on1ent /ommission J ,abor
Arbiter
+n1er t4e contract invo;e1' 0rivate res0on1ent 4a1 never been
0etitioner?s em0lo%ee' but onl% its commission a5ent. As an
in1e0en1ent contractor' 4is claim for un0ai1 commission s4oul1 4ave
been liti5ate1 in an or1inar% civil action.[1()
T4e 7uris1iction of labor arbiters an1 res0on1ent /ommission is set
fort4 in Article "1( of t4e ,abor /o1e.[1&) T4e unif%in5 element
runnin5 t4rou54 0ara5ra04s @1A 8 @9A of sai1 0rovision is t4e consistent
reference to cases or 1is0utes arisin5 out of or in connection 6it4 an
em0lo%er8em0lo%ee relations4i0. Prior to its amen1ment b% -atas
Pambansa -l5. ""( on $une 1' 1#&"' t4is 0oint 6as clear as t4e
article inclu1e1 <all ot4er cases arisin5 from em0lo%er8em0lo%ee
relation unless eB0ressl% eBclu1e1 b% t4is /o1e.<[1#) Iit4out t4is
critical element of em0lo%ment relations4i0' t4e labor arbiter an1
res0on1ent /ommission can never ac=uire 7uris1iction over a 1is0ute.
As in t4e case at bar. It 6as serious error on t4e 0art of t4e labor
arbiter to 4ave assume1 7uris1iction an1 a17u1icate1 t4e claim.
,i;e6ise' t4e res0on1ent /ommission?s affirmance t4ereof.
Suc4 lac; of 7uris1iction of a court or tribunal ma% be raise1 at an%
sta5e of t4e 0rocee1in5s' even on a00eal. T4e 1octrine of esto00el
cannot be 0ro0erl% invo;e1 b% res0on1ent /ommission to cure t4is
fatal 1efect as it cannot confer 7uris1iction u0on a tribunal t4at to be5in
6it4' 6as bereft of 7uris1iction over a cause of action.["!) *oreover' in
t4e 0rocee1in5s belo6' 0etitioner consistentl% c4allen5e1 t4e
7uris1iction of t4e labor arbiter ["1) an1 res0on1ent /ommission.["")
It remains a basic fact in la6 t4at t4e c4oice of t4e 0ro0er forum is
crucial as t4e 1ecision of a court or tribunal 6it4out 7uris1iction is a
total nullit%.[">) A voi1 7u15ment for 6ant of 7uris1iction is no 7u15ment
at all. It cannot be t4e source of an% ri54t nor t4e creator of an%
obli5ation. All acts 0erforme1 0ursuant to it an1 all claims emanatin5
from it 4ave no le5al effect. Hence' it can never become final. <B B B
@IAt ma% be sai1 to be a la6less t4in5 64ic4 can be treate1 as an
outla6 an1 slain at si54t' or i5nore1 64erever an1 64enever it
eB4ibits its 4ea1.<["H)
T4e 6a% t4in5s stan1' it becomes unnecessar% to consi1er t4e merits
of 0rivate res0on1ent?s claim for un0ai1 commission. -e t4at as it
ma%' t4is rulin5 is 6it4out 0re7u1ice to 0rivate res0on1ent?s ri54t to file
a suit for collection of un0ai1 commissions a5ainst 0etitioner 6it4 t4e
0ro0er forum an1 6it4in t4e 0ro0er 0erio1.
IH.R.FOR.' t4e 0etition is 4ereb% RANT.D' an1 t4e assaile1
Resolution is 4ereb% S.T ASID..
SO ORD.R.D.
".A 1avao minin5 cor0 vs nlrc
SK,,A-+S
1. ,A-OR AND SO/IA, ,.IS,ATIONF ,A-OR /OD.F
T.R*INATION OF .*P,OK*.NTF /A+S.D -K /,OS+R. D+.
TO ,OSS.SF .*P,OK.R' NOT O-,IAT.D TO PAK
S.PARATION -.N.FITS. 8 I4ere t4e closure 6as 1ue to business
losses t4e ,abor /o1e 1oes not im0ose an% obli5ation u0on t4e
em0lo%er to 0a% se0aration benefits' for obvious reasons. Art. "&> of
t4e ,abor /o1e 1oes not obli5ate an em0lo%er to 0a% se0aration
benefits 64en t4e closure is 1ue to losses.
". ID.F ID.F ID.F OV.RN*.NT AS A STO/L8HO,D.R' NOT
P.RSONA,,K ,IA-,. FOR IND.-T.DN.SS OF TH.
