Ando vs. Campo et al.; G.R. No. 184007

Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 184007               February 16, 2011

PAQUITO V. ANDO, Petitioner,
vs.
ANDRESITO Y. CAMPO, ET AL., Respondents.

D E C I S I O N

NACHURA, J.:

Before this Court is a Petition for Review on Certiorari¹ under Rule 45 of the Rules of Court. Petitioner Paquito V. Ando (petitioner) is assailing the Decision² dated February 21, 2008 and the Resolution³ dated July 25, 2008 of the Court of Appeals (CA) in CA-G.R. CEB-SP. No. 02370.

Petitioner was the president of Premier Allied and Contracting Services, Inc. (PACSI), an independent labor contractor. Respondents were hired by PACSI as pilers or haulers tasked to manually carry bags of sugar from the warehouse of Victorias Milling Company and load them on trucks.⁴ In June 1998, respondents were dismissed from employment. They filed a case for illegal dismissal and some money claims with the National Labor Relations Commission (NLRC), Regional Arbitration Branch No. VI, Bacolod City.⁵

On June 14, 2001, Labor Arbiter Phibun D. Pura (Labor Arbiter) promulgated a decision, ruling in respondents’ favor.⁶ PACSI and petitioner were directed to pay a total of P422,702.28, representing respondents’ separation pay and the award of attorney’s fees.⁷

Petitioner and PACSI appealed to the NLRC. In a decision⁸ dated October 20, 2004, the NLRC ruled that petitioner failed to perfect his appeal because he did not pay the supersedeas bond. It also affirmed the Labor Arbiter’s decision with modification of the award for separation pay to four other employees who were similarly situated. Upon finality of the decision, respondents moved for its execution.⁹

To answer for the monetary award, NLRC Acting Sheriff Romeo Pasustento issued a Notice of Sale on Execution of Personal Property¹⁰ over the property covered by Transfer Certificate of Title (TCT) No. T-140167 in the name of "Paquito V. Ando x x x married to Erlinda S. Ando."

This prompted petitioner to file an action for prohibition and damages with prayer for the issuance of a temporary restraining order (TRO) before the Regional Trial Court (RTC), Branch 50, Bacolod City. Petitioner claimed that the property belonged to him and his wife, not to the corporation, and, hence, could not be subject of the execution sale. Since it is the corporation that was the judgment debtor, execution should be made on the latter’s properties.¹¹

On December 27, 2006, the RTC issued an Order¹² denying the prayer for a TRO, holding that the trial court had no jurisdiction to try and decide the case. The RTC ruled that, pursuant to the NLRC Manual on the Execution of Judgment, petitioner’s remedy was to file a third-party claim with the NLRC Sheriff. Despite lack of jurisdiction, however, the RTC went on to decide the merits of the case.

Petitioner did not file a motion for reconsideration of the RTC Order. Instead, he filed a petition for certiorari under Rule 65¹³ before the CA. He contended that the RTC acted without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction in issuing the Order. Petitioner argued that the writ of execution was issued improvidently or without authority since the property to be levied belonged to him – in his personal capacity – and his wife. The RTC, respondent contended, could stay the execution of a judgment if the same was unjust.¹⁴ He also contended that, pursuant to a ruling of this Court, a third party who is not a judgment creditor may choose between filing a third-party claim with the NLRC sheriff or filing a separate action with the courts.¹⁵

In the Decision now assailed before this Court, the CA affirmed the RTC Order in so far as it dismissed the complaint on the ground that it had no jurisdiction over the case, and nullified all other pronouncements in the same Order. Petitioner moved for reconsideration, but the motion was denied.lawph!l

Petitioner then filed the present petition seeking the nullification of the CA Decision. He argues that he was never sued in his personal capacity, but in his representative capacity as president of PACSI. Neither was there any indication in the body of the Decision that he was solidarily liable with the corporation.¹⁶ He also concedes that the Labor Arbiter’s decision has become final. Hence, he is not seeking to stop the execution of the judgment against the properties of PACSI. He also avers, however, that there is no evidence that the sheriff ever implemented the writ of execution against the properties of PACSI.¹⁷

Petitioner also raises anew his argument that he can choose between filing a third-party claim with the sheriff of the NLRC or filing a separate action.¹⁸ He maintains that this special civil action is purely civil in nature since it "involves the manner in which the writ of execution in a labor case will be implemented against the property of petitioner which is not a corporate property of PACSI."¹⁹ What he is seeking to be restrained, petitioner maintains, is not the Decision itself but the manner of its execution.²⁰ Further, he claims that the property levied has been constituted as a family home within the contemplation of the Family Code.²¹

The petition is meritorious.

Initially, we must state that the CA did not, in fact, err in upholding the RTC’s lack of jurisdiction to restrain the implementation of the writ of execution issued by the Labor Arbiter.

