Escolar Documentos
Profissional Documentos
Cultura Documentos
147039
The assailed decision originated from Civil Case No. 90-602 filed by Radio
Mindanao Network, Inc. (respondent) against DBP Pool of Accredited
Insurance Companies (petitioner) and Provident Insurance Corporation
(Provident) for recovery of insurance benefits. Respondent owns several
broadcasting stations all over the country. Provident covered respondents
transmitter
equipment
and
generating
set
for
the
amount
ofP13,550,000.00 under Fire Insurance Policy No. 30354, while petitioner
covered respondents transmitter, furniture, fixture and other transmitter
facilities for the amount of P5,883,650.00 under Fire Insurance Policy No.
F-66860.
In the evening of July 27, 1988, respondents radio station located in SSS
Building, Bacolod City, was razed by fire causing damage in the amount
of P1,044,040.00. Respondent sought recovery under the two insurance
policies but the claims were denied on the ground that the cause of loss
was an excepted risk excluded under condition no. 6 (c) and (d), to wit:
Both insurance companies appealed from the trial courts decision but the
CA affirmed the decision, with the modification that the applicable interest
rate was reduced to 6% per annum. A motion for reconsideration was filed
by petitioner DBP which was denied by the CA per its Resolution dated
January 30, 2001.5
Insurance
In fact the only person who seems to be so sure that that the CPPNPA had a hand in the burning of DYHB was Lt. Col. Nicolas Torres.
However, though We found him to be persuasive in his testimony
regarding how he came to arrive at his opinion, We cannot nevertheless
admit his testimony as conclusive proof that the CPP-NPA was really
involved in the incident considering that he admitted that he did not
personally see the armed men even as he tried to pursue them. Note that
when Lt. Col. Torres was presented as witness, he was presented as an
ordinary witness only and not an expert witness. Hence, his opinion on the
identity or membership of the armed men with the CPP-NPA is not
admissible in evidence.
Anent the letter of a certain Celso Magsilang, who claims to be a member
of NPA-NIROC, being an admission of person which is not a party to the
present action, is likewise inadmissible in evidence under Section 22, Rule
130 of the Rules of Court. The reason being that an admission is
competent only when the declarant, or someone identified in legal interest
with him, is a party to the action.9
The Court will not disturb these factual findings absent compelling or
exceptional reasons. It should be stressed that a review by certiorari
evidence to show why such excepted risk does not release petitioner from
any liability. Unfortunately for petitioner, it failed to discharge its
primordial burden of proving that the damage or loss was caused by an
excepted risk.
Petitioner however, insists that the evidence on record established the
identity of the author of the damage. It argues that the trial court and the
CA erred in not appreciating the reports of witnesses Lt. Col Torres and
SFO II Rochar that the bystanders they interviewed claimed that the
perpetrators were members of the CPP/NPA as an exception to the
hearsay rule as part of res gestae.
A witness can testify only to those facts which he knows of his personal
knowledge, which means those facts which are derived from his
perception.19 A witness may not testify as to what he merely learned from
others either because he was told or read or heard the same. Such
testimony is considered hearsay and may not be received as proof of the
truth of what he has learned. The hearsay rule is based upon serious
concerns about the trustworthiness and reliability of hearsay evidence
inasmuch as such evidence are not given under oath or solemn
affirmation and, more importantly, have not been subjected to crossexamination by opposing counsel to test the perception, memory, veracity
and articulateness of the out-of-court declarant or actor upon whose
reliability on which the worth of the out-of-court statement depends. 20
Res gestae, as an exception to the hearsay rule, refers to those
exclamations and statements made by either the participants, victims, or
spectators to a crime immediately before, during, or after the commission
of the crime, when the circumstances are such that the statements were
made as a spontaneous reaction or utterance inspired by the excitement
of the occasion and there was no opportunity for the declarant to
deliberate and to fabricate a false statement. The rule in res gestae
applies when the declarant himself did not testify and provided that the
testimony of the witness who heard the declarant complies with the
following requisites: (1) that the principal act, the res gestae, be a
startling occurrence; (2) the statements were made before the declarant
had the time to contrive or devise a falsehood; and (3) that the
October 8, 2001
"(1) The Court of Appeals erred in its conclusion that the issue of
non-payment of the premium was beyond its jurisdiction because it
was raised for the first time on appeal." 8
"(2) The Court of Appeals erred in its legal interpretation of 'Fire
Extinguishing Appliances Warranty' of the policy." 9
"(3) With due respect, the conclusion of the Court of Appeals giving
no regard to the parole evidence rule and the principle of estoppel
is erroneous."10
A:
I told them as will be shown by the map the intention really
of Mr. Edison Tantuco is to cover the new oil mill that is why when I
presented the existing policy of the old policy, the policy issuing
clerk just merely (sic) copied the wording from the old policy and
what she typed is that the description of the boundaries from
the old policy was copied but she inserted covering the new
oil mill and to me at that time the important thing is that it
covered the new oil mill because it is just within one
compound and there are only two oil mill[s] and so just
enough, I had the policy prepared. In fact, two policies were
prepared having the same date one for the old one and the other
for the new oil mill and exactly the same policy period,
sir."14 (emphasis supplied)
It is thus clear that the source of the discrepancy happened during the
preparation of the written contract.
