EN BANC

G.R. No. L-22301     August 30, 1967

THE PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee, vs. MARIO MAPA Y MAPULONG, Defendant-Appellant.

FERNANDO, J.: chanrobles virtual law library

The sole question in this appeal from a judgment of conviction by the lower court is whether or not the appointment to and holding of the position of a secret agent to the provincial governor would constitute a sufficient defense to a prosecution for the crime of illegal possession of firearm and ammunition. We hold that it does not.chanroblesvirtualawlibrary chanrobles virtual law library

The accused in this case was indicted for the above offense in an information dated August 14, 1962 reading as follows: "The undersized accuses MARIO MAPA Y MAPULONG of a violation of Section 878 in connection with Section 2692 of the Revised Administrative Code, as amended by Commonwealth Act No. 56 and as further amended by Republic Act No. 4, committed as follows: That on or about the 13th day of August, 1962, in the City of Manila, Philippines, the said accused did then and there wilfully and unlawfully have in his possession and under his custody and control one home-made revolver (Paltik), Cal. 22, without serial number, with six (6) rounds of ammunition, without first having secured the necessary license or permit therefor from the corresponding authorities. Contrary to law." chanrobles virtual law library

When the case was called for hearing on September 3, 1963, the lower court at the outset asked the counsel for the accused: "May counsel stipulate that the accused was found in possession of the gun involved in this case, that he has neither a permit or license to possess the same and that we can submit the same on a question of law whether or not an agent of the governor can hold a firearm without a permit issued by the Philippine Constabulary." After counsel sought from the fiscal an assurance that he would not question the authenticity of his exhibits, the understanding being that only a question of law would be submitted for decision, he explicitly specified such question to be "whether or not a secret agent is not required to get a license for his firearm." chanrobles virtual law library

Upon the lower court stating that the fiscal should examine the document so that he could pass on their authenticity, the fiscal asked the following question: "Does the accused admit that this pistol cal. 22 revolver with six rounds of ammunition mentioned in the information was found in his possession on August 13, 1962, in the City of Manila without first having secured the necessary license or permit thereof from the corresponding authority?" The accused, now the appellant, answered categorically: "Yes, Your Honor." Upon which, the lower court made a statement: "The accused admits, Yes, and his counsel Atty. Cabigao also affirms that the accused admits." chanrobles virtual law library

Forthwith, the fiscal announced that he was "willing to submit the same for decision." Counsel for the accused on his part presented four (4) exhibits consisting of his appointment "as secret agent of the Hon. Feliciano Leviste," then Governor of Batangas, dated June 2, 1962;1 another document likewise issued by Gov. Leviste also addressed to the accused directing him to proceed to Manila, Pasay and Quezon City on a confidential mission;2 the oath of office of the accused as such secret agent,3 a certificate dated March 11, 1963, to the effect that the accused "is a secret agent" of Gov. Leviste.4 Counsel for the accused then stated that with the presentation of the above exhibits he was "willing to submit the case on the question of whether or not a secret agent duly appointed and qualified as such of the provincial governor is exempt from the requirement of having a license of firearm." The exhibits were admitted and the parties were given time to file their respective memoranda.chanroblesvirtualawlibrary chanrobles virtual law library

Thereafter on November 27, 1963, the lower court rendered a decision convicting the accused "of the crime of illegal possession of firearms and sentenced to an indeterminate penalty of from one year and one day to two years and to pay the costs. The firearm and ammunition confiscated from him are forfeited in favor of the Government." chanrobles virtual law library

The only question being one of law, the appeal was taken to this Court. The decision must be affirmed.chanroblesvirtualawlibrary chanrobles virtual law library

The law is explicit that except as thereafter specifically allowed, "it shall be unlawful for any person to . . . possess any firearm, detached parts of firearms or ammunition therefor, or any instrument or implement used or intended to be used in the manufacture of firearms, parts of firearms, or ammunition."5 The next section provides that "firearms and ammunition regularly and lawfully issued to officers, soldiers, sailors, or marines [of the Armed Forces of the Philippines], the Philippine Constabulary, guards in the employment of the Bureau of Prisons, municipal police, provincial governors, lieutenant governors, provincial treasurers, municipal treasurers, municipal mayors, and guards of provincial prisoners and jails," are not covered "when such firearms are in possession of such officials and public servants for use in the performance of their official duties."6 chanrobles virtual law library

The law cannot be any clearer. No provision is made for a secret agent. As such he is not exempt. Our task is equally clear. The first and fundamental duty of courts is to apply the law. "Construction and interpretation come only after it has been demonstrated that application is impossible or inadequate without them."7 The conviction of the accused must stand. It cannot be set aside.chanroblesvirtualawlibrary chanrobles virtual law library

Accused however would rely on People v. Macarandang,8 where a secret agent was acquitted on appeal on the assumption that the appointment "of the accused as a secret agent to assist in the maintenance of peace and order campaigns and detection of crimes, sufficiently put him within the category of a "peace officer" equivalent even to a member of the municipal police expressly covered by section 879." Such reliance is misplaced. It is not within the power of this Court to set aside the clear and explicit mandate of a statutory provision. To the extent therefore that this decision conflicts with what was held in People v. Macarandang, it no longer speaks with authority.chanroblesvirtualawlibrary chanrobles virtual law library

Wherefore, the judgment appealed from is affirmed.

EN BANC

G.R. Nos. 24116-17           August 22, 1968

CEBU PORTLAND CEMENT COMPANY, Plaintiff-Appellant, vs. MUNICIPALITY OF NAGA, CEBU, ET AL., Defendants-Appellees.

FERNANDO, J.: chanrobles virtual law library

In two separate actions, plaintiff-appellant Cebu Portland Cement Company sought to test the validity of the distraint and thereafter the sale at public auction by the principal defendant-appellee, Municipality of Naga, Cebu, of 100,000 bags of cement for the purpose of satisfying its alleged deficiency in the payment of the municipal license tax for 1960, municipal license tax for 1961 as well as the penalty, all in the total sum of P204,300.00. The lower court rendered a joint decision sustaining the validity of the action taken by defendant-appellee Municipality of Naga. The case is now before us on appeal. We affirm.chanroblesvirtualawlibrary chanrobles virtual law library

According to the appealed decision: "From all the evidence, mostly documentary, adduced during the hearing the following facts have been established. The efforts of the defendant Treasurer to collect from the plaintiff the municipal license tax imposed by Amended Ordinance No. 21. Series of 1959 on cement factories located within the Municipality of Naga, Cebu, have met with rebuff time and again. The demands made on the taxpayer ... have not been entirely successful. Finally, the defendant Treasurer decided on June 26, 1961 to avail of the Civil remedies provided for under Section 2304 of the Revised Administrative Code and gave the plaintiff a period of ten days from receipt thereof within which to settle the account, computed as follows ...: Deficiency Municipal License Tax for 1960 - P80,250.00; Municipal License Tax for 1961 - P90,000.00; and 20% Penalty - P34,050.00, stating in exasperation, "This is our last recourse as we had exhausted all efforts for an amicable solution of our problem." "1 chanrobles virtual law library

It was further shown: "On July 6, 1961, at 11:00 A.M., the defendant Treasurer notified the Plant Manager of the plaintiff that he was "distraining 100,000 bags of Apo cement in satisfaction of your delinquency in municipal license taxes in the total amount of P204,300.00" ... This notice was received by the acting officer in charge of the plaintiff's plant, Vicente T. Garaygay, according to his own admission. At first, he was not in accord with the said letter, asking the defendant Treasurer for time to study the same, but in the afternoon he [acknowledged the] distraint ..." 2 chanrobles virtual law library

As was noted in the decision, the defendant Treasurer in turn "signed the receipt for goods, articles or effects seized under authority of Section 2304 of the Revised Administrative Code, certifying that he has constructively distrained on July 6, 1961 from the Cebu Portland Cement Company at its plant at Tina-an, Naga, Cebu, 100,000 bags of Apo cement in tanks, and that "the said articles or goods will be sold at public auction to the highest bidder on July 27, 1961, and the proceeds thereof will be utilized in part satisfaction of the account of the said company in municipal licenses and penalties in the total amount of P204,300.00 due the Municipality of Naga Province of Cebu" ..."3 chanrobles virtual law library

The lower court likewise found as a fact that on the same day, July 6, 1961, the municipal treasurer posted the notice of sale to the effect that pursuant to the provisions of Section 2305 of the Revised Administrative Code, he would sell at public auction for cash to the highest bidder at the main entrance of the municipal building of the Municipality of Naga, Province of Cebu, Philippines on the 27th day of July, 1961, at 9 o'clock in the morning, the property seized and distrained or levied upon from the Cebu Portland Cement Company in satisfaction of the municipal license taxes and penalties in the amount of P204,300.00, specifying that what was to be sold was 100,000 bags of Apo cement. 4 No sale, as thus announced, was held on July 27, 1961. It was likewise stated in the appealed decision that there was stipulation by the parties to this effect: "1. The auction sale took place on January 30, 1962, ..."5 chanrobles virtual law library

In this appeal from the above joint decision, plaintiff-appellant Cebu Portland Cement Company upholds the view that the distraint of the 100,000 bags of cement as well as the sale at public auction thereafter made ran counter to the law. As earlier noted, we do not see it that way.chanroblesvirtualawlibrary chanrobles virtual law library

1. On the validity of the distraint - In the first two errors assigned, plaintiff-appellant submits as illegal the distraint of 100,000 bags of cement made on July 6, 1961. Its contention is premised on the fact that in the letter of defendant-appellee dated June 26, 1961, requiring plaintiff-appellant to settle its account of P204,300.00, it was given a period of 10 days from receipt within which it could pay, failure to do so being the occasion for the distraint of its property. It is now alleged that the 10-day period of grace was not allowed to lapse, the distraint having taken place on July 6, 1961.chanroblesvirtualawlibrary chanrobles virtual law library

It suffices to answer such a contention by referring to the explicit language of the law. According to the Revised Administrative Code: "The remedy by distraint shall proceed as follows: Upon the failure of the person owing any municipal tax or revenue to pay the same, at the time required, the municipal treasurer may seize and distrain any personal property belonging to such person or any property subject to the tax lien, in sufficient quantity to satisfy the tax or charge in question, together with any increment thereto incident to delinquency, and the expenses of the distraint." 6 chanrobles virtual law library

The clear and explicit language of the law leaves no room for doubt. The municipal treasurer "may seize and distrain any personal property" of the individual or entity subject to the tax upon failure "to pay the same, at the time required ..." There was such a failure on the part of plaintiff-appellant to pay the municipal tax at the time required. The power of the municipal treasurer in accordance with the above provision therefore came into play.chanroblesvirtualawlibrary chanrobles virtual law library

Whatever might have been set forth in the letter of the municipal treasurer could not change or amend the law it has to be enforced as written. That was what the lower court did. What was done then cannot be rightfully looked upon as a failure to abide by what the statutory provision requires. Time and time again, it has been repeatedly declared by this Court that where the law speaks in clear and categorical language, there is no room for interpretation. There is only room for application. That was what occurred in this case.7 chanrobles virtual law library

2. On the validity of the auction sale - The validity of the auction sale held on January 30, 1962 is challenged in the next two errors assigned as allegedly committed by the lower court. Plaintiff-appellant's argument is predicated on the fact that it was not until January 16, 1962 that it was notified that the public auction sale was to take place on January 29, 1962. It is its view that under the Revised Administrative Code 8 the sale of the distrained property cannot take place "less than twenty days after notice to the owner or possessor of the property [distrained] ... and the publication or posting of such notice." chanrobles virtual law library

