Motion for Leave Once Granted the Second Motion is not Anymore Prohibited

Motion for leave to file the second Motion for Reconsideration is no longer prohibited once it is granted. The SC granted leave to file the Supplemental Motion for Reconsideration. The Supplemental Motion for Reconsideration, therefore, is no longer prohibited.

Thus, the Supreme Court held as follows:

Club Filipino, Inc. vs. Benjamin Bautista, et al.
G.R. No. 168406, January 14, 2015

Illegal strike; Res judicata; Double compensation; Second motion for reconsideration before the SC; Supplemental motion for reconsideration before the SC

Facts:

In this case, the SC resolves the Supplemental Motion for Reconsideration but treated the same as second motion for reconsideration.

Club Filipino Employees Association (CLUFEA) is a union representing the employees of Club Filipino, Inc. CLUFEA and Club Filipino, Inc. entered into previous collective bargaining agreements, the last of which expired on May 31, 2000.

Before CLUFEA and Club Filipino, Inc.’s last collective bargaining agreement expired and within the 60-day freedom period, CLUFEA had made several demands on Club Filipino, Inc. to negotiate a new agreement. Club Filipino, Inc., however, replied that its Board of Directors could not muster a quorum to negotiate with CLUFEA.

CLUFEA then formally submitted its proposals to Club Filipino Inc.’s negotiating panel. Still, Club Filipino, Inc. failed to negotiate, citing as reason the illness of the chairperson of its negotiating panel. To compel Club Filipino, Inc. to negotiate with it, CLUFEA filed before the National Conciliation and Mediation Board (NCMB) a request for preventive mediation. The negotiating panels of CLUFEA and Club Filipino, Inc. finally met. However, the meeting ended with the parties’ respective panels declaring a deadlock in negotiation.

Thus, CLUFEA filed with the NCMB a Notice of Strike on the ground of bargaining deadlock. Club Filipino, Inc. submitted the first part of its counterproposal. CLUFEA conducted a strike vote under the DOLE’s supervision with the majority of CLUFEA’s total union membership voting to strike. Club Filipino, Inc. submitted to CLUFEA the second part of its counterproposal, which CLUFEA countered with an improved offer. Club Filipino, Inc., however, refused CLUFEA’s improved offer. CLUFEA staged a strike on the ground of bargaining deadlock.

Club Filipino, Inc. filed before the National Capital Regional Arbitration Branch of the National Labor Relations Commission (NLRC) a Petition to Declare [CLUFEA’s] Strike Illegal. According to Club Filipino, Inc., CLUFEA failed to file a Notice of Strike and to conduct a strike vote, in violation of the legal requirements for staging a strike. Worse, CLUFEA’s members allegedly committed illegal acts while on strike, preventing their co-workers from entering and leaving Club Filipino, Inc.’s premises and even cutting off Club Filipino, Inc.’s electricity and water supply on the first day of the strike. Club Filipino, Inc. prayed that all of CLUFEA’s officers who participated in the strike be declared to have lost their employment pursuant to Article 264(a) of the Labor Code.

LA Ruling:

The Labor Arbiter Manuel P. Asuncion decided Club Filipino, Inc.’s Petition for declaration of illegal strike. He found that CLUFEA’s Notice of Strike did not contain CLUFEA’s written proposals and Club Filipino, Inc.’s counterproposals, in violation of then Rule XXII, Section 4 of the Omnibus Rules Implementing the Labor Code.

Updated and Re-numbered Labor Code 2018 Edition now available

Thus, the Labor Arbiter declared CLUFEA’s strike “procedurally infirm” for CLUFEA’s failure to comply with the procedural requirements for staging a strike. The Labor Arbiter declared the strike illegal and considered “all the officers of the union terminated from service.” Because of the retrenchment program Club Filipino, Inc. allegedly launched before the Labor Arbiter issued his Decision, the dismissed union officers were ordered to receive separation pay “similar in terms with those offered to the employees affected by the retrenchment program of the club.

NLRC Ruling:

CLUFEA appealed before the National Labor Relations Commission (NLRC) with Bautista, Caluag, Sualog, and Calida verifying the Memorandum of Appeal on CLUFEA’s behalf.

The NLRC ruled that CLUFEA’s Appeal was filed by persons “[having] no legal standing to question the [Labor Arbiter’s] decision.” Bautista had allegedly resigned from Club Filipino, Inc., receiving separation benefits pursuant to Club Filipino, Inc.’s Employees Retirement Plan.