These facts lead us to hold that the present case falls within one of the
recognized exceptions to the parole evidence rule. Under the Rules of
with two (2) policies, you will only do that if you will make to
increase the amount and it is by indorsement not by another policy,
sir.,16
We again stress that the object of the court in construing a contract is to
ascertain the intent of the parties to the contract and to enforce the
agreement which the parties have entered into. In determining what the
parties intended, the courts will read and construe the policy as a whole
and if possible, give effect to all the parts of the contract, keeping in mind
always, however, the prime rule that in the event of doubt, this doubt is to
be resolved against the insurer. In determining the intent of the parties to
the contract, the courts will consider the purpose and object of the
contract.17
In a further attempt to avoid liability, petitioner claims that respondent
forfeited the renewal policy for its failure to pay the full amount of the
premium and breach of the Fire Extinguishing Appliances Warranty.
The amount of the premium stated on the face of the policy was
P89,770.20. From the admission of respondent's own witness, Mr. Borja,
which the petitioner cited, the former only paid it P75,147.00, leaving a
difference of P14,623.20. The deficiency, petitioner argues, suffices to
invalidate the policy, in accordance with Section 77 of the Insurance
Code.18
The Court of Appeals refused to consider this contention of the petitioner.
It held that this issue was raised for the first time on appeal, hence,
beyond its jurisdiction to resolve, pursuant to Rule 46, Section 18 of the
Rules of Court.19
Petitioner, however, contests this finding of the appellate court. It insists
that the issue was raised in paragraph 24 of its Answer, viz.:
"24. Plaintiff has not complied with the condition of the policy and
renewal certificate that the renewal premium should be paid on or
before renewal date."
Petitioner adds that the issue was the subject of the cross-examination of
Mr. Borja, who acknowledged that the paid amount was lacking by
P14,623.20 by reason of a discount or rebate, which rebate under Sec.
361 of the Insurance Code is illegal.
The argument fails to impress. It is true that the asseverations petitioner
made in paragraph 24 of its Answer ostensibly spoke of the policy's
condition for payment of the renewal premium on time and respondent's
non-compliance with it. Yet, it did not contain any specific and definite
allegation that respondent did not pay the premium, or that it did not pay
the full amount, or that it did not pay the amount on time.
Likewise, when the issues to be resolved in the trial court were formulated
at the pre-trial proceedings, the question of the supposed inadequate
payment was never raised. Most significant to point, petitioner fatally
neglected to present, during the whole course of the trial, any witness to
testify that respondent indeed failed to pay the full amount of the
premium. The thrust of the cross-examination of Mr. Borja, on the other
hand, was not for the purpose of proving this fact. Though it briefly
touched on the alleged deficiency, such was made in the course of
discussing a discount or rebate, which the agent apparently gave the
respondent. Certainly, the whole tenor of Mr. Borja's testimony, both
during direct and cross examinations, implicitly assumed a valid and
subsisting insurance policy. It must be remembered that he was called to
the stand basically to demonstrate that an existing policy issued by the
petitioner covers the burned building.
Finally, petitioner contends that respondent violated the express terms of
the Fire Extinguishing Appliances Warranty. The said warranty provides:
"WARRANTED that during the currency of this Policy, Fire Extinguishing
Appliances as mentioned below shall be maintained in efficient working
order on the premises to which insurance applies:
-
PORTABLE EXTINGUISHERS
INTERNAL HYDRANTS
EXTERNAL HYDRANTS
FIRE PUMP
BREACH of this warranty shall render this policy null and void and the
Company shall no longer be liable for any loss which may occur." 20
vs. COURT OF
The application was approved for a period of one year from March 1, 1988
to March 1, 1989. Accordingly, he was issued Health Care Agreement No.