The Court has long recognized that regular courts have no jurisdiction to hear and decide questions which arise from and are incidental to the enforcement of decisions, orders, or awards rendered in labor cases by appropriate officers and tribunals of the Department of Labor and Employment. To hold otherwise is to sanction splitting of jurisdiction which is obnoxious to the orderly administration of justice.²²

Thus, it is, first and foremost, the NLRC Manual on the Execution of Judgment that governs any question on the execution of a judgment of that body. Petitioner need not look further than that. The Rules of Court apply only by analogy or in a suppletory character.²³

Consider the provision in Section 16, Rule 39 of the Rules of Court on third-party claims:

SEC. 16. Proceedings where property claimed by third person.—If the property levied on is claimed by any person other than the judgment obligor or his agent, and such person makes an affidavit of his title thereto or right to the possession thereof, stating the grounds of such right or title, and serves the same upon the officer making the levy and a copy thereof upon the judgment obligee, the officer shall not be bound to keep the property, unless such judgment obligee, on demand of the officer, files a bond approved by the court to indemnify the third-party claimant in a sum not less than the value of the property levied on. In case of disagreement as to such value, the same shall be determined by the court issuing the writ of execution. No claim for damages for the taking or keeping of the property may be enforced against the bond unless the action therefor is filed within one hundred twenty (120) days from the date of the filing of the bond.

The officer shall not be liable for damages for the taking or keeping of the property, to any third-party claimant if such bond is filed. Nothing herein contained shall prevent such claimant or any third person from vindicating his claim to the property in a separate action, or prevent the judgment obligee from claiming damages in the same or a separate action against a third-party claimant who filed a frivolous or plainly spurious claim.

When the writ of execution is issued in favor of the Republic of the Philippines, or any officer duly representing it, the filing of such bond shall not be required, and in case the sheriff or levying officer is sued for damages as a result of the levy, he shall be represented by the Solicitor General and if held liable therefor, the actual damages adjudged by the court shall be paid by the National Treasurer out of such funds as may be appropriated for the purpose.

On the other hand, the NLRC Manual on the Execution of Judgment deals specifically with third-party claims in cases brought before that body. It defines a third-party claim as one where a person, not a party to the case, asserts title to or right to the possession of the property levied upon.²⁴ It also sets out the procedure for the filing of a third-party claim, to wit:

SECTION 2. Proceedings. — If property levied upon be claimed by any person other than the losing party or his agent, such person shall make an affidavit of his title thereto or right to the possession thereof, stating the grounds of such right or title and shall file the same with the sheriff and copies thereof served upon the Labor Arbiter or proper officer issuing the writ and upon the prevailing party. Upon receipt of the third party claim, all proceedings with respect to the execution of the property subject of the third party claim shall automatically be suspended and the Labor Arbiter or proper officer issuing the writ shall conduct a hearing with due notice to all parties concerned and resolve the validity of the claim within ten (10) working days from receipt thereof and his decision is appealable to the Commission within ten (10) working days from notice, and the Commission shall resolve the appeal within same period.

There is no doubt in our mind that petitioner’s complaint is a third- party claim within the cognizance of the NLRC. Petitioner may indeed be considered a "third party" in relation to the property subject of the execution vis-à-vis the Labor Arbiter’s decision. There is no question that the property belongs to petitioner and his wife, and not to the corporation. It can be said that the property belongs to the conjugal partnership, not to petitioner alone. Thus, the property belongs to a third party, i.e., the conjugal partnership. At the very least, the Court can consider that petitioner’s wife is a third party within contemplation of the law.

The Court’s pronouncements in Deltaventures Resources, Inc. v. Hon. Cabato²⁵ are instructive:

Ostensibly the complaint before the trial court was for the recovery of possession and injunction, but in essence it was an action challenging the legality or propriety of the levy vis-a-vis the alias writ of execution, including the acts performed by the Labor Arbiter and the Deputy Sheriff implementing the writ. The complaint was in effect a motion to quash the writ of execution of a decision rendered on a case properly within the jurisdiction of the Labor Arbiter, to wit: Illegal Dismissal and Unfair Labor Practice. Considering the factual setting, it is then logical to conclude that the subject matter of the third party claim is but an incident of the labor case, a matter beyond the jurisdiction of regional trial courts.

x x x x

x x x. Whatever irregularities attended the issuance an execution of the alias writ of execution should be referred to the same administrative tribunal which rendered the decision. This is because any court which issued a writ of execution has the inherent power, for the advancement of justice, to correct errors of its ministerial officers and to control its own processes.

The broad powers granted to the Labor Arbiter and to the National Labor Relations Commission by Articles 217, 218 and 224 of the Labor Code can only be interpreted as vesting in them jurisdiction over incidents arising from, in connection with or relating to labor disputes, as the controversy under consideration, to the exclusion of the regular courts.²⁶

There is no denying that the present controversy arose from the complaint for illegal dismissal. The subject matter of petitioner’s complaint is the execution of the NLRC decision. Execution is an essential part of the proceedings before the NLRC. Jurisdiction, once acquired, continues until the case is finally terminated,²⁷ and there can be no end to the controversy without the full and proper implementation of the commission’s directives.

Further underscoring the RTC’s lack of jurisdiction over petitioner’s complaint is Article 254 of the Labor Code, to wit:

ART. 254. INJUNCTION PROHIBITED. – No temporary or permanent injunction or restraining order in any case involving or growing out of labor disputes shall be issued by any court or other entity, except as otherwise provided in Articles 218 and 264 of this Code.

That said, however, we resolve to put an end to the controversy right now, considering the length of time that has passed since the levy on the property was made.

