Cases Labor New

7/23/2019 Cases Labor New

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Republic of the PhilippinesSUPREME COURT

ManilaFIRST DIVISION

G.R. No. 165881 April 19, 2006OSCAR VILLAMARIA, JR. Petitioner,vs.COURT O APPEALS !"# JERR$ V. %USTAMANTE, Respondents

D ! I S I O NCALLEJO, SR., J.&"efore us is a Petition for Revie# on !ertiorari under Rule $% of theRevised Rules of !ourt assailin& the Decision'and Resolution(ofthe !ourt of )ppeals *!)+ in !)-.R. SP No. /(0 #hich set asidethe Resolution1of the National 2abor Relations !o33ission *N2R!+in N!R100/01(400, #hich in turn affir3ed the Decision4of the2abor )rbiter dis3issin& the co3plaint filed b5 respondent 6err5 V.

"usta3ante.Petitioner Oscar Villa3aria, 6r. #as the o#ner of Villa3aria Motors, asole proprietorship en&a&ed in asse3blin& passen&er 7eepne5s #itha public utilit5 franchise to operate alon& the "aclaranSucat route."5 '88%, Villa3aria stopped asse3blin& 7eepne5s and retained onl5nine, four of #hich he operated b5 e3plo5in& drivers on a 9boundar5basis.9 One of those drivers #as respondent "usta3ante #ho drovethe 7eepne5 #ith Plate No. PV:$$0. "usta3ante re3itted P4%0.00 ada5 to Villa3aria as boundar5 and ;ept the residue of his dail5earnin&s as co3pensation for drivin& the vehicle. In )u&ust '88,Villa3aria verball5 a&reed to sell the 7eepne5 to "usta3ante underthe 9boundar5hulo& sche3e,9 #here "usta3ante #ould re3it to

Villara3a P%%0.00 a da5 for a period of four 5ears< "usta3ante#ould then beco3e the o#ner of the vehicle and continue to drivethe sa3e under Villa3aria=s franchise. It #as also a&reed that"usta3ante #ould 3a;e a do#npa53ent of P'0,000.00.On )u&ust , '88, Villa3aria e>ecuted a contract entitled9?asunduan n& "ilihan n& Sasa;5an sa Pa3a3a&itan n& "oundar5@ulo&9%over the passen&er 7eepne5 #ith Plate No. PV:$$0,!hassis No. VR8%1/'$/! and Motor No. S2($$4. The partiesa&reed that if "usta3ante failed to pa5 the boundar5hulo& for threeda5s, Villa3aria Motors #ould hold on to the vehicle until"usta3ante paid his arrears, includin& a penalt5 of P%0.00 a da5< in

case "usta3ante failed to re3it the dail5 boundar5hulo& for a periodof one #ee;, the ?asunduan #ould cease to have le&al effect and"usta3ante #ould have to return the vehicle to Villa3aria Motors.:nder the ?asunduan, "usta3ante #as prohibited fro3 drivin& the

vehicle #ithout prior authorit5 fro3 Villa3aria Motors. Thus,"usta3ante #as authoriAed to operate the vehicle to transportpassen&ers onl5 and not for other purposes. @e #as also reBuired todispla5 an identification card in front of the #indshield of the vehicleecute a Deed of Sale in favor of theco3plainant relative to the P:6 #ith Plate No. PV:$$0ecuted on )u&ust , '88 transfor3ed thee3plo5ere3plo5ee relationship into that of vendorvendee. @ence,the spouses concluded, there #as no le&al basis to hold the3 liablefor ille&al dis3issal. The5 pra5ed that the case be dis3issed for lac;of 7urisdiction and patent lac; of 3erit.In his Repl5,'1"usta3ante clai3ed that Villa3aria e>ercised controland supervision over the conduct of his e3plo53ent. @e 3aintainedthat the rulin&s of the !ourt in National 2abor :nion v.Din&lasan,'4Ma&boo v. "ernardo,'%and !itiAens 2ea&ue of Freeor;ers v. )bbas'$are &er3ane to the issue as the5 define thenature of the o#nerJoperatordriver relationship under the boundar5s5ste3. @e further reiterated that it #as the Villa3aria spouses #hopresented the ?asunduan to hi3 and that he confor3ed thereto onl5upon their representation that he #ould o#n the vehicle after four5ears. Moreover, it appeared that the Paalala #as dul5 received b5hi3, as he, to&ether #ith other drivers, #as 3ade to affi> his
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si&nature on a blan; piece of paper purportin& to be an 9attendancesheet.9On March '%, (00(, the 2abor )rbiter rendered 7ud&3ent'in favor ofthe spouses Villa3aria and ordered the co3plaint dis3issed on thefollo#in& ratiocinationC

Respondents presented the contract of "oundar5@ulo&, as #ell asthe P))2)2), to prove their clai3 that co3plainant violated theter3s of their contract and after#ards abandoned the vehicleassi&ned to hi3. )s a&ainst the fore&oin&, Ethe co3plaint=s *sic+3ere alle&ations to the contrar5 cannot prevail.Not havin& been ille&all5 dis3issed, co3plainant is not entitled toda3a&es and attorne5s fees.'/

"usta3ante appealed the decision to the N2R!,'8insistin& that the?asunduan did not e>tin&uish the e3plo5ere3plo5ee relationshipbet#een hi3 and Villa3aria. hile he did not receive fi>ed #a&es,he ;ept onl5 the e>cess of the boundar5hulo& #hich he #asreBuired to re3it dail5 to Villa3aria under the a&ree3ent.

"usta3ante 3aintained that he re3ained an e3plo5ee because he#as en&a&ed to perfor3 activities #hich #ere necessar5 or desirableto Villa3aria=s trade or business.The N2R! rendered 7ud&3ent(0dis3issin& the appeal for lac; of3erit, thusC@RFOR, pre3ises considered, co3plainants appeal is hereb5DISMISSD for reasons not stated in the 2abor )rbiters decision but3ainl5 on a 7urisdictional issue, there bein& none over the sub7ect3atter of the controvers5.('

The N2R! ruled that under the ?asunduan, the 7uridical relationshipbet#een "usta3ante and Villa3aria #as that of vendor and vendee,hence, the 2abor )rbiter had no 7urisdiction over the co3plaint."usta3ante filed a Motion for Reconsideration, #hich the N2R!resolved to den5 on Ma5 10, (001.((

"usta3ante elevated the 3atter to the !) via Petition for !ertiorari,alle&in& that the N2R! erred

IIN DISMISSIN- PTITIONR=S )PP)2 9FOR R)SON NOTST)TD IN T@ 2)"OR )R"ITR=S D!ISION, ":T M)IN2K ON6:RISDI!TION)2 ISS:


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In its Decision(%dated )u&ust 10, (004, the !) reversed and setaside the N2R! decision. The fallo of the decision readsC:PON T@ VI T)? IN T@IS !)S, T@:S, the i3pu&nedresolutions of the N2R! 3ust be, as the5 are hereb5 are,RVRSD )ND ST )SID, and 7ud&3ent entered in favor of

petitionerC'. Sentencin& private respondent Oscar Villa3aria, 6r. to pa5petitioner 6err5 "usta3ante separation pa5 co3puted fro3the ti3e of his e3plo53ent up to the ti3e of ter3inationbased on the prevailin& 3ini3u3 #a&e at the ti3e ofter3ination< and,(. !onde3nin& private respondent Oscar Villa3aria, 6r. topa5 petitioner 6err5 "usta3ante bac; #a&es co3puted fro3the ti3e of his dis3issal up to March (00' based on theprevailin& 3ini3u3 #a&e at the ti3e of his dis3issal.

ithout !osts.SO ORDRD.($

The appellate court ruled that the 2abor )rbiter had 7urisdiction over"usta3ante=s co3plaint. :nder the ?asunduan, the relationshipbet#een hi3 and Villa3aria #as dualC that of vendorvendee ande3plo5ere3plo5ee. The !) ratiocinated that Villa3aria=s e>ercise ofcontrol over "usta3ante=s conduct in operatin& the 7eepne5 isinconsistent #ith the for3er=s clai3 that he #as not en&a&ed in thetransportation business. There #as no evidence that petitioner #asallo#ed to let so3e other person drive the 7eepne5.The !) further held that, #hile the po#er to dis3iss #as not3entioned in the ?asunduan, it did not 3ean that Villa3aria couldnot e>ercise it. It e>plained that the e>istence of an e3plo53entrelationship did not depend on ho# the #or;er #as paid but on thepresence or absence of control over the 3eans and 3ethod of thee3plo5ee=s #or;. In this case, Villa3aria=s directives *to drivecarefull5, #ear an identification card, don decent attire, par; thevehicle in his &ara&e, and to infor3 hi3 about provincial trips, etc.+#as a 3eans to control the #a5 in #hich "usta3ante #as to &oabout his #or;. In vie# of Villa3aria=s supervision and control ase3plo5er, the fact that the 9boundar59 represented install3entpa53ents of the purchase price on the 7eepne5 did not re3ove theparties= e3plo5ere3plo5ee relationship.hile the appellate court reco&niAed that a #ee;=s default in pa5in&the boundar5hulo& constituted an additional cause for ter3inatin&