P010194. Under the agreement, respondents husband was entitled to
avail of hospitalization benefits, whether ordinary or emergency, listed
therein. He was also entitled to avail of "out-patient benefits" such as
annual physical examinations, preventive health care and other outpatient services.
Upon the termination of the agreement, the same was extended for
another year from March 1, 1989 to March 1, 1990, then from March 1,
1990 to June 1, 1990. The amount of coverage was increased to a
maximum sum of P75,000.00 per disability.2
During the period of his coverage, Ernani suffered a heart attack and was
confined at the Manila Medical Center (MMC) for one month beginning
March 9, 1990. While her husband was in the hospital, respondent tried to
claim the benefits under the health care agreement. However, petitioner
denied her claim saying that the Health Care Agreement was void.
According to petitioner, there was a concealment regarding Ernanis
medical history. Doctors at the MMC allegedly discovered at the time of
Ernanis confinement that he was hypertensive, diabetic and asthmatic,
contrary to his answer in the application form. Thus, respondent paid the
hospitalization expenses herself, amounting to about P76,000.00.
After her husband was discharged from the MMC, he was attended by a
physical therapist at home. Later, he was admitted at the Chinese General
Hospital. Due to financial difficulties, however, respondent brought her
husband home again. In the morning of April 13, 1990, Ernani had fever
and was feeling very weak. Respondent was constrained to bring him back
to the Chinese General Hospital where he died on the same day.
On July 24, 1990, respondent instituted with the Regional Trial Court of
Manila, Branch 44, an action for damages against petitioner and its
president, Dr. Benito Reverente, which was docketed as Civil Case No. 9053795. She asked for reimbursement of her expenses plus moral damages
and attorneys fees. After trial, the lower court ruled against
petitioners, viz:
(3) of any person under a legal obligation to him for the payment of
money, respecting property or service, of which death or illness
might delay or prevent the performance; and
(4) of any person upon whose life any estate or interest vested in
him depends.
not a medical doctor. Where matters of opinion or judgment are called for,
answers made in good faith and without intent to deceive will not avoid a
policy even though they are untrue.14 Thus,
(A)lthough false, a representation of the expectation, intention,
belief, opinion, or judgment of the insured will not avoid the policy if
there is no actual fraud in inducing the acceptance of the risk, or its
acceptance at a lower rate of premium, and this is likewise the rule
although the statement is material to the risk, if the statement is
obviously of the foregoing character, since in such case the insurer
is not justified in relying upon such statement, but is obligated to
make further inquiry. There is a clear distinction between such a
case and one in which the insured is fraudulently and intentionally
states to be true, as a matter of expectation or belief, that which he
then knows, to be actually untrue, or the impossibility of which is
shown by the facts within his knowledge, since in such case the
intent to deceive the insurer is obvious and amounts to actual
fraud.15 (Underscoring ours)
The fraudulent intent on the part of the insured must be established to
warrant rescission of the insurance contract. 16 Concealment as a defense
for the health care provider or insurer to avoid liability is an affirmative
defense and the duty to establish such defense by satisfactory and
convincing evidence rests upon the provider or insurer. In any case, with
or without the authority to investigate, petitioner is liable for claims made
under the contract. Having assumed a responsibility under the agreement,
petitioner is bound to answer the same to the extent agreed upon. In the
end, the liability of the health care provider attaches once the member is
hospitalized for the disease or injury covered by the agreement or
whenever he avails of the covered benefits which he has prepaid.
Under Section 27 of the Insurance Code, "a concealment entitles the
injured party to rescind a contract of insurance." The right to rescind
should be exercised previous to the commencement of an action on the
contract.17 In this case, no rescission was made. Besides, the cancellation
of health care agreements as in insurance policies require the concurrence
of the following conditions:
From the agreed stipulation of facts and other pleadings filed by the
parties, it appears that plaintiffs Juan Isasi, M. Salustiana Aldecoa, Claudio
Zuloaga, Jr., and Miren Zuloaga formed a partnership known as "Aldecoa,
Zuloaga e Isasi" organized principally for the exploitation, development
and utilization of Haciendas Manucao and Conchita, located in the
municipalities of Binalbagan and Hinigaran, Negros, Occidental. The
partnership agreement "Escritura de Constitucion de la Sociedad Agricola
Aldecoa, Zuloaga e Isasi" was duly registered on October 27, 1947.