Petitioner claims that the property sought to be levied does not belong to PACSI, the judgment debtor, but to him and his wife. Since he was sued in a representative capacity, and not in his personal capacity, the property could not be made to answer for the judgment obligation of the corporation.

The TCT²⁸ of the property bears out that, indeed, it belongs to petitioner and his wife. Thus, even if we consider petitioner as an agent of the corporation – and, therefore, not a stranger to the case – such that the provision on third-party claims will not apply to him, the property was registered not only in the name of petitioner but also of his wife. She stands to lose the property subject of execution without ever being a party to the case. This will be tantamount to deprivation of property without due process.

Moreover, the power of the NLRC, or the courts, to execute its judgment extends only to properties unquestionably belonging to the judgment debtor alone.²⁹ A sheriff, therefore, has no authority to attach the property of any person except that of the judgment debtor.³⁰ Likewise, there is no showing that the sheriff ever tried to execute on the properties of the corporation.

In sum, while petitioner availed himself of the wrong remedy to vindicate his rights, nonetheless, justice demands that this Court look beyond his procedural missteps and grant the petition.

WHEREFORE, the foregoing premises considered, the petition is GRANTED. The Decision dated February 21, 2008 and the Resolution dated July 25, 2008 of the Court of Appeals in CA-G.R. CEB-SP. No. 02370 are hereby REVERSED and SET ASIDE, and a new one is entered declaring NULL and VOID (1) the Order of the Regional Trial Court of Negros Occidental dated December 27, 2006 in Civil Case No. 06-12927; and (2) the Notice of Sale on Execution of Personal Property dated December 4, 2006 over the property covered by Transfer Certificate of Title No. T-140167, issued by the Acting Sheriff of the National Labor Relations Commission.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA
Associate Justice

WE CONCUR:

ANTONIO T. CARPIO
Associate Justice
Chairperson

DIOSDADO M. PERALTA Associate Justice

ROBERTO A. ABAD Associate Justice

JOSE CATRAL MENDOZA
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

Footnotes

¹ Rollo, pp. 26-48.

² Penned by Associate Justice Priscilla Baltazar-Padilla, with Associate Justices Isaias P. Dicdican and Franchito N. Diamante, concurring; rollo, pp. 50-59.

³ Id. at 75-77.

⁴ CA rollo, p. 191.

⁵ Rollo, pp. 50-51.

⁶ CA rollo, pp. 191-199.

⁷ Id. at 198.

⁸ Id. at 200-204.

⁹ Rollo, p. 51.

¹⁰ CA rollo, pp. 72-73.

¹¹ Rollo, p. 51.

¹² CA rollo, pp. 41-44.

¹³ Id. at 2-40.

¹⁴ Id. at 16.

¹⁵ Id. at 26-27.

¹⁶ Rollo, p. 33.

¹⁷ Id. at 34.

¹⁸ Id. at 35.

¹⁹ Id. at 36.

²⁰ Id. at 37.

²¹ Id. at 39.

²² Air Services Cooperative v. CA, 354 Phil. 905, 916 (1998), citing Balais v. Hon. Velasco, 322 Phil. 790, 807 (1996).

²³ 2005 Revised Rules of Procedure of the National Labor Relations Commission, Section 3. Suppletory Application of the Rules of Court. - In the absence of any applicable provision in these Rules, and in order to effectuate the objectives of the Labor Code, the pertinent provisions of the Rules of Court of the Philippines may, in the interest of expeditious dispensation of labor justice and whenever practicable and convenient, be applied by analogy or in a suppletory character and effect.

²⁴ NLRC Manual on the Execution of Judgment, Rule VI, Sec. 1.

²⁵ 384 Phil. 252, 260 (2000).

²⁶ Id. at 260-261. (Citations omitted.)

²⁷ Mariño, Jr. v. Gamilla, 490 Phil. 607, 620 (2005), citing A’ Prime Security Services, Inc. v. Hon. Drilon, 316 Phil. 532, 537 (1995).

²⁸ CA rollo, p. 109.

²⁹ Go v. Yamane, G.R. No. 160762, May 3, 2006, 489 SCRA 107, 124; Yao v. Hon. Perello, 460 Phil. 658, 662 (2003); Co Tuan v. NLRC, 352 Phil. 240, 250 (1998).

³⁰ Johnson and Johnson (Phils.), Inc. v. CA, 330 Phil. 856, 873 (1996).

E.G. & I. Construction Corporation and Edsel Galeos vs. Sato et al.; G.R. No. 182070

Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 182070               February 16, 2011

E.G & I. CONSTRUCTION CORPORATION and EDSEL GALEOS, Petitioners,
vs.
ANANIAS P. SATO, NILO BERDIN, ROMEO M. LACIDA, JR., and HEIRS OF ANECITO S. PARANTAR, SR., namely: YVONNE, KIMBERLY MAE, MARYKRIS, ANECITO, JR., and JOHN BRYAN, all surnamed PARANTAR, Respondents.

D E C I S I O N

NACHURA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court, assailing the Decision¹dated October 24, 2007 and the Resolution² dated March 3, 2008 of the Court of Appeals (CA) in CA-G.R. SP No. 02316.