For their part, Caluag, Sualog, and Calida allegedly misrepresented themselves as CLUFEA’s officers when they appealed to the NLRC. According to the NLRC, CLUFEA had already elected a new set of officers. Caluag, Sualog, and Calida, therefore, were no longer CLUFEA’s officers when they filed the Appeal on December 20, 2001. Finding that CLUFEA no longer wished to appeal the Labor Arbiter’s Decision, the NLRC cited a letter the new officers of CLUFEA allegedly gave Atty. Roberto F. De Leon, Club Filipino, Inc.’s President stating “Ang pamunuan sampu ng aming mga kasapi ay mariing tinututulan ang ano mang uri ng pag-aapela upang maisalba ang natitirang miyembro sa tiyak na kapahamakan kung magpapatuloy and [sic] ganitong uri ng tagisan ng bawat isa.”

Thus, the NLRC denied the Appeal filed for lack of merit.           Club Filipino, Inc. filed a Motion for Partial Reconsideration, while Bautista, Caluag, Sualog, and Calida filed a Motion for Reconsideration of the NLRC’s Decision. Johnny Arinto (Arinto), Roberto de Guzman (de Guzman), and Laureno Fegalquin (Fegalquin), all directors and officers of CLUFEA, joined Bautista, Caluag, Sualog, and Calida in filing the Motion for Reconsideration.

The NLRC denied the motions.

Bautista, Sualog, Calida, Arinto, de Guzman, and Fegalquin filed a Petition for Certiorari with the Court of Appeals.

However, Caluag no longer joined his colleagues.

Instead, Carlito Presentacion (Presentacion), a CLUFEA member, joined in the filing of the Petition for Certiorari.

CA Ruling:

The Court of Appeals first resolved whether Bautista, Sualog, Calida, Arinto, de Guzman, and Fegalquin had legal personality to appeal before the NLRC. On this issue, the Court of Appeals ruled that “a worker ordered dismissed under a tribunal’s decision has every right to question his or her dismissal especially if he [or she] had not been properly impleaded in the case and in the decision that decreed his or her dismissal.” Being officers of CLUFEA, Bautista, et al. had the right to appeal the loss of their employment with the NLRC.

With respect to Arinto, de Guzman, and Fegalquin, the Court of Appeals further ruled that they were not granted “the full hearing that the due process requirements of the Philippine Constitution impose.” Arinto, de Guzman, and Fegalquin participated only during the Motion for Reconsideration stage with the NLRC. The Labor Arbiter’s Decision, therefore, did not bind Arinto, de Guzman, and Fegalquin.

On the merits, the Court of Appeals held that the Labor Arbiter gravely abused his discretion in declaring CLUFEA’s strike illegal. The Court of Appeals ruled that the requirements under Rule XXII, Section 4 of the Omnibus Rules Implementing the Labor Code “[do] not appear to be absolute.” Rule XXII, Section 4 only requires that the proposals and counterproposals be attached to the Notice of Strike “as far as practicable.” Since CLUFEA had already filed a Notice of Strike when Club Filipino, Inc. submitted its counterproposals, it was not practicable for CLUFEA to attach Club Filipino, Inc.’s counterproposals to the Notice of Strike.

The Court of Appeals found that the Labor Arbiter “disregarded” the law on the status of employees who participated in an illegal strike. Under the law, union officers may be dismissed for participating in an illegal strike only if they knowingly participated in it. According to the Court of Appeals, the Labor Arbiter erred in ordering all the officers of CLUFEA dismissed from the service without even naming these officers and specifying the acts these officers committed that rendered the strike illegal.

The Court of Appeals, however, found that Bautista and Fegalquin had already resigned during the pendency of the case and had received separation benefits from Club Filipino, Inc. Bautista and Fegalquin, therefore, “no longer [had] any legal interest [in filing the petition for certiorari].” As for Presentacion, the Court of Appeals found that he was not an officer of CLUFEA and was not dismissed by virtue of the Labor Arbiter’s Decision. He, therefore, had no personality to join Bautista, Sualog, Calida, Arinto, de Guzman, and Fegalquin in filing the Petition for Certiorari.

As for Sualog, Calida, Arinto, and de Guzman, the Court of Appeals ruled that the Labor Arbiter’s Decision was void.