The records show that for the tax years 1948 and 1949, the firm Aldecoa,
Zuloaga e Isasi filed its income tax returns and the Collector of Internal
Revenue assessed the sum of P26,873.66 against said partnership which
the latter paid and that the members of the partnership filed their
individual income tax returns for the years 1948, 1949, 1950 and 1951, in
which returns they indicated the shares of the profit or dividends that they
allege to have received from the partnership. On June 30, 1951, the
partners agreed to dissolve the partnership and the agreement of
dissolution was duly recorded in the Securities and Exchange Commission
on October 25, 1951, wherein plaintiff Hugo P. Rodriguez was appointed as
liquidator.
income tax. The Fiscal further set up the affirmative defense that it being
a civil partnership, whether registered or not, Aldecoa, Zuloaga e Isasi
could be taxed as a corporation under Section 24 of the National Internal
Revenue Code. He therefore prayed that the complaint be dismissed with
costs against plaintiffs.
After the parties had filed their respective memoranda, the of Tax Appeals
which took the case rendered a decision ordering defendant to refund the
sum of P26,873.66, without costs, and making the following
pronouncements:
In view of the foregoing, we are, therefore, of the opinion and so
hold that the partnership "Aldecoa, Zuloaga e Isasi" was a duly
registered general co-partnership (compania colectiva) with the
meaning and contemplation of sections 24 and 26 of the National
Internal Revenue Code and as such it is not liable for income tax as
a juridical person although the partners composing it are liable in
their individual capacity. Since it is admitted that during the
calendar years 1948, 1949, 1950 and 1951, the plaintiff partners
Juan Isasi, M. Salustiana Aldecoa, Claudio Zuloaga and Zuloaga of
the said partnership had filed their respective individual income tax
returns, and in these returns, the said plaintiff partners indicated
the amounts they had received as income from the partnership and
paid the income tax assessed against them by the defendant
Collector of Internal Revenue on account thereof, the total amount
of P26,873.66 paid by the partnership "Aldecoa, Zuloaga e Isasi" as
income tax for the fiscal years from July 1, 1948, to June 30, 1950,
is therefore refundable.
From this decision, defendant filed with this Court a petition to review the
said decision making the following assignment of errors:
partnership have been repealed by Article 2270, No. 2, of the new Civil
Code.
Under the old codes, there was a distinction between civil and commercial
partnership and since sections 24 and 26 of the Tax Code, under which
respondent partners claim their right to be refunded, expressly exempts
from corporation tax "duly registered general co-partnerships"
(sociedades colectivas), respondent partners maintain that their defunct
partnership (which by its purposes and scope seemed to partake of the
nature of a civil partnership), was dully registered and had the form and
style of a general co-partnership and is, therefore, entitled to the
exemption. They also advanced the theory that a partnership, whether
civil or commercial, would be entitled to the exemption as long as it is a
general partnership, because the Tax Code makes qualification to this
effect.
The issues left for Us to determine in this appeal are: whether the term
duly registered general co-partnership (sociedades colectivas) used in
sections 24 and 26 of the Tax Code includes both the commercial civil
ones, and whether the partnership Aldecoa, Zuloaga e Isasi falls within
said classification and hence entitled to the benefit granted therein.