Why such a contention could not prosper is explained clearly by the lower court in the appealed decision. Thus: "With respect to the claim that the auction sale held on January 30, 1962 pursuant to the distraint was null and void for being contrary to law because not more than twenty days have elapsed from the date of notice, it is believed that the defendant Municipality of Naga and Municipal Treasurer of Naga have substantially complied with the requirements provided for by Section 2305 of the Revised Administrative Code. From the time that the plaintiff was first notified of the distraint on July 6, 1961 up to the date of the sale on January 30, 1962, certainly, more than twenty days have elapsed. If the sale did not take place, as advertised, on July 27, 1961, but only on January 30, 1962, it was due to the requests for deferment made by the plaintiff which unduly delayed the proceedings for collection of the tax, and the said taxpayer should not be allowed now to complain that the required period has not yet elapsed when the intention of the tax collector was already well-publicized for many months."9 The reasonableness of the above observation of the lower court cannot be disputed. Under the circumstances, the allegation that there was no observance of the twenty-day period hardly carries conviction.chanroblesvirtualawlibrary chanrobles virtual law rary

The point is further made that the auction sale took place not on January 29, 1962, as stated in the notice of sale, but on the next day, January 30, 1962. According to plaintiff-appellant: "On this score alone, the sale ..., was illegal as it was not made on the time stated in the notice."  10 chanrobles virtual law library

There is no basis to sustain such a plea as the finding of the lower court is otherwise. Thus: "On January 16, 1962, the defendant Treasurer informed Garaygay that he would cause the readvertisement for sale at public auction of the 100,000 bags of Apo cement which were under constructive distraint ... On January 19, 1962, the said defendant issued the corresponding notice of sale, which fixed January 30, 1962, at 10:00 A.M., as the date of sale, posting the said notice in public places and delivering copies thereof to the interested parties in the previous notice, ... Ultimately, the bidding was conducted on that day, January 30, 1962, with the representatives of the Provincial Auditor and Provincial Treasurer present. Only two bidders submitted sealed bids. After the bidding, the defendant-treasurer informed the plaintiff that an award was given to the winning bidder, ..."  11 chanrobles virtual law library

This being a direct appeal to us, plaintiff-appellant must be deemed to have accepted as conclusive what the lower court found as established by the evidence, only questions of law being brought to us for review. It is the established rule that when a party appeals directly to this Court, he is deemed to have waived the right to dispute any finding of fact made by the court below. 12 chanrobles virtual law library

WHEREFORE, the decision of the lower court dated 23, 1964, is affirmed in toto. With costs against plaintiff-appellant.

EN BANC

G.R. No. L-26712-16      December 27, 1969

UNITED CHRISTIAN MISSIONARY SOCIETY, UNITED CHURCH BOARD FOR WORLD MINISTERS, BOARD OF FOREIGN MISSION OF THE REFORMED CHURCH IN AMERICA, BOARD OF MISSION OF THE EVANGELICAL UNITED PRESBYTERIAN CHURCH, COMMISSION OF ECUMENICAL MISSION ON RELATIONS OF THE UNITED PRESBYTERIAN CHURCH Petitioners, vs. SOCIAL SECURITY COMMISSION and SOCIAL SECURITY SYSTEM, Respondents.

Sedfrey A. Ordoñez for petitioners.Office of the Solicitor General Antonio P. Barredo, Assistant Solicitor General Felicisimo R. Rosete and Solicitor Buenaventura J. Guerrero for respondents.

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TEEHANKEE, J.: chanrobles virtual law library

In this appeal from an order of the Social Security Commission, we uphold the Commission's Order dismissing the petition before it, on the ground that in the absence of an express provision in the Social Security Act1 vesting in the Commission the power to condone penalties, it has no legal authority to condone, waive or relinquish the penalty for late premium remittances mandatorily imposed under the Social Security Act.chanroblesvirtualawlibrary chanrobles virtual law library

The five petitioners originally filed on November 20, 1964 separate petitions with respondent Commission, contesting the social security coverage of American missionaries who perform religious missionary work in the Philippines under specific employment contracts with petitioners. After several hearings, however, petitioners commendably desisted from further contesting said coverage, manifesting that they had adopted a policy of cooperation with the Philippine authorities in its program of social amelioration, with which they are in complete accord. They instead filed their consolidated amended petition dated May 7, 1966, praying for condonation of assessed penalties against them for delayed social security premium remittances in the aggregate amount of P69,446.42 for the period from September, 1958 to September, 1963.chanroblesvirtualawlibrary chanrobles virtual law library

In support of their request for condonation, petitioners alleged that they had labored under the impression that as international organizations, they were not subject to coverage under the Philippine Social Security System, but upon advice by certain Social Security System officials, they paid to the System in October, 1963, the total amount of P81,341.80, representing their back premiums for the period from September, 1958 to September, 1963. They

further claimed that the penalties assessed against them appear to be inequitable, citing several resolutions of respondent Commission which in the past allegedly permitted condonation of such penalties.chanroblesvirtualawlibrary chanrobles virtual law library

On May 25, 1966, respondent System filed a Motion to Dismiss on the ground that "the Social Security Commission has no power or authority to condone penalties for late premium remittance, to which petitioners filed their opposition of June 15, 1966, and in turn, respondent filed its reply thereto of June 22, 1966.chanroblesvirtualawlibrary chanrobles virtual law library

Respondent Commission set the Motion to Dismiss for hearing and oral argument on July 20, 1966. At the hearing, petitioners' counsel made no appearance but submitted their Memorandum in lieu of oral argument. Upon petition of the System's Counsel, the Commission gave the parties a further period of fifteen days to submit their Memorandum consolidating their arguments, after which the motion would be deemed submitted for decision. Petitioners stood on their original memorandum, and respondent System filed its memorandum on August 4, 1966.chanroblesvirtualawlibrary chanrobles virtual law library

On September 22, 1966, respondent Commission issued its Order dismissing the petition, as follows:

Considering all of the foregoing, this Commission finds, and so holds, that in the absence of an express provision in the Social Security Act vesting in the Commission the power to condone penalties, it cannot legally do so. The policy enunciated in Commission Resolution No. 536, series of 1964, cited by the parties, in their respective pleadings, has been reiterated in Commission Resolution No. 878, dated August 18, 1966, wherein the Commission adopting the recommendation of the Committee on Legal Matters and Legislation of the Social Security Commission ruled that it "has no power to condone, waive or relinquish the penalties for late premium remittances which may be imposed under the Social Security Act."  chanrobles virtual law library

WHEREFORE, the petition is hereby dismissed and petitioners are directed to pay the respondent System, within thirty (30) days from receipt of this Order, the amount of P69,446.42 representing the penalties payable by them, broken down as follows:

United Christian Missionary Society P5,253.53

Board of Mission of the Evangelical United Brothers Church 7,891.74

United Church Board for World Ministers 12,353.75

Commission on Ecumenical Mission & Relations 33,019.36

Board of Foreign Mission of the Reformed Church in America 10,928.04

TOTAL P 69,446.42

Upon failure of the petitioners to comply with this Order within the period specified herein, a warrant shall be issued to the Sheriff of the Province of Rizal to levy and sell so much of the property of the petitioners as may be necessary to satisfy the aforestated liability of the petitioners to the System.

This Court is thus confronted on appeal with this question of first impression as to whether or not respondent Commission erred in ruling that it has no authority under the Social Security Act to condone the penalty prescribed by law for late premium remittances.chanroblesvirtualawlibrary chanrobles virtual law library

We find no error in the Commission's action.chanroblesvirtualawlibrary chanrobles virtual law library

1. The plain text and intent of the pertinent provisions of the Social Security Act clearly rule out petitioners' posture that the respondent Commission should assume, as against the mandatory imposition of the 3% penalty per month for late payment of premium remittances, the discretionary authority of condoning, waiving or relinquishing such penalty.chanroblesvirtualawlibrary chanrobles virtual law library

The pertinent portion of Section 22 (a) of the Social Security Act peremptorily provides that:

SEC 22. Remittance of premiums. - (a) The contributions imposed in the preceding sections shall be remitted to the System within the first seven days of each calendar month following the month for which they are applicable or within such time as the Commission may prescribe. "Every employer required to deduct and to remit such contribution shall be liable for their payment and if any contribution is not paid to the system, as herein prescribed, he shall pay besides the contribution a penalty thereon of three per centum per month from the date the contribution falls due until paid . . .2

No discretion or alternative is granted respondent Commission in the enforcement of the law's mandate that the employer who fails to comply with his legal obligation to remit the premiums to the System within the prescribed period shall pay a penalty of three 3% per month. The prescribed penalty is evidently of a punitive character, provided by the legislature to assure that employers do not take lightly the State's exercise of the police power in the implementation of the Republic's declared policy "to develop, establish gradually and perfect a social security system which shall be suitable to the needs of the people throughout the Philippines and (to) provide protection to employers against the hazards of disability, sickness, old age and death."3 In this concept, good faith or bad faith is rendered irrelevant, since the law makes no distinction between an employer who professes good reasons for delaying the remittance of premiums and another who deliberately disregards the legal duty imposed upon him to make such remittance. From the moment the remittance of premiums due is delayed, the penalty immediately attaches to the delayed premium payments by force of law.chanroblesvirtualawlibrary chanrobles virtual law library

2. Petitioners contend that in the exercise of the respondent Commission's power of direction and control over the system, as provided in Section 3 of the Act, it does have the authority to condone the penalty for late payment under Section 4 (1), whereby it is empowered to "perform such other acts as it

may deem appropriate for the proper enforcement of this Act." The law does not bear out this contention. Section 4 of the Social Security Act precisely enumerates the powers of the Commission. Nowhere from said powers of the Commission may it be shown that the Commission is granted expressly or by implication the authority to condone penalties imposed by the Act.chanroblesvirtualawlibrary chanrobles virtual law library

3. Moreover, the funds contributed to the System by compulsion of law have already been held by us to be "funds belonging to the members which are merely held in trust by the Government."4 Being a mere trustee of the funds of the System which actually belong to the members, respondent Commission cannot legally perform any acts affecting the same, including condonation of penalties, that would diminish the property rights of the owners and beneficiaries of such funds without an express or specific authority therefor.chanroblesvirtualawlibrary chanrobles virtual law library

4. Where the language of the law is clear and the intent of the legislature is equally plain, there is no room for interpretation and construction of the statute. The Court is therefore bound to uphold respondent Commission's refusal to arrogate unto itself the authority to condone penalties for late payment of social security premiums, for otherwise we would be sanctioning the Commission's reading into the law discretionary powers that are not actually provided therein, and hindering and defeating the plain purpose and intent of the legislature.chanroblesvirtualawlibrary chanrobles virtual law library

5. Petitioners cite fourteen instances in the past wherein respondent Commission had granted condonation of penalties on delayed premium payments. They charge the Commission with grave abuse of discretion in not having uniformly applied to their cases its former policy of granting condonation of penalties. They invoke more compelling considerations of equity in their cases, in that they are non-profit religious organizations who minister to the spiritual needs of the Filipino people, and that their delay in the payment of their premiums was not of a contumacious or deliberate defiance of the law but was prompted by a well-founded belief that the Social Security Act did not apply to their missionaries.chanr The past instances of alleged condonation granted by the Commission are not, however, before the Court, and the unilateral conclusion asserted by petitioners that the Commission had granted such condonations would be of no avail, without a review of the pertinent records of said cases. Nevertheless, assuming such conclusion to be correct, the Commission, in its appealed Order of September 22, 1966 makes of record that since its Resolution No. 536, series of 1964, which it reiterated in another resolution dated August 18, 1966, it had definitely taken the legal stand, pursuant to the recommendation of its Committee on Legal Matters and Legislation, that in the absence of an express provision in the Social Security Act vesting in the Commission the power to condone penalties, it "has no power to condone, waive or relinquish the penalties for late premium remittances which may be imposed under the Social Security Act." chanrobles virtual law library