"usta3ante=s e3plo53ent, it held that the latter #as ille&all5dis3issed. )ccordin& to the !), assu3in& that "usta3ante failed to3a;e the reBuired pa53ents as clai3ed b5 Villa3aria, the latternevertheless failed to ta;e steps to recover the unit and #aited for"usta3ante to abandon it. It also pointed out that Villa3aria neither

sub3itted an5 police report to support his clai3 that the vehiclefi&ured in a 3ishap nor presented the affidavit of the &as station&uard to substantiate the clai3 that "usta3ante abandoned the unit.Villa3aria received a cop5 of the decision on Septe3ber /, (004,and filed, on Septe3ber ', (004, a 3otion for reconsiderationthereof. The !) denied the 3otion in a Resolution(dated Nove3ber(, (004, and Villa3aria received a cop5 thereof on Nove3ber /,(004.Villa3aria, no# petitioner, see;s relief fro3 this !ourt via petition forrevie# on certiorari under Rule $% of the Rules of !ourt, alle&in& thatthe !) co33itted &rave abuse of its discretion a3ountin& to e>cessor lac; of 7urisdiction in reversin& the decision of the 2abor )rbiter

and the N2R!. @e clai3s that the !) erred in rulin& that the 7uridicalrelationship bet#een hi3 and respondent under the ?asunduan #asa co3bination of e3plo5ere3plo5ee and vendorvendeerelationships. The ter3s and conditions of the ?asunduan clearl5state that he and respondent "usta3ante had entered into aconditional deed of sale over the 7eepne5< as such, their e3plo5ere3plo5ee relationship had been transfor3ed into that of vendorvendee. Petitioner insists that he had the ri&ht to reserve his title onthe 7eepne5 until after the purchase price thereof had been paid infull.In his !o33ent on the petition, respondent avers that theappropriate re3ed5 of petitioner #as an appeal via a petition forrevie# on certiorari under Rule 4% of the Rules of !ourt and not aspecial civil action of certiorari under Rule $%. @e ar&ues thatpetitioner failed to establish that the !) co33itted &rave abuse of itsdiscretion a3ountin& to e>cess or lac; of 7urisdiction in its decision,as the said rulin& is in accord #ith la# and the evidence on record.Respondent further asserts that the ?asunduan presented to hi3 b5petitioner #hich provides for a boundar5hulo& sche3e #as adevious circu3vention of the 2abor !ode of the Philippines.Respondent insists that his 7uridical relationship #ith petitioner is thatof e3plo5ere3plo5ee because he #as en&a&ed to perfor3 activities
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#hich #ere necessar5 or desirable in the usual business ofpetitioner, his e3plo5er.In his Repl5, petitioner avers that the Rules of Procedure should beliberall5 construed in his favor< hence, it behooves the !ourt toresolve the 3erits of his petition.

e a&ree #ith respondent=s contention that the re3ed5 of petitionerfro3 the !) decision #as to file a petition for revie# on certiorariunder Rule 4% of the Rules of !ourt and not the independent actionof certiorari under Rule $%. Petitioner had '% da5s fro3 receipt of the!) resolution den5in& his 3otion for the reconsideration #ithin #hichto file the petition under Rule 4%.(/"ut instead of doin& so, he filed apetition for certiorari under Rule $% on Nove3ber ((, (004, #hich didnot, ho#ever, suspend the runnin& of the '%da5 re&le3entar5period< conseBuentl5, the !) decision beca3e final and e>ecutor5upon the lapse of the re&le3entar5 period for appeal. Thus, on thisprocedural lapse, the instant petition stands to be dis3issed.(8

It 3ust be stressed that the recourse to a special civil action under

Rule $% of the Rules of !ourt is proscribed b5 the re3ed5 of appealunder Rule 4%. )s the !ourt elaborated in To3as !laudio Me3orial!olle&e, Inc. v. !ourt of )ppealsC10

e a&ree that the re3ed5 of the a&&rieved part5 fro3 a decision orfinal resolution of the !) is to file a petition for revie# on certiorariunder Rule 4% of the Rules of !ourt, as a3ended, on Buestions offacts or issues of la# #ithin fifteen da5s fro3 notice of the saidresolution. Other#ise, the decision of the !) shall beco3e final ande>ecutor5. The re3ed5 under Rule 4% of the Rules of !ourt is a3ode of appeal to this !ourt fro3 the decision of the !). It is acontinuation of the appellate process over the ori&inal case. ) revie#is not a 3atter of ri&ht but is a 3atter of 7udicial discretion. Thea&&rieved part5 3a5, ho#ever, assail the decision of the !) via apetition for certiorari under Rule $% of the Rules of !ourt #ithin si>t5da5s fro3 notice of the decision of the !) or its resolution den5in&the 3otion for reconsideration of the sa3e. This is based on thepre3ise that in issuin& the assailed decision and resolution, the !)acted #ith &rave abuse of discretion, a3ountin& to e>cess or lac; of

7urisdiction and there is no plain, speed5 and adeBuate re3ed5 in theordinar5 course of la#. ) re3ed5 is considered plain, speed5 andadeBuate if it #ill pro3ptl5 relieve the petitioner fro3 the in7uriouseffect of the 7ud&3ent and the acts of the lo#er court.

The a&&rieved part5 is proscribed fro3 filin& a petition for certiorari ifappeal is available, for the re3edies of appeal and certiorari are3utuall5 e>clusive and not alternative or successive. The a&&rievedpart5 is, li;e#ise, barred fro3 filin& a petition for certiorari if there3ed5 of appeal is lost throu&h his ne&li&ence. ) petition for

certiorari is an ori&inal action and does not interrupt the course of theprincipal case unless a te3porar5 restrainin& order or a #rit ofpreli3inar5 in7unction has been issued a&ainst the public respondentfro3 further proceedin&. ) petition for certiorari 3ust be based on

7urisdictional &rounds because, as lon& as the respondent courtacted #ithin its 7urisdiction, an5 error co33itted b5 it #ill a3ount tonothin& 3ore than an error of 7ud&3ent #hich 3a5 be corrected orrevie#ed onl5 b5 appeal.1'

@o#ever, #e have also ruled that a petition for certiorari under Rule$% 3a5 be considered as filed under Rule 4%, confor3abl5 #ith theprinciple that rules of procedure are to be construed liberall5,provided that the petition is filed #ithin the re&le3entar5 period under

Section (, Rule 4% of the Rules of !ourt, and #here valid andco3pellin& circu3stances #arrant that the petition be resolved on its3erits.1(In this case, the petition #as filed #ithin the re&le3entar5period and petitioner has raised an issue of substanceC #hether thee>istence of a boundar5hulo& a&ree3ent ne&ates the e3plo5ere3plo5ee relationship bet#een the vendor and vendee, and, as acorollar5, #hether the 2abor )rbiter has 7urisdiction over a co3plaintfor ille&al dis3issal in such case.e resolve these issues in the affir3ative.The rule is that, the nature of an action and the sub7ect 3atterthereof, as #ell as, #hich court or a&enc5 of the &overn3ent has

7urisdiction over the sa3e, are deter3ined b5 the 3aterial alle&ationsof the co3plaint in relation to the la# involved and the character ofthe reliefs pra5ed for, #hether or not the co3plainantJplaintiff isentitled to an5 or all of such reliefs.11) pra5er or de3and for relief isnot part of the petition of the cause of action< nor does it enlar&e thecause of action stated or chan&e the le&al effect of #hat isalle&ed.14In deter3inin& #hich bod5 has 7urisdiction over a case, thebetter polic5 is to consider not onl5 the status or relationship of theparties but also the nature of the action that is the sub7ect of theircontrovers5.1%

)rticle (' of the 2abor !ode, as a3ended, vests on the 2abor)rbiter e>clusive ori&inal 7urisdiction onl5 over the follo#in&C
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> > > *a+ >cept as other#ise provided under this !ode, the 2abor)rbiters shall have ori&inal and e>clusive 7urisdiction to hear anddecide, #ithin thirt5 *10+ calendar da5s after the sub3ission of thecase b5 the parties for decision #ithout e>tension, even in theabsence of steno&raphic notes, the follo#in& cases involvin& all

#or;ers, #hether a&ricultural or nona&riculturalC'. :nfair labor practice casesclusive appellate7urisdiction over all cases decided b5 2abor )rbiters.*c+ !ases arisin& fro3 the interpretation ori3ple3entation of collective bar&ainin& a&ree3ents,and those arisin& fro3 the interpretation orenforce3ent of co3pan5 personnel policies shall bedisposed of b5 the 2abor )rbiter b5 referrin& thesa3e to the &rievance 3achiner5 and voluntar5arbitration as 3a5 be provided in said a&ree3ents.

In the fore&oin& cases, an e3plo5ere3plo5ee relationship is anindispensable 7urisdictional reBuisite.1$The 7urisdiction of 2abor

)rbiters and the N2R! under )rticle (' of the 2abor !ode is li3itedto disputes arisin& fro3 an e3plo5ere3plo5ee relationship #hichcan onl5 be resolved b5 reference to the 2abor !ode, other laborstatutes or their collective bar&ainin& a&ree3ent.1Not ever5 disputebet#een an e3plo5er and e3plo5ee involves 3atters that onl5 the

2abor )rbiter and the N2R! can resolve in the e>ercise of theirad7udicator5 or Buasi7udicial po#ers. )ctions bet#een e3plo5ersand e3plo5ees #here the e3plo5ere3plo5ee relationship is 3erel5incidental is #ithin the e>clusive ori&inal 7urisdiction of the re&ularcourts.1/hen the principal relief is to be &ranted under labor

le&islation or a collective bar&ainin& a&ree3ent, the case falls #ithinthe e>clusive 7urisdiction of the 2abor )rbiter and the N2R! eventhou&h a clai3 for da3a&es 3i&ht be asserted as an incident to suchclai3.18

e a&ree #ith the rulin& of the !) that, under the boundar5hulo&sche3e incorporated in the ?asunduan, a dual 7uridical relationship#as created bet#een petitioner and respondentC that of e3plo5ere3plo5ee and vendorvendee. The ?asunduan did not e>tin&uish thee3plo5ere3plo5ee relationship of the parties e>tant before thee>ecution of said deed.