There is no dispute that the partnership agreement entered into by the
respondent partners was styled "Escritura de Constitucion de la Sociedad
Agricola Limitada Aldecoa, Zuloaga e Isasi", thereby giving said
partnership is a limited one. On the other hand, said agreement specifies
that the primary purpose for which the partnership was organized was the
exploitation of the two haciendas "Manucao" and "Conchita", as stated in
paragraph 3 thereof which declares that:
3.o Que el objeto de la sociedad es la rehabilitation de las
haciendas citadas y de sus pertenencias, y la explotacion agricola
de las mismas, en la forma que crea oportuno el gerente de la
misma, y para llevar a cabo dicho objeto y los fines generales de la
sociedad, la misma podra:
not added; the management of the firm was entrusted to a partner, Don
Juan Isasi; the contribution of all the partners was expressly provided
therein there being no person Contributing a specific amount of capital
to a common fund to become liable for the business transactions of the
firm executedexclusively by others under a collective name, as is the case
in limited partnerships (Art. 122, No. 2, Code of Commerce); the duration
of the partnership was made to last until June 30, 1952; and it allowed its
manager, Don Juan Isasi to engage in the same kind of undertaking. It is
unmistakable, notwithstanding the title of the partnership agreement
(Escritura de Constitucion de la Sociedad Agricola Limitada Aldecoa,
Zuloaga e Isasi), that the partners intended to organize a general
partnership under the Code of Commerce. For this reason, We agree with
the Court of Tax Appeals when it states:
To establish a limited partnership there must be at least one
general partner and the name of at least one of the general
partners must appear in the firm name. (Articles 122(2), 146, 148,
Code of Commerce). If these requisites are not complied with, the
partnership, notwithstanding the fact that the articles of association
are entitled "limited partnership" (Jo Chung Cang vs. Pacific
Commercial Co., 45 Phil. 142). An examination of the firm name of
the partnership "Aldecoa, Zuloaga e Isasi" will readily show that
neither of this requirements have been fulfilled; instead it operated
under the name of all its members of some of them, or of only one
(without necessarily adding to the name of names stated in last two
cases, the words "and company" (par. 1, Art. 126, Code of
Commerce). A limited partnership that has not complied with the
law of its creation is not considered a limited partnership at all, but
a general partnership in which all the members are liable (Hechen,
Elements of Partnership, p. 412; Gilmore, Partnership, p. 499; 20
R.C.L. 1064). Moreover, a limited partnership cannot perform any
act in the management of the partner interests and cannot even
examine the condition and state of partnership administration
except at stated times. (Articles 122 (2), 148 and 150, Code of
Commerce), unlike the partnership Aldecoa, Zuloaga e Isasi,
March 2, 1926
the present action was brought for the recovery of the unpaid balance
with interest. Upon trial the court below rendered judgment in favor of the
plaintiff and against the partnership for the sum of P27,951.68 and for the
payment of interest on the capital of P21,168.71 at the rate of 10 per cent
per annum from the 31st October, 1924, until paid, together with 10 per
cent on the amount due for fees for collection in accordance with the
terms of the aforesaid note. The judgment further provided that execution
should first issue against the property of the partnership should first issue
against the insolvency of the partnership, it might issue against the
property of the partners De Silva and Aboitiz and in the event of their
insolvency, then against the property of the industrial partner Jose
Martinez. From this judgment Martinez appealed to this court and here
maintains that under article 141 of the Code of Commerce he, as a mere
industrial partner, cannot be held responsible for the partnership's debt.
The case is practically identical with that of the Compania Maritima vs.
Munoz (9 Phil., 326), in which this court held the industrial partners
secondarily liable for the debts of the partnership but on the strength of
the vigorous dissenting opinion of Chief Justice Arellano in that case, that
appellant argues that the decision therein was erroneous and should now
be overruled. With all due respect for the legal acumen of the first Chief
Justice of this Court, we are still of the opinion that the case was correctly
decided. Article 127 of the Code of Commerce reads as follows:
All the members of the general copartnership, be they or be they
not managing partners of the same are liable personally and in
solidum with all their property for the results of the transaction
made in the name and for the account of the partnership, under the
signature of the later, and by a person authorized to make use
thereof.
The language of this article is clear and specific that all the members of a
general copartnership are liable with all their property for the results of
the duly authorized transactions made in the name and for the account of
the partnership. On the other hand, article 141, upon which the appellants
relies and which provides that "losses shall be computed in the same
proportion among the capitalist partners without including the industrial
NEGROS
METAL
CORPORATION, Petitioner,
LAMAYO, Respondent.
vs.
ARMELO
J.
that
complainant
was
illegally
dismissed
by
for illegal dismissal, there being nothing wrong in opting for separation
pay in lieu of reinstatement.
Petitioners motion for reconsideration having been denied by
Resolution12 of January 21, 2009, it interposed the present petition for
review on certiorari, maintaining that the grievance machinery procedure
should have been followed first before respondents complaint for illegal
dismissal could be given due course.
The petition fails.