/ORPORATION. 8 .ven if t4e national 5overnment o6ne1 or
controlle1 &1.&E of t4e common stoc; an1 1!!E of t4e 0referre1
stoc; of Nort4 Davao' it remains onl% a stoc;4ol1er t4ereof' an1 un1er
eBistin5 la6s an1 0revailin5 7uris0ru1ence' a stoc;4ol1er as a rule is
not 1irectl%' in1ivi1uall% an1Cor 0ersonall% liable for t4e in1ebte1ness
of t4e cor0oration. T4e national 5overnment is not t4e em0lo%er of
0rivate res0on1ent an1 4is co8com0lainants' so t4ere is no reason to
eB0ect an% ;in1 of bailout b% t4e national 5overnment un1er eBistin5
la6 an1 7uris0ru1ence.
>. R.*.DIA, ,AIF .VID.N/.F FINDINS OF FA/T -K TH.
NATIONA, ,A-OR R.,ATIONS /O**ISSIONF -INDIN +PON
TH. /O+RT. 8 It is 6ell settle1 t4at t4is /ourt is boun1 b% t4e fin1in5s
of fact of t4e N,R/' so lon5 as sai1 fin1in5s are su00orte1 b%
substantial evi1ence. In *a%a Farms .m0lo%ees Or5aniDation vs.
N,R/' "># S/RA :!&' :1" @December "&' 1##HA 6e 4el13 MT4is
/ourt 4as consistentl% rule1 t4at fin1in5s of fact of a1ministrative
a5encies an1 =uasi87u1icial bo1ies 64ic4 4ave ac=uire1 eB0ertise
because t4eir 7uris1iction is confine1 to s0ecific matters are 5enerall%
accor1e1 not onl% res0ect but even finalit% an1 are bin1in5 u0on t4is
/ourt unless t4ere is a s4o6in5 of 5rave abuse of 1iscretion' or 64ere
it is clearl% s4o6n t4at t4e% 6ere arrive1 at arbitraril% or in 1isre5ar1 of
t4e evi1ence on recor1.G
.N -AN/
[.R. No. 11":H9. *arc4 1>' 1##9)
NORTH DAVAO *ININ /ORPORATION an1 ASS.T
PRIVATINATION TR+ST' 0etitioners' vs. NATIONA, ,A-OR
R.,ATIONS /O**ISSION' ,A-OR AR-IT.R ANTONIO *.
VI,,AN+.VA an1 II,FR.DO +I,,.*A' res0on1ents.
D . / I S I O N
PANANI-AN' $.3
Is a com0an% 64ic4 is force1 b% 4u5e business losses to close its
business' le5all% re=uire1 to 0a% se0aration benefits to its em0lo%ees
at t4e time of its closure in an amount e=uivalent to t4e se0aration 0a%
0ai1 to t4ose 64o 6ere se0arate1 64en t4e com0an% 6as still a 5oin5
concernO T4is is t4e main =uestion brou54t before t4is /ourt in t4is
0etition for certiorari un1er Rule 9: of t4e Revise1 Rules of /ourt'
64ic4 see;s to reverse an1 set asi1e t4e Resolutions 1ate1 $ul% "#'
1##>[1) an1 Se0tember "(' 1##>[") of t4e National ,abor Relations
/ommision[>) @N,R/A in N,R/8/A No. *8!!1>#:8#>.
T4e Resolution 1ate1 $ul% "#' 1##> affirme1 in to6 t4e 1ecision of t4e
,abor Arbiter in RA-81 18!&8!!9("8#" an1 RA-8 118!&8!!(1>8#"
or1erin5 0etitioners to 0a% t4e com0lainants t4erein certain monetar%
claims.
T4e Resolution 1ate1 Se0tember "(' 1##> 1enie1 t4e motion for
reconsi1eration of t4e sai1 $ul% "#' 1##> Resolution.
T4e Facts
Petitioner Nort4 Davao *inin5 /or0oration @Nort4 DavaoA 6as
incor0orate1 in 1#(H as a 1!!E 0rivatel%8o6ne1 com0an%. ,ater' t4e
P4ili00ine National -an; @PN-A became 0art o6ner t4ereof as a result
of a conversion into e=uit% of a 0ortion of loans obtaine1 b% Nort4
Davao from sai1 ban;. On $une >!' 1#&9' PN- transferre1 all its
loans to an1 e=uit% in Nort4 Davao in favor of t4e national 5overnment
64ic4' b% virtue of Proclamation No. :! 1ate1 December &' 1#&9'
later turne1 t4em over to 0etitioner Asset PrivatiDation Trust @APTA. As
of December >1' 1##! t4e national 5overnment 4el1 &1.&E of t4e
common stoc; an1 1!!E of t4e 0referre1 stoc; of sai1 com0an%.[H)
Res0on1ent Iilfre1o uillema is one amon5 several em0lo%ees of
Nort4 Davao 64o 6ere se0arate1 b% reason of t4e com0an%Ps closure
on *a% >1' 1##"' an1 64o 6ere t4e com0lainants in t4e cases before
t4e res0on1ent labor arbiter.