)s earl5 as '8%$, the !ourt ruled in National 2abor :nion v.Din&lasan40that the 7eepne5 o#nerJoperatordriver relationship under

the boundar5 s5ste3 is that of e3plo5ere3plo5ee and not lessorlessee. This doctrine #as affir3ed, under si3ilar factual settin&s, inMa&boo v. "ernardo4'and 2antaco, Sr. v. 2la3as,4(and #asanalo&ousl5 applied to &overn the relationships bet#een autocalesao#nerJoperator and driver,41bus o#nerJoperator andconductor,44and ta>i o#nerJoperator and driver.4%

The boundar5 s5ste3 is a sche3e b5 an o#nerJoperator en&a&ed intransportin& passen&ers as a co33on carrier to pri3aril5 &overn theco3pensation of the driver, that is, the latter=s dail5 earnin&s arere3itted to the o#nerJoperator less the e>cess of the boundar5 #hichrepresents the driver=s co3pensation. :nder this s5ste3, theo#nerJoperator e>ercises control and supervision over the driver. It isunli;e in lease of chattels #here the lessor loses co3plete controlover the chattel leased but the lessee is still ulti3atel5 responsiblefor the conseBuences of its use. The 3ana&e3ent of the business isstill in the hands of the o#nerJoperator, #ho, bein& the holder of thecertificate of public convenience, 3ust see to it that the driver follo#sthe route prescribed b5 the franchisin& and re&ulator5 authorit5, andthe rules pro3ul&ated #ith re&ard to the business operations. Thefact that the driver does not receive fi>ed #a&es but onl5 the e>cessof the 9boundar59 &iven to the o#nerJoperator is not sufficient tochan&e the relationship bet#een the3. Indubitabl5, the driver
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perfor3s activities #hich are usuall5 necessar5 or desirable in theusual business or trade of the o#nerJoperator.4$

:nder the ?asunduan, respondent #as reBuired to re3it P%%0.00dail5 to petitioner, an a3ount #hich represented the boundar5 ofpetitioner as #ell as respondent=s partial pa53ent *hulo&+ of the

purchase price of the 7eepne5.Respondent #as entitled to ;eep the e>cess of his dail5 earnin&s ashis dail5 #a&e. Thus, the dail5 re3ittances also had a dual purposeCthat of petitioner=s boundar5 and respondent=s partial pa53ent*hulo&+ for the vehicle. This dual purpose #as e>pressl5 stated in the?asunduan. The #ellsettled rule is that an obli&ation is not novatedb5 an instru3ent that e>pressl5 reco&niAes the old one, chan&esonl5 the ter3s of pa53ent, and adds other obli&ations notinco3patible #ith the old provisions or #here the ne# contract3erel5 supple3ents the previous one. 4The t#o obli&ations of therespondent to re3it to petitioner the boundar5hulo& can standto&ether.

In resolvin& an issue based on contract, this !ourt 3ust first e>a3inethe contract itself, ;eepin& in 3ind that #hen the ter3s of thea&ree3ent are clear and leave no doubt as to the intention of thecontractin& parties, the literal 3eanin& of its stipulations shallprevail.4/The intention of the contractin& parties should beascertained b5 loo;in& at the #ords used to pro7ect their intention,that is, all the #ords, not 7ust a particular #ord or t#o or 3ore #ordsstandin& alone. The various stipulations of a contract shall beinterpreted to&ether, attributin& to the doubtful ones that sense #hich3a5 result fro3 all of the3 ta;en 7ointl5.48The parts and clauses3ust be interpreted in relation to one another to &ive effect to the#hole. The le&al effect of a contract is to be deter3ined fro3 the#hole read to&ether.%0

:nder the ?asunduan, petitioner retained supervision and controlover the conduct of the respondent as driver of the 7eepne5, thusC

)n& 3&a pata;aran, ;au&na5 n& bilihan& ito sa pa3a3a&itan n&boundar5 hulo& a5 an& 3&a su3usunodC

'. Pan&an&ala&aan at pa&iin&atan n& T):@)N N-I?)2))N- P)NI- an& sasa;5an ipina&;ati#ala sa ;an5an& T):@)N N- :N)N- P)NI-.(. Na an& sasa;5an naban&&it a5 &a&a3itin la3an& n&T):@)N N- I?)2))N- P)NI- sa pa&hahanapbuha5

bilan& pa3pasada o pan&an&ala;al sa 3alinis at 3aa5os napa3a3araan.1. Na an& sasa;5an naban&&it a5 hindi &a&a3itin n&T):@)N N- I?)2))N- P)NI- sa 3&a ba&a5 na3a;apa&dudulot n& ;ahihi5an, ;asiraan o panana&utan sa

T):@)N N- :N)N- P)NI-.4. Na hindi ito 3a3anehohin n& hindi a#torisado n& opisinan& :N)N- P)NI-.%. Na an& T):@)N N- I?)2))N- P)NI- a5;ina;ailan&an& 3a&la&a5 n& ID !ard sa harap n& #indshieldupan& sa pa3a3a&itan nito a5 3adalian& 3ala3an ;un&an& na&3a3aneho a5 a#torisado n& VI22)M)RI)MOTORS o hindi.$. Na sasa&utin n& T):@)N N- I?)2))N- P)NI- an&Ehala&a n& 3ulta ;un& sa;alin& 3ahuli an& sasa;5an& itona hindi na;a;abit an& ID card sa #aston& lu&ar o anu3an;asalanan o ;apaba5aan.

. Na sasa&utin din n& T):@)N N- I?)2))N- P)NI-an& 3ater5ales o pi5esa na papalitan n& nasira o na#ala itodahil sa ;an5an& ;apaba5aan./. ?ailan&an sa VI22)M)RI) MOTORS pa rin an& &arahehaban& hinuhulu&an pa rin n& T):@)N N- I?)2))N-P)NI- an& nasabin& sasa;5an.8. Na ;un& 3a&;aroon n& 3abi&at na ;asiraan an&sasa;5an& ipina&;aloob n& T):@)N N- :N)N- P)NI-,an& T):@)N N- I?)2))N- P)NI- a5 obli&adon& ita#a&ito 3una sa VI22)M)RI) MOTORS ba&o ipa&a#a sa alin3an& Motor Shop na a#torisado n& VI22)M)RI) MOTORS.'0. Na hindi pahihintulutan n& T):@)N N- I?)2))N-P)NI- sa panahon n& pa3a3asada na an& na&3a3anehoa5 na;atsinelas, na;a short pants at na;asando la3an&.Dapat an& na&3a3aneho a5 la&in& nasa 3aa5os an&;asuotan upan& i&alan& n& 3&a pasahero.''. Na an& T):@)N N- I?)2))N- P)NI- o an&a#torisado ni5an& driver a5 3a&papa;ita n& 3a&andan&asal sa 3&a pasaheros at hindi dapat 3a&sasalita n&3asa3a ;un& sa;ali 3an 3a5 pasaheron& pilosopo upan&3ai#asan an& anu3an& ;a&uluhan na 3aaarin&;asan&;utan.
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'(. Na ;un& sa;alin& hindi 3a;apa&bi&a5 n& "O:ND)RK@:2O- an& T):@)N N- I?)2))N- P)NI- sa loob n&tatlon& *1+ ara# a5 an& opisina n& VI22)M)RI) MOTORSan& 3a5 ;arapatan& 3an&asi#a n& nasabin& sasa;5anhan&&an& 3atu&unan an& lahat n& responsibilidad. )n&

hala&an& dapat ba5aran sa opisina a5 3a5 ;ara&da&an&3ulta n& P%0.00 sa ara#ara# na ito a5 nasa pan&an&asi#an& VI22)M)RI) MOTORS.'1. Na ;un& an& T):@)N N- I?)2))N- P)NI- a5 hindi3a;apa&bi&a5 n& "O:ND)RK @:2O- sa loob n& isan&lin&&o a5 nan&an&ahulu&an na an& ;asunduan& ito a5 #alan& bisa at ;usan& ibabali; n& T):@)N N- I?)2))N-P)NI- an& nasabin& sasa;5an sa T):@)N N- :N)N-P)NI-.'4. Sasa&utin n& T):@)N N- I?)2))N- P)NI- an&ba5ad sa rehistro, co3prehensive insurance taontaon at;ahit anon& uri n& a;sidente haban& ito a5 hinuhulu&an pasa T):@)N N- :N)N- P)NI-.'%. Na an& T):@)N N- I?)2))N- P)NI- a5 obli&adon&du3alo sa pan&;alahatan& pa&pupulon& n& VI22)M)RI)MOTORS sa tu#in& tata#a& an& 3&a ta&apan&asi#a nitoupan& 3aipaabot an& anu3an& 3un&;ahi sa i;asusulon&n& sa3ahan.'$. Na an& T):@)N N- I?)2))N- P)NI- a5 3a;i;iisasa lahat n& 3&a pata;aran na 3a&;a;aroon n& pa&baba&oo ;ara&da&an sa 3&a daratin& na panahon at hindi 3a&i&in&hadlan& sa lahat n& 3&a bala;in n& VI22)M)RI) MOTORSsa lalo pan& ipa&tata&u3pa5 at i;a;atiba5 n& Sa3ahan.'. Na an& T):@)N N- I?)2))N- P)NI- a5 hindi3a&i&in& bu#a5a sa pasahero upan& hindi ;ainisan n&;ap#a driver at 3ai#asan an& pa&;a;asan&;ot sa anu3an&&ulo.'/. )n& nasabin& sasa;5an a5 hindi ;alili3utan& si5asatinan& ;ala&a5an lalo na sa u3a&a ba&o pu3asada, at sahapon o &abi na3an a5 sisi;apin 3apanatili an& ;alinisannito.'8. Na ;un& sa;alin& an& nasabin& sasa;5an a5 3aaar;ilaat aabutin n& dala#a o hi&it pan& ara# sa lala#i&an a5dapat la3an& na ipa&bi&a5 ala3 3una ito sa VI22)M)RI)MOTORS upan& 3ai#asan an& 3&a anu3an& suliranin.

