LOSS OF TRUST AND CONFIDENCE MUST BE FROM DISHONEST OR DECEITFUL CONDUCT

Julieta B. Sta. Ana vs. Manila Jockey Club, Inc.
G.R. No. 208459, February 15, 2017

Facts:

In May 1977, Manila Jockey Club, Inc. (MJCI) hired Julieta B. Sta. Ana (Sta. Ana) as outlet teller of its off-track betting (OTB) station in Tayuman, Manila (OTB Tayuman). MCJI issued a Memorandum stating that its Treasury Department was discovered to have been illegally appropriating funds and lending it out to the employees of MJCI.

As a result, MJCI required its officers and employees to report any loan obtained from said department or any of its personnel. MJCI’s Intemal Auditing Department (IAD) submitted its Preliminary Report indicating that its Agudo OTB Branch (OTB Agudo) had unaccounted check remittances amounting to P44,377,455.00 for the period January 10, 2008 to November 30, 2008.

MJCI formally charged Sta. Ana with Dishonesty and Fraudulent Acts. In her Explanation, Sta. Ana denied committing any offense. She contended that even prior to the takeover of the new management of MJCI, she had been engaged in the lending business to augment her income.

Sta. Ana averred that she did not know anything regarding MJCI’s unaccounted money and that her suspension was unjust. She maintained that she did not violate any company rule by engaging in the lending business.

In its Report, the Special Disciplinary Committee (SDC) found that Sta. Ana extended loans to the employees of MJCI during office hours using its personnel as messenger. It further stated that on one occasion, Sta. Ana used corporate funds without MJCI’s authority, and with the assistance of Tejada.

Consequently, the SDC found Sta. Ana guilty of conspiring to defraud, illegally take funds, and cause irreparable damage to MJCI; as such, MJCI lost its trust on her. It also declared that even granting that there was no conspiracy, Sta. Ana, nonetheless, committed gross inexcusable negligence for failure to perform her duties and protect the interest of MJCI.

SDC recommended the dismissal of Sta. Ana and the filing of criminal cases for qualified theft and other appropriate charges. MJCI issued a Notice of Termination to Sta. Ana. Sta. Ana filed a Complaint for illegal dismissal and payment of actual, moral and exemplary damages, and attorney’s fees.

LA Ruling:

The LA dismissed the Complaint for lack of merit. He declared that Sta. Ana conspired with the other tellers against MJCI by issuing reports intended to conceal discrepancies in the remittance which resulted in the unlawful taking of MJCI’s funds, and that the money obtained by Sta. Ana was used in her lending business.

The LA noted that Sta. Ana claimed that her capital was sourced from the proceeds of the sale of her fishing vessels two years ago; yet, she also alleged that she started her lending business 15 years prior to the takeover of the new management.

The LA also concluded, based on the declarations of two employees, that the amounts they borrowed from Sta. Ana were delivered by an employee of MJCI, that Sta. Ana had used an MJCI’s employee and company time in her business.

Lastly, the LA held that Sta. Ana’s salary alone could not support her lending business. He also decreed that the filing by MJCI of criminal cases against Sta. Ana proved its loss of trust and confidence in her, a valid ground for dismissal from work

NLRC Ruling:

The NLRC affirmed the LA Decision. It ruled that MJCI validly dismissed Sta. Ana for loss of trust and confidence; that although Sta. Ana might not have been directly involved in the discrepancies of the remittances and in the preparation of reports to cover up such discrepancies, she was nonetheless a recipient of the stolen money which she used in her lending business;

Sta. Ana’s claim that her lending business was funded by the sale of her fishing vessels two years ago contradicted her declaration that she commenced her business 15 years earlier; and that Sta. Ana’s statement, anent her co-employees who had loans from her, did not indicate the dates when the borrowers obtained their loans from Sta.Ana.

The NLRC denied the Motion for Reconsideration filed by Sta.Ana. She filed with the CA a Petition for Certiorari contending that the NLRC committed grave abuse of discretion amounting to lack or excess of jurisdiction when it ruled that she was validly dismissed from work.