The factual and procedural antecedents of the case are as follows:

Respondent Ananias P. Sato (Sato) was hired in October 1990 by petitioner E.G. & I. Construction Corporation as a grader operator, which is considered as technical labor. He held the position for more than thirteen (13) years. In April 2004, Sato discovered that petitioner corporation had not been remitting his premium contributions to the Social Security System (SSS). When Sato kept on telling petitioners to update his premium contributions, he was removed as a grader operator and made to perform manual labor, such as tilling the land in a private cemetery and/or digging earthworks in petitioner corporation’s construction projects.³ In July 2004, an inspection team from the SSS went to petitioner corporation’s office to check its compliance with the SSS law. On July 22, 2004, petitioners told Sato that they could no longer afford to pay his wages, and he was advised to look for employment in other construction companies.⁴ Sato, however, found difficulty in finding a job because he had been blacklisted in other construction companies and was prevented from entering the project sites of petitioners.⁵

Respondent Nilo Berdin (Berdin) was hired by petitioners in March 1991 as a steelman/laborer; respondent Anecito S. Parantar, Sr.⁶ (Parantar) was hired in February 1997 as a steelman; and respondent Romeo M. Lacida, Jr.⁷ (Lacida) was hired in March 2001 as a laborer.⁸ At the start of their employment, they were required by petitioners to sign several documents purporting to be employment contracts.⁹ They immediately signed the documents without verifying their contents for fear of forfeiting their employment.¹⁰

Respondents were required to work from 7:00 a.m. until 5:00 p.m. While in the employ of petitioners, they devoted their time exclusively in the service of petitioners and were assigned to various construction projects of petitioners. They were tasked to set up steel bars used in the building foundation, to mix cement, and to perform other tasks required of them by petitioners.¹¹

On July 24, 2004, the project engineer of respondents Berdin, Parantar, and Lacida instructed them to affix their signatures on various documents. They refused to sign the documents because they were written in English, a language that they did not understand. Irked by their disobedience, the project engineer terminated their employment. On the same date, they were given their weekly wages. However, the wages that were paid to them were short of three (3) days worth of wages, as penalty for their refusal to sign the documents. The following day, they were not allowed to enter the work premises.¹²

On July 26, 2004, respondents filed their respective complaints with the Regional Arbitration Branch of Cebu City for illegal dismissal, underpayment of wages (wage differentials), holiday pay, thirteenth (13th) month pay, and service incentive leave pay.¹³

Petitioners, on the other hand, admitted that respondents were employed by them and were assigned in their various construction projects. However, they denied that they illegally terminated respondents’ employment. According to petitioners, respondents abandoned their work when they failed to report for work starting on July 22, 2004. Petitioner corporation sent letters advising respondents to report for work, but they refused. Petitioner corporation maintained that respondents are still welcome, if they desire to work.¹⁴

As to respondent Sato, petitioner corporation alleged that it admonished respondent for having an illicit affair with another woman; that, in retaliation, Sato complained to the SSS for alleged non-remittance of his premium contributions; that Sato’s work was substandard; and that he also incurred unexplained absences and was constantly reprimanded for habitual tardiness.

On July 27, 2005, the Labor Arbiter rendered a decision¹⁵ finding that respondents were illegally dismissed from employment. In lieu of reinstatement, due to the strained relations of the parties and as prayed for by respondents, each of them was granted separation pay equivalent to one (1) month pay for every year of service. The Labor Arbiter likewise awarded respondents’ claim for wage differentials, 13th month pay, holiday pay, and service incentive leave pay. The Labor Arbiter ruled in favor of granting the monetary claims of respondents because of petitioner corporation’s failure to effectively controvert the said claims by not presenting proof of payment, such as payrolls or vouchers.¹⁶ The dispositive portion of the decision reads:

WHEREFORE, premises considered, judgment is hereby rendered ordering respondent [petitioner] E.G. & I. Construction Corporation to pay [respondents] the following:

1. Ananias P. Sato	-	P 107,250.00
2. Anecito Parantar	-	120,944.00
3. Nilo Berdin	-	152,144.00
4. Romeo M. Lacida, Jr.	-	138,594.00
Total Award	-	P 518,932.00 ==========

The other claims and the case against respondent Edsel Galeos are dismissed for lack of merit.

SO ORDERED.¹⁷

On appeal, the National Labor Relations Commission (NLRC) reversed the ruling of the Labor Arbiter in a decision¹⁸ dated July 31, 2006. The fallo 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 case. Respondents are however ordered to pay complainants’ proportionate 13th month [pay] for the year 2004 computed as follows:

1. Ananias Sato	-	P 3,180.00
2. Anecito Parantar	-	2,520.00
3. Nilo Berdin	-	2,700.00
4. Romeo Laceda	-	2,520.00
Total	-	P 10,920.00

SO ORDERED.¹⁹

In reversing the decision of the Labor Arbiter, the NLRC ratiocinated that, other than respondents’ bare allegation that they were dismissed, they failed to present a written notice of dismissal,²⁰ and that respondents’ individual complaints opted for the payment of separation pay instead of reinstatement.²¹ The NLRC opined that illegal dismissal was inconsistent with the prayer for separation pay instead of reinstatement. As for the monetary reliefs prayed for by respondents, the NLRC withdrew the grant of the same because of petitioner corporation’s submission of the copies of payrolls, annexed to its memorandum on appeal.²²

Respondents filed a motion for reconsideration. However, the same was denied in a resolution²³ dated October 9, 2006.