(0. Na an& T):@)N N- I?)2))N- P)NI- a5 ii#asanan& pa;i;ipa&unahan sa ;aninu3an& sasa;5an upan&3ai#asan an& a;sidente.('. Na ;un& an& T):@)N N- I?)2))N- P)NI- a53a5roon sasabihin sa VI22)M)RI) MOTORS 3abuti 3an

or 3asa3a a5 iparatin& a&ad ito sa ;inauu;ulan at i#asanna iparatin& ito ;un& E;ani;anino la3an& upan& 3ai#asanan& anu3an& usapin. Ma&sad5a a&ad sa opisina n&VI22)M)RI) MOTORS.((. )n& 3&a nasasaad sa ?)S:ND:)N ito a5 buon&&alan& at puso ;on& sinasan&a5unan at buon& si;ap napan&an&ala&aan n& T):@)N N- I?)2))N- P)NI- an&nasabin& sasa;5an at &a&a3itin la3an& ito sapa&hahanapbuha5 at #ala nan& iba pa.%'

The parties e>pressl5 a&reed that petitioner, as vendor, andrespondent, as vendee, entered into a contract to sell the 7eepne5 ona dail5 install3ent basis of P%%0.00 pa5able in four 5ears and thatpetitioner #ould thereafter beco3e its o#ner. ) contract is one ofconditional sale, oftenti3es referred to as contract to sell, if theo#nership or title over thepropert5 sold is retained b5 the vendor, and is not passed to thevendee unless and until there is full pa53ent of the purchase priceandJor upon faithful co3pliance #ith the other ter3s and conditionsthat 3a5 la#full5 be stipulated.%(Such pa53ent or satisfaction ofother preconditions, as the case 3a5 be, is a positive suspensivecondition, the failure of #hich is not a breach of contract, casual orserious, but si3pl5 an event that #ould prevent the obli&ation of thevendor to conve5 title fro3 acBuirin& bindin& force.%1Stateddifferentl5, the efficac5 or obli&ator5 force of the vendors obli&ation totransfer title is subordinated to the happenin& of a future anduncertain event so that if the suspensive condition does not ta;eplace, the parties #ould stand as if the conditional obli&ation hadnever e>isted.%4The vendor 3a5 e>tra7udiciall5 ter3inate theoperation of the contract, refuse conve5ance, and retain the su3s orinstall3ents alread5 received, #here such ri&hts are e>pressl5provided for.%%

:nder the boundar5hulo& sche3e, petitioner retained o#nership ofthe 7eepne5 althou&h its 3aterial possession #as vested inrespondent as its driver. In case respondent failed to 3a;e hisP%%0.00 dail5 install3ent pa53ent for a #ee;, the a&ree3ent #ould
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be of no force and effect and respondent #ould have to return the7eepne5 to petitioner< the e3plo5ere3plo5ee relationship #ouldli;e#ise be ter3inated unless petitioner #ould allo# respondent tocontinue drivin& the 7eepne5 on a boundar5 basis of P%%0.00 dail5despite the ter3ination of their vendorvendee relationship.

The 7uridical relationship of e3plo5ere3plo5ee bet#een petitionerand respondent #as not ne&ated b5 the fore&oin& stipulation in the?asunduan, considerin& that petitioner retained control ofrespondent=s conduct as driver of the vehicle. )s correctl5 ruled b5the !)CThe e>ercise of control b5 private respondent over petitioner=sconduct in operatin& the 7eepne5 he #as drivin& is inconsistent #ithprivate respondent=s clai3 that he is, or #as, not en&a&ed in thetransportation business< that, even if petitioner #as allo#ed to letso3e other person drive the unit, it #as not sho#n that he did soistence of an e3plo53ent relation is not dependent onho# the #or;er is paid but on the presence or absence of controlover the 3eans and 3ethod of the #or;< that the a3ount earned ine>cess of the 9boundar5 hulo&9 is eBuivalent to #a&es< and that thefact that the po#er of dis3issal #as not 3entioned in the ?asunduandid not 3ean that private respondent never e>ercised such po#er, orcould not e>ercise such po#er.Moreover, reBuirin& petitioner to drive the unit for co33ercial use, orto #ear an identification card, or to don a decent attire, or to par; thevehicle in Villa3aria Motors &ara&e, or to infor3 Villa3aria Motorsabout the fact that the unit #ould be &oin& out to the province for t#oda5s of 3ore, or to drive the unit carefull5, etc. necessaril5 related tocontrol over the 3eans b5 #hich the petitioner #as to &o about his#or;< that the rulin& applicable here is not Sin&er Se#in& Machinebut National 2abor :nion since the latter case involved 7eepne5o#nersJoperators and 7eepne5 drivers, and that the fact that the9boundar59 here represented install3ent pa53ent of the purchaseprice on the 7eepne5 did not #ithdra# the relationship fro3 that ofe3plo5ere3plo5ee, in vie# of the overt presence of supervision andcontrol b5 the e3plo5er.%$

Neither is such 7uridical relationship ne&ated b5 petitioner=s clai3 thatthe ter3s and conditions in the ?asunduan relative to respondent=sbehavior and deport3ent as driver #as for his and respondent=sbenefitC to insure that respondent #ould be able to pa5 the reBuisitedail5 install3ent of P%%0.00, and that the vehicle #ould still be in

&ood condition despite the lapse of four 5ears. hat is pri3ordial isthat petitioner retained control over the conduct of the respondent asdriver of the 7eepne5.Indeed, petitioner, as the o#ner of the vehicle and the holder of thefranchise, is entitled to e>ercise supervision and control over the

respondent, b5 seein& to it that the route provided in his franchise,and the rules and re&ulations of the 2and Transportation Re&ulator5"oard are dul5 co3plied #ith. Moreover, in a businessestablish3ent, an identification card is usuall5 provided not 7ust as asecurit5 3easure but to 3ainl5 identif5 the holder thereof as a bonafide e3plo5ee of the fir3 #ho issues it.%

)s respondent=s e3plo5er, it #as the burden of petitioner to provethat respondent=s ter3ination fro3 e3plo53ent #as for a la#ful or

7ust cause, or, at the ver5 least, that respondent failed to 3a;e hisdail5 re3ittances of P%%0.00 as boundar5. @o#ever, petitioner failedto do so. )s correctl5 ruled b5 the appellate courtCIt is basic of course that ter3ination of e3plo53ent 3ust be effectedin accordance #ith la#. The 7ust and authoriAed causes forter3ination of e3plo53ent are enu3erated under )rticles (/(, (/1and (/4 of the 2abor !ode.Parentheticall5, &iven the peculiarit5 of the situation of the partieshere, the default in the re3ittance of the boundar5 hulo& for one#ee; or lon&er 3a5 be considered an additional cause forter3ination of e3plo53ent. The reason is because the ?asunduan#ould be of no force and effect in the event that the purchaser failedto re3it the boundar5 hulo& for one #ee;. The ?asunduan in thiscase pertinentl5 stipulatesC'1. Na ;un& an& T):@)N N- I?)2))N- P)NI- a5 hindi3a;apa&bi&a5 n& "O:ND)RK @:2O- sa loob n& isan& lin&&o a5N)N-)N-)@:2:-)N na an& ;asunduan& ito a5 #ala n& bisa at;usan& ibabali; n& T):@)N N- I?)2))N- P)NI- an& nasabin&sasa;5an sa T):@)N N- :N)N- P)NI- na #ala n& pa&hahabolpa.Moreover, #ellsettled is the rule that, the e3plo5er has the burdenof provin& that the dis3issal of an e3plo5ee is for a 7ust cause. Thefailure of the e3plo5er to dischar&e this burden 3eans that thedis3issal is not 7ustified and that the e3plo5ee is entitled toreinstate3ent and bac; #a&es.In the case at bench, private respondent in his position paper beforethe 2abor )rbiter, alle&ed that petitioner failed to pa5 the
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3iscellaneous fee of P'0,000.00 and the 5earl5 re&istration of theunit< that petitioner also stopped re3ittin& the 9boundar5 hulo&,9pro3ptin& hi3 *private respondent+ to issue a 9Paalala,9 #hichpetitioner ho#ever i&nored< that petitioner even brou&ht the unit tohis *petitioner=s+ province #ithout infor3in& hi3 *private respondent+

