Cebu People’s Multi-purpose Cooperative vs. Carbonilla, Jr.

G.R. No. 212070, January 27, 2016




Cebu People’s Multi-purpose Cooperative (CPMPC) hired Carbonilla, Jr. as a Credit and Collection Manager and, as such, was tasked with the handling of the credit . and collection activities of the cooperative, which included recommending loan approvals, formulating and implementing credit and collection policies, and conducting trainings. Sometime in 2007, CPMPC underwent a I reorganization whereby Carbonilla, Jr. was also assigned to perform the duties of Human Resources Department (HRD) Manager, i.e., assisting in the personnel hiring, firing, and handling of labor disputes. In 2008, he was appointed as Legal Officer and subsequently, held the position of Legal and Collection Manager.


Subsequently, CPMPC, through its HRD Manager, sent various memoranda to Carbonilla, Jr. seeking explanation on the various infractions he allegedly committed. He replied explaining his side. Unconvinced by Carbonilla, Jr.’s explanations, CPMPC scheduled several clarificatory hearings, but the former failed to attend despite due notice. Later, CPMPC conducted a formal investigation where it ultimately found Carbonilla, Jr. to have committed acts prejudicial to CPMPC’s interests. As such, CPMPC, CEO Quevedo, sent Carbonilla, Jr. a Notice of Dismissal dated August 5, 2008 informing the latter of his termination on the grounds of: (a) loss of trust and confidence; ( b) gross disrespect; ( c) serious misconduct; ( d) gross negligence; ( e) commission of a crime of falsification/inducing Aguipo to violate the law or the Land Transportation and Traffic Code; and (e) committing acts highly prejudicial to the interest of the cooperative. He filed the case for illegal dismissal and money claims.


CMPC maintained that the totality of Carbonilla, Jr.’s infractions was sufficient to warrant his dismissal, and that it had complied with the procedural due process in terminating him.


LA Ruling:


The Labor Arbiter (LA) dismissed Carbonilla, Jr.’ s complaint for lack of merit. The LA found that Carbonilla, Jr. committed a litany of infractions, the totality of which constituted just cause for the termination of his employment. Likewise, it was determined that CPMPC afforded Carbonilla, Jr. procedural due process prior to his termination, as evinced by the former’s issuance of a series of memoranda, as well as its conduct of investigation with notices to the latter. Aggrieved, Carbonilla, Jr. appealed to the NLRC.


NLRC Ruling:


The NLRC affirmed the LA ruling. It found CPMPC to have substantially proven the existence of just causes in dismissing Carbonilla, Jr. It further held that Carbonilla, Jr. was given the opportunity to present his side and to disprove the charges against him, but failed to do so. Finally, the NLRC explained that while Carbonilla, Jr. may indeed be entitled to his claims for unpaid salaries and 13th month pay, the same cannot be granted as his accountabilities with CPMPC were larger than said claims. His motion for reconsideration was denied. Thus, he filed the petition for certiorari with the CA.


CA Ruling:


The CA reversed and set aside the NLRC ruling and accordingly, ordered Carbonilla, Jr.’s reinstatement and the remand of the case to the LA for the computation of his full backwages, inclusive of allowances and other benefits, as well as attorney’s fees. It held that the NLRC gravely abused its discretion in declaring Carbqnilla, Jr.’s dismissal as valid, considering that, other than CPMPC’s series of memoranda and self-serving allegations, it did not present substantial documents to support a conclusion that would warrant Carbonilla, Jr.’s valid dismissal. In fine, CPMPC failed to discharge the burden of proving that Carbonilla, Jr. ‘s dismissal was for just causes. Dissatisfied, petitioners moved for reconsideration, but the same was denied; hence, the petition.




1. Whether or not the dismissal was valid.

2. Whether or not employee accountabilities can be validly offset against the 13th month pay


SC Ruling:


The SC found merit in the petition.


For serious misconduct to be valid ground for dismissal, termination, the following requisites must concur: (a) the misconduct must be serious; (b) it must relate to the performance of the employee’s duties showing that the employee has become unfit to continue working for the employer; and (c) it must have been performed with wrongful intent. All of the foregoing requisites have been duly established in this case. Records reveal that Carbonilla, Jr. ‘s serious misconduct consisted of him frequently exhibiting disrespectful and belligerent behavior, not only to his colleagues, but also to his superiors. He even used his stature as a law graduate to insist that he is “above” them, often using misguided legalese to weasel his way out of the charges against him, as well as to strong-arm his colleagues and superiors into succumbing to his arrogance.


His dismissal was also justified on the ground of loss of trust and confidence. He occupied a position of trust and confidence as he was employed as Credit and Collection Manager, and later on, as Legal and Collection Manager. His dismissal on this ground was justified by his acts of forwarding the mediation settlements for notarization to a lawyer who was not the authorized legal retainer of CPMPC; the pulling out of important records and vital documents from the office premises, which were either lost or returned already tampered and altered; and (c) the incurring of unliquidated cash advances related to the notarial transactions of the mediation agreements. While Carbonilla, Jr. posited that these actuations were resorted with good intentions as he was only finding ways for CPMPC to save up on legal fees, this defense can hardly hold, considering that all of these transactions were not only highly irregular, but also done without the prior knowledge and consent of CPMPC’s management. Cast against this light, Carbonilla, Jr.’s performance of the said acts therefore gives CPMPC more than enough reason to lose trust and confidence in him.


The totality and gravity of Carbonilla, Jr. ‘s infractions throughout the course of his employment completely justified CPMPC’s decision to finally terminate his employment. The Court’s pronouncement in Realda v. New Age Graphics, is instructive on this matter: The totality of infractions or the number of violations committed during the period of employment shall be considered in determining the penalty to be imposed upon an erring employee. The offenses committed by petitioner should not be taken singly and separately. Fitness for continued employment cannot be compartmentalized into tight little cubicles of aspects of character, conduct and ability separate and independent of each other.


Carbonilla, Jr.’s award of unpaid salaries and 13th month pay were validly offset by his accountabilities to CPMPC. Pursuant to Article 1278 in relation to Article 1706 of the Civil Code and Article 113 (c) of the Labor Code, compensation can take place between two persons who are creditors and debtors of each other.

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