Aggrieved, respondents filed a petition for certiorari under Rule 65 of the Rules of Court before the CA. On October 24, 2007, the CA rendered a Decision, the dispositive portion of which reads:

WHEREFORE, premises considered, this petition is GRANTED. The Decision and Resolution of the NLRC, dated July 31, 2006 and October 9, 2006, respectively, are hereby REVERSED and SET ASIDE. The Decision of the labor arbiter, dated July 27, 2005, is REINSTATED.

Costs against private respondents.

SO ORDERED.²⁴

The CA ruled that respondents were illegally dismissed. A written notice of dismissal is not a pre-requisite for a finding of illegal dismissal.²⁵ Respondents did not abandon their work. They were refused entry into the company’s project sites.²⁶ As to the award of monetary claims, the CA decided in favor of the grant of the same. Petitioner corporation belatedly submitted copies of the weekly time record, payroll, and acknowledgement receipts of the 13th month pay. There was no explanation given why the said documents were not submitted before the Labor Arbiter in order to establish their authenticity and correctness, and to give respondents the opportunity to refute the entries therein.²⁷

Hence, this petition.

The issue to be resolved in this case is whether the CA erred in reinstating the decision of the Labor Arbiter, declaring that respondents were illegally terminated from employment by petitioner corporation, and that respondents are entitled to their monetary claims.

We sustain the ruling of the CA. Petitioner corporation failed to prove that respondents were dismissed for just or authorized cause. In an illegal dismissal case, the onus probandi rests on the employer to prove that the dismissal of an employee is for a valid cause.²⁸

For abandonment to exist, it is essential (a) that the employee must have failed to report for work or must have been absent without valid or justifiable reason; and (b) that there must have been a clear intention to sever the employer-employee relationship manifested by some overt acts.²⁹ The employer has the burden of proof to show the employee's deliberate and unjustified refusal to resume his employment without any intention of returning. Mere absence is not sufficient. There must be an unequivocal intent on the part of the employee to discontinue his employment.³⁰

In this case, petitioner corporation claims that respondent Sato committed unexplained absences on May 20, 24, and 25, 2004 and on June 7, 18, and 23, 2004. However, based on the findings of fact of the CA, respondent Sato worked on May 20, June 18 and 23, 2004. This was based on the weekly time record and payroll of respondent Sato that were presented by petitioner corporation in its appeal before the NLRC. On respondent Sato’s alleged absences on May 24 and 25 and on June 7, 2004, no time record and payroll documents were presented by petitioner corporation. With regard to respondents Berdin, Lacida, and Parantar, petitioner corporation alleges that they failed to report for work starting on July 22, 2004, and that petitioner even sent them letters advising them to report for work, but to no avail.

Notwithstanding these assertions of petitioner corporation, we sustain the ruling of the CA.lawphi1 The reason why respondents failed to report for work was because petitioner corporation barred them from entering its construction sites. It is a settled rule that failure to report for work after a notice to return to work has been served does not necessarily constitute abandonment.³¹ The intent to discontinue the employment must be shown by clear proof that it was deliberate and unjustified.³² Petitioner corporation failed to show overt acts committed by respondents from which it may be deduced that they had no more intention to work. Respondents’ filing of the case for illegal dismissal barely four (4) days from their alleged abandonment is totally inconsistent with our known concept of what constitutes abandonment.

We sustain the ruling of the CA on respondents’ money claims. As a rule, one who pleads payment has the burden of proving it. Even as the employee must allege non-payment, the general rule is that the burden rests on the employer to prove payment, rather than on the employee to prove non-payment. The reason for the rule is that the pertinent personnel files, payrolls, records, remittances, and other similar documents — which will show that overtime, differentials, service incentive leave, and other claims of the worker have been paid — are not in the possession of the worker but in the custody and absolute control of the employer.³³

In this case, the submission of petitioner corporation of the time records and payrolls of respondents only on their appeal before the NLRC is contrary to elementary precepts of justice and fair play. Respondents were not given the opportunity to check the authenticity and correctness of the same. Thus, we sustain the ruling of the CA in the grant of the monetary claims of respondents. We are guided by the time-honored principle that if doubts exist between the evidence presented by the employer and the employee, the scales of justice must be tilted in favor of the latter. It is the rule in controversies between a laborer and his master that doubts reasonably arising from the evidence, or in the interpretation of agreements and writing, should be resolved in the former's favor.³⁴

WHEREFORE, in view of the foregoing, the Decision dated October 24, 2007 and the Resolution dated March 3, 2008 of the Court of Appeals in CA-G.R. SP No. 02316 are hereby AFFIRMED.

Costs against the petitioners.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA
Associate Justice

WE CONCUR:

ANTONIO T. CARPIO
Associate Justice
Chairperson

DIOSDADO M. PERALTA Associate Justice

ROBERTO A. ABAD Associate Justice

JOSE CATRAL MENDOZA
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

Footnotes

¹ Penned by Associate Justice Antonio L. Villamor, with Associate Justices Stephen C. Cruz and Amy C. Lazaro-Javier, concurring; rollo, pp. 40-54.

² Id. at 56-58.

