SECOND MOTION FOR RECONSIDERATION MAY BE ENTERTAINED BY THE SUPREME COURT EN BANC EVEN FOR CASE RESOLVED BY SC DIVISION AS FINAL AND EXECUTORY

Second motion for reconsideration can only be entertained before the ruling sought to be reconsidered becomes final by operation of law or by the Court’s declaration.

Thus, the Supreme Court held in the January 10, 2018 case, as follows:

Alfredo F. Laya, Jr. vs. Court of Appeals, et al.
G.R. No. 205813, January 10, 2018

Facts:

Petitioner Alfredo F. Laya, Jr. (Laya) was hired by PVB Philippine Veterans Bank (PVB) as its Chief Legal Counsel with a rank of Vice President. Among others, the terms and conditions of his appointment includes membership in the Provident Fund Program/Retirement Program.

PVB has its Retirement Plan Rules and Regulations which provides under Section 1 of Article IV that the normal retirement date of a member shall be the first day of the month coincident with or next following his attainment of age 60.

PVB also has the rule for late retirement which states that a member may, with the approval of the Board of Directors, extend his service beyond his normal retirement date but not beyond age 65. Such deferred retirement shall be on a case by case and yearly extension basis.

Laya was informed thru letter by PVB of his retirement effective on 1 July 2007 (note: before reaching 65 years old). Laya wrote Col. Emmanuel V. De Ocampo, Chairman of PVB bank, requesting for an extension of his tenure for two (2) more years pursuant to the Bank’s Retirement Plan (Late Retirement).

PVB issued a memorandum directing Laya to continue to discharge his official duties and functions as chief legal counsel pending his request. However, Laya was later informed thru its president Ricardo A. Balbido Jr. that his request for an extension of tenure was denied.

According to Laya, he was made aware of the retirement plan of PVB only after he had long been employed and was shown a photocopy of the Retirement Plan Rules and Regulations, but PVB’s President Ricardo A. Balbido, Jr. had told him then that his request for extension of his service would be denied “to avoid precedence.” He sought the reconsideration of the denial of the request for the extension of his retirement, but PVB certified his retirement from the service as of July 1, 2007 on March 6, 2008.

Several months thereafter, Laya filed his complaint for illegal dismissal against PVB and Balbido, Jr. in the NLRC to protest his unexpected retirement.

LA Ruling:

The Labor Arbiter rendered a decision dismissing the complaint for illegal dismissal. After his motion for reconsideration was denied, Laya appealed to the NLRC. [Note: the Decision of the LA becomes final and executory if not appealed to the Commission within ten calendar days from receipt of said decision. Further, no MR of the LA Decision shall be filed before the Commission]

NLRC Ruling:

The NLRC affirmed the Decision of the LA.

Laya assailed the NLRC Decision before the CA via a petition for certiorari.

CA Ruling:

The CA denied the petition.

The CA held that Laya’s acceptance of his appointment as Chief Legal Officer of PVB signified his conformity to the retirement program. He could not have been unaware of the retirement program which had been in effect since January 1, 1996 (note: Laya was hired June 1, 2001).

The Ca held further that the lowering of the retirement age through the retirement plan was a recognized exception under the provisions of Article 287 of the Labor Code. Considering his failure to adduce evidence showing that PVB had acted maliciously in applying the provisions of the retirement plan to him and in denying his request for the extension of his service, PVB ‘s implementation of the retirement plan was a valid exercise of its management prerogative.

Laya filed a petition for review on certiorari before the SC. This was raffled to the SC First Division.

On April 8, 2013, the Supreme Court (First Division) denied the petition for review on certiorari. In his motion for reconsideration, Laya not only prayed for the reconsideration of the denial but also sought the referral of his petition to the Court En Banc, arguing that the CA and the NLRC had erroneously applied laws and legal principles intended for corporations in the private sector to a public instrumentality like PVB.

The SC (First Division) denied Laya’s motion for reconsideration, as well as his prayer to refer the case to the Court En Banc. The entry of judgment was issued on December 6, 2013.

Laya filed a second motion for reconsideration on December 18, 2013 whereby he expounded on the issues he was raising in his first motion for reconsideration. He urged that the SC should find and declare PVB as a public instrumentality. According to him, the law applicable to his case was Presidential Decree No. 1146 (GSIS Law), which stipulated the compulsory retirement age of 65 years. The compulsory retirement age for civil servants could not be “contracted out.”

The First Division referred the case to SC En Banc.