Articles 217, 261, and 262 of the Labor Code outline the jurisdiction of
labor arbiters and voluntary arbitrators as follows:
Art. 217. Jurisdiction of the Labor Arbiters and the Commission. - (a)
Except as otherwise provided under this Code, the Labor Arbiters shall
have original and exclusive jurisdiction to hear and decide, within thirty
(30) calendar days after the submission of the case by the parties for
decision without extension, even in the absence of stenographic notes,
the following cases involving all workers, whether agricultural or nonagricultural:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases
that workers may file involving wages, rates of pay, hours of
work and other terms and conditions of employment;
4. Claims for actual, moral, exemplary and other forms of
damages arising from the employer-employee relations;
5. Cases arising from any violation of Article 264 of this Code,
including questions involving the legality of strikes and
lockouts; and
This is a petition for certiorari to reverse the Decision dated August 16,
1991 of the Voluntary Arbitrator, respondent Israel D. Damasco, declaring
as valid the separation from employment of petitioner. We dismiss the
petition.
I
Petitioner was employed as typist of private respondent at its plant in
Quezon, Bukidnon.
At about 5:00 P.M. of November 27, 1990, petitioner went to visit Mercy
Baylas, a co-employee, at the ladies' dormitory inside the compound of
private respondent. Upon seeing petitioner, Baylas hid behind the divider
at the reception room. Rosemarie Basa and Isabel Beleno, co-boarders of
Baylas, told petitioner that Baylas was not at the dormitory and advised
him to stop courting her because she had no feelings towards him.
Afterwards, the two left leaving petitioner alone in the room. When he
peeped behind the divider, he saw Baylas, who stood up without
answering his greetings and ran towards her room. He followed, and after
taking hold of her left hand, pulled her towards him. The force caused her
to fall on the floor. He then placed himself on top of her. She resisted and
futilely struggled to free herself from his grasp. Sonia Armada, the
dormitory housekeeper, responded to Baylas' shouts for help. Armada saw
petitioner embracing and kissing Baylas. She tried to separate petitioner
from Baylas but to no avail. So she went outside and asked Basa and
Beleno to help Baylas. She also asked the help of Edmundo Subong.
Basa and Beleno tried to pull petitioner away from Baylas, but it was
Subong who was able to free Baylas from petitioner.
II
According to petitioner's version, Baylas was his girlfriend, whom he
visited at the ladies' dormitory in the afternoon of November 27, 1990. At
the dormitory, petitioner saw Rosemarie Basa who told him that Baylas
was not around. To prove that Basa was lying, he peeped behind the
divider and saw Baylas hiding there. When Baylas ran towards her room,
petitioner followed her. While running, Baylas lost her balance and fell
down. However, petitioner got hold of her to prevent her from hitting the
floor and to help her to her feet. He denied having kissed and embraced
her. He admitted that Subong arrived and pulled him away from Baylas.
He also admitted that he voluntarily surrendered to the security guards.
III
v.
National
Labor
Relation
NAME
TOTAL
1. Rico E. Gomez
P 99,088.125
2. Rolando Tupas
P110,377.170
3. Detecio S. Vicente
P107,904.92
4. Edwin Tupas
P113,532.67
5. Roberto P. Ruiz
P110,604.92
6. Ronnie Llabres
P 9,608.25
7. Dennis Llabres
P 6,626.60
8. Sandy Figer
P 3,247.05
P560,989.705
Despite the fact that the records of the said case disclose that the
appearance of the undersigned as counsel for the petitioner has
been duly acknowledged and recognized, no copy of such Order
was ever sent officially to the undersigned counsel. The
undersigned counsel was able to secure a copy thereof from the
DOLE Regional Office in Baguio City only on June 18, 1996. 6
A Notice and a copy of the Order dated 24 January 1996 was sent by the
DOLE-CAR Regional Office through registered mail to the address of
petitioners then counsel-of-record Atty. Salvador Solis (Atty. Solis) on 29
January 1996. However, the same was not received by Atty. Solis.
Indicated on the envelope containing the Notice of the Order dated 24
January 1996 were the following notations by the post office on 5 February
1996:
This Court notes that prior notices of the hearings were all sent to the very
same address and were received always by petitioners counsel. It is a
source of no little wonder, therefore, why the post office reported that
there was "[n]o such number #5 at Sto. Nio St." We could only conclude,
at this time, that the notice was not received by the petitioners not
through their fault. Thus, we say that the post office failed to deliver the
Notice and copy of the 24 January 1996 Order thereto. This fact was
admitted by public respondent.21
Without receipt by the petitioners of the notice and copy of the Order
dated 24 January 1996, the same has not yet become final and executory
and the Writ of Execution issued pursuant thereto on 12 March 1996 was
premature and without legal basis. This renders the Writ of Execution
fatally defective and, thus, null.