On *a% >1' 1##"' 0etitioner Nort4 Davao com0letel% cease1
o0erations 1ue to serious business reverses. From 1#&& until its
closure in 1##"' Nort4 Davao suffere1 net losses avera5in5 t4ree
billion 0esos @P>'!!!'!!!'!!!.!!A 0er %ear' for eac4 of t4e five %ears
0rior to its closure. All tol1' as of December >1' 1##1' or five mont4s
0rior to its closure' its total liabilities 4a1 eBcee1e1 its assets b%
"!.>#" billion 0esos' as s4o6n b% its financial statements au1ite1 b%
t4e /ommission on Au1it. I4en it cease1 o0erations' its remainin5
em0lo%ees 6ere se0arate1 an1 5iven t4e e=uivalent of 1".: 1a%sP 0a%
for ever% %ear of service' com0ute1 on t4eir basic mont4l% 0a%' in
a11ition to t4e commutation to cas4 of t4eir unuse1 vacation an1 sic;
leaves. Ho6ever' it a00ears t4at' 1urin5 t4e life of t4e 0etitioner
cor0oration' from t4e be5innin5 of its o0erations in 1#&1 until its
closure in 1##"' it 4a1 been 5ivin5 se0aration 0a% e=uivalent to t4irt%
@>!A 1a%sP 0a% for ever% %ear of service. *oreover' inasmuc4 as t4e
re5ion 64ere Nort4 Davao o0erate1 6as 0la5ue1 b% insur5enc% an1
ot4er 0eace an1 or1er 0roblems' t4e em0lo%ees 4a1 to collect t4eir
salaries at a ban; in Ta5um' Davao 1el Norte' some :& ;ilometers
from t4eir 6or;0lace an1 about " Q4oursP travel time b% 0ublic
trans0ortationF t4is arran5ement laste1 from 1#&1 u0 to 1##!.
Subse=uentl%' a com0laint 6as file1 6it4 res0on1ent labor arbiter b%
res0on1ent Iilfre1o uillema an1 "(1 ot4er se0erate1 em0lo%ees
for3 @1A a11itional se0aration 0a% of 1(.: 1a%s for ever% %ear of
serviceF @"A bac; 6a5es e=uivalent to t6o 1a%s a mont4F @>A
trans0ortation allo6anceF @HA 4aDar1 0a%F @:A 4ousin5 allo6anceF @9A
foo1 allo6anceF @(A 0ost8em0lo%ment me1ical clearanceF an1 @&A
future me1ical allo6ance' all of 64ic4 amounte1 to P:&'!""'&(&.>1 as
com0ute1 b% 0rivate res0on1ent.[:)
On *a% 9' 1##>' res0on1ent ,abor Arbiter ren1ere1 a 1ecision
or1erin5 0etitioner Nort4 Davao to 0a% t4e com0lainants t4e follo6in53
M@aA A11itional se0aration 0a% of 1(.: 1a%s for ever% %ear of serviceF
@bA -ac;6a5es e=uivalent to t6o @"A 1a%s a mont4 times t4e number
of %ears of service but not to eBcee1 t4ree @>A %earsF
@cA Trans0ortation allo6ance at P&! a mont4 times t4e number of
%ears of service but not to eBcee1 t4ree @>A %ears.G
T4e benefits a6ar1e1 b% res0on1ent ,abor Arbiter amounte1 to
P1!'"H!':1(.(:. Attorne%Ps fees e=uivalent to ten 0ercent @1!EA
t4ereof 6ere also 5rante1.[9)
On a00eal' res0on1ent N,R/ affirme1 t4e 1ecision in toto. Petitioner
Nort4 DavaoPs motion for reconsi1eration 6as li;e6ise 1enie1.
Hence' t4is 0etition.