6. The Commission cannot be faulted for this correct legal position. Granting that it had erred in the past in granting condonation of penalties without legal authority, the Court has held time and again that "it is a well-known rule that erroneous application and enforcement of the law by public officers do not block subsequent correct application of the statute and that the Government is never estopped by mistake or error on the part of its agents."5 Petitioners' lack of intent to deliberately violate the law may be conceded, and was borne out by their later withdrawal in May, 1966 of their original petitions in November, 1964 contesting their social security coverage. The point, however, is that they followed the wrong procedure in questioning the applicability of the Social Security Act to them, in that they failed for five years to pay the premiums prescribed by law and thus incurred the 3% penalty thereon per month mandatorily imposed by law for late payment. The proper procedure would have been to pay the premiums and then contest their liability therefor, thereby preventing the penalty from attaching. This would have been the prudent course, considering that the Act provides in Section 22 (b) thereof that the premiums which the employer refuses or neglects to pay may be collected by the System in the same manner as taxes under the National Internal Revenue Code, and that at the time they instituted their petitions in 1964 contesting their coverage, the Court had already ruled in effect against their contest three years earlier, when it held in Roman Catholic Archbishop vs. Social Security Commission6 that the legislature had clearly intended to include charitable and religious institutions and other non-profit institutions, such as petitioners, within the scope and coverage of the Social Security Act.chanroblesvirtualawlibrary chanrobles virtual law library

7. No grave abuse of discretion was committed, therefore, by the Commission in issuing its Order dismissing the petition for condonation of penalties for late payment of premiums, as claimed by petitioners in their second and last error assigned. Petitioners were duly heard by the Commission and were given due opportunity to adduce all their arguments, as in fact they filed their Memorandum in lieu of oral argument and waived the presentation of an additional memorandum. The mere fact that there was a pending appeal in the Court of Appeals from an identical ruling of the Commission in an earlier case as to its lack of authority to condone penalties does not mean, as petitioners contend, that the Commission was thereby shorn of its authority and discretion to dismiss their petition on the same legal ground.7 The Commission's action has thus paved the way for a final ruling of the Court on the matter.chanroblesvirtualawlibrary chanrobles virtual law library

ACCORDINGLY, the order appealed from is hereby affirmed, without pronouncement as to costs.chanroblesvirtualawlibrary  chanrobles virtual law library

EN BANC

G.R. No. L-26419 October 16, 1970

GEDEON G. QUIJANO and EUGENIA T. QUIJANO, petitioners-appellants, vs. THE DEVELOPMENT BANK OF THE PHILIPPINES and THE EX-OFICIO SHERIFF OF MISAMIS OCCIDENTAL, respondents-appellees.

BARREDO, J.:.

Appeal from the decision of the Court of First Instance of Misamis Occidental in its Special Civil Case No. 2519, dismissing the petition for mandamus with prayer for a writ of preliminary injunction filed therein by the herein petitioners-appellants Gedeon G. Quijano and Eugenio T. Quijano to compel the herein respondent-appellee Development Bank of the Philippines to accept said petitioners-appellants' back pay certificate payment of their loan from the said appellee Bank, and to restrain the herein respondent-appellee ex-oficio sheriff of the province of Misamis Occidental from proceeding with the scheduled foreclosure sale of the real properties the above-named appellant spouses had mortgaged with the Development Bank of the Philippines to secure the loan aforementioned.chanroblesvirtualawlibrary chanrobles virtual law library

The said appealed decision was based on the following: chanrobles virtual law library

STIPULATION OF FACTS.

The undersigned parties, thru counsels, hereby submit the foregoing stipulation of facts, to wit: chanrobles virtual law library

I. That the petitioners filed an application for an urban estate loan with the Rehabilitation Finance Corporation (RFC), predecessor-in-interest of the herein respondent-bank, in the amount of P19,500.00; chanrobles virtual law library

II. That the petitioners' urban real estate loan was approved per RFC Board Resolution No. 2533 on April 30, 1953; chanrobles virtual law library

III. That the mortgage contract was executed by the petitioners in favor of the respondent-bank on March 23, 1954; chanrobles virtual law library

IV. That the said loan of P19,500.00 was to be received by the petitioners in several releases, subject among others, to the following conditions:.

"(1) That the amount of P4,200.00 shall be released only after:.

"(a) the execution and registration of the mortgage contract; chanrobles virtual law library

"(b) the presentation of a duly approved building permit; chanrobles virtual law library

"(c) the construction has been started and the value of the work done amounted to P6,500.00;.chanroblesvirtualawlibrary chanrobles virtual law library

"(d) the submission of the certificate of title covering Psu-136173, free form any encumbrance and chanrobles virtual law library

"(e) the submission of evidence showing full payment of current estate taxes;

(2) That the subsequent releases shall not be more than 100% of the value of the construction completed in excess of P6,500.00; that all releases shall be made against the payroll of workers engaged in the project, receipts of all materials used and that there are no unpaid labor or unpaid materials; chanrobles virtual law library

(3) That a sufficient amount may be withheld until the building is completed and painted and found in accordance with the plans and specifications submitted; chanrobles virtual law library

(4) That the amount of insurance of the building, when completed, shall not be less than P18,000.00, which shall be secured by the mortgagee, in accordance with its Board Resolution No. 3395, series of 1947; chanrobles virtual law library

(5) That the construction and painting of the building shall be completed within 120 days from the date of the mortgage contract; chanrobles virtual law library

(6) That the release of this loan is subject to the availability of funds; chanrobles virtual law library

(7) That the lien appearing on the face of the title shall be cancelled, otherwise, Luciana Jimenez shall sign as co-mortgagor; that this mortgage contract was registered on March 23, 1954 with the Register of Deeds of Misamis Occidental at Oroquieta;

"V. That the first release of P4,200 was made on April 29, 1954, and the other releases were made subsequent thereafter; chanrobles virtual law library

"VI. That as of July 31, 1965, the outstanding obligation of the petitioners with the respondent-bank, including interests, was P13,983.59;  chanrobles virtual law library

"VII. That on July 27, 1965, petitioner Gedeon Quijano, as holder of Acknowledgment No. 10181, wrote the respondent-bank in Manila offering to pay in the amount of P14,000.00 for his outstanding obligation with the respondent-bank, out of the proceeds of his back pay pursuant to Republic Act No. 897; chanrobles virtual law library

"VIII. That the respondent-bank, thru its Ozamis Branch advised the petitioners of the non-acceptance of his offer on the ground that the loan was not incurred before or subsisting on June 20, 1953 when Republic Act 897 was approved; chanrobles virtual law library

"IX. That the respondent-bank, thru its Ozamis City Branch, filed on October 14, 1965, an application for the foreclosure of real estate mortgage executed by the petitioners, and that acting on the application of the respondent-bank, the Provincial Sheriff, thru his deputies, scheduled the public auction sale for January 18, 1966, after advising petitioner Gedeon Quijano of the application for foreclosure filed by the respondent-bank;  chanrobles virtual law library

"X. That the parties herein agree to transfer the auction sale scheduled for January 16, 1966 to February 18, 1966, without the necessity of republication of the notice of sale."

Upon these facts and the submission of the parties that the only issue is whether or not the obligation of the petitioners was subsisting at the time of the approval of Republic Act No. 897, the Amendatory Act of Julie 20, 1953 to Republic Act 304, the original back pay law, the trial court dismissed the petition, as already stated, and directed respondent sheriff to proceed and continue with the public auction sale of the property mortgaged in accordance with the foreclosure application of respondent Development Bank of the Philippines after due notice to petitioners. In their appeal, petitioners' sole assignment of error is that: "The trial court erred in declaring that the loan of the petitioners-appellants was not subsisting when Republic Act No. 897 was enacted on June 20, 1953." chanrobles virtual law library

The appeal has no merit.chanroblesvirtualawlibrary chanrobles virtual law library

The pertinent portions of the controlling provisions of the aforementioned Back Pay Law, as amended by Republic Act No. 897 on June 20, 1953, 1 read as follows:.

SEC. 2. The Treasurer of the Philippines shall, upon application of all persons specified in section one hereof and within one year from the approval of this Amendatory Act, and under such rules and regulations as may be promulgated by the Secretary of Finance, acknowledge and file requests for the recognition of the right to the Salaries and wages as provided in section one hereof and notice of such acknowledgment shall be issued to the applicant which shall state the total amount of such salaries or wages due the applicant, and certify that it shall be redeemed by the Government of the Philippines within ten years from the date of their issuance without interests: Provided, That upon application and subject to such rules and regulations as may be approved by the Secretary of Finance a certificate of indebtedness may be issued by the Treasurer of the Philippines covering the whole or a part of the total salaries and wages the right to which has been duly acknowledged and recognized, provided that the face value of such certificate of indebtedness shall not exceed the amount that the applicant may need for the payment of (1)  obligations subsisting at the time of the approval of this Amendatory Act for which the applicant may directly be liable to the government or to any of its branches or instrumentalities, or the corporations owned or controlled by the Government, or to any citizen of the Philippines, or to any association or corporation organized under the laws of the Philippines, who may be willing to accept the same for such settlement; ...

It is indeed settled that under the above provisions, the Government or any of its agencies does not have any discretion in the acceptance of back pay certificates, 2when they are used by the applicants or original holders themselves for the settlement of any of the obligations or liabilities specifically enumerated in the law.3 It is equally clear, however, that the same provisions expressly require that the obligations - for which certificates of indebtedness may be accepted as payments of - must be subsisting at the time of the approval of Republic Act No. 897; hence when, as in the instant case, such back pay certificates are offered in payment to a government-owned corporation of an obligation thereto which was not subsisting at the time of the enactment of said amendatory Act on June 20, 1953, which corporation may not, legally be compelled to accept the certificates.chanroblesvirtualawlibrary chanrobles virtual law library

It is true that appellants' application for an urban real estate loan was approved by appellee bank on April 80, 1953. It appears, however, that appellants did not avail of it until much later, as in fact, they executed the mortgage contract only on March 23, 1954, and furthermore, that the release of the amount of the said loan of P19,500.00 was to be made in installments and subject to compliance with certain conditions by said appellants. Under these circumstances, Our ruling in the case ofRodriguez vs. Development Bank of the Philippines 4 is controlling.chanroblesvirtualawlibrary chanrobles virtual law library

In that case, Rodriguez obtained a loan from the said Development Bank of the Philippines to be received by him in several releases and to be paid later in installments, under the terms and conditions specified in the loan agreement. Pursuant to said agreement, Rodriguez received the first release in the sum of P5,000.00 on May 27, 1953, while the subsequent releases covering the P9,000.00 - balance of the loan were all availed of and received by him later than June, 1953. Later, Rodriguez paid the installments as they fell due. When a balance of about P10,000.00 remained unpaid, Rodriguez offered to pay the said outstanding balance of the loan with his back pay certificate. The Bank refused at first to accept the said tender of payment in certificate, and when it accepted the same later, it limited its acceptance only to the amount of P5,000.00 representing the portion of the loan released before the passage of Republic Act No. 897, although the amount of the back pay certificate offered by Rodriguez was more than sufficient to cover the total unpaid balance of the loan. So, Rodriguez instituted an action for mandamus in the Court of First Instance of Davao to compel the Bank to accept his back pay certificate in payment of his whole outstanding obligation or, in other words, even for the portions of the loan corresponding to the releases made after June 20, 1953. This action was dismissed by the trial court and upon appeal to this Court, the dismissal was affirmed upon the following rationale:.