³ CA Decision, id. at 41; NLRC decision, id. at 61-62; LA decision, id. at 142.

⁴ CA Decision, id. at 41-42; NLRC decision, id. at 62; LA decision, id. at 142-143.

⁵ CA Decision; id. at 42.

⁶ Also known as Aniceto S. Parantar, Sr. in other documents.

⁷ Also known as Romeo Laceda in other documents.

⁸ CA Decision; rollo, p. 41.

⁹ CA Decision, id. at 42; NLRC decision, id. at 62; LA decision, id. at 143.

¹⁰ CA Decision, id. at 42.

¹¹ Id.; NLRC decision, id. at 62; LA decision, id. at 143.

¹² Id.

¹³ Id.

¹⁴ CA Decision, id. at 43; NLRC decision, id. at 62-63; LA decision, id. at 143-144.

¹⁵ Penned by Labor Arbiter Ernesto F. Carreon; id. at 142-148.

¹⁶ Id. at 145.

¹⁷ Id. at 147-148.

¹⁸ Penned by Commissioner Oscar S. Uy, with Presiding Commissioner Gerardo C. Nograles and Commissioner Aurelio D. Menzon, concurring; id. at 61-67.

¹⁹ Id. at 66.

²⁰ Id. at 63.

²¹ Id. at 64.

²² Id. at 65.

²³ Id. at 73-76.

²⁴ Id. at 53.

²⁵ Id. at 47.

²⁶ Id.

²⁷ Id. at 50.

²⁸ THE LABOR CODE, Art. 277(b); Pepsi Cola Products Philippines, Inc. v. Santos, G.R. No. 165968, April 14, 2008, 551 SCRA 245, 252.

²⁹ Padilla Machine Shop v. Javilgas, G.R. No. 175960, February 19, 2008, 546 SCRA 351, 357.

³⁰ Uniwide Sales Warehouse Club v. National Labor Relations Commission, G.R. No. 154503, February 29, 2008, 547 SCRA 220, 239.

³¹ Id.

³² Agabon v. National Labor Relations Commission, G.R. No. 158693, November 17, 2004, 442 SCRA 573, 606.

³³ Id. at 618.

³⁴ De Castro v. Liberty Broadcasting Network, Inc., G.R. No. 165153, September 23, 2008, 566 SCRA 238, 251.

Report on the Judicial Audit Conducted in the Regional Trial Court; A.M. No. 09-7-284-RTC

Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

A.M. No. 09-7-284-RTC               February 16, 2011

RE: REPORT ON THE JUDICIAL AUDIT CONDUCTED IN THE REGIONAL TRIAL COURT - BRANCH 56, MANDAUE CITY, CEBU.

D E C I S I O N

PERALTA, J.:

This administrative matter stemmed from the Report dated July 6, 2009 on the judicial audit and physical inventory of cases conducted by the Audit Team of the Office of the Court Administrator (OCA) in March 2007 in the Regional Trial Court of Mandaue City, Branch 56, Cebu, in anticipation of the compulsory retirement of Judge Augustine A. Vestil (Judge Vestil), then presiding judge of the same court.

The report disclosed that during the audit, the trial court has: (1) a total caseload of 1,431 cases consisting of 555 civil cases and 876 criminal cases; (2) 15 cases submitted for decision, but were already beyond the reglementary period;¹ (3) two cases with pending incidents awaiting resolution, which were beyond the reglementary period;²and (4) 247 cases, which had remained dormant for a considerable length of time.

It was further reported that Branch 56 did not observe an organized record management. No system was being followed to facilitate the monitoring of the status of cases. The court records were found to be in disarray as: (1) court records of terminated and archived cases were mixed with active cases; (2) copies of orders, pleadings and other documents were not chronologically attached to the case folders; (3) copies of the minutes of the hearings/proceedings were left unattached to the case folders and were merely kept in a separate file; and (4) loose copies of orders, pleadings and other documents were found merely inserted in the case folders.

Thus, on April 23, 2007, then Deputy Court Administrator Zenaida N. Elepaño issued a Memorandum, directing Judge Vestil to: (1) submit an explanation of his failure to: [a] decide 15 cases submitted for decision within the reglementary period, [b] resolve the incidents for resolution in two cases within the reglementary period, and [c] take further action on the 247 cases despite the lapse of a considerable length of time; (2) decide the 15 cases submitted for decision and resolve the incidents in two cases; and (3) take appropriate action on the 247 dormant cases within 45 days from notice.

Likewise, in the same Memorandum, Atty. Emeline Bullever-Cabahug (Atty. Cabahug), Clerk of Court of the same court, was directed to devise and adopt a records management system that will ensure the immediate and orderly filing of court records, and effectively facilitate the monitoring of the status of cases and supervise her staff members to ensure prompt delivery of their respective assignments.