Finally, the Court declines from addressing at this point the question of
petitioner Antonios solidary liability with co-petitioner Rizal Security for
the payment of the monetary awards granted to the private respondents.
Considering that the Order dated 24 January 1996 has not yet attained
finality and the Writ of Execution dated 12 March 1996 has been quashed
by reason thereof, to resolve the last issue now would be injudicious and
would pre-empt whatever action public respondent DOLE-CAR Director
Maraan may still take on CAR00-9507-CI-25. The underlying principle of
the rule on exhaustion of administrative remedies rests on the
presumption that when the administrative body, or grievance machinery,
is afforded a chance to pass upon the matter, it will decide the same
correctly. Thus, for reasons of comity and convenience, our courts of
justice will shy away from a dispute until the system of administrative
redress has been completed and complied with so as to give the
administrative agency every opportunity to correct its error and to dispose
of the case.24
WHEREFORE, premises considered, the Court PARTIALLY GRANTS the
instant Petition and ISSUES a Writ of Certiorari to quash the Writ of
Execution dated 12 March 1996 for being issued prematurely. The
Department of Labor and Employment Cordillera Administrative Region is
further DIRECTED to proceed with CAR00-9507-CI-25 with DISPATCH. No
costs.
SO ORDERED.
NAME
DEFICIENCY
The Facts
1. ALEXANDER POCDING
P 36,380.85
2. FIDEL BALANGAY
36,380.85
3. BUAGEN CLYDE
36,380.85
4. DENNIS EPI
36,380.85
36,380.85
6. GABRIEL TAMULONG
36,380.85
7. ANTON PEDRO
36,380.85
8. FRANCISCO PINEDA
36,380.85
9. GASTON DUYAO
36,380.85
10. HULLARUB
36,380.85
36,380.85
36,380.85
36,380.85
36,380.85
36,380.85
36,380.85
36,380.85
36,380.85
EBVSAI filed a motion for reconsideration 8 and alleged that the Regional
Director does not have jurisdiction over the subject matter of the case
because the money claim of each private respondent exceeded P5,000.
EBVSAI pointed out that the Regional Director should have endorsed the
case to the Labor Arbiter.
In a supplemental motion for reconsideration, 9 EBVSAI questioned the
Regional Director's basis for the computation of the deficiencies due to
each private respondent.
In an Order10 dated 16 January 1997, the Regional Director denied
EBVSAI's motion for reconsideration and supplemental motion for
reconsideration. The Regional Director stated that, pursuant to Republic
Act No. 7730 (RA 7730),11 the limitations under Articles 129 12 and
217(6)13 of the Labor Code no longer apply to the Secretary of Labor's
visitorial and enforcement powers under Article 128(b). 14 The Secretary of
Labor or his duly authorized representatives are now empowered to hear
and decide, in a summary proceeding, any matter involving the recovery
of any amount of wages and other monetary claims arising out of
employer-employee relations at the time of the inspection.
EBVSAI appealed to the Secretary of Labor.
36,380.85
36,380.85
36,380.85
TOTAL
P 763,997.85
xxxx
SO ORDERED.7
of the hearing and that the payroll documents did not indicate the periods
covered by EBVSAI's alleged payments.
EVBSAI filed a motion for reconsideration which was denied by the
Secretary of Labor in his 3 January 2000 Order. 17
EBVSAI filed a petition for certiorari before the Court of Appeals.
The Ruling of the Court of Appeals
In its 29 May 2001 Decision, the Court of Appeals dismissed the petition
and affirmed the Secretary of Labor's decision. The Court of Appeals
adopted the Secretary of Labor's ruling that RA 7730 repealed the
jurisdictional limitation imposed by Article 129 on Article 128 of the Labor
Code. The Court of Appeals also agreed with the Secretary of Labor's
finding that EBVSAI was accorded due process.
The Court of Appeals also denied EBVSAI's motion for reconsideration in
its 26 February 2002 Resolution.
Hence, this petition.