T4e PartiesP Submissions an1 t4e Issues
In affirmin5 t4e ,abor ArbiterPs 1ecision' res0on1ent N,R/ rule1 t4at
Msince @Nort4 DavaoA 4as been 0a%in5 its em0lo%ees se0aration 0a%
e=uivalent to t4irt% @>!A 1a%s 0a% for ever% %ear of service'G ;no6in5
full% 6ell t4at t4e la6 0rovi1es for a lesser se0aration 0a%' t4en suc4
com0an% 0olic% M4as ri0ene1 into an obli5ation'G an1 t4erefore'
1e0rivin5 no6 t4e 4erein 0rivate res0on1ent an1 ot4ers similarl%
situate1 of t4e same benefits 6oul1 be 1iscriminator%.[() 2uotin5 from
-usiness1a% Information S%stems an1 Services. Inc. @-ISSIA vs.
N,R/.[&) it sai1 t4at 0etitioners Mma% not 0a% se0aration benefits
une=uall% for suc4 1iscrimination bree1s resentment an1 ill86ill amon5
t4ose 64o 4ave been treate1 less 5enerousl% t4an ot4ers.G It also
cite1 Abella vs. N,R/'[#) as aut4orit% for sa%in5 t4at Art. "&> of t4e
,abor /o1e 0rotects 6or;ers in case of t4e closure of t4e
establis4ment.
To 7ustif% t4e a6ar1 of t6o 1a%s a mont4 in bac;6a5es an1 P&! 0er
mont4 of trans0ortation allo6ance' res0on1ent /ommission rule13
MAs to t4e a00ellantsP claim t4at com0lainants8a00ealleesP time s0ent
in collectin5 t4eir 6a5es at Ta5um' Davao is not com0ensable
alle5e1l% because it 6as on official time can not be 5iven cre1ence.
No iota of evi1ence 4as been 0resente1 to bac; u0 sai1 contention.
T4e same is true 6it4 a00ellantsP assertion t4at t4e claim for
trans0ortation eB0enses is 6it4out basis since t4e% 6ere incurre1 b%
t4e com0lainants. A00ellants s4oul1 4ave submitte1 t4e 0a%rolls to
0rove t4at com0lainants8a00ellees 6ere not t4e ones 64o 0ersonall%
collecte1 t4eir 6a5es an1Cor t4e busC7ee0 tri0 tic;ets or vouc4ers to
s4o6 t4at t4e com0lainants8a00ellees 6ere 0rovi1e1 6it4 free
trans0ortation as claime1.G
Petitioner' t4rou54 t4e overnment /or0orate /ounsel' raise1 t4e
follo6in5 5roun1s for t4e allo6ance of t4e 0etition3
M1. T4e N,R/ acte1 6it4 5rave abuse of 1iscretion in affirmin5 6it4out
le5al basis t4e a6ar1 of a11itional se0aration 0a% to 0rivate
res0on1ents 64o 6ere se0arate1 1ue to serious business losses on
t4e 0art of 0etitioner.
". T4e N,R/ acte1 6it4 5rave abuse of 1iscretion in affirmin5 6it4out
sufficient factual basis t4e a6ar1 of bac;6a5es an1 trans0ortation
eB0enses to 0rivate res0on1ents.
>. T4ere is no a00eal' nor an% 0lain' s0ee1% an1 a1e=uate reme1% in
t4e or1inar% course of t4e la6.G
an1 t4e follo6in5 issues3
M1. I4et4er or not an em0lo%er 64ose business o0erations cease1
1ue to serious business losses or financial reverses is obli5e1 to 0a%
se0aration 0a% to its em0lo%ees se0arate1 b% reason of suc4 closure.
". I4et4er or not time s0ent in collectin5 6a5es in a 0lace ot4er t4an
t4e 0lace of em0lo%ment is com0ensable not6it4stan1in5 t4at t4e
same is 1one 1urin5 official time.