It can not be said that appellant became indebted to the Bank for the total amount of P14,000.00 from the date of the agreement. The releases of the balance of the agreed loan were made dependent on certain conditions (see additional conditions mentioned in paragraph 4 of the stipulation of facts, supra) among which is the availability of funds. Non-compliance with any of these conditions will not entitle the appellant to the release of the balance of the agreed loan and conversely, will not entitle the bank to hold the appellant liable for the unreleased amounts. Consequently, we hold, as did the trial court, that:.

"... the amounts released in July, 1953 and thereafter cannot be considered as obligations subsisting in June, 1953. The defendant may be compelled to accept a back pay certificate in payment of obligations subsisting when the Amendatory Act was approved (Sec. 2, Republic Act 897). Republic Act 897 was approved on June 20, 1953. The defendant may not be compelled to accept plaintiff's back pay certificate in payment of the amounts released after June 20, 1953."

The case of Sabelino v. RFC (G.R. No. L-11790, Sept. 30, 1958) relied upon by appellant is irrelevant, as the mortgage indebtedness sought to be paid with appellee's back pay certificate therein, appears to have subsisted prior to the approval of Republic Act No. 897. ...

Herein appellants' situation is even worse than that of Rodriguez. Here appellants actually availed of their approved loan only about nine (9) months after the enactment of Republic Act 897 and the corresponding releases thereof were received by appellants only after the execution of the mortgage contract on March 23, 1954. Undoubtedly, notwithstanding the approval by the appellee Development Bank of the Philippines (RFC) of appellants' loan application on April 30, 1953, appellants did not thereby incur any obligation to pay the same; only after the corresponding amounts were released to appellants after March 23, 1954 did such obligation attach; and it cannot, therefore, be said that the said loan was an  obligation subsisting at the time of the approval of Republic Act No. 897 on June 20, 1953.chanroblesvirtualawlibrary chanrobles virtual law library

It may be truly said, as contended by appellants, that when their application for the loan was approved by the appellee Bank on April 30, 1953, an agreement was perfected between them and said Bank, but it should be noted that under such agreement the only enforceable obligation that was

created was that of the Bank to grant the loan applied for, whereas the obligation of appellants to pay the same could not have arisen until after the amount of the loan has been actually released to them; and said release was even subject to their compliance with certain conditions specified in the mortgage contract executed after the approval already of Republic Act 897. Appellants' appeal that a more liberal construction of the law would enable "many crippled or disabled veterans, or their wives and orphans, or those who had in one way or another unselfishly sacrificed or contributed to the cause of the last war" to take advantage of their back pay certificates, does deserve sympathy, for indeed, among the avowed purposes of the said law are: "First, to serve as a source of financial aid to needy veterans, like crippled or disabled veterans, and to their wives and orphans. Secondly, to give recognition to the sacrifices of those who joined the last war, and particularly to those who have given their all for the cause of the last war." (Congressional Record No. 61, 2nd Congress, 4th Regular Session, May 6, 1953, page 74, as quoted in Florentino, et al. vs. PNB, 98 Phil. 959, 961-963). On the other hand, however, We cannot see any room for interpretation or construction in the clear and unambiguous language of the above-quoted provision of law. This Court has steadfastly adhered to the doctrine that its first and fundamental duty is the application of the law according to its express terms, interpretation being called for only when such literal application is impossible.5 No process of interpretation or construction need be resorted to here a provision of law peremptorily calls for application. Where a requirement or condition is made in explicit and unambiguous terms, no discretion is left to the judiciary. It must see to it that its mandate is obeyed. 6 Thus, even before the amendment of the Back Pay Law, when said law limited the applicability of back pay certificates to "obligations subsisting at the time of the approval of this Act," this Court has ruled that obligations contracted after its enactment on June 18, 1948 cannot come within its purview.

Since the debt of appellants was contracted on November 24, 1948, they could not validly seek to discharge it by application of their back pay certificate under Republic Act 304, on June 18, 1948, because that Act, in terms, limited any such application to "obligations subsisting at the time of the approval of this Act". (Sec. 2)7 chanrobles virtual law library

WHEREFORE, the judgment of the trial court is affirmed. No costs.

Republic of the PhilippinesSUPREME COURTManila

EN BANC

 

G.R. No. L-28463 May 31, 1971

REPUBLIC FLOUR MILLS INC., Petitioner, vs. THE COMMISSIONER OF CUSTOMS and THE COURT OF TAX APPEALS, Respondents.

FERNANDO, J.: chanrobles virtual law library

It is a novel question that this petition for the review of a decision of respondent Court of Tax Appeals presents. Petitioner Republic Flour Mills, Inc. would have this Court construe the words "products of the Philippines" found in Section 2802 of the Tariff and Custom Code  1as excluding bran (ipa) and pollard (darak) on the ground that, coming as they do from wheat grain which is imported in the Philippines, they are merely waste and not the products, which is the flour produced. 2That way, it would not be liable at all for the wharfage dues assessed under such section by respondent Commission of Customs. It elevated the matter to respondent Court, as the construction it would place on the aforesaid section appears too strained and far remote from the ordinary meaning of the text, not to mention the policy of the Act. We affirm.chanroblesvirtualawlibrary chanrobles virtual law library

In the decision of respondent Court now sought to be reviewed, after stating that what was before it was an appeal from a decision of the Commissioner of Customs holding petitioner liable for the sum of P7,948.00 as wharfage due the facts were set forth as follows: "Petitioner, Republic Flour Mills, Inc., is a domestic corporation, primarily engaged in the manufacture of wheat flour, and produces pollard (darak) and bran (ipa) in the process of milling. During the period from December, 1963 to July, 1964, inclusive, petitioner exported Pollard and/or bran which was loaded from lighters alongside vessels engaged in foreign trade while anchored near the breakwater The respondent assessed the petitioner by way of wharfage dues on the said exportations in the sum of P7,948.00, which assessment was paid by petitioner under protest."  3The only issue, in the opinion of respondent Court, is whether or not such collection of wharfage dues was in accordance with law. The main contention before respondent Court of petitioner was "that inasmuch as no government or private wharves or government facilities [were] utilized in exporting the pollard and/or bran, the collection of wharfage dues is contrary to law." 4On the other hand, the stand of respondent Commissioner of Customs was that petitioner was liable for wharfage dues "upon receipt or discharge of the exported goods by a vessel engaged in foreign trade regardless of the non-use of government-owned or private wharves." 5Respondent Court of Tax Appeals sustained the action taken by the Commissioner of Customs under the appropriate provision of the Tariff and Customs Code, relying on our decision in Procter & Gamble Phil. Manufacturing Corp. v. Commissioner of Customs. 6It did not feel called upon to answer the question now before us as, in its opinion, petitioner only called its attention to it for the first time in its memorandum.chanroblesvirtualawlibrary chanrobles virtual law library

Hence, this petition for review. The sole error assigned by petitioner is that it should not, under its construction of the Act, be liable for wharfage dues on its exportation of bran and pollard as they are not "products of the Philippines", coming as they did from wheat grain which were imported from abroad, and being "merely parts of the wheat grain milled by Petitioner to produce flour  which had become waste." 7We find, to repeat, such contention unpersuasive and affirm the decision of respondent Court of Tax Appeals.chanroblesvirtualawlibrary chanrobles virtual law library

1. The language of Section 2802 appears to be quite explicit: "There shall be levied, collected and paid on all articles imported or brought into the Philippines, and on products of the Philippines ... exported from the Philippines, a charge of two pesos per gross metric ton as a fee for wharfage ...." One category refers to what is imported. The other mentions products of the Philippines that are exported. Even without undue scrutiny, it does appear quite obvious that as long as the goods are produced in the country, they fall within the terms of the above section. Petitioner appeared to have entertained such a nation. In its petition for review before respondent Court, it categorically asserted: "Petitioner is primarily engaged in the manufacture of flour from wheat grain. In the process of milling the wheat grain into flour, petitioner also produces 'bran' and 'pollard' which it exports abroad."  8It does take a certain amount of hair-splitting to exclude from its operation what petitioner calls "waste" resulting from the production of flour processed from the wheat grain in petitioner's flour mills in the Philippines. It is always timely to remember that, as stressed by Justice Moreland: "The first and fundamental duty of courts, in our judgment, is to apply the law. Construction and interpretation come only after it has been demonstrated that application is impossible or inadequate without them." 9Petitioner ought to have been aware that deference to such a doctrine precludes an affirmative response to its contention. The law is clear; it must be obeyed. It is as simple, as that. 10 chanrobles virtual law library

2. There is need of confining familiar language of a statute to its usual signification. While statutory construction involves the exercise of choice, the temptation to roam at will and rely on one's predilections as to what policy should prevail is to be resisted. The search must be for a reasonable interpretation. It is best to keep in mind the reminder from Holmes that "there is no canon against using common sense in construing laws as saying what obviously means." 11To paraphrase Frankfurter, interpolation must be eschewed but evisceration avoided. Certainly, the utmost effort should be exerted lest the interpretation arrived at does violence to the statutory language in its total context. It would be then to ignore what has been stressed time and time again as to limits of judicial freedom in the construction of statutes to accept their view advanced by petitioner.chanroblesvirtualawlibrary chanrobles virtual law library

3. Then, again, there is the fundamental postulate in statutory construction requiring fidelity to the legislative purpose. What Congress intended is not to be frustrates. Its objective must be carried out. Even if there be doubt as to the meaning of the language employed, the interpretation should not be at war with the end sought to be attained. No undue reflection is needed to show that if through an ingenious argument, the scope of a statute may be contracted, the probability that other exceptions may be thought of is not remote. If petitioner were to prevail, subsequent pleas motivated by the same desire to be excluded from the operation of the Tariff and Customs Code would likewise be entitled to sympathetic consideration. It is desirable then that the gates to such efforts at undue restriction of the coverage of the Act be kept closed. Otherwise, the end result would be not respect for, but defiance of, a clear legislative mandate. That kind of approach in statutory construction has never recommended itself. It does not now. 12 chanrobles virtual law library

WHEREFORE, the decision of respondent Court of Tax Appeals of November 27, 1967 is affirmed. With costs against petitioner.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Villamor and Makasiar, JJ., concur.chanroblesvirtualawlibrary chanrobles virtual law library

Castro, Teehankee and Barredo, JJ., took no part.

Republic of the PhilippinesSUPREME COURTManila

EN BANC

G.R. No. L-61236 January 31, 1984

NATIONAL FEDERATION OF LABOR and ZAMBOWOOD MONTHLY EMPLOYEES UNION, ITS OFFICERS AND MEMBERS, Petitioners, vs. THE HONORABLE CARLITO A. EISMA, LT. COL. JACOB CARUNCHO, COMMANDING OFFICER, ZAMBOANGA DISTRICT COMMAND, PC, AFP, and ZAMBOANGA WOOD PRODUCTS,Respondents.