Thus, in the Decision the Court of Appeals granted the Petition for Certiorari with respect to Sualog, Calida, Arinto, and de Guzman. The Court of Appeals set aside the Labor Arbiter’s Decision for being null and void and ordered the payment of full backwages and benefits to them from the time of their dismissal up to the finality of the Court of Appeals’ Decision. In lieu of reinstatement, the Court of Appeals ordered Club Filipino, Inc. to pay Sualog, Calida, Arinto, and de Guzman separation pay computed at one (1) month salary per year of service from the time of their hiring up to the finality of the Decision less any amount Sualog, Calida, Arinto, and de Guzman may have received pursuant to the Labor Arbiter’s Decision.

As for Bautista, Fegalquin, and Presentacion, the Court of Appeals dismissed the Petition for Certiorari.

Club Filipino, Inc. filed a Petition for Review on Certiorari with the SC. The SC denied the petition.

The SC held that CLUFEA could not have attached Club Filipino, Inc.’s counterproposals in the Notice of Strike since Club Filipino, Inc. submitted it only after CLUFEA had filed the Notice of Strike. It was, therefore, “not practicable” for CLUFEA to attach Club Filipino, Inc.’s counterproposal to the Notice of Strike. CLUFEA did not violate Rule XXII, Section 4 of the Omnibus Rules Implementing the Labor Code.

The SC ruled that the Labor Arbiter gravely abused his discretion in ordering the “wholesale dismissal” of CLUFEA’s officers. According to the SC, the law requires “‘knowledge’ of the illegality of the strike as a condition sine qua non before a union officer can be dismissed for participating in an illegal strike.” Nowhere in the ruling of the labor arbiter can there be found any discussion of how Bautista, et al., as union officers, knowingly participated in the alleged illegal strike. Thus, even assuming that the strike was illegal, the automatic dismissal of CLUFEA’s officers had no basis.

Club Filipino, Inc. filed a Motion for Reconsideration, which the SC denied with finality in the Resolution. The SC declared that it should not entertain any further pleadings or motions and ordered that Entry of Judgment in this case be made in due course.

Solis Medina Limpingco and Fajardo entered its appearance for Club Filipino, Inc. and simultaneously filed a Motion for Leave to file and admit the attached Supplemental Motion for Reconsideration. Club Filipino, Inc. filed its Motion for Leave to File and Admit further Pleading/Motion, alleging that the SC failed to consider its Supplemental Motion for Reconsideration in issuing its Resolution denying Club Filipino, Inc.’s first Motion for Reconsideration. Club Filipino, Inc. prayed that the SC resolve the Supplemental Motion for Reconsideration.

The SC granted Club Filipino, Inc.’s Motions for Leave and noted the Supplemental Motion for Reconsideration. However, because of its Resolution, an Entry of Judgment was issued, declaring that this case had become final and executory. The SC likewise ordered the return of the case records to the Court of Appeals for remand to the court of origin.

Club Filipino, Inc. received the Entry of Judgment. Nine (9) days after, Club Filipino, Inc. filed a Manifestation and Motion, arguing that the court prematurely issued the Entry of Judgment because it still had to resolve the Supplemental Motion for Reconsideration.

The SC noted the Manifestation and Motion in the Resolution. Club Filipino, Inc. filed a very urgent Motion to Resolve, alleging that Bautista, et al. filed a Motion for Execution of the SC’s Decision on the illegal strike case despite the pendency of its Supplemental Motion for Reconsideration with the SC. Club Flipino, Inc. prayed that the SC resolve the Supplemental Motion for Reconsideration in order not to render the filing of its Supplemental Motion for Reconsideration moot.

The SC noted the very urgent Motion to Resolve. Club Filipino, Inc. filed the very urgent Motion for Leave to File and Admit very urgent Motion for Clarification. It informed the SC that the NLRC granted Bautista, et al.’s Motion for Execution, which would allegedly result in Club Filipino, Inc. paying them separation pay twice. Because of the “extreme urgency” brought about by the developments in this case, Club Filipino, Inc. prayed that the SC resolve its Supplemental Motion for Reconsideration.

Club Filipino, Inc. filed a second very urgent Motion for Clarification, pleading the court to clarify its Resolution noting the Supplemental Motion for Reconsideration. It reiterated its claim that implementing the Writ of Execution in the illegal strike case “will only result in doubly compensating respondents to the utmost prejudice and manifest injustice of [Club Filipino, Inc.].”

Club Filipino, Inc. subsequently filed the very urgent Manifestation and Omnibus Motion, very urgent Omnibus Motion, and second very urgent Omnibus Motion, all arguing that the implementation of the Writ of Execution would result in double compensation to respondents. All of these Motions were noted by the SC.

In the Supplemental Motion for Reconsideration and the subsequent Motions to Resolve, Club Filipino, Inc. maintains that the SC erred in affirming the Court of Appeals’ award of backwages and separation pay in the illegal strike case on top of the separation pay respondents received by virtue of Club Filipino, Inc.’s retrenchment program.