>. I4et4er or not 0rivate res0on1ents are entitle1 to trans0ortation
eB0enses in t4e absence of evi1ence t4at t4ese eB0enses 6ere
incurre1.G
T4e First Issue3 Se0aration Pa%
To resolve t4is issue' it is necessar% to revisit t4e 0rovision of la6
a1verte1 to b% t4e 0arties in t4eir submissions' namel% Art. "&> of t4e
,abor /o1e' 64ic4 rea1s as follo6s3
MArt. "&>. /losure of establis4ment an1 re1uction of 0ersonnel. 8 T4e
em0lo%er ma% also terminate t4e em0lo%ment of an% em0lo%ee 1ue to
t4e installation of labor savin5 1evices' re1un1anc%' retrenc4ment to
0revent losses or t4e closin5 or cessation of o0eration of t4e
establis4ment or un1er8ta;in5 unless t4e closin5 is for t4e 0ur0ose of
circumventin5 t4e 0rovisions of t4is Title' b% servin5 a 6ritten notice
on t4e 6or;ers an1 t4e *inistr% of ,abor an1 .m0lo%ment at least one
@1A mont4 before t4e inten1e1 1ate t4ereof. In case of termination 1ue
to t4e installation of labor savin5 1evices or re1un1anc%' t4e 6or;er
affecte1 t4ereb% s4all be entitle1 to a se0aration 0a% e=uivalent to at
least 4is one @1A mont4 0a% or to at least one @1A mont4 0a% for ever%
%ear of service' 64ic4ever is 4i54er. In case of retrenc4ment to
0revent losses an1 in cases of closures or cessation of o0erations of
establis4ment or un1erta;in5 not 1ue to serious business losses or
financial reverses' t4e se0aration 0a% s4all be e=uivalent to one @1A
mont4 0a% or at least one84alf @QA mont4 0a% for ever% %ear of
service' 64ic4ever is 4i54er. A fraction of at least siB @9A mont4s s4all
be consi1ere1 one @1A 64ole %ear.G @italics su00lie1A
T4e un1erscore1 0ortion of Art. "&> 5overns t4e 5rant of se0eration
benefits Min case of closures or cessation of o0erationG of business
establis4ments MNOT 1ue to serious business losses or financial
reverses B B BG. I4ere' 4o6ever' t4e closure 6as 1ue to business
losses 8 as in t4e instant case' in 64ic4 t4e a55re5ate losses
amounte1 to over P"! billion 8 t4e ,abor /o1e 1oes not im0ose an%
obli5ation u0on t4e em0lo%er to 0a% se0aration benefits' for obvious
reasons. T4ere is no nee1 to belabor t4is 0oint. .ven t4e 0ublic
res0on1ents' in t4eir /omment[1!) file1 b% t4e Solicitor eneral'
im0lie1l% conce1e t4is 0oint.
Ho6ever' res0on1ents tenaciousl% insist on t4e a6ar1 of se0aration
0a%' anc4orin5 t4eir claim solel% on 0etitioner Nort4 DavaoPs lon58
stan1in5 0olic% of 5ivin5 se0aration 0a% benefits e=uivalent to >!8
1a%sP 0a%' 64ic4 0olic% 4a1 been in force in t4e %ears 0rior to its
closure. Res0on1ents conten1 t4at' b% 1en%in5 t4e same se0aration
benefits to 0rivate res0on1ent an1 t4e ot4ers similarl% situate1'
0etitioners 1iscriminate1 a5ainst t4em. T4e% rel% on t4is /ourtPs
rulin5 in -usiness1a% Information S%stems an1 Services' Inc. @-ISSIA
vs. N,R/' @su0raA. In sai1 case' 0etitioner -ISSI' after eB0eriencin5
financial reverses' 1eci1e1 Mas a retrenc4ment measureG to la%8off
some em0lo%ees on *a% 19' 1#&& an1 5ave t4em se0aration 0a%
e=uivalent to one84alf @QA mont4 0a% for ever% %ear of service. -ISSI
retaine1 some em0lo%ees in an attem0t to re4abilitate its business as
a tra1in5 com0an%. Ho6ever' barel% t6o an1 a 4alf mont4s later'
t4ese remainin5 em0lo%ees 6ere li;e6ise 1isc4ar5e1 because t4e
com0an% 1eci1e1 to cease business o0erations alto5et4er. +nli;e t4e
earlier terminate1 em0lo%ees' t4e secon1 batc4 receive1 se0aration
0a% e=uivalent to a full mont4Ps salar% for ever% %ear of service' 0lus a
mi18%ear bonus. T4is /ourt rule1 t4at Mt4ere 6as im0ermissible
1iscrimination a5ainst t4e 0rivate res0on1ents in t4e 0a%ment of t4eir
se0aration benefits. T4e la6 re=uires an em0lo%er to eBten1 e=ual
treatment to its em0lo%ees. It ma% not' in t4e 5uise of eBercisin5
mana5ement 0rero5atives' 5rant 5reater benefits to some an1 less to
ot4ers. B B BG
In resolvin5 t4e 0resent case' it bears ;ee0in5 in min1 at t4e outset
t4at t4e factual circumstances of -ISSI are =uite 1ifferent from t4e
current case. T4e /ourt note1 t4at -ISSI continue1 to suffer losses
even after t4e retrenc4ment of t4e first batc4 of em0lo%eesF clearl%'
business 1i1 not im0rove 1es0ite suc4 1rastic measure. T4at
not6it4stan1in5' 64en -ISSI finall% s4ut 1o6n' it coul1 6ell affor1 to
@an1 actuall% 1i1A 0a% off its remainin5 em0lo%ees 6it4 *OR.