 

FERNANDO, C.J.:

This Court is confronted once again with the question of whether or not it is a court or a labor arbiter that can pass on a suit for damages filed by the employer, here private respondent Zamboanga Wood Products. Respondent Judge Carlito A. Eisma 1 then of the Court of First Instance, now of the Regional Trial Court of Zamboanga City, was of the view that it is a court and denied a motion to dismiss filed by petitioners National Federation of labor and Zambowood Monthly Employees Union, its officers and members. It was such an order dated July 20, 1982 that led to the filing of this certiorari and prohibition proceeding. In the order assailed, it was required that the officers and members of petitioner union appear before the court to show cause why a writ of preliminary injunction should not be issued against them and in the meanwhile such persons as well as any other persons acting under their command and on their behalf were "temporarily restrained and ordered to desist and refrain from further obstructing, impeding and impairing plaintiff's use of its property and free ingress to or egress from plaintiff's Manufacturing Division facilities at Lumbayao, Zamboanga City and on its road right of way leading to and from said plaintiff's facilities, pending the determination of the litigation, and unless a contrary order is issued by this Court." 2 chanrobles virtual law library

The record discloses that petitioner National Federation of Labor, on March 5, 1982, filed with the Ministry of Labor and Employment, Labor Relations Division, Zamboanga City, a petition for direct certification as the sole exclusive collective bargaining representative of the monthly paid employees of the respondent Zamboanga Wood Products, Inc. at its manufacturing plant in Lumbayao, Zamboanga City. 3 Such employees, on April 17, 1982 charged respondent firm before the same office of the Ministry of Labor for underpayment of monthly living allowances. 4 Then came, on May 3, 1982, from petitioner union, a notice of strike against private respondent, alleging illegal termination of Dionisio Estioca, president of the said local union; unfair labor practice, non-payment of living allowances; and "employment of oppressive alien management personnel without proper permit. 5 It was followed by the union submitting the minutes of the declaration of strike, "including the ninety (90) ballots, of which 79 voted for yes and three voted for no."  6 The strike began on May 23, 1982. 7 On July 9, 1982, private respondent Zambowood filed a complaint with respondent Judge against the officers and members of petitioners union, for "damages for obstruction of private property with prayer for preliminary injunction and/or restraining order."  8It was alleged that defendants, now petitioners, blockaded the road leading to its manufacturing division, thus preventing customers and suppliers free ingress to or egress from such premises. 9 Six days later, there was a motion for the dismissal and for the dissolution of the restraining order and opposition to the issuance of the writ of preliminary injunction filed by petitioners. It was contended that the acts complained of were incidents of picketing by defendants then on strike against private respondent, and that therefore the exclusive jurisdiction belongs to the Labor Arbiter pursuant to Batas Pambansa Blg. 227, not to a court of first instance.10 There was, as noted earlier, a motion to dismiss, which was denied. Hence this petition for certiorari.chanroblesvirtualawlibrary chanrobles virtual law library

Four days after such petition was filed, on August 3, 1982, this Court required respondents to answer and set the plea for a preliminary injunction to be heard on Thursday, August 5, 1982. 11 After such hearing, a temporary restraining order was issued, "directing respondent Judge and the commanding officer in Zamboanga and his agents from enforcing the ex-parte order of injunction dated July 20, 1982; and to restrain the respondent Judge from proceeding with the hearing of the until otherwise case effective as of [that] date and continuing ordered by [the] Court. In the exercise of the right to peaceful picketing, petitioner unions must abide strictly with Batas Pambansa Blg. 227, specifically Section 6 thereof, amending Article 265 of the Labor Code, which now reads: '(e) No person engaged in picketing shall commit any act of violence, coercion or intimidation or obstruct the free ingress to or egress from the employer's premises for lawful purposes, or obstruct public thoroughfares.' " 12

On August 13, 1982, the answer of private respondent was filed sustaining the original jurisdiction of respondent Judge and maintaining that the order complained of was not in excess of such jurisdiction, or issued with grave abuse of discretion. Solicitor General Estelito P. Mendoza, 13 on the other hand, instead of filing an answer, submitted a Manifestation in lieu thereof. He met squarely the issue of whether or not respondent Judge had jurisdiction, and answered in the negative. He (i)ncluded that "the instant petition has merit and should be given due course."  chanrobles virtual law library

He traced the changes undergone by the Labor Code, citing at the same time the decisions issued by this Court after each of such changes. As pointed out, the original wording of Article 217 vested the labor arbiters with jurisdictional. 14 So it was applied by this Court in Garcia v. Martinez 15 and in Bengzon v. Inciong. 16 On May 1, 1978, however, Presidential Decree No. 1367 was issued, amending Article 217, and provided "that the Regional Directors shall not indorse and Labor Arbiters shall not entertain claims for moral and other forms of damages."  17 The ordinary courts were thus vested with jurisdiction to award actual and moral damages in the case of illegal dismissal of employees. 18 That is not, as pointed out by the Solicitor General, the end of the story, for on May 1, 1980, Presidential Decree No. 1691 was issued, further amending Article 217, returning the original jurisdiction to the labor arbiters, thus enabling them to decide "3. All money claims of workers, including those based on non-payment or underpayment of wages, overtime compensation, separation pay and other benefits provided by law or appropriate agreement, except claims for employees compensation, social security, medicare and maternity benefits; [and] (5) All other claims arising from employer-employee relations unless expressly excluded by tills Code." 19 An equally conclusive manifestation of the lack of jurisdiction of a court of first instance then, a regional trial court now, is Batas Pambansa Blg. 130, amending Article 217 of the Labor Code. It took effect on August 21, 1981. Subparagraph 2, paragraph (a) is now worded thus: "(2) those that involve wages, hours of work and other terms and conditions of employment."  20 This is to be compared with the former phraseology "(2) unresolved issue in collective bargaining, including those that involve wages, hours of work and other terms and conditions of employment."  21It is to be noted that Batas Pambansa Blg. 130 made no change with respect to the original and exclusive jurisdiction of Labor Arbiters with respect to money claims of workers or claims for damages arising from employer-employee relations.chanroblesvirtualawlibrary chanrobles virtual law library

Nothing becomes clearer, therefore, than the meritorious character of this petition. certiorari and prohibition lie, respondent Judge being devoid of jurisdiction to act on the matter.chanroblesvirtualawlibrary chanrobles virtual law library

1. Article 217 is to be applied the way it is worded. The exclusive original jurisdiction of a labor arbiter is therein provided for explicitly. It means, it can only mean, that a court of first instance judge then, a regional trial court judge now, certainly acts beyond the scope of the authority conferred on him by law when he entertained the suit for damages, arising from picketing that accompanied a strike. That was squarely within the express terms of the law. Any deviation cannot therefore be tolerated. So it has been the constant ruling of this Court even prior to  Lizarraga Hermanos v. Yap Tico, 22 a 1913 decision. The ringing words of the ponencia of Justice Moreland still call for obedience. Thus, "The first and fundamental duty of courts, in our judgment, is to apply the law. Construction and interpretation come only after it has been demonstrated that application is impossible or inadequate without them." 23 It is so even after the lapse of sixty years. 24 chanrobles virtual law library

2. On the precise question at issue under the law as it now stands, this Court has spoken in three decisions. They all reflect the utmost fidelity to the plain command of the law that it is a labor arbiter, not a court, that ossesses original and exclusive jurisdiction to decide a claim for damages arising from picketing or a strike. In Pepsi-Cola Bottling Co. v. Martinez, 25the issue was set forth in the opening paragraph, in the ponencia of Justice Escolin: "This petition for certiorari, prohibition and mandamus raises anew the legal question often brought to this Court: Which tribunal has exclusive jurisdiction over an action filed by an employee against his employer for recovery of unpaid salaries, separation benefits and damages - the court of general jurisdiction or the Labor Arbiter of the National Labor Relations Commission [NLRC]?" 26It was categorically held: "We rule that the Labor Arbiter has exclusive

jurisdiction over the case." 27Then came this portion of the opinion: "Jurisdiction over the subject matter in a judicial proceeding is conferred by the sovereign authority which organizes the court; and it is given only by law. Jurisdiction is never presumed; it must be conferred by law in words that do not admit of doubt. Since the jurisdiction of courts and judicial tribunals is derived exclusively from the statutes of the forum, the issue before us should be resolved on the basis of the law or statute now in force. We find that law in presidential Decree 1691 which took effect on May 1, 1980, Section 3 of which reads as follows: ... Article 217. Jurisdiction of Labor Arbiters and the Commission. - (a) The Labor Arbiters shall have the original and exclusive jurisdiction to hear and decide the following cases involving all workers, whether agricultural or non-agricultural: ... 3. All money claims of workers, including those based on nonpayment or underpayment of wages, overtime compensation, separation pay and other benefits provided by law or appropriate agreement, except claims for employees' compensation, social security, medicare and maternity benefits; 4. Cases involving household services; and 5. All other claims arising from employer-employee relations, unless expressly excluded by this Code." 28That same month, two other cases were similarly decided, Ebon v. De Guzman 29and Aguda v. Vallejos. 30 chanrobles virtual law library

3. It is regrettable that the ruling in the above three decisions, decided in March of 1982, was not followed by private respondent when it filed the complaint for damages on July 9, 1982, more than four months later. 31On this point, reference may be made to our decision in National Federation of Labor, et al. v. The Honorable Minister of Labor and Employment, 32promulgated on September 15, 1983. In that case, the question involved was the failure of the same private respondent, Zamboanga Wood Products, Inc., to admit the striking petitioners, eighty-one in number, back to work after an order of Minister Blas F. Ople certifying to the National Labor Relations Commission the labor dispute for compulsory arbitration pursuant to Article 264 (g) of the Labor Code of the Philippines. It was noted in the first paragraph of our opinion in that case: "On the face of it, it seems difficult to explain why private respondent would not comply with such order considering that the request for compulsory arbitration came from it. It ignored this notification by the presidents of the labor unions involved to its resident manager that the striking employees would lift their picket line and start returning to work on August 20, 1982. Then, too, Minister Ople denied a partial motion for reconsideration insofar as the return-to-work aspect is concerned which reads: 'We find no merit in the said Motion for Reconsideration. The Labor code, as amended, specifically Article 264 (g), mandates that whenever a labor dispute is certified by the Minister of Labor and Employment to the National Labor Relations Commission for compulsory arbitration and a strike has already taken place at the time of certification, "all striking employees shall immediately return to work and the employees shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike." ' " 33 No valid distinction can be made between the exercise of compulsory arbitration vested in the Ministry of Labor and the jurisdiction of a labor arbiter to pass over claims for damages in the light of the express provision of the Labor Code as set forth in Article 217. In both cases, it is the Ministry, not a court of justice, that is vested by law with competence to act on the matter.chanroblesvirtualawlibrary chanrobles virtual law library

4. The issuance of Presidential Decree No. 1691 and the enactment of Batas Pambansa Blg. 130, made clear that the exclusive and original jurisdiction for damages would once again be vested in labor arbiters. It can be affirmed that even if they were not that explicit, history has vindicated the view that in the appraisal of what was referred to by Philippine American Management & Financing Co., Inc. v. Management & Supervisors Association of the Philippine-American Management & Financing Co., Inc. 34 as "the rather thorny question as to where in labor matters the dividing line is to be drawn" 35between the power lodged in an administrative body and a court, the unmistakable trend has been to refer it to the former. Thus: "Increasingly, this Court has been committed to the view that unless the law speaks clearly and unequivocally, the choice should fall on [an administrative agency]." 36 Certainly, the present Labor Code is even more committed to the view that on policy grounds, and equally so in the interest of greater promptness in the disposition of labor matters, a court is spared the often onerous task of determining what essentially is a factual matter, namely, the damages that may be incurred by either labor or management as a result of disputes or controversies arising from employer-employee relations.chanroblesvirtualawlibrary chanrobles virtual law library

WHEREFORE, the writ of certiorari is granted and the order of July 20, 1982, issued by respondent Judge, is nullified and set aside. The writ of prohibition is likewise granted and respondent Judge, or whoever acts in his behalf in the Regional Trial Court to which this case is assigned, is enjoin from taking any further action on Civil Case No. 716 (2751), except for the purpose of dismissing it. The temporary restraining order of August 5, 1982 is hereby made permanent.