about it< and that petitioner eventuall5 abandoned the vehicle at a&asoline station after fi&urin& in an accident. "ut private respondentfailed to substantiate these alle&ations #ith solid, sufficient proof.Notabl5, private respondent=s alle&ation viA, that he retrieved thevehicle fro3 the &as station, #here petitioner abandoned it,contradicted his state3ent in the Paalala that he #ould enforce theprovision *in the ?asunduan+ to the effect that default in there3ittance of the boundar5 hulo& for one #ee; #ould result in theforfeiture of the unit. The Paalala reads as follo#sC9Sa lahat n& 3&a ;u3u;uha n& sasa;5an9Sa pa3a3a&itan n& L"O:ND)RK @:2O-=9Nais ;o pon& ipaalala sa in5o an& ?asunduan na in5on& pinir3ahanparticular na an& para&rapo '1 na na&sasaad na ;un& hindi ;a5o3a;apa&bi&a5 n& "oundar5 @ulo& sa loob n& isan& lin&&o a5 ;usanin5on& ibabali; and nasabin& sasa;5an na in5on& hinuhulu&an nala n& pa&hahabol pa.9Mula po sa ara# n& in5on& pa&;atan&&ap n& Paalala na ito a5 a;inna pon& ipatutupad an& nasabin& ?asunduan ;a5a=t a;in& pinaaalalasa in5on& lahat na tuparin natin an& na;ala&a5 sa ;asunduan upan&3ai#asan natin ito.9@inihilin& ;o na su3unod ;a5o sa hinihin&i n& paalalan& ito upan&hindi na ta5o 3a;aabot pa sa ;orte ;un& sa;alin& hindi nin5oisasauli an& in5on& sasa;5an na hinuhulu&an na an& 3&a3a&a&astos a5 ;a5o pa an& 3a&baba5ad sapa&;at an& hindi nin5opa&tupad sa ;asunduan an& na&in& dahilan n& pa&sa3pa n& ;aso.9Su3asain5o9)ttendanceC /J(J889*The Si&natures appearin& hereininclude *sic+ that of petitioner=s+ *S&d.+OS!)R VI22)M)RI), 6R.9If it #ere true that petitioner did not re3it the boundar5 hulo& for one#ee; or 3ore, #h5 did private respondent not forth#ith ta;e steps to

recover the unit, and #h5 did he have to #ait for petitioner toabandon it1avvphil.netOn another point, private respondent did not sub3it an5 police reportto support his clai3 that petitioner reall5 fi&ured in a vehicular3ishap. Neither did he present the affidavit of the &uard fro3 the &as

station to substantiate his clai3 that petitioner abandoned the unitthere.%/

Petitioner=s clai3 that he opted not to ter3inate the e3plo53ent ofrespondent because of 3a&nani3it5 is ne&ated b5 his *petitioner=s+o#n evidence that he too; the 7eepne5 fro3 the respondent onl5 on6ul5 (4, (000.IN 2I-@T OF )22 T@ FOR-OIN-, the petition is DNID. Thedecision of the !ourt of )ppeals in !)-.R. SP No. /(0 is

)FFIRMD. !osts a&ainst petitioner.SO ORDRD.ROMEO J. CALLEJO, SR.

)ssociate 6ustice !ON!:RC

ARTEMIO V. PANGANI%AN!hief 6ustice!hairperson

CONSUELO $NARES'SANTIAGO

)ssociate 6ustice

MA. ALICIA AUSTRIA'MARTINE(

)sscociate 6ustice

MINITA V. C)ICO'NA(ARIO)ssociate 6ustice

! R T I F I ! ) T I O N

Pursuant to Section '1, )rticle VIII of the !onstitution, it is hereb5certified that the conclusions in the above decision #ere reached inconsultation before the case #as assi&ned to the #riter of theopinion of the !ourt=s Division.ARTEMIO V. PANGANI%AN!hief 6ustice
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Republic of the Philippines

SUPREME COURT

ManilaSECOND DIVISIONG.R. No. 142293 February 27, 2003

VICENTE S, TRINI!"! P"U#INO, $%&S TRUC'INGCORPOR"TION, a() S%T1TRUC'ING

CORPOR"TION, petitioners,

vs.

*ON. COURT OF "PPE"#S a() +"IME S"*OT,

responents.D E C I S I O NUISUM%ING, J.:!his petition for revie" see#s the reversal of the ecision$of

the Court of %ppeals ate &ebruar' $(, $))), in C%*+.R. SP

No. $-1, a/r0in "ith 0oi2cation the ecision 3of the

National 4abor Relations Co00ission pro0ulate on 5une$), 1((- in N4RC NCR C% No. )1)$-*(-. Petitioners also

pra' for the reinstate0ent of the ecision6of the 4abor

%rbiter in N4RC NCR Case No. ))*)(*)-1*(6.Culle fro0 the recors are the follo"in facts of this case7So0eti0e in 1(8, private responent 5ai0e Sahotstarte

"or#in as a truc# helper for petitioners9 fa0il'*o"ne

truc#in business na0e Vicente S' !ruc#in. In 1(-, he

beca0e a truc# river of the sa0e fa0il' business, rena0e

!. Paulino !ruc#in Service, later -:9s !ruc#in Corporation

in 1(8, an thereafter #no"n as S:! !ruc#in Corporation

since 1((6. !hrouhout all these chanes in na0es an for

3- 'ears, private responent continuousl' serve the

truc#in business of petitioners.In %pril 1((6, Sahot "as alrea' ( 'ears ol. ;e ha been

incurrin absences as he "as su


12/21

establishe, an onl' then i responent Sahot beco0e an

e0plo'ee of the co0pan', "ith a 0onthl' salar' that

reache P6,1-).)) at the ti0e of his separation.Petitioners further clai0e that so0eti0e prior to 5une 1,

1((6, Sahot "ent on leave an "as not able to report for

"or# for al0ost seven a's. On 5une 1, 1((6, Sahot as#eper0ission to e@ten his leave of absence until 5une 3),

1((6. It appeare that fro0 the e@piration of his leave,

private responent never reporte bac# to "or# nor i he

2le an e@tension of his leave. Instea, he 2le the co0plaint

for illeal is0issal aainst the truc#in co0pan' an its

o"ners.Petitioners a that ue to Sahot9s refusal to "or# after the

e@piration of his authorie leave of absence, he shoul be

ee0e to have voluntaril' resine fro0 his "or#. !he'

contene that Sahot ha all the ti0e to e@ten his leave orat least infor0 petitioners of his health conition. 4astl',

the' cite N4RC Case No. RE*6((*-, entitle AManuelito

Jimenez et al. vs. T. Paulino Trucking Service,A as a efense

in vie" of the allee si0ilarit' in the factual 0ilieu an

issues of sai case to that of Sahot9s, hence the' are inpari

materialan Sahot9s co0plaint ouht also to be is0isse.!he N4RC NCR %rbitration :ranch, throuh 4abor %rbiter

%riel Caiente Santos, rule that there "as no illeal

is0issal in Sahot9s case. Private responent ha faile to

report to "or#. Moreover, sai the 4abor %rbiter, petitioners

an private responent "ere inustrial partners before5anuar' 1((6. !he 4abor %rbiter conclue b' orerin

petitioners to pa' A2nancial assistanceA of P1,))) to Sahot

for havin serve the co0pan' as a reular e0plo'ee since

5anuar' 1((6 onl'.On appeal, the National 4abor Relations Co00ission

0oi2e the u0ent of the 4abor %rbiter. It eclare that

private responent "as an e0plo'ee, not an inustrial

partner, since the start. Private responent Sahot i not

abanon his ob but his e0plo'0ent "as ter0inate on

account of his illness, pursuant to %rticle $86(of the 4abor

Coe. %ccorinl', the N4RC orere petitioners to pa'

private responent separation pa' in the a0ount of

P-),3$).)), at the rate of P$,)8).)) per 'ear for $( 'ears of

service.Petitioners assaile the ecision of the N4RC before the

Court of %ppeals. In its ecision ate &ebruar' $(, $))),

the appellate court a/r0e "ith 0oi2cation the u0ent

of the N4RC. It hel that private responent "as inee an

e0plo'ee of petitioners since 1(8. It also increase the

a0ount of separation pa' a"are to private responent to

P6,88), co0pute at the rate of P$,)8) per 'ear for 3-

'ears of service fro0 1(8 to 1((6. It ecree7;ERE&ORE, the assaile ecision is hereb' %&&IRMED "ith

MODI&IC%!ION. S: !ruc#in Corporation is hereb' irecteto pa' co0plainant 5ai0e Sahot the su0 of SEVEN!F*&OBR

!;OBS%ND EI+;! ;BNDRED EI+;!F >P6,88).))? PESOS as

an for his separation pa'.1)

;ence, the instant petition anchore on the follo"in

contentions7IRESPONDEN! COBR! O& %PPE%4S IN PROMB4+%!IN+ !;E

GBES!IONHED DECISION %&&IRMIN+ I!; MODI&IC%!ION

!;E DECISION O& N%!ION%4 4%:OR RE4%!IONS

COMMISSION DECIDED NO! IN %CCORD I!; 4% %ND PB!

%! N%B+;! %R!IC4E 6)$ O& !;E CIVI4 CODE.11

IIRESPONDEN! COBR! O& %PPE%4S VIO4%!ED SBPREME

COBR! RB4IN+ !;%! !;E N%!ION%4 4%:OR RE4%!IONS

COMMISSION IS :OBND :F !;E &%C!B%4 &INDIN+S O& !;E

4%:OR %R:I!ER %S !;E 4%!!ER %S IN % :E!!ER POSI!ION

!O O:SERVE !;E DEME%NOR %ND DEPOR!MEN! O& !;E

I!NESSES IN !;E C%SE O& %SSOCI%!ION O& INDEPENDEN!