Issue/s:

Whether or not a case that had already been decided by the SC Division and have become final and executory can still be referred to the SC En Banc for Resolution

Whether or not a second motion for reconsideration may be file before the Supreme Court after the case had become final and executory

SC Ruling En Banc:

The SC En Banc granted the petition.

The SC En Banc accepted the referral of the case by the First Division. It required PVB and the Office of the Solicitor General (OSG) to file their comments on Laya’s second motion for reconsideration.

In its comment, PVB argued that the Court should not have accepted the referral of the case to the Banc because the First Division had already denied with finality Laya’s first motion for reconsideration, as well as his motion to refer the case to the Banc. The Court En Banc’s acceptance of the case was in violation of the principle of immutability of final judgments as well as of Section 3, Rule 15 of the Internal Rules of the Supreme Court to the effect that a second motion for reconsideration could be allowed only “before the ruling sought to be reconsidered becomes final by operation of law or by the Court’s declaration.

According to PVB, the SC First Division had correctly denied the petition for review because the issues raised therein were factual matters that this mode of appeal could not review and pass upon.

PVB demurrs to the propriety of Laya’s attack on its corporate existence. It submits that he should not be allowed to pose such attack for the first time in this appeal. His argument was also an impermissible collateral attack on the constitutionality of Republic Act No. 3518 and Republic Act No. 7169. His seeking a declaration of PVB as a public institution “partakes the nature of a petition for declaratory relief which is an action beyond the original jurisdiction of the Honorable Court.

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The SC En Banc held that as a general rule, second and subsequent motions for reconsideration are forbidden. Nevertheless, there are situations in which exceptional circumstances warrant allowing such motions for reconsideration, and for that reason the Court has recognized several exceptions to the general rule.

Citing McBurnie vs. Ganzon the SC en banc held that the general rule against second and subsequent motions for reconsideration admits of settled exceptions. For one, the present Internal Rules of the Supreme Court, particularly Section 3, Rule 15 thereof, provides that the Court shall not entertain a second motion for reconsideration, and any exception to this rule can only be granted in the higher interest of justice by the SC en banc upon a vote of at least two-thirds of its actual membership.

There is reconsideration “in the higher interest of justice” when the assailed decision is not only legally erroneous, but is likewise patently unjust and potentially capable of causing unwarranted and irremediable injury or damage to the parties. A second motion for reconsideration can only be entertained before the ruling sought to be reconsidered becomes final by operation of law or by the Court’s declaration.

Further, the SC opined that it is also recognized that in some instances, the prudent action towards a just resolution of a case is to suspend rules of procedure, for the power of the Court to suspend its own rules or to except a particular case from its operations whenever the purposes of justice require it, cannot be questioned.

Citing Navarro vs. Executive Secretary, the SC held that the power to suspend or even disregard rules of procedure can be so pervasive and compelling as to alter even that which this Court itself has already declared final. The SC mentioned the case of Munoz vs. CA where the SC resolved to recall an entry of judgment to prevent a miscarriage of justice. This justification was likewise applied in Tan Tiac Chiong vs. Hon. Cosico, wherein the Court held that the recall of entries of judgments, albeit rare, is not a novelty.

Citing Barnes vs. Judge Padilla, it was held that the final and executory judgment can no longer be attacked by any of the parties or be modified, directly or indirectly, even by the highest court of the land. However, the SC has relaxed this rule in order to serve substantial justice considering (a) matters of life, liberty, honor or property, (b) the existence of special or compelling circumstances, (c) the merits of the case, (d) a cause not entirely attributable to the fault or negligence of the party favored by the suspension of the rules, (e) a lack of any showing that the review sought is merely frivolous and dilatory, and (f) the other party will not be unjustly prejudiced thereby.

The SC may entertain second and subsequent motions for reconsideration when the assailed decision is legally erroneous, patently unjust and potentially capable of causing unwarranted and irremediable injury or damage to the parties. Under these circumstances, even final and executory judgments may be set aside because of the existence of compelling reasons.

Although PVB could validly impose a retirement age lower than 65 years for as long as it did so with the employees’ consent, the consent must be explicit, voluntary, free, and uncompelled.

In dismissing the petition for review on certiorari, the SC’s First Division inadvertently overlooked that the law required the employees’ consent to be express and voluntary in order for them to be bound by the retirement program providing for a retirement age earlier than the age of 65 years. Hence, the SC en banc found it proper to render a fair adjudication on the merits of the appeal upon Laya’s second motion for reconsideration.

Furthermore, allowing this case to be reviewed on its merits furnishes the Court with the opportunity to re-examine the case in order to ascertain whether or not the dismissal produced results patently unjust to Laya. These reasons do justify treating this case as an exception to the general rule on immutability of judgments.