se0aration benefits as com0are1 6it4 t4ose earlier lai1 offF obviousl%'
t4en' t4ere 6as no reason for -ISSI to s;im0 on se0aration 0a% for
t4e first batc4 of 1isc4ar5e1 em0lo%ees. T4at it 6as able to 0a% one8
mont4 se0aration benefit for em0lo%ees at t4e time of closure of its
business meant t4at it must 4ave been also in a 0osition to 0a% t4e
same amount to t4ose 64o 6ere se0arate1 0rior to closure. T4at it
1i1 not 1o so 6as a 6ron5ful eBercise of mana5ement 0rero5atives.
T4at is 64% t4e /ourt correctl% faulte1 it 6it4 Mim0ermissible
1iscrimination.G /learl%' it eBercise1 its mana5ement 0rero5atives
contrar% to M5eneral 0rinci0les of fair 0la% an1 7ustice.G
In t4e instant case 4o6ever' t4e com0an%Ps 0ractice of 5ivin5 one
mont4Ps 0a% for ever% %ear of service coul1 no lon5er be continue1
0recisel% because t4e com0an% coul1 not affor1 it an%more. It 6as
force1 to close 1o6n on account of accumulate1 losses of over P"!
billion. T4is coul1 not be sai1 of -ISSI. In t4e case of Nort4 Davao' it
5ave >!81a%sP se0aration 0a% to its em0lo%ees 64en it 6as still a
5oin5 concern even if it 6as alrea1% losin5 4eavil%. As a 5oin5
concern' its cas4 flo6 coul1 still 4ave sustaine1 t4e 0a%ment of suc4
se0aration benefits. -ut 64en a business enter0rise com0letel%
ceases o0erations' i.e.' u0on its 1eat4 as a 5oin5 business concern'
its vital lifebloo1 8its cas4flo6 8 literall% 1ries u0. T4erefore' t4e fact
t4at less se0aration benefits 6ere 5rante1 64en t4e com0an% finall%
met its business 1eat4 cannot be c4aracteriDe1 as 1iscrimination.
Suc4 action 6as 1ictate1 not b% a 1iscriminator% mana5ement o0tion
but b% its com0lete inabilit% to continue its business life 1ue to
accumulate1 losses. In1ee1' one cannot s=ueeDe bloo1 out of a 1r%
stone. Nor 6ater out of 0arc4e1 lan1.
As alrea1% state1' Art. "&> of t4e ,abor /o1e 1oes not obli5ate an
em0lo%er to 0a% se0aration benefits 64en t4e closure is 1ue to
losses. In t4e case before us' t4e basis for t4e claim of t4e a11itional
se0aration benefit of 1(.: 1a%s is alle5e1 1iscrimination' i.e.' une=ual
treatment of em0lo%ees' 64ic4 is 0roscribe1 as an unfair labor
0ractice b% Art. "H& @eA of sai1 /o1e. +n1er t4e facts an1
circumstances of t4e 0resent case' t4e 5rant of a lesser amount of
se0aration 0a% to 0rivate res0on1ent 6as 1one' not b% reason of
1iscrimination' but rat4er' out of s4eer financial ban;ru0tc% 8 a fact
t4at is not controlle1 b% mana5ement 0rero5atives. State1 1ifferentl%'
t4e total cessation of o0eration 1ue to min18bo55lin5 losses 6as a
su0ervenin5 fact t4at 0revente1 t4e com0an% from continuin5 to 5rant
t4e more 5enerous amount of se0aration 0a%. T4e fact t4at Nort4
Davao at t4e 0oint of its force1 closure voluntaril% 0ai1 an% se0aration
benefits at all 8 alt4ou54 not re=uire1 b% la6 8 an1 1".:81a%sP 6ort4 at
t4at' s4oul1 4ave elicite1 a1miration instea1 of con1emnation. -ut to
re=uire it to continue bein5 5enerous 64en it is no lon5er in a 0osition
to 1o so 6oul1 certainl% be un1ul% o00ressive' unfair an1 most
revoltin5 to t4e conscience. As t4is /ourt 4el1 in *anila Tra1in5 J
Su00l% /o. vs. Nulueta'[11) an1 reiterate1 in San *i5uel /or0oration
vs. N,R/[1") an1 later' in Allie1 -an;in5 /or0oration vs. /astro'[1>)
M@tA4e la6' in 0rotectin5 t4e ri54ts of t4e laborer' aut4oriDes neit4er
o00ression nor self81estruction of t4e em0lo%er.G
At t4is 7uncture' 6e note t4at t4e Solicitor eneral in 4is /omment
