ROYAL CROWN INTERNATIONALE vs.

NATIONAL LABOR RELATIONS COMMISSION

G.R. No. 78085, October 16, 1989
Doctrine: Any agent of a foreign corporation, whether or not engaged in business in
the Philippines, constitutes personal service upon that corporation, and accordingly,
judgment may be rendered against said foreign corporation
MEEZ
FACTS:
In 1983, petitioner recruited and deployed Virgilio P. Nacionales for employment
with ZAMEL as an architectural draftsman in Saudi Arabia. On May 25, 1983, a
service agreement was executed. Private respondent departed for Saudi Arabia on
June 28,1983.
On February 13, 1984, ZAMEL terminated the employment of private respondent on
the ground that his performance was below par. On February 16, 1984, he was
made to board a plane bound for the Philippines.
Private respondent then filed on April 23, 1984 a complaint for illegal termination
against petitioner and ZAMEL with the POEA.
Based on a finding that petitioner and ZAMEL failed to establish that private
respondent was terminated for just and valid cause, the Workers' Assistance and
Adjudication Office of the POEA issued a decision.
On July 18, 1986, petitioner filed thru its new counsel a motion for reconsideration
where he alleged that the POEA erred in holding it solidarity liable for ZAMEL's
violation of private respondent's service agreement even if it was not a party to the
agreement.
In a resolution promulgated on December 11, 1986, the NLRC affirmed the POEA
decision, holding that, as a duly licensed private employment agency, petitioner is
jointly and severally liable with its foreign principal ZAMEL for all claims and
liabilities which may arise in connection with the implementation of the employment
contract or service agreement.
On March 30, 1987, the NLRC denied for lack of merit petitioner's motion for
reconsideration.
Petitioner contends that there is no provision in the Labor Code, or the omnibus
rules implementing the same, which either provides for the "third-party liability" of
an employment agency or recruiting entity for violations of an employment
agreement performed abroad, or designates it as the agent of the foreign-based
employer for purposes of enforcing against the latter claims arising out of an
employment agreement. Hence this petition.

ISSUE:
Whether or not petitioner as a private employment agency may be held jointly and
severally liable with the foreign-based employer for any claim which may arise in
connection with the implementation of the employment contracts of the employees
recruited and deployed abroad.
HELD:
Petitioner conveniently overlooks the fact that it had voluntarily assumed solidary
liability under the various contractual undertakings it submitted to the Bureau of
Employment Services. In applying for its license to operate a private employment
agency for overseas recruitment and placement, petitioner was required to submit,
among others, a document or verified undertaking whereby it assumed all
responsibilities for the proper use of its license and the implementation of the
contracts of employment with the workers it recruited and deployed for overseas
employment. It was also required to file with the Bureau a formal appointment or
agency contract executed by the foreign-based employer in its favor to recruit and
hire personnel for the former, which contained a provision empowering it to sue and
be sued jointly and solidarily with the foreign principal for any of the violations of
the recruitment agreement and the contracts of employment.
These contractual undertakings constitute the legal basis for holding petitioner, and
other private employment or recruitment agencies, liable jointly and severally with
its principal, the foreign-based employer, for all claims filed by recruited workers
which may arise in connection with the implementation of the service agreements
or employment contracts.
In the case at bar, it cannot be denied that petitioner is an agent of ZAMEL. The
service agreement was executed in the Philippines between private respondent and
Milagros G. Fausto, the General Manager of petitioner, for and in behalf of ZAMEL.
Moreover, one of the documents presented by petitioner as evidence, i.e., the
counter-affidavit of its General Manager Ms. Fausto, contains an admission that it is
the representative and agent of ZAMEL.
Considering the foregoing, the Court holds that the NLRC committed no grave abuse
of discretion amounting to lack or excess of jurisdiction in declaring petitioner jointly
and severally liable with its foreign principal ZAMEL for all claims which have arisen
in connection with the implementation of private respondent's employment
contract.