BNIONS IN !;E P;I4IPPINES VERSBS N%!ION%4 C%PI!%4

RE+ION >3) SCR% $33?.1$
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IIIPRIV%!E RESPONDEN! %S NO! DISMISSHED :F

RESPONDEN! S:! !RBCJIN+ CORPOR%!ION.13

!hree issues are to be resolve7 >1? hether or not an

e0plo'er*e0plo'ee relationship e@iste bet"een petitioners

an responent SahotK >$? hether or not there "as valiis0issalK an >3? hether or not responent Sahot is

entitle to separation pa'.Crucial to the resolution of this case is the eter0ination of

the 2rst issue. :efore a case for illeal is0issal can

prosper, an e0plo'er*e0plo'ee relationship 0ust 2rst be

establishe.16

Petitioners invo#e the ecision of the 4abor %rbiter %riel

Caiente Santos "hich foun that responent Sahot "as not

an e0plo'ee but "as in fact, petitioners9 inustrial

partner.1It is contene that it "as the 4abor %rbiter "ho

hear the case an ha the opportunit' to observe the

e0eanor an eport0ent of the parties. !he sa0e

conclusion, aver petitioners, is supporte b' substantial

evience.1-Moreover, it is arue that the 2nins of fact of

the 4abor %rbiter "as "ronl' overturne b' the N4RC "hen

the latter 0ae the follo"in pronounce0ent7e aree "ith co0plainant that there "as error co00itte

b' the 4abor %rbiter "hen he conclue that co0plainant

"as an inustrial partner prior to 1((6. % co0putation of the

ae of co0plainant sho"s that he "as onl' t"ent'*three

>$3? 'ears "hen he starte "or#in "ith responent astruc# helper. ;o" can "e entertain in our 0in that a

t"ent'*three >$3? 'ear ol 0an, "or#in as a truc# helper,

be consiere an inustrial partner. ;ence "e rule that

co0plainant "as onl' an e0plo'ee, not a partner of

responents fro0 the ti0e co0plainant starte "or#in for

responent.1

:ecause the Court of %ppeals also foun that an e0plo'er*

e0plo'ee relationship e@iste, petitioners aver that the

appellate court9s ecision ives an Ai0pri0aturA to the

AillealA 2nin an conclusion of the N4RC.Private responent, for his part, enies that he "as ever an

inustrial partner of petitioners. !here "as no "ritten

aree0ent, no proof that he receive a share in petitioners9

pro2ts, nor "as there an'thin to sho" he ha an'participation "ith respect to the runnin of the business.18

!he ele0ents to eter0ine the e@istence of an e0plo'0ent

relationship are7 >a? the selection an enae0ent of the

e0plo'eeK >b? the pa'0ent of "aesK >c? the po"er of

is0issalK an >? the e0plo'er9s po"er to control the

e0plo'ee9s conuct. !he 0ost i0portant ele0ent is the

e0plo'er9s control of the e0plo'ee9s conuct, not onl' as to

the result of the "or# to be one, but also as to the 0eans

an 0ethos to acco0plish it.1(

%s foun b' the appellate court, petitioners o"ne an

operate a truc#in business since the 1()s an b' their

o"n alleations, the' eter0ine private responent9s

"aes an rest a'.$)Recors of the case sho" that private

responent actuall' enae in "or# as an e0plo'ee.

Durin the entire course of his e0plo'0ent he i not have

the freeo0 to eter0ine "here he "oul o, "hat he

"oul o, an ho" he "oul o it. ;e 0erel' follo"e

instructions of petitioners an "as content to o so, as lon

as he "as pai his "aes. Inee, sai the C%, private

responent ha "or#e as a truc# helper an river of

petitioners not for his o"n pleasure but uner the latter9scontrol.%rticle 1-$1of the Civil Coe states that in a contract of

partnership t"o or 0ore persons bin the0selves to

contribute 0one', propert' or inustr' to a co00on fun,

"ith the intention of iviin the pro2ts a0on

the0selves.$$Not one of these circu0stances is present in

this case. No "ritten aree0ent e@ists to prove the

partnership bet"een the parties. Private responent i not
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contribute 0one', propert' or inustr' for the purpose of

enain in the suppose business. !here is no proof that

he "as receivin a share in the pro2ts as a 0atter of course,

urin the perio "hen the truc#in business "as uner

operation. Neither is there an' proof that he ha activel'

participate in the 0anae0ent, a0inistration an

aoption of policies of the business. !hus, the N4RC an the

C% i not err in reversin the 2nin of the 4abor %rbiter

that private responent "as an inustrial partner fro0 1(8

to 1((6.On this point, "e a/r0 the 2nins of the appellate court

an the N4RC. Private responent 5ai0e Sahot "as not an

inustrial partner but an e0plo'ee of petitioners fro0 1(8

to 1((6. !he e@istence of an e0plo'er*e0plo'ee

relationship is ulti0atel' a =uestion of fact$3an the

2nins thereon b' the N4RC, as a/r0e b' the Court of%ppeals, eserve not onl' respect but 2nalit' "hen

supporte b' substantial evience. Substantial evience is

such a0ount of relevant evience "hich a reasonable 0in

0iht accept as ae=uate to ustif' a conclusion.$6

!i0e an aain this Court has sai that Aif oubt e@ists

bet"een the evience presente b' the e0plo'er an the

e0plo'ee, the scales of ustice 0ust be tilte in favor of the

latter.A$;ere, "e entertain no oubt. Private responent

since the beinnin "as an e0plo'ee of, not an inustrial

partner in, the truc#in business.

Co0in no" to the secon issue, "as private responentvalil' is0isse b' petitionersLPetitioners conten that it "as private responent "ho

refuse to o bac# to "or#. !he ecision of the 4abor %rbiter

pointe out that urin the conciliation proceeins,

petitioners re=ueste responent Sahot to report bac# for

"or#. ;o"ever, in the sa0e proceeins, Sahot state that

he "as no loner 2t to continue "or#in, an instea he

e0ane separation pa'. Petitioners then retorte that if

Sahot i not li#e to "or# as a river an'0ore, then he

coul be iven a ob that "as less strenuous, such as

"or#in as a chec#er. ;o"ever, Sahot ecline that

suestion. :ase on the foreoin recitals, petitioners

assert that it is clear that Sahot "as not is0isse but it

"as of his o"n volition that he i not report for "or#

an'0ore.In his ecision, the 4abor %rbiter conclue that7hile it 0a' be true that responents insiste that

co0plainant continue "or#in "ith responents espite his

allee illness, there is no irect evience that "ill prove

that co0plainant9s illness prevents or incapacitates hi0

fro0 perfor0in the function of a river. !he fact re0ains

that co0plainant suenl' stoppe "or#in ue to boreo0

or other"ise "hen he refuse to "or# as a chec#er "hich

certainl' is a 0uch less strenuous ob than a river.

$-

:ut ealin the 4abor %rbiter a reversal on this score the

N4RC, concurre in b' the Court of %ppeals, hel that7hile it "as ver' obvious that co0plainant i not have an'

intention to report bac# to "or# ue to his illness "hich

incapacitate hi0 to perfor0 his ob, such intention cannot

be construe to be an abanon0ent. Instea, the sa0e

shoul have been consiere as one of those fallin uner

the ust causes of ter0inatin an e0plo'0ent. !he

insistence of responent in 0a#in co0plainant "or# i

not chane the scenario.

It is "orth' to note that responent is enae in thetruc#in business "here ph'sical strenth is of ut0ost

re=uire0ent >sic?. Co0plainant starte "or#in "ith

responent as truc# helper at ae t"ent'*three >$3?, then as

truc# river since 1(-. Co0plainant "as alrea' 2ft'*nine

>(? "hen the co0plaint "as 2le an su


15/21

la"ful cause an valil' 0ae.$8%rticle $>b? of the 4abor

Coe puts the buren of provin that the is0issal of an

e0plo'ee "as for a vali or authorie cause on the

e0plo'er, "ithout istinction "hether the e0plo'er a0its

or oes not a0it the is0issal.$(&or an e0plo'ee9s

is0issal to be vali, >a? the is0issal 0ust be for a vali

cause an >b? the e0plo'ee 0ust be a$? the notice infor0in the e0plo'ee of his

is0issal, to be issue after the e0plo'ee has been iven

reasonable opportunit' to ans"er an to be hear on his

efense.33!hese, the petitioners faile to o, even onl' for
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recor purposes. hat 0anae0ent i "as to threaten the

e0plo'ee "ith is0issal, then actuall' i0ple0ent the threat

"hen the occasion presente itself because of private

responent9s painful left thih.%ll tol, both the substantive an proceural aspects of ue

process "ere violate. Clearl', therefore, Sahot9s is0issalis tainte "ith invaliit'.On the last issue, as hel b' the Court of %ppeals,

responent 5ai0e Sahot is entitle to separation pa'. !he

la" is clear on the 0atter. %n e0plo'ee "ho is ter0inate

because of isease is entitle to Aseparation pa' e=uivalent

to at least one 0onth salar' or to one*half 0onth salar' for

ever' 'ear of service, "hichever is reater @@@.A36&ollo"in

the for0ula set in %rt. $86 of the 4abor Coe, his separation

pa' "as co0pute b' the appellate court at P$,)8) ti0es

3- 'ears >1(8 to 1((6? or P6,88). e aree "ith the

co0putation, after notin that his last 0onthl' salar' "as

P6,1-).)) so that one*half thereof is P$,)8).)). &inin no

reversible error nor rave abuse of iscretion on the part of

appellate court, "e are constraine to sustain its ecision.