c4allen5es t4e 0etitioners assertion t4at Nort4 Davao' 4avin5 close1
1o6n' no lon5er 4as t4e means to 0a% for t4e benefits. T4e Solicitor
eneral stresses t4at Nort4 Davao 6as amon5 t4e assets transferre1
b% PN- to t4e national 5overnment' an1 t4at b% virtue of Proclamation
No. :! 1ate1 December &' 1#&9' t4e APT 6as constitute1 trustee of
t4is 5overnment asset. He t4en conclu1es t4at M@iAt 6oul1' t4erefore'
be incon5ruous to 1eclare t4at t4e National overnment' 64ic4
s4oul1 al6a%s be 0resume1 to be solvent' coul1 not 0a% no6 0rivate
res0on1entsP mone% claims.G Suc4 ar5umentation is com0letel%
mis0lace1. .ven if t4e national 5overnment o6ne1 or controlle1
&1.&E of t4e common stoc; an1 1!!E of t4e 0referre1 stoc; of Nort4
Davao' it remains onl% a stoc;4ol1er t4ereof' an1 un1er eBistin5 la6s
an1 0revailin5 7uris0ru1ence' a stoc;4ol1er as a rule is not 1irectl%'
in1ivi1uall% an1Cor 0ersonall% liable for t4e in1ebte1ness of t4e
cor0oration. T4e obli5ation of Nort4 Davao cannot be consi1ere1 t4e
obli5ation of t4e national 5overnment' 4ence' 64et4er t4e latter be
solvent or not is not material to t4e instant case. T4e res0on1ents
4ave not s4o6n t4at t4is case constitutes one of t4e instances 64ere
t4e cor0orate veil ma% be 0ierce1.[1H) From anot4er an5le' t4e
national 5overnment is not t4e em0lo%er of 0rivate res0on1ent an1 4is
co8com0lainants' so t4ere is no reason to eB0ect an% ;in1 of bailout
b% t4e national 5overnment un1er eBistin5 la6 an1 7uris0ru1ence.
T4e Secon1 an1 T4ir1 Issues3
-ac; Ia5es an1 Trans0ortation Allo6ance
Anent t4e a6ar1 of bac; 6a5es an1 trans0ortation allo6ance' t4e
issues raise1 in connection t4ere6it4 are factual' t4e 1etermination of
64ic4 is best left to t4e res0on1ent N,R/. It is 6ell settle1 t4at t4is
/ourt is boun1 b% t4e fin1in5s of fact of t4e N,R/' so lon5 as sai1
fin1in5s are su00orte1 b% substantial evi1ence.[1:)
As t4e Solicitor eneral 0ointe1 out in 4is comment3
MIt is un1is0ute1 t4at because of securit% reasons' from t4e time of its
o0erations' 0etitioner ND*/ maintaine1 its 0olic% of 0a%in5 its
6or;ers at a ban; in Ta5um' Davao 1el Norte' 64ic4 usuall% too; t4e
6or;ers about t6o an1 a 4alf @" 1C"A 4ours of travel from t4e 0lace of
6or; an1 suc4 travel time is not official.
Recor1s also s4o6 t4at on Februar% 1"'1##"' 64en an ins0ection
6as con1ucte1 b% t4e De0artment of ,abor an1 .m0lo%ment at t4e
0remises of 0etitioner ND*/ at Amacan' *aco' Davao 1el Norte' it
6as foun1 out t4at 0etitioners 4a1 violate1 labor stan1ar1s la6' one of
64ic4 is t4e 0lace of 0a%ment of 6a5es @0.1!#' Vol. 1' Recor1A.
Section H' Rule VIII' -oo; III of t4e Omnibus Rules Im0lementin5 t4e
,abor /o1e 0rovi1es t4at3
RSection H. Place of 0a%ment. 8 @aA As a 5eneral rule' t4e 0lace of
0a%ment s4all be at or near t4e 0lace of un1erta;in5. Pa%ment in a
0lace ot4er t4an t4e 6or;0lace s4all be 0ermissible onl% un1er t4e
follo6in5 circumstances3
@1A I4en 0a%ment cannot be effecte1 at or near t4e 0lace of 6or;
b% reason of t4e 1eterioration of 0eace an1 or1er con1itions' or b%
reason of actual or im0en1in5 emer5encies cause1 b% fire' floo1'
e0i1emic or ot4er calamit% ren1erin5 0a%ment t4ereat im0ossibleF
@"A I4en t4e em0lo%er 0rovi1es free trans0ortation to t4e
em0lo%ees bac; an1 fort4F an1
@>A +n1er an% analo5ous circumstancesF 0rovi1e1 t4at t4e time
s0ent b% t4e em0lo%ees in collectin5 t4eir 6a5es s4all be consi1ere1
as com0ensable 4ours 6or;e1.