Sta. Ana filed with the CA a Petition for Certiorari contending that the NLRC committed grave abuse of discretion amounting to lack or excess of jurisdiction when it ruled that she was validly dismissed from work.

CA Ruling:

The CA held that Sta. Ana regularly handled a large amount of money belonging to MJCI; thus, she occupied a position of trust.

The CA gave credence to Sunga’s Affidavit where he declared that Sta. Ana told him that Tejada was her (Sta. Ana) business partner.

The CA further held that it could not see how Sta. Ana, with her meager salary, could finance her lending business. It likewise sustained the view that Sta. Ana’s statement that she funded her business from the sale of her fishing boats two years ago contradicted her assertion that her lending business commenced 15 years earlier.

In sum, the CA held that Sta. Ana connived with Tejada in stealing MJCI’s funds and using it to finance her lending business. The CA denied Sta. Ana’s Motion for Reconsideration. Undetered, Sta. Ana filed the Petition for Review on Certiorari.

Issue/s:

Whether or not the dismissal was valid for loss of trust and confidence.

SC Ruling:

To legally dismiss an employee on the ground of loss of trust, the employer must establish that a) the employee occupied a position of trust and confidence, or has been routinely charged wit. a) the care and custody of the employer’s money or property; b) employee committed a willful breach of trust based on clearly established facts; and, c) such loss of trust relates to the employee’s performance of duties.

In fine, must be actual breach of duty on the part of the employee to justify his or her dismissal on the ground of loss of trust and confidence.

Sta. Ana occupied such position of trust and MJCI afforded her procedural due her dismissal is still unwarranted because MJCI failed to discharge its burden of proving that she willfully breached its trust, and such loss of trust relates to Sta. Ana’s performance of duties.

MJCI’s accusation against Sta. Ana of having used a co-employee in her personal business during office hours; and, having lent money to another using MJCI’s fond without authority, by clear and convincing evidence.

The narration of the SDC, during the hearing, Sta. Ana admitted owning fishing vessels as evidenced by a permit to operate them; also, the SDC stated that Sta. Ana confirmed that these vessels were eventually sold and their proceeds were used in her business. This only means that MJCI, through the SDC, was fully aware that the sale of Sta. Ana’s fishing vessels was for the purpose of infusing additional capital into her lending business. In addition, from the time Sta. Ana was under investigation, she made readily available documents to justify the amount of her capital for her lending business.

A cardinal rule that loss of trust and confidence should be genuine, and not simulated; it must be from dishonest or deceitful conduct, and must not be arbitrarily asserted in the face of overwhelming contrary evidence.

 Loss of Trust and Confidence must be founded on clearly established facts

While proof beyond reasonable doubt is not required, loss of trust must have some basis or such reasonable ground for one to believe that the employee committed the infraction, and the latter’s participation makes him or her totally unworthy of the trust demanded by the position.

Here, MJCI failed to prove that Sta. Ana committed willful breach of its trust. Particularly, it failed to establish that Sta. Ana used its employee for her personal business during office hours, and used its money; without authority, to lend money to another. Hence, to dismiss her on the ground of loss of trust and confidence is unwarranted. Under these circumstances, she is entitled to receive backwages and separation pay.

An illegally dismissed employee is entitled to two separate reliefs: full backwages and reinstatement. In such case where reinstatement is no longer an option, payment of separation pay is justified. The Court considers “considerable time,” which includes the lapse of eight years or more (from the filing of the complaint up to the resolution of the case) to support the grant of separation pay in lieu of reinstatement. Considering that about eight years had passed from the time that Sta. Ana filed her complaint on February 25, 2009 then, her reinstatement is an impractical option. Thus, instead of reinstatement, the Court grants her separation pay of one month for every year of service.

As regards backwages, she is entitled to receive full backwages, which include allowances and other benefits due her or their monetary equivalent, computed from the time her compensation was withheld up to the finality of this Decision.