Separate Opinions ABAD SANTOS, J., concurring: chanrobles virtual law libraryI concur and express the hope that Art. 217 should not undergo repeated amendments.  Separate OpinionsABAD SANTOS, J., concurring:I concur and express the hope that Art. 217 should not undergo repeated amendments. 

Republic of the PhilippinesSUPREME COURTManila

SECOND DIVISION

G.R. No. L-25316 February 28, 1979

KAPISANAN NG MGA MANGGAGAWA SA MANILA RAILROAD COMPANY CREDIT UNION, INC., petitioner-appellant, vs. MANILA RAILROAD COMPANY, respondent appellee.

 

FERNANDO, J.:

In this mandamus petition dismissed by the lower court, petitioner-appellant would seek a reversal of such decision relying on what it considered to be a right granted by Section 62 of the Republic Act No. 2023, more specifically the first two paragraphs thereof: "... (1) A member of a cooperative may, notwithstanding the provisions of existing laws, execute an agreement in favor of the co-operative authorizing his employer to deduct from the salary or wages payable to him by the employer such amount as may be specified in the agreement and to pay the amount so deducted to the co-operative in satisfaction of any debt or other demand owing from the member to the co-operative. (2) Upon the exemption of such agreement the employer shall if so required by the co-operative by a request in writing and so long as such debt or other demand or any part of it remains unpaid, make the claimant and remit forth with the amount so deducted to the co-operative." 1 chanrobles virtual law library

To show that such is futile, the appealed decision, as quoted in the brief for petitioner-appellant, stated the following: "Then petitioner contends that under the above provisions of Rep. Act 2023, the loans granted by credit union to its members enjoy first priority in the payroll collection from the respondent's employees' wages and salaries. As can be clearly seen, there is nothing in the provision of Rep. Act 2023 hereinabove quoted which provides that obligation of laborers and employees payable to credit unions shall enjoy first priority in the deduction from the employees' wages and salaries. The only effect of Rep. Act 2023 is to compel the employer to deduct from the salaries or wages payable to members of the employees' cooperative credit unions the employees' debts to the union and to pay the same to the credit union. In other words, if Rep. Act 2023 had been enacted, the employer could not be compelled to act as the collecting agent of the employees' credit union for the employees' debt to his credit union but to contend that the debt of a member of the employees cooperative credit union as having first priority in the matter of deduction, is to write something into the law which does not appear.  In other words, the mandatory character of Rep. Act 2023 is only to compel the employer to make the deduction of the employees' debt from the latter's salary and turn this over to the employees' credit union but this mandatory character does not convert the credit union's credit into a first priority credit. If the legislative intent in enacting pars. 1 and 2 of Sec. 62 of Rep. Act 2023 were to give first priority in the matter of payments to the obligations of employees in favor of their credit unions, then, the law would have so expressly declared. Thus, the express provisions of the New Civil Code, Arts. 2241, 2242 and 2244 show the legislative intent on preference of credits. 2 chanrobles virtual law library

Such an interpretation, as could be expected, found favor with the respondent-appellee, which, in its brief, succinctly pointed out "that there is nothing in said provision from which it could be implied that it gives top priority to obligations of the nature of that payable to petitioner, and that, therefore, respondent company, in issuing the documents known as Exhibit "3" and Exhibit "P", which establish the order of priority of payment out of the salaries of the employees of respondent-appellee, did not violate the above-quoted Section 62 of Republic Act 2023. In promulgating Exhibit "3", [and] Exhibit "P" respondent, in effect, implemented the said provision of law. 3 chanrobles virtual law library

This petition being one for mandamus and the provision of law relied upon being clear on its face, it would appear that no favorable action can be taken on this appeal. We affirm.chanroblesvirtualawlibrary chanrobles virtual law library

1. The applicable provision of Republic Act No. 2023 quoted earlier, speaks for itself. There is no ambiguity. As thus worded, it was so applied. Petitioner-appellant cannot therefore raise any valid objection. For the lower court to view it otherwise would have been to alter the law. That cannot be done by the judiciary. That is a function that properly appertains to the legislative branch. As was pointed out in  Gonzaga v. Court of Appeals: 4 "It has been repeated time and time again that where the statutory norm speaks unequivocally, there is nothing for the courts to do except to apply it. The law, leaving no doubt as to the scope of its operation, must be obeyed. Our decisions have consistently born to that effect. 5.chanroblesvirtualawlibrary chanrobles virtual law library

2. Clearly, then, mandamus does not lie. Petitioner-appellant was unable to show a clear legal right. The very law on which he would base his action fails to supply any basis for this petition. A more rigorous analysis would have prevented him from instituting a a suit of this character. In J.R.S. Business Corporation v. Montesa, 6 this Court held. "Man-damus is the proper remedy if it could be shown that there was neglect on the part of a tribunal in the performance of an act, which specifically the law enjoins as a duty or an unlawful exclusion of a party from the use and enjoyment of a right to which he is entitled. 7The opinion continued in this wise:"According to former Chief Justice Moran," only specific legal rights may be enforced by mandamus if they are clear and certain. If the legal rights are of the petitioner are not well defined, clear, and certain, the petition must be dismissed. In support of the above view, Viuda e Hijos de Crispulo Zamora v. Wright was cited. As was there categorically stated: "This court has held that it is fundamental that the duties to be enforced by mandamus must be those which are clear and enjoined by law or by reason of official station, and that petitioner must have a clear, legal right to the thing and that it must be the legal duty of the defendant to perform the required act.' As expressed by the then Justice Recto in a subsequent opinion: "It is well establish that only specific legal rights are enforceable by mandamus, that the right sought to be enforced must be certain and clear, and that the writ not issue in cases where the right is doubtful." To the same effect is the formulation of such doctrine by former Justice Barrera: "Stated otherwise, the writ never issues in doubtful cases. It neither confers powers nor imposes duties. It is simply a command to exercise a power already possessed and to perform a duty already imposed." 8 So it has been since then. 9 The latest reported case, Province. of Pangasinan v. Reparations Commission, 10 this court speaking through Justice Concepcion Jr., reiterated such a well-settled doctrine: "It has also been held that it is essential to the issuance of the writ of mandamus that the plaintiff should have a clear legal right to the thing demanded, and it must be the imperative duty of the defendant to perform the act required. It never issues in doubtful cases. 11 chanrobles virtual law library

WHEREFORE, the appealed decision is affirmed. No pronouncement as to costs.

Barredo, Antonio, Concepcion, Jr., Santos and Abad Santos, JJ., concur.chanroblesvirtualawlibrary chanrobles virtual law library

Aquino, J., took no part.

 

SECOND DIVISION

G.R. No. L-68729 May 29, 1987

RADIO COMMUNICATIONS OF THE PHILIPPINES, INC., Petitioner, vs. NATIONAL TELECOMMUNICATIONS COMMISSION and KAYUMANGGI RADIO NETWORK INCORPORATED, Respondents.chanrobles virtual law library

 

GUTIERREZ, JR, J.:

This petition seeks the reversal of the decision of the National Telecommunications Commission (NTC) which ordered petitioner Radio Communications of the Philippines, Incorporated (RCPI) to desist from operating its radio telephone services in Catarman, Northern Samar; San Jose, Occidental Mindoro; and Sorsogon, Sorsogon.chanrobles virtual law library

Petitioner has been operating a radio communications system since 1957 under its legislative franchise granted by Republic Act No. 2036 which was enacted on June 23, 1957.chanrobles virtual law library

In 1968, the petitioner established a radio telegraph service in Sorsogon, Sorsogon. In 1971, another radio telegraph service was put up in San Jose, Mindoro followed by another in Catarman, Samar in 1976. The installation of radio telephone services started in 1971 in San Jose, Mindoro; then in Sorsogon, Sorsogon and Catarman, Samar in 1983.chanrobles virtual law library

In a decision dated June 24, 1980 in NTC Case No. 80-08, private respondent Kayumanggi Radio Network Incorporated was authorized by the public respondent to operate radio communications systems in Catarman, Samar and in San Jose, Mindoro.chanrobles virtual law library

On December 14, 1983, the private respondent filed a complaint with the NTC alleging that the petitioner was operating in Catarman, Samar and in San Jose, Mindoro without a certificate of public covenience and necessity. The petitioner, on the other hand, counter-alleged that its telephone services in the places subject of the complaint are covered by the legislative franchise recognized by both the public respondent and its predecessor, the Public Service Commission. In its supplemental reply, the petitioner further stated that it has been in operation in the questioned places long before private respondent Kayumanggi filed its application to operate in the same places.chanrobles virtual law library

After conducting a hearing, NTC, in its decision dated August 22, 1984 ordered petitioner RCPI to immediately cease or desist from the operation of its radio telephone services in Catarman Northern Samar; San Jose, Occidental Mindoro; and Sorsogon, Sorsogon stating that under Executive Order No. 546, a certificate of public convenience and necessity is mandatory for the operation of communication utilities and services including radio communications.chanrobles virtual law library

On September 4, 1984, the petitioner filed a motion for reconsideration which was denied in an order dated September 12, 1984.chanrobles virtual law library

On October 1, 1984, the present petition was filed raising the issue of whether or not petitioner RCPI, a grantee of a legislative franchise to operate a radio company, is required to secure a certificate of public convenience and necessity before it can validly operate its radio stations including radio telephone services in Catarman, Northern Samar; San Jose, Occidental Mindoro; and Sorsogon, Sorsogon.chanrobles virtual law library

The petitioner's main argument states that the abolition of the Public Service Commission under Presidential Decree No. 1 and the creation of the National Telecommunications Commission under Executive Order No. 546 to replace the defunct Public Service Commission did not affect sections 14 and 15 of the Public Service Law (Commonwealth Act. No. 146, as amended).chanrobles virtual law library

The provisions of the Public Service Law pertinent to the petitioner's allegation are as follows:

Section 13. (a) the Commission shall have jurisdiction, supervision, and control over all public services and their franchises, equipment and other properties, and in the exercise of its authority, it shall have the necessary powers and the aid of public force: ...chanrobles virtual law library

Section 14. The following are exempted from the provisions of the preceding section:

xxx xxx xxx

(d) Radio companies except with respect to the fixing of rates;

xxx xxx xxx

Section 15. With the exception of those enumerated in the preceding section, no public service shall operate in the Philippines without possessing a valid and subsisting certificate from the Public Service Commission, known as "certificate of public convenience," or "certificate of convenience and public necessity," as the case may be, to the effect that the operation of said service and the authorization to do business will promote the public interests in a proper and suitable manner. ...