@bA BBB BBB BBB.P
@Italics su00lie1A
Accor1in5l%' in 4is Or1er 1ate1 A0ril 1H' 1##" @0. 1!#' Vol. 1' Recor1A'
t4e Re5ional Director' Re5ional Office No. SI' De0artment of ,abor
an1 .m0lo%ment' Davao /it%' or1ere1 0etitioner ND*/' amon5
ot4ers' as follo6s3
RIH.R.FOR.' B B B. Res0on1ent is furt4er or1ere1 to 0a% its
6or;ers salaries at t4e 0lantsite at Amacan' Ne6 ,e%te' *aco' Davao
1el Norte or 64enever not 0ossible' t4rou54 t4e ban; in Ta5um'
Davao 1el Norte as alrea1% been 0ractice1 sub7ect' 4o6ever to t4e
0rovisions of Section H of Rule VIII' -oo; III of t4e rules im0lementin5
t4e ,abor /o1e as amen1e1.P
T4us' 0ublic res0on1ent ,abor Arbiter Antonio *. Villanueva correctl%
4el1 t4at3
RFrom t4e evi1ence on recor1' 6e fin1 t4at t4e 4ours s0ent b%
com0lainants in collectin5 salaries at a ban; in Ta5um' Davao 1el
Norte s4all be consi1ere1 com0ensable 4ours 6or;e1. /onsi1erin5
furt4er t4e 1istance bet6een Amacan' *aco to Ta5um 64ic4 is "Q
4ours b% travel an1 t4e ris;s in commutin5 all t4e time in collectin5
com0lainantsP salaries' 6oul1 7ustif% t4e 5rantin5 of bac;6a5es
e=uivalent to t6o @"A 1a%s in a mont4 as 0ra%e1 for.
R/orollar% to t4e above fin1in5s' an1 for e=uitable reasons' 6e
li;e6ise 4ol1 res0on1ents liable for t4e trans0ortation eB0enses
incurre1 b% com0lainants at PH!.!! roun1 tri0 fare 1urin5 0a% 1a%s.P
@0. 1!' DecisionF 0. "!(' Vol. 1' Recor1A
On t4e contrar%' it 6ill be 0etitionersP bur1en or 1ut% to 0resent
evi1ence of com0liance of t4e la6 on labor stan1ar1s' rat4er t4an for
0rivate res0on1ents to 0rove t4at t4e% 6ere not 0ai1C0rovi1e1 b%
0etitioners of t4eir bac;6a5es an1 trans0ortation eB0enses.G
Ot4er t4an t4e bare 1enials of 0etitioners' t4e above fin1in5s stan1s
uncontra1icte1. In1ee1 6e are not at libert% to set asi1e fin1in5s of
facts of t4e N,R/' absent an% ca0riciousness' arbitrariness' or abuse
or com0lete lac; of basis. In *a%a Farms .m0lo%ees Or5aniDations
vs. N,R/'[19) 6e 4el13
MT4is /ourt 4as consistentl% rule1 t4at fin1in5s of fact of a1ministrative
a5encies an1 =uasi87u1icial bo1ies 64ic4 4ave ac=uire1 eB0ertise
because t4eir 7uris1iction is confine1 to s0ecific matters are 5enerall%
accor1e1 not onl% res0ect but even finalit% an1 are bin1in5 u0on t4is
/ourt unless t4ere is a s4o6in5 of 5rave abuse of 1iscretion' or 64ere
it is clearl% s4o6n t4at t4e% 6ere arrive1 at arbitraril% or in 1isre5ar1 of
t4e evi1ence on recor1.G
IH.R.FOR.' 7u15ment is 4ereb% ren1ere1 *ODIFKIN t4e
assaile1 Resolution b% S.TTIN ASID. an1 1eletin5 t4e a6ar1 for
Ma11itional se0aration 0a% of 1(.: 1a%s for ever% %ear of service'G an1
AFFIR*IN it in all ot4er as0ects. No costs.
SO ORD.R.D.
>.A