On June 20, 2007, in compliance with the Court's directives, Judge Vestil, without explaining the reason for the delay, reported the subsequent actions taken in the cases referred to in the Memorandum dated April 23, 2007, to wit:

As to directive no. 2:

1. Civil Case No. MAN-2910 - submitted for decision in May 2007 as the defendant's Formal Offer of Exhibits was filed on February 12, 2007 and the exhibits were admitted on March 19, 2007;

2. Civil Case No. MAN-3084 – still pending trial and hearing was reset to June 28, 2007;

3. Civil Case No. MAN-4009 - decided on February 20, 2007, or 17 days before the lapse of the reglementary period. But due to the absence of the typist-in-charge, the typing of the decision was left unfinished;

4. LRC No. 638 – decided on March 8, 2007;

5. LRC (Fe Cortes Dabon, petitioner) – decided on December 7, 2006;

6. Criminal Case No. DU-3316 – decided on September 4, 2006 and was promulgated on June 6, 2007;

7. Criminal Case No. DU-5308 - decided on September 21, 2004. Promulgated set on December 5, 2006. Reset to May 28, 2007. Reset to April 26, 2007 and reset to May 21, 2007. Pre-trial of other accused was still set on May 21, 2007;

8. Criminal Case No. DU-7047 – decided on April 13, 2007; promulgated on March 26, 2007;

9. Criminal Case No. DU-7518 – decided on April 7, 2006; promulgated on April 3, 2007;

10. Criminal Case No. DU-7649 – decided on February 9, 2007; promulgated on May 28, 2007;

11. Criminal Case No. DU-9207 – decided on August 1, 2006 and promulgated on April 18, 2007;

12. Criminal Case No. DU-9650 – submitted for decision on March 1, 2007;

13. Criminal Case No. DU-11862 – decided per judgment dated October 16, 2006; set for promulgation on March 1. 2007;

14. Criminal Case No. DU-12508 – originally set to be promulgated on December 6, 2006 but due to lack of judges, it was eventually promulgated only on May 11, 2007;

15. Criminal Case No. DU-13453 – promulgated on April 2007;

16. Civil Case No. MAN-3762 (Motion to Dismiss) - counsels were required to submit their respective memoranda with regard to the motion to dismiss only up to June 11, 2007, thus, not yet submitted for decision;

17. Criminal Case No. DU-10480 (Demurrer to Evidence)- per order dated May 25, 2007, demurrer to evidence was denied. Reception of Accused evidence was set to August 28, 2007.

With regard to the alleged dormant cases, Judge Vestil acted, although belatedly, on the two hundred forty-seven (247) cases before he retired on August 8, 2007. Some of the cases were ordered dismissed or archived; others were set for pre-marking of exhibits, deposition-taking, arraignment, pre-trial or hearing; and, some were ordered submitted for decision. Judge Vestil, however, offered no explanation why there was delay in the court's action in these cases.

For her part, Atty. Cabahug reported that:

(1) they have already conducted an inventory of court records in the storage room to properly give space for cases which are archived, disposed or decided cases;

(2) they made a list in separate logbooks - of the cases: (a) forwarded to the Supreme Court, and the Court of Appeals; (b) those placed in the bodega; (c) transmitted to the Office of the Clerk of Court; (d) newly filed and transferred from other courts; and (e) already disposed of, decided or archived;

(3) they already gave instructions to the court clerks to note in the Semi Annual Inventory Report the last action of the court in all the cases assigned to them;

(4) issued a memorandum to her staff members to seek permission and enter in the logbook the time whenever they go out of the office during office hours;

(5) and suggested to have a staff meeting every Monday of the month to monitor the concerns of their staff.

In a Resolution dated March 26, 2008, the Court granted the request of Judge Vestil for the release of his retirement benefits, "provided the amount of One Hundred Thousand Pesos (P100,000.00) shall be retained/withheld therefrom to answer for whatever adverse decision the Court may impose on him in relation to the instant case.

The audit team maintained, however, that except for Civil Case No. MAN-3084 and Criminal Cases Nos. DU-9650 and DU-11862 which were inadvertently included as submitted for decision but were in fact already decided or still pending trial, all other cases reported in the audit report suffered undue delay in its disposition. While, Judge Vestil claimed that certain cases were decided within the reglementary period, he, however, also admitted that while he was able to prepare the decisions, the same remained unpromulgated within the reglementary period. With regard to the 247 dormant cases, while he immediately acted upon its resolution, he however, offered no explanation for the delay in the resolution thereof.

On August 8, 2007, Judge Vestil compulsorily retired from service.

Later, on July 6, 2009, the OCA, in its Report, found Judge Vestil guilty of undue delay in deciding cases and recommended that a fine of twenty thousand pesos (P20,000.00) be deducted from the one hundred thousand pesos (P100,000.00) previously withheld from his retirement benefits. However, in so far as Atty. Cabahug is concerned, the instant matter was recommended to be considered as closed and terminated.

On August 19, 2009, the Court resolved to consider the instant complaint CLOSED and TERMINATED in so far as Atty. Cabahug is concerned.

On October 12, 2009, Judge Vestil manifested that since his retirement in 2007, he had already undergone several medical examinations and presently his continuous medication costs at least P500.00 daily. Judge Vestil, thus, prays for the resolution of the instant complaint against him and the subsequent release of the P100,000.00 which was previously withheld from his retirement benefits upon his retirement.

We sustain the findings and recommendation of the OCA.

A review of the records would show the undisputed delay in the disposition of numerous cases assigned to Branch 56 which was then presided by Judge Vestil. There were at least 80 civil cases, some were filed as early as 1997, which are still pending as of March 2007. Furthermore, at least 100 criminal cases are still pending beyond the 90-day reglementary period.