We find no merit in the petitioner's contention.chanrobles virtual law library

Pursuant to Presidential Decree No. 1 dated September 23,1972, reorganizing the executive branch of the National Government, the Public Service Commission was abolished and its functions were transferred to three specialized regulatory boards, as follows: the Board of Transportation, the Board

of Communications and the Board of Power and Waterworks. The functions so transferred were still subject to the limitations provided in sections 14 and 15 of the Public Service Law, as amended. With the enactment of Executive Order No. 546 on July 23, 1979 implementing P.D. No.1, the Board of Communications and the Telecommunications Control Bureau were abolished and their functions were transferred to the National Telecommunications Commission (Sec. 19(d), Executive Order No. 546). Section 15 of said Executive Order spells out the functions of the National Telecommunications Commission as follows:

Sec. 15. Functions of the Commission.-The Commission shall exercise the following functions:

a. Issue Certificate of Public Convenience for the operation of communications utilities and services, radio communications petitions systems, wire or wireless telephone or telegraph system, radio and television broadcasting system and other similar public utilities;

b. Establish, prescribe and regulate areas of operation of particular operators of public service communications; and determine and prescribe charges or rates pertinent to the operation of such public utility facilities and services except in cases where charges or rates are established by international bodies or associations of which the Philippines is a participating member or by bodies recognized by the Philippine Government as the proper arbiter of such charges or rates;

c. Grant permits for the use of radio frequencies for wireless telephone and telegraph systems and radio communication systems including amateur radio stations and radio and television broadcasting systems;

d. Sub-allocate series of frequencies of bands allocated by the International Telecommunications Union to the specific services;

e. Establish and prescribe rules, regulations, standards, specifications in all cases related to the issued Certificate of Public Convenience and administer and enforce the same;

f. Coordinate and cooperate with government agencies and other entities concerned with any aspect involving communications with a view to continuously improve the communications service in the country;

g. Promulgate such rules and regulations, as public safety and interest may require, to encourage a larger and more effective use of communications, radio and television broadcasting facilities, and to maintain effective competition among private entities in these activities whenever the Commission finds it reasonably feasible;

h. Supervise and inspect the operation of radio stations and telecommunications facilities;

i. Undertake the examination and licensing of radio operators;

j. Undertake, whenever necessary, the registration of radio transmitters and transceivers; and

k. Perform such other functions as may be prescribed by law.

It is clear from the aforequoted provision that the exemption enjoyed by radio companies from the jurisdiction of the Public Service Commission and the Board of Communications no longer exists because of the changes effected by the Reorganization Law and implementing executive orders. The petitioner's claim that its franchise cannot be affected by Executive Order No. 546 on the ground that it has long been in operation since 1957 cannot be sustained.chanrobles virtual law library

A franchise started out as a "royal privilege or (a) branch of the King's prerogative, subsisting in the hands of a subject." This definition was given by Finch, adopted by Blackstone, and accepted by every authority since (State v. Twin Village Water Co., 98 Me 214, 56 A 763 (1903)). Today, a franchise, being merely a privilege emanating from the sovereign power of the state and owing its existence to a grant, is subject to regulation by the state itself by virtue of its police power through its administrative agencies. We ruled in Pangasinan transportation Co., Inc. v. Public Service Commission (70 Phil. 221) that:

... statutes enacted for the regulation of public utilities, being a proper exercise by the State of its police power, are applicable not only to those public utilities coming into existence after its passage, but likewise to those already established and in operation ...

Executive Order No. 546, being an implementing measure of P.D. No. I insofar as it amends the Public Service Law (CA No. 146, as amended) is applicable to the petitioner who must be bound by its provisions. The petitioner cannot install and operate radio telephone services on the basis of its legislative franchise alone.chanrobles virtual law library

The position of the petitioner that by the mere grant of its franchise under RA No. 2036 it can operate a radio communications system anywhere within the Philippines is erroneous. Section 1 of said statute reads:

Section 1. Subject to the provisions of the Constitution, and to the provisions, not inconsistent herewith, of Act Numbered Three thousand eight hundred and forty-six, entitled.' An Act providing for the regulation of radio stations and radio communications in the Philippine Islands, and for other purposes;' Commonwealth Act Numbered One hundred forty-six, known as the Public Service Act, and their amendments, and other applicable laws,  there is hereby granted to the Radio Communications of the Philippines, its successors or assigns, the right and privilege of constructing, installing, establishing and operating in the Philippines, at such places as the said corporation may select and the Secretary of Public Works and Communications may approve, radio stations for the reception and transmission of wireless messages on radiotelegraphy and/or radiotelephone, including both coastal and marine telecommunications, each station to consist of two radio apparatus comprising of a receiving and sending radio apparatus. (Emphasis supplied).

Section 4(a) of the same Act further provides that:

Sec. 4(a). This franchise shall not take effect nor shall any powers thereunder be exercised by the grantee until the  Secretary of Public works and Communications shall have allotted to the grantee the frequencies and wave lengths to be used, and issued to the grantee a license for such case . (Emphasis supplied)

Thus, in the words of R.A. No. 2036 itself, approval of the then Secretary of Public Works and Communications was a precondition before the petitioner could put up radio stations in areas where it desires to operate. It has been repeated time and again that where the statutory norm speaks unequivocally, there is nothing for the courts to do except to apply it. The law, leaving no doubt as to the scope of its operation, must be obeyed. (Gonzaga v. Court of Appeals, 51 SCRA 381).chanrobles virtual law library

The records of the case do not show any grant of authority from the then Secretary of Public Works and Communications before the petitioner installed the questioned radio telephone services in San Jose, Mindoro in 1971. The same is true as regards the radio telephone services opened in Sorsogon, Sorsogon and Catarman, Samar in 1983. No certificate of public convenience and necessity appears to have been secured by the petitioner from the public respondent when such certificate,was required by the applicable public utility regulations (See executive Order No. 546, sec. 15,  supra.; Philippine Long Distance Telephone Co. v. City of Davao, 15 SCRA 75; Olongapo Electric Light and Power Corp. v. National Power Corporation, et al., G.R. No. L-24912, promulgated April 9, 1987.)

It was well within the powers of the public respondent to authorize the installation by the private respondent network of radio communications systems in Catarman, Samar and San Jose, Mindoro. Under the circumstances of this case, the mere fact that the petitioner possesses a franchise to put up and operate a radio communications system in certain areas is not an insuperable obstacle to the public respondent's issuing the proper certificate to an applicant desiring to extend the same services to those areas. The Constitution mandates that a franchise cannot be exclusive in nature nor can a franchise be granted except that it must be subject to amendment, alteration, or even repeal by the legislature when the common good so requires. (Art. XII, sec. 11 of the 1986 Constitution). There is an express provision in the petitioner's franchise which provides compliance with the above mandate R.A. 2036, sec. 15).chanrobles virtual law library

In view of the foregoing, we find no reason to disturb the public respondent's findings of fact, and conclusions of law insofar as the private respondent was authorized to operate in Catarman, Samar and San Jose, Mindoro. As a rule, the Commission's findings of fact, if supported by substantial evidence, are conclusive upon this Court. We may modify or ignore them only when it clearly appears that there is no evidence to support reasonably such a conclusion. (Halili v. Daplas, 14 SCRA 14). The petitioner has not shown why the private respondent should be denied the authority to operate its services in Samar and Mindoro. It has not overcome the presumption that when the public respondent disturbed the petitioner's monopoly in certain areas, it was doing so pursuant to public interest and the common good.chanrobles virtual law library

WHEREFORE, the challenged order of the public respondent dated August 22, 1984 is hereby AFFIRMED. The petition is dismissed for lack of merit.chanrobles virtual law library

SO ORDERED.

FIRST DIVISION

[G.R. No. 122165. February 17, 1997]

ALA MODE GARMENTS, INC., Petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, (First Division) LUCRECIA V. GABA and ELSA I. MELARPES,Respondents.

D E C I S I O N

HERMOSISIMA, JR., J.:

Before us is a petition for certiorari seeking to annul and set aside the Resolutions1 of the National Labor Relations Commission (NLRC.) dated November 24, 1994 and June 26, 1995 in an illegal dismissal case.2chanroblesvirtuallawlibrary

The following facts are not disputed:

Petitioner is a garments manufacturer and exporter. Private respondents were both employees of petitioner until May 7, 1993 when, upon reporting for work, private respondents were disallowed from entering petitioner's premises.

Private respondents were first hired as sewers. They were, in time, promoted to the position of line leaders, each tasked with supervising thirty-six (36) sewers.

On May 5 and 6, 1993, all the line leaders in petitioner's establishment did not report for work. Acting on what appeared to be a concerted action to boycott petitioner's operations, petitioner verbally required private respondents to submit written explanations as to their absence.

On May 7, 1993, private respondents were not allowed to enter the premises of petitioner.

On May 10, 1993, both private respondents tendered their explanation letters to petitioner. Private respondent Gaba's letter states, thus:

"5-10-93

Dear Sir:

Ipagpaumanhin ninyo ang hindi ko pagpapasok ngayon dahil ang anak ko po ay dadalhin ko sa Doctor at baka po dalawan (sic) araw akong hindi makakapasok dahil po sa aking anak na (______) ay naloloko sa kaya (sic) barkada kaya aking inaasikaso pa.

Sana po ay ako ay maunawaan ninyo.

Lubos na Gumagalang,

(Sgd)

Lucrecia"

On the other hand, private respondent Melarpes gave the following reason for her absence in her letter:

"May 10, 1993

Dear Sir:

Ipagpaumanhin ninyo ang pag-absent ko noong May 5-6, 1993 dahil masakit ang pos-on ko at may dalang nag-tatai at nagsusuka, at sorry po kung hindi ako nakapadala nang sulat o kaya tumawag sa telephone.

Aasahan ko po ang inyong consideration.

Respectfully yours,

(Sgd)

Elsa Melarpes"

Thus, private respondent Gaba was absent on May 5 and 6, 1993 because her child was sick, while private respondent Melarpes was also absent because she was ill on said dates due to her pregnancy.

Notwithstanding the submission by private respondents of their explanation letters, they were not allowed to resume their work. Petitioner alleged that it advised private respondents to await the decision of management, pending a company investigation as to whether or not the real reason for their absence was an intent to sabotage the operations of petitioner.

Significantly, however, petitioner never denied that the other line leaders who were also absent on May 5 and 6, 1993, had been immediately allowed to resume their work despite their two-day absence.

On May 17, 1993, private respondents filed with the NLRC separate complaints for, among others, illegal dismissal.

After submission of position papers, replies and rejoinders, the Labor Arbiter rendered a Decision dated April 25, 1994 finding that private respondents were illegally dismissed from service on the mere suspicion that their two-day absence was actually a boycott to derail the operations of petitioner. The Labor Arbiter held that such suspicion was utterly unsupported by any evidence. The Labor Arbiter also found that private respondents' right to due process was violated in the absence of compliance by petitioner with the twin requirements of notice and hearing. The Labor Arbiter ruled, thus:

"Well-settled is the rule that in termination cases, the employer has the burden of proof to show that the dismissal was for cause. Failure in this regard, renders the dismissal unjustified and therefore, illegal (Gesulgon vs. NLRC, 219 SCRA 561). In the case at bar, except for respondent's bare allegation that complainants sabotage[d] its business operations which resulted in huge losses, no evidence was adduced to support its contention. Neither did respondent submitted [sic] proof that the company indeed incurred losses as a result of complainants' concerted action. Decisions could not be based on mere conjectures or surmises but must be supported by evidence.

Furthermore, records are bereft of any showing that complainants were indeed afforded the due process requirement of the law. What complainants submitted were letters-explanations regarding their absence but not with respect to the charge of sabotage as alleged by respondent.  s

Moreover, granting arguendo, that complainants violated the company rules and regulations for having been absent without prior approval by the management, still the penalty of dismissal is too severe a penalty, considering that this is the first offense/infraction committed by them during their three (3) years of service with the company.