!o avoi further ela' in the pa'0ent ue the separate

"or#er, "hose clai0 "as 2le "a' bac# in 1((6, this

ecision is i00eiatel' e@ecutor'. Other"ise, si@ percent

>-? interest per annu0 shoul be chare thereon, for an'

ela', pursuant to provisions of the Civil Coe.-*EREFORE, the petition is DENIED an the ecision of

the Court of %ppeals ate &ebruar' $(, $))) is %&&IRMED.Petitioners 0ust pa' private responent 5ai0e Sahot his

separation pa' for 3- 'ears of service at the rate of one*half

0onthl' pa' for ever' 'ear of service, a0ountin to

P6,88).)), "ith interest of si@ per centu0 >-? per annu0

fro0 2nalit' of this ecision until full' pai.Costs aainst petitioners.SO ORDERED.:ellosillo, >Chair0an?, Menoa, an Calleo, Sr., 55., concur.%ustria*Martine, 5., no part

Republic of the Philippines

SUPREME COURT

Manila!;IRD DIVISIONG.R. No. /33/0/1 Noeber 1, 19/9M"'"TI *"%ER!"S*ER, INC., +ORGE #E!ESM" a()

CECI#IO G. INOCENCIO, petitioners,

vs.

N"TION"# #"%OR RE#"TIONS COMMISSION, CEFERIN"

+. !IOS"N" #abor "rb56er, !ear6e(6 o8 #abor a()

Eoye(6, Na65o(a Ca56a Re:5o(;, S"N!IG"N NG

M"NGG"G"-"NG PI#IPINO S"N!IG"N;TUCP a() 56

eber, +"CINTO G"RCI"NO, "#FRE!O C. %"SCO,

VICTORIO . #"URETO, ESTER N"RV"ES%NDI+%N?*!BCP etc., et al. v.

Ma#ati ;aberasher' anor !oppers Ma#ati, et al.A an

N4RC C%SE No. $*6$8*8 entitle ASanian N
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Manaa"an Pilipino >S%NDI+%N?*!BCP etc., et al. v.

!oppers Ma#ati, et al.A, a/r0in the ecision of the 4abor

%rbiter "ho ointl' hear an ecie aforesai cases,

2nin7 >a? petitioners uilt' of illeal is0issal an orerin

the0 to reinstate the is0isse "or#ers an >b? the

e@istence of e0plo'er*e0plo'ee relationship an rantinresponent "or#ers b' reason thereof their various

0onetar' clai0s.!he unispute facts are as follo"s7Iniviual co0plainants, private responents herein, have

been "or#in for petitioner Ma#ati ;aberasher', Inc. as

tailors, sea0stress, se"ers, basters >0anlililip? an

AplantsaorasA. !he' are pai on a piece*rate basis e@cept

Maria %neles an 4eonila Sera2na "ho are pai on a

0onthl' basis. In aition to their piece*rate, the' are iven

a ail' allo"ance of three >P 3.))? pesos provie the'

report for "or# before (73) a.0. ever'a'.Private responents are re=uire to "or# fro0 or before (73)

a.0. up to -7)) or 7)) p.0. fro0 Mona' to Satura' an

urin pea# perios even on Suna's an holia's.On 5ul' $), 1(86, the Sanian n Manaa"an Pilipino, a

labor oraniation of the responent "or#ers, 2le a

co0plaint oc#ete as N4RC NCR Case No. *$-)3*86 for >a?

unerpa'0ent of the basic "aeK >b? unerpa'0ent of livin

allo"anceK >c? non*pa'0ent of overti0e "or#K >? non*

pa'0ent of holia' pa'K >e? non*pa'0ent of service

incentive pa'K >f? 13th 0onth pa'K an >? bene2ts proviefor uner ae Orers Nos. 1, $, 3, 6 an . 1

Durin the penenc' of N4RC NCR Case No. *$-)3*86,

private responent Dioscoro Pelobello left "ith Salvaor

Rivera, a sales0an of petitioner ;aberasher', an open

pac#ae "hich "as iscovere to contain a AusiA baron

taalo. hen confronte, Pelobello replie that the sa0e

"as orere b' responent Casi0iro apata for his

custo0er. apata alleel' a0itte that he copie the

esin of petitioner ;aberasher'. :ut in the afternoon,

"hen aain =uestione about sai baron, Pelobello an

apata enie o"nership of the sa0e. Conse=uentl' a

0e0oranu0 "as issue to each of the0 to e@plain on or

before &ebruar' 6, 1(8 "h' no action shoul be ta#en

aainst the0 for acceptin a ob orer "hich is preuicialan in irect co0petition "ith the business of the

co0pan'. 2:oth responents alleel' i not sub0it their

e@planation an i not report for "or#. 3;ence, the' "ere

is0isse b' petitioners on &ebruar' 6, 1(8. !he'

countere b' 2lin a co0plaint for illeal is0issal oc#ete

as N4RC NCR Case No. $*6$8*8 on &ebruar' , 1(8. 4

On 5une 1), 1(8-, 4abor %rbiter Ceferina 5. Diosana renere

u0ent, the ispositive portion of "hich reas7;ERE&ORE, u0ent is hereb' renere in N4RC NCR

Case No. $*6$8*8 2nin responents uilt' of illeal

is0issal an orerin the0 to reinstate Dioscoro Pelobello

an Casi0iro apata to their respective or si0ilar positions

"ithout loss of seniorit' rihts, "ith full bac#"aes fro0 5ul'

6, 1(8 up to actual reinstate0ent. !he chare of unfair

labor practice is is0isse for lac# of 0erit.In N4RC NCR Case No. *$-)3)*86, the co0plainants clai0s

for unerpa'0ent re violation of the 0ini0u0 "ae la" is

hereb' orere is0isse for lac# of 0erit.Responents are hereb' foun to have violate the ecrees

on the cost of livin allo"ance, service incentive leave pa'

an the 13th Month Pa'. In vie" thereof, the econo0icanal'st of the Co00ission is irecte to co0pute the

0onetar' a"ars ue each co0plainant base on the

available recors of the responents retroactive as of three

'ears prior to the 2lin of the instant case.SO ORDERED.

&ro0 the foreoin ecision, petitioners appeale to the

N4RC. !he latter on March 3), 1(88 a/r0e sai ecision


18/21

but li0ite the bac#"aes a"are the Dioscoro Pelobello

an Casi0iro apata to onl' one >1? 'ear. $

%fter their 0otion for reconsieration "as enie,

petitioners 2le the instant petition raisin the follo"in

issues7

I!;E SB:5EC! DECISIONS ERRONEOBS4F CONC4BDED !;%!

%N EMP4OFER*EMP4OFEE RE4%!IONS;IP EQIS!S :E!EEN

PE!I!IONER ;%:ERD%S;ERF %ND RESPONDEN!S ORJERS.II!;E SB:5EC! DECISIONS ERRONEOBS4F CONC4BDED !;%!

RESPONDEN!S ORJERS %RE EN!I!4ED !O MONE!%RF

C4%IMS DESPI!E !;E &INDIN+ !;%! !;EF %RE NO!

EN!I!4ED !O MINIMBM %+E.III!;E SB:5EC! DECISIONS ERRONEOBS4F CONC4BDED !;%!

RESPONDEN!S PE4O:E44O %ND %P%!% ERE I44E+%44FDISMISSED. 7

!he 2rst issue "hich is the pivotal issue in this case is

resolve in favor of private responents. e have

repeatel' hel in countless ecisions that the test of

e0plo'er*e0plo'ee relationship is four*fol7 >1? the

selection an enae0ent of the e0plo'eeK >$? the

pa'0ent of "aesK >3? the po"er of is0issalK an >6? the

po"er to control the e0plo'ees conuct. It is the so calle

Acontrol testA that is the 0ost i0portant ele0ent. /!his

si0pl' 0eans the eter0ination of "hether the e0plo'er

controls or has reserve the riht to control the e0plo'ee

not onl' as to the result of the "or# but also as to the

0eans an 0etho b' "hich the sa0e is to be

acco0plishe. 9

!he facts at bar inubitabl' reveal that the 0ost i0portant

re=uisite of control is present. %s leane fro0 the

operations of petitioner, "hen a custo0er enters into a

contract "ith the haberasher' or its proprietor, the latter

irects an e0plo'ee "ho 0a' be a tailor, pattern 0a#er,

se"er or AplantsaoraA to ta#e the custo0ers

0easure0ents, an to se" the pants, coat or shirt as

speci2e b' the custo0er. Supervision is activel'

0anifeste in all these aspects the 0anner an =ualit' of

cuttin, se"in an ironin.

&urther0ore, the presence of control is i00eiatel' evientin this 0e0oranu0 issue b' %ssistant Manaer Cecilio :.

Inocencio, 5r. ate Ma' 3), 1(81 aresse to !oppers

Ma#ati !ailors "hich reas in part76. Esic? 0ust as# per0ission to

the above 0entione before ivin orers or instructions to

the tailors.:. efore accepting t"e #ob orders tailors must c"eck t"e

materials, #ob orders, due dates and ot"er t"ingsto

0a@i0ie the e/cienc' of our prouction. !he 0aterials

shoul be chec#e >sic? if it is 0atche >sic? "ith the

sa0ple, toether "ith the nu0ber of the ob orer.C. Esic? 0ust as# 2rst or 0ust avise the tailors

rearin the ue ates so that "e can eli0inate "hat "e

call :itin.E. If there is an' proble0 rearin supervisors or co*tailor

insie our shop, consult "ith 0e at once settle the proble0.