The Issues
This case raises the following issues:
1. Whether the Secretary of Labor or his duly authorized
representatives acquired jurisdiction over EBVSAI; and
2. Whether the Secretary of Labor or his duly authorized
representatives have jurisdiction over the money claims of private
respondents which exceed P5,000.
The Ruling of the Court
The petition has no merit.
On the Regional Director's Jurisdiction over EBVSAI
EBVSAI claims that the Regional Director did not acquire jurisdiction over
EBVSAI because he failed to comply with Section 11, Rule 14 of the 1997
Rules of Civil Procedure. 18 EBVSAI points out that the notice of hearing was
served at the Ambuklao Plant, not at EBVSAI's main office in Makati, and
that it was addressed to Leonardo Castro, Jr., EBVSAI's Vice-President.
The Rules on the Disposition of Labor Standards Cases in the Regional
Offices19 (rules) specifically state that notices and copies of orders shall be
served on the parties or their duly authorized representatives at their last
known address or, if they are represented by counsel, through the
latter.20 The rules shall be liberally construed 21 and only in the absence of
any applicable provision will the Rules of Court apply in a suppletory
character.22
In this case, EBVSAI does not deny having received the notices of hearing.
In fact, on 29 March and 13 June 1996, Danilo Burgos and Edwina Manao,
detachment commander and bookkeeper of EBVSAI, respectively,
appeared before the Regional Director. They claimed that the 22 March
1996 notice of hearing was received late and manifested that the notices
should be sent to the Manila office. Thereafter, the notices of hearing were
sent to the Manila office. They were also informed of EBVSAI's violations
and were asked to present the employment records of the private
respondents for verification. They were, moreover, asked to submit, within
10 days, proof of compliance or their position paper. The Regional Director
validly acquired jurisdiction over EBVSAI. EBVSAI can no longer question
the jurisdiction of the Regional Director after receiving the notices of
hearing and after appearing before the Regional Director.
On the Regional Director's Jurisdiction over the Money Claims
EBVSAI maintains that under Articles 129 and 217(6) of the Labor Code,
the Labor Arbiter, not the Regional Director, has exclusive and original
jurisdiction over the case because the individual monetary claim of private
respondents exceeds P5,000. EBVSAI also argues that the case falls under
the exception clause in Article 128(b) of the Labor Code. EBVSAI asserts
that the Regional Director should have certified the case to the Arbitration
Branch of the National Labor Relations Commission (NLRC) for a full-blown
hearing on the merits.
In Allied Investigation Bureau, Inc. v. Sec. of Labor, we ruled that:
While it is true that under Articles 129 and 217 of the Labor Code,
the Labor Arbiter has jurisdiction to hear and decide cases where
the aggregate money claims of each employee exceeds P5,000.00,
said provisions of law do not contemplate nor cover the visitorial
and enforcement powers of the Secretary of Labor or his duly
authorized representatives.
This was further affirmed in our ruling in Cirineo Bowling Plaza, Inc. v.
Sensing,24 where we sustained the jurisdiction of the DOLE Regional
Director and held that "the visitorial and enforcement powers of the
DOLE Regional Director to order and enforce compliance with
labor standard laws can be exercised even where the individual
claim exceeds P5,000."
Rather, said powers are defined and set forth in Article 128 of the
Labor Code (as amended by R.A. No. 7730) thus:
In this case, the Regional Director validly assumed jurisdiction over the
money claims of private respondents even if the claims exceeded P5,000
because such jurisdiction was exercised in accordance with Article 128(b)
of the Labor Code and the case does not fall under the exception clause.
The Court notes that EBVSAI did not contest the findings of the labor
regulations officer during the hearing or after receipt of the notice of
inspection results. It was only in its supplemental motion for
reconsideration before the Regional Director that EBVSAI questioned the
findings of the labor regulations officer and presented documentary
evidence to controvert the claims of private respondents. But even if this
was the case, the Regional Director and the Secretary of Labor still looked
into and considered EBVSAI's documentary evidence and found that such
did not warrant the reversal of the Regional Director's order. The Secretary
of Labor also doubted the veracity and authenticity of EBVSAI's
documentary evidence. Moreover, the pieces of evidence presented by
EBVSAI were verifiable in the normal course of inspection because all
employment records of the employees should be kept and maintained in
or about the premises of the workplace, which in this case is in Ambuklao
Plant, the establishment where private respondents were regularly
assigned.27