All told, complainants were indeed dismissed from the service without cause and due process. As such, they should be reinstated to their former positions without loss of seniority rights with backwages not exceeding three (3) years x x x"3chanroblesvirtuallawlibrary

Understandably, petitioner appealed the aforecited decision of the Labor Arbiter to respondent NLRC. Such appeal, however, was dismissed on November 24, 1994.

Before respondent NLRC; petitioner advanced the theory that it could not be liable for illegal dismissal, since private respondents have not been in fact dismissed from the service. Petitioner complained that after having told private respondents to wait for the decision of management, private respondents "jumped the gun" on them, so to speak, by filing the complaint for illegal dismissal. Respondent NLRC, however, was the least persuaded; it ruled:

"With the record clearly showing that complainants were able to satisfactorily explain their absences with valid reasons, and that they actually presented themselves for work on May 7, 1993, except that they were not accepted back by respondent, we cannot but affirm the decision below."4

Petitioner filed a Motion for Reconsideration of the aforecited decision, but respondent NLRC denied the same in a Resolution dated June 26, 1995 for having been filed out of time. Hence, this petition.

Petitioner raises the following as grounds justifying the nullification of the herein assailed resolutions of respondent NLRC:

A. THE NLRC GRAVELY ABUSED ITS DISCRETION WHEN IT RULED THAT PRIVATE RESPONDENTS WERE DISMISSED BY PETITIONER WHEN THE EVIDENCE ON RECORD SHOWS THAT PRIVATE RESPONDENTS WERE SIMPLY INSTRUCTED TO AWAIT MANAGEMENT'S DECISION REGARDING THE PENDING ADMINISTRATIVE INVESTIGATION.

B. PETITIONER HAD REASONABLE GROUND TO CONCLUDE THAT PRIVATE RESPONDENTS' FAILURE TO REPORT FOR WORK WAS A FORM OF CONCERTED ACTION DESIGNED TO SABOTAGE ITS OPERATIONS. THE NLRC GRAVELY ABUSED ITS DISCRETION WHEN IT RULED OTHERWISE.

C. THE NLRC GRAVELY ABUSED ITS DISCRETION WHEN IT CONCLUDED THAT DISMISSAL WAS TOO SEVERE A PENALTY FOR PRIVATE RESPONDENTS' INFRACTIONS. PRIVATE RESPONDENTS WERE GUILTY OF SABOTAGING THE OPERATIONS OF PETITIONER. HENCE, THE PENALTY OF DISMISSAL IS COMMENSURATE TO THE INFRACTIONS COMMITTED BY PRIVATE RESPONDENTS.

D. THE NLRC GRAVELY ABUSED ITS DISCRETION IN CONCLUDING THAT PETITIONER FAILED TO OBSERVE THE REQUIREMENTS OF DUE PROCESS.

E. THE NLRC GRAVELY ABUSED ITS DISCRETION IN HOLDING PETITIONER LIABLE FOR BACKWAGES. HOLIDAY PAY, SERVICE INCENTIVE LEAVE PAY, AND ATTORNEY'S FEES WHEN ITS FINDING OF ILLEGAL DISMISSAL IS NOT EVEN SUBSTANTIATED BY EVIDENCE.

The petition fails to convince us that respondent NLRC is guilty of grave abuse of discretion.

The crux of petitioner's argument is that it cannot be held guilty of illegal dismissal because there was no dismissal effected in the first place. This claim is belied by the fact, undisputed by the petitioner, that private respondents were barred from entering the work premises while the other line leaders supposedly part of the boycott were allowed to return to work. The failure of the petitioner to accept the private respondents back after their absences constitutes constructive discharge or dismissal. A constructive discharge or dismissal is defined as a "quitting because continued employment is rendered impossible, unreasonable or unlikely; as an offer involving a demotion in rank and a diminution in pay." Private respondents herein found it well nigh impossible to continue their employment, having been denied access into their workplace. The case of  Valiant Machinery and Metal Corp. vs. NLRC,5 wherein this Court found the employer guilty of illegal dismissal when it did not allow its workers to enter the company premises finds application to the situation at hand. As held therein:

"The Court finds substantial evidence in support of the ruling of the NLRC that the private respondents were indeed dismissed without cause. While there was no outright or open termination of the services of the employees, there is reason to believe the company barred them from work because they were absent practically for one week when they were badly needed in the factory."

Finding that there was, indeed, a dismissal, We hold that the same was made without compliance with the requirements laid down by law and jurisprudence. In order to constitute a valid dismissal, two requisites must concur: (a) the dismissal must be for any of the causes expressed in Art. 282 of the Labor Code, and (b) the employee must be accorded due process, basic of which are the opportunity to be heard and to defend himself.6 Herein, the Labor Arbiter found that records are bereft of any showing that private respondents were indeed afforded the due process requirement of the law. What private respondents submitted were letters-explanations regarding their absences but not with respect to the charge of sabotage as alleged by petitioner.7chanroblesvirtuallawlibrary

Petitioner claims that the private respondents were only made to wait for the decision of the management pending investigation of the alleged "sabotage" or boycott. It will be noted, however, that the private respondents were already barred from entering the company as early as May 7, 1993. They filed their complaint on May 17 of the same year. Ten days had lapsed before the said complaints were filed. Within those ten days the private respondents were not allowed to work in the company and their status remained unclear. As aptly noted by the Solicitor General:

"Even assuming ex gratia argumenti that there was a company investigation being then conducted, still petitioner should not have ordered private respondents to await its decision on the matter but instead imposed on the latter preventive suspension in conformity with Sections 3 and 4 of Rule XIV of Book V of the Implementing Rules of the Labor Code, considering that private respondents were accused of having sabotaged petitioner's operations which resulted in business losses, a clear example of a serious and imminent, if not actual, threats to petitioner's property. Hence, having been placed in suspended animation, so to speak, by petitioner, private respondents had every reason to believe that they were dismissed by the former, as they actually were, thereby warranting the filing of the complaints for illegal dismissal."8chanroblesvirtuallawlibrary

The private respondents were never summoned by the management to air their side regarding the accusations of sabotage, but were only required to give explanations regarding their absences. Thus, even if, as petitioner claims, that the dismissal was due to the role played by the respondents in the alleged sabotage, the said dismissal is still invalid, as no notice was given and no hearing was conducted. To reiterate, the twin requirements of notice and hearing constitute essential elements of due process in the dismissal of employees.9chanroblesvirtuallawlibrary

Moreover, the petitioner is inconsistent in its arguments. While contending that private respondents were not dismissed, it goes on to state that dismissal in this instance is valid as petitioner had "reasonable ground to suspect that the absences were a form of concerted action." 10 It also insists that private respondent Inocencio's absence due to abdominal pains, accompanied by loose bowel movement and vomiting, to be flimsy at best, despite the fact that said private respondent submitted a medical certificate to substantiate her claim.11

On the contrary, as noted by the Solicitor General, the Labor Arbiter gave credence and weight to the justification given by private respondents for their two-day absence as consistent with the truth, against petitioner's mere conjecture that the absences were a form of sabotage. Well entrenched is the rule that when the conclusions of the labor arbiter are sufficiently corroborated by the evidence on record, the same should be respected by appellate tribunals since he is in a better position to assess and evaluate the credibility of the contending parties. 12 If ever there is anything that may be considered flimsy in this case, it should be the petitioner's lame justification for the dismissal of the private respondents. As succinctly put by the NLRC:

"Absent any proof that complainants (private respondents in this case) actually initiated what it termed a concerted action of its line leaders to sabotage its business operations by absenting themselves all at the same time on May 5 and 6, 1993, the respondent (herein petitioner) cannot just invoke sabotage that does not exist. Besides, what makes it difficult for respondent to charge complainants of illegal strike, if such existed? That it miserably failed to show that there were other line leaders (aside from complainants) who were likewise absent on said dates, we cannot but consign this defense to the 'dustbin' of afterthoughts"13chanroblesvirtuallawlibrary

We come now to the petitioner's claim that the NLRC gravely abused its discretion in holding it liable for backwages, holiday pay, service Incentive leave pay, and attorney's fees. Other than the award for backwages, this Court finds no reason why the petitioner should not be made so liable. As noted by the Labor Arbiter, and affirmed by respondent NLRC, petitioner failed to show proof that the holiday pay and service incentive leave pay had been paid. Having been also compelled to litigate, the award of attorney's fees equivalent to five percent (5%) of the total judgment award is also proper. 14 We find no reason to disturb said findings.

Anent the issue of backwages, We find that the Labor Arbiter erred in limiting the award of back wages for only a period not exceeding three (3) years. Prior to the effectivity of Republic Act No. 6715, the rule was that an employee, who was illegally dismissed, was entitled to an award of backwages equivalent to three years (where his case is not terminated sooner).15 Republic Act No. 6715, which amended Art. 279 of the Labor Code took effect on March 21, 1989. It states in part:

"ART. 279. Security of Tenure.... An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages inclusive of allowances and to his other benefits or their monetary equivalent computed from the time his compensation is withheld from him up to the time of his actual reinstatement." (emphasis ours)

Private respondents' cause of action against the petitioner arose on May 7, 1993, their complaint for illegal dismissal was filed on May 17, 1993. Since the dismissal took place after the passage of such law, and following the doctrine laid down in the case of  Caltex Refinery Employees Association (CREA) vs. National Labor Relations Commission (Third Division),16 We hold that the private respondents are entitled to reinstatement without loss of seniority rights, as well as to other privileges and their full backwages inclusive of allowances, and to their other benefits or their monetary equivalent computed from the time their compensation was withheld from them up to the time of their actual reinstatement. Moreover, no deduction shall be allowed in accordance with the doctrine enunciated in the recent case of Bustamante vs. National Labor Relations Commission and Evergreen Farms, Inc.17 wherein this Court took the opportunity to clarify how Republic Act No. 6715 is to be interpreted:

"The Court deems it appropriate, however, to reconsider such earlier ruling on the computation of backwages as enunciated in said Pines City Educational Center case, by now holding that conformably with the evident legislative intent as expressed in Rep. Act No. 6715, x x x backwages to be awarded to an illegally dismissed employee, should not, as a general rule, be diminished or reduced by the earnings derived by him during the period of his illegal dismissal. The underlying reason for this ruling is that the employee, while litigating the legality ([or] illegality) of his dismissal, must still earn a living to support himself and family, while full backwages have to be paid by the employer as part of the price or penalty he has to pay for illegally dismissing his employee. The clear legislative intent of the amendment in Rep. Act No. 6715 is to give more benefits to workers than was previously given them under the Mercury Drug rule or the 'deduction of earnings elsewhere' rule. Thus, a closer adherence to the legislative policy behind Rep. Act No. 6715 points to 'full backwages' as meaning exactly that, i.e., without deducting from backwages the earnings derived elsewhere by the concerned employee during the period of his illegal dismissal. In other words, the provision calling for 'full backwages' to illegally dismissed employees is clear, plain and free from ambiguity, and, therefore, must be applied without attempted or strained interpretation. Index animi sermo est."

Should reinstatement no longer be feasible due to strained relations, the award of separation pay equivalent to one (1) month salary for every year of service, a fraction of six (6) months to be considered as one (1) year.

WHEREFORE, the, Petition is hereby DISMISSED, and the Resolution of the National Labor Relations Commission dated November 24, 1994 is AFFIRMED with MODIFICATION that the award of backwages or separation pay be computed according to the foregoing discussion.

Costs against the Petitioners.

SO ORDERED.