&ihtin insie the shop is strictl' prohibite. %n' tailor

violatin this 0e0oranu0 "ill be subect to isciplinar'

action.&or strict co0pliance. 10


19/21

&ro0 this 0e0oranu0 alone, it is evient that petitioner

has reserve the riht to control its e0plo'ees not onl' as

to the result but also the 0eans an 0ethos b' "hich the

sa0e are to be acco0plishe. !hat private responents are

reular e0plo'ees is further proven b' the fact that the'

have to report for "or# reularl' fro0 (73) a.0. to -7)) or7)) p.0. an are pai an aitional allo"ance of P 3.))

ail' if the' report for "or# before (73) a.0. an "hich is

forfeite "hen the' arrive at or after (73) a.0. 11

Since private responents are reular e0plo'ees,

necessaril' the aru0ent that the' are inepenent

contractors 0ust fail. %s establishe in the precein

pararaphs, private responents i not e@ercise

inepenence in their o"n 0ethos, but on the contrar'

"ere subect to the control of petitioners fro0 the beinnin

of their tas#s to their co0pletion. Bnli#e inepenentcontractors "ho enerall' rel' on their o"n resources, the

e=uip0ent, tools, accessories, an paraphernalia use b'

private responents are supplie an o"ne b' petitioners.

Private responents are totall' epenent on petitioners in

all these aspects.Co0in no" to the secon issue, there is no ispute that

private responents are entitle to the Mini0u0 ae as

0anate b' Section $>? of 4etter of Instruction No. 8$(,

Rules I0ple0entin Presiential Decree No. 1-16 an

reiterate in Section 3>f?, Rules I0ple0entin Presiential

Decree 113 "hich e@plicitl' states that, A%ll e0plo'eespai b' the result shall receive not less than the applicable

ne" 0ini0u0 "ae rates for eiht >8? hours "or# a a',

e@cept "here a pa'0ent b' result rate has been establishe

b' the Secretar' of 4abor. ...A 12No such rate has been

establishe in this case.:ut all these not"ithstanin, the =uestion as to "hether or

not there is in fact an unerpa'0ent of 0ini0u0 "aes to

private responents has alrea' been resolve in the

ecision of the 4abor %rbiter "here he state7 A;ence, for

lac# of su/cient evience to support the clai0s of the

co0plainants for allee violation of the 0ini0u0 "ae,

their clai0s for unerpa'0ent re violation of the Mini0u0

ae 4a" uner ae Orers Nos. 1, $, 3, 6, an 0ust

perforce fall.A 13

!he recors sho" that private responents i not appeal

the above rulin of the 4abor %rbiter to the N4RCK neither

i the' 2le an' petition raisin that issue in the Supre0e

Court. %ccorinl', insofar as this case is concerne, that

issue has been lai to rest. %s to private responents, the

u0ent 0a' be sai to have attaine 2nalit'. &or it is a

"ell*settle rule in this urisiction that Aan appellee "ho

has not hi0self appeale cannot obtain fro0 the appellate

court*, an' a/r0ative relief other than the ones rante in

the ecision of the court belo". A

14

%s a conse=uence of their status as reular e0plo'ees of

the petitioners, the' can clai0 cost of livin allo"ance. !his

is apparent fro0 the provision e2nin the e0plo'ees

entitle to sai allo"ance, thus7 A... %ll "or#ers in the private

sector, rearless of their position, esination or status,

an irrespective of the 0etho b' "hich their "aes are

pai. A 1

Private responents are also entitle to clai0 their 13th

Month Pa' uner Section 3>e? of the Rules an Reulations

I0ple0entin P.D. No. 81 "hich provies7

Section 3. E0plo'ers covere. !he Decree shall appl' toall e0plo'ers e@cept to7@@@ @@@ @@@>e? E0plo'ers of those "ho are pai on purel' co00ission,

bounar', or tas# basis, an those "ho are pai a 2@e

a0ount for perfor0in a speci2c "or#, irrespective of the

ti0e consu0e in the perfor0ance thereof, e$cept !"ere

t"e !orkers are paid on piece%rate basis in !"ic" case t"e


20/21

emploer s"all be covered b t"is issuance insofar as suc"

!orkers are concerned. >E0phasis supplie.?On the other han, "hile private responents are entitle to

Mini0u0 ae, CO4% an 13th Month Pa', the' are not

entitle to service incentive leave pa' because as piece*rate

"or#ers bein pai at a 2@e a0ount for perfor0in "or#irrespective of ti0e consu0e in the perfor0ance thereof,

the' fall uner one of the e@ceptions state in Section 1>?,

Rule V, I0ple0entin Reulations, :oo# III, 4abor Coe. &or

the sa0e reason private responents cannot also clai0

holia' pa' >Section 1>e?, Rule IV, I0ple0entin

Reulations, :oo# III, 4abor Coe?.ith respect to the last issue, it is apparent that public

responents have 0isrea the evience, for it oes sho"

that a violation of the e0plo'ers rules has been co00itte

an the evience of such transression, the copie baron

taalo, "as in the possession of Pelobello "ho pointe to

apata as the o"ner. hen re=uire b' their e0plo'er to

e@plain in a 0e0oranu0 issue to each of the0, the' not

onl' faile to o so but instea "ent on %O4 >absence

"ithout o/cial leave?, "aite for the perio to e@plain to

e@pire an for petitioner to is0iss the0. !he' thereafter

2le an action for illeal is0issal on the far*fetche roun

that the' "ere is0isse because of union activities.

%ssu0in that such acts o not constitute abanon0ent of

their obs as insiste b' private responents, their blatant

isrear of their e0plo'ers 0e0oranu0 is unoubtel'an open e2ance to the la"ful orers of the latter, a

usti2able roun for ter0ination of e0plo'0ent b' the

e0plo'er e@pressl' provie for in %rticle $83>a? of the

4abor Coe as "ell as a clear inication of uilt for the

co00ission of acts ini0ical to the interests of the e0plo'er,

another usti2able roun for is0issal uner the sa0e

%rticle of the 4abor Coe, pararaph >c?. ell establishe in

our urispruence is the riht of an e0plo'er to is0iss an

e0plo'ee "hose continuance in the service is ini0ical to the

e0plo'ers interest. 1$

In fact the 4abor %rbiter hi0self to "ho0 the e@planation of

private responents "as sub0itte ave no creence to

their version an foun their e@cuses that sai baron

taalo "as the one the' ot fro0 the e0broierer for the%ssistant Manaer "ho "as investiatin the0,

unbelievable.Bner the circu0stances, it is evient that there is no illeal

is0issal of sai e0plo'ees. !hus, e have rule that7No e0plo'er 0a' rationall' be e@pecte to continue in

e0plo'0ent a person "hose lac# of 0orals, respect an

lo'alt' to his e0plo'er, rear for his e0plo'ers rules, an

appreciation of the init' an responsibilit' of his o/ce,

has so plainl' an co0pletel' been bare.!hat there shoul be concern, s'0path', an solicitue for

the rihts an "elfare of the "or#in class, is 0eet an

proper. !hat in controversies bet"een a laborer an his

0aster, oubts reasonabl' arisin fro0 the evience, or in

the interpretation of aree0ents an "ritins shoul be

resolve in the for0ers favor, is not an unreasonable or

unfair rule. :ut that isrear of the e0plo'ers o"n rihts

an interests can be usti2e b' that concern an solicitue

is unust an unacceptable. >Stanfor Micros'ste0s, Inc. v.

N4RC, 1 SCR% 616*61 H1(88 ?.!he la" is protectin the rihts of the laborer authories

neither oppression nor self*estruction of thee0plo'er.17More i0portantl', "hile the Constitution is

co00itte to the polic' of social ustice an the protection

of the "or#in class, it shoul not be suppose that ever'

labor ispute "ill auto0aticall' be ecie in favor of

labor. 1/

&inall', it has been establishe that the riht to is0iss or

other"ise i0pose iscriplinar' sanctions upon an e0plo'ee

for ust an vali cause, pertains in the 2rst place to the


21/21

e0plo'er, as "ell as the authorit' to eter0ine the

e@istence of sai cause in accorance "ith the nor0s of ue

process. 19

!here is no evience that the e0plo'er violate sai nor0s.

On the contrar', private responents "ho viorousl' insist

on the e@istence of e0plo'er*e0plo'ee relationship,because of the supervision an control of their e0plo'er

over the0, "ere the ver' ones "ho e@hibite their lac# of

respect an rear for their e0plo'ers rules.

Bner the foreoin facts, it is evient that petitioner

;aberasher' ha vali rouns to ter0inate the services of

private responents.;ERE&ORE, the ecision of the National 4abor Relations

Co00ission ate March 3), 1(88 an that of the 4abor

%rbiter ate 5une 1), 1(8- are hereb' 0oi2e. !heco0plaint 2le b' Pelobello an apata for illeal is0issal

oc#ete as N4RC NCR Case No. $*6$8*8 is is0isse for

lac# of factual an leal bases. %"ar of service incentive

leave pa' to private responents is elete.SO ORDERED.'utierrez, Jr., (eliciano, idin and )ortes, JJ., concur.

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