In his defense, Judge Vestil sought refuge from the fact that Branch 56 was saddled with a heavy caseload. We are, however, unconvinced. The Court knew the heavy caseloads heaped on the shoulders of every trial judge. But such cannot excuse him from doing his mandated duty to resolve cases with diligence and dispatch. Judges burdened with heavy caseloads should request the Court for an extension of the reglementary period within which to decide their cases if they think they cannot comply with their judicial duty. This, Judge Vestil failed to do. Corollarily, a heavy caseload may excuse a judge’s failure to decide cases within the reglementary period but not their failure to request an extension of time within which to decide the case on time.³ Hence, all that respondent judge needs to do is request for an extension of time over which the Court has, almost customarily, been considerate.

Moreover, as correctly pointed out by the OCA, it is not enough that he pens his decision; it is imperative to promulgate the same within the mandated period. The lack of staff that will prepare and type the decision is equally inexcusable to justify the delay in the promulgation of the cases.

We cannot overemphasize the Court’s policy on prompt resolution of disputes. Justice delayed is justice denied. Failure to resolve cases submitted for decision within the period fixed by law constitutes a serious violation of Section 16,⁴ Article III of the Constitution.

The honor and integrity of the judicial system is measured not only by the fairness and correctness of decisions rendered, but also by the efficiency with which disputes are resolved. Thus, judges must perform their official duties with utmost diligence if public confidence in the judiciary is to be preserved. There is no excuse for mediocrity in the performance of judicial functions. The position of judge exacts nothing less than faithful observance of the law and the Constitution in the discharge of official duties.⁵

Furthermore, the proper and efficient court management is the responsibility of the judge, and he is the one directly responsible for the proper discharge of his official functions.⁶ What we emphasized before bears repeating: "It is the duty of a judge to take note of the cases submitted for his decision or resolution and to see to it that the same are decided within the 90-day period fixed by law, and failure to resolve a case within the required period constitutes gross inefficiency." "A judge ought to know the cases submitted to him for decision or resolution and is expected to keep his own record of cases so that he may act on them promptly." "The public trust character of his office imposes upon him the highest degree of responsibility and efficiency."⁷ Accordingly, it is incumbent upon him to devise an efficient recording and filing system in his court, so that no disorderliness can affect the flow of cases and their speedy disposition.

Failure to render decisions and orders within the mandated period constitutes a violation of Rule 3.05,⁸ Canon 3, of the Code of Judicial Conduct, which then makes Judge Vestil liable administratively. Section 9, Rule 140 of the Revised Rules of Court classifies undue delay in rendering a decision or order as a less serious charge punishable under Section 11 (B) of the same Rule.1avvphi1

Here, considering that Judge Vestil had been previously administratively sanctioned for dereliction of duty,⁹ the imposition of fine amounting to P40,000.00 is, thus, proper.

WHEREFORE, in view of all the foregoing, Judge Augustine A. Vestil is adjudged administratively liable for failure to decide cases within the reglementary period and is hereby FINED in the amount of P40,000.00, to be deducted from the P100,000.00 previously retained from his retirement benefits. The Fiscal Management Office isDIRECTED to immediately release the balance of Judge Vestil’s retirement benefits after such fine has been deducted therefrom.

SO ORDERED.

DIOSDADO M. PERALTA
Associate Justice

WE CONCUR:

ANTONIO T. CARPIO
Associate Justice
Chairperson

ANTONIO EDUARDO B. NACHURA Associate Justice

ROBERTO A. ABAD Associate Justice

JOSE CATRAL MENDOZA
Associate Justice

Footnotes

¹ Civil Cases Nos. MAN-2910, MAN-3084, MAN-4009, Land Registration Cases Nos. LRC-638, LRC (Fe Cortes Dabon, Petitioner), and Criminal Cases Nos. DU-3316, DU-5308, DU-7047, DU-7518, DU-7649, DU-9207, DU-9650, DU-11862, DU-12508 and DU-13453.

² Civil Case No. 3762 (Motion to Dismiss) and Criminal Case no. 10480 (Demurrer to Evidence)

³ Report on the Judicial Audit Conducted in the RTC, Branches 2 and 31, Tagum City, A.M. No. 04-1-56-RTC, February 17, 2005, 451 SCRA 605, 610.

⁴ Sec. 16. All persons shall have the right to a speedy disposition of their cases before all judicial, quasi-judicial, or administrative bodies.

⁵ Petallar v. Pullos, A.M. No. MTJ-03-1484, January 15, 2004, 419 SCRA 434, 438.

⁶ Office of the Court Administrator v. Judge Reinato G. Quilala and Branch Clerk of Court Zenaida D. Reyes-Macabeo, MeTC, Branch 26, Manila, A.M. No. MTJ-01-1341, February 15, 2001, 351 SCRA 597, 604

⁷ Id.

⁸ CANON 3-A JUDGE SHOULD PERFORM OFFICIAL DUTIES HONESTLY, AND WITH IMPARTIALITY AND DILIGENCE

x x x x

Rule 3.05 - A judge shall dispose of the court’s business promptly and decide cases within the required periods.

⁹ Suspended for one (1) year and fined in the amount of P50,000.00 for dereliction of duty.