Club Filipino, Inc. alleged that pending its Petition for declaration of illegal strike with the NLRC, it implemented a retrenchment program to minimize its “mounting losses.” Among the 76 retrenched employees were respondents.

Bautista, et al., together with other retrenched employees, filed a Complaint for illegal dismissal with the NLRC, questioning the validity of the retrenchment program. The Labor Arbiter dismissed the Complaint and found the retrenchment program valid. She ordered that the retrenched employees, which included respondents, be paid their separation pay.

The LA’s Decision was affirmed by the NLRC in the Decision. The NLRC’s Decision became final and executory. Considering that the NLRC had finally resolved that Bautista, et al. were not illegally dismissed and had already ordered that they be paid separation pay under the retrenchment program, Club Filipino, Inc. argues that the NLRC’s Resolution of the issue constituted res judicata as to bar the Court of Appeals from declaring that respondents were illegally dismissed and from awarding respondents separation pay in the illegal strike case.

Issue/s:

Whether the Supplemental motion for reconsideration in the SC amounts to second motion for reconsideration

Whether the second motion for reconsideration that is granted by SC tolls the finality of the Decision of the SC

Whether or not the union officers, irrespective of circumstances, are deemed to have lost their employment status for participating in an illegal strike

Whether the strike is illegal

Whether the decision on the illegal dismissal case is res judicata on the illegal strike case

Whether ordering the employer to pay the backwages and separation pay in the illegal strike case will result in double compensation to those paid the separation pay due to valid retrenchment as these involve the same subject matter

SC Ruling:

The SC denied the Supplemental Motion for Reconsideration with finality. The SC treated it as in the nature of a second Motion for Reconsideration.

To entertain second Motions for Reconsideration, the second Motions must present “extraordinarily persuasive reasons and only upon express leave first obtained.” Once leave to file is granted, the second Motion for Reconsideration is no longer prohibited. The SC granted leave to Club Filipino, Inc. to file the Supplemental Motion for Reconsideration. The Supplemental Motion for Reconsideration, therefore, is no longer prohibited.

The grant of leave to file the Supplemental Motion for Reconsideration, however, did not prevent the SC’s Resolution from becoming final and executory. A decision or resolution of the SC is deemed final and executory after the lapse of 15 days from the parties’ receipt of a copy of the decision or resolution. The grant of leave to file the second Motion for Reconsideration does not toll this 15-day period. It only means that the Entry of Judgment first issued may be lifted should the second Motion for Reconsideration be granted. Entry of Judgment, therefore, was in order.

Since no temporary restraining order to enjoin the execution of the Court of Appeals’ Decision was issued, the SC held that the NLRC correctly proceeded in implementing the Court of Appeals’ Decision in the illegal strike case.

Res judicata “literally means ‘a matter adjudged; a thing judicially acted upon or decided; [or] a thing or matter settled by judgment.’” Res judicata “lays the rule that an existing final judgment or decree rendered on the merits, and without fraud or collusion, by a court of competent jurisdiction, upon any matter within its jurisdiction, is conclusive of the rights of the parties or their privies, in all other actions or suits in the same or any other judicial tribunal of concurrent jurisdiction on the points and matters in issue in the first suit.”

Res judicata has two (2) aspects. The first is bar by prior judgment that precludes the prosecution of a second action upon the same claim, demand or cause of action. The second aspect is conclusiveness of judgment, which states that “issues actually and directly resolved in a former suit cannot again be raised in any future case between the same parties involving a different cause of action.

The elements of res judicata are:

• the judgment sought to bar the new action must be final;
• the decision must have been rendered by a court having jurisdiction over the subject matter and the parties;
• the disposition of the case must be a judgment on the merits; and
• there must be as between the first and second action identity of parties, subject matter, and causes of action.

The first three (3) elements of res judicata are present in this case. The fourth element of res judicata, however, is absent. Although the cases have substantially identical parties and subject matter of the dismissal of respondents, the cause of action for declaration of illegal strike and the cause of action for illegal dismissal are different.

In an action for declaration of illegal strike, the cause of action is premised on a union or a labor organization’s conduct of a strike without compliance with the statutory requirements. On the other hand, in an action for illegal dismissal, the cause of action is premised on an employer’s alleged dismissal of an employee without a just or authorized cause as provided under Articles 282, 283, and 284 of the Labor Code.

There is no res judicata in the present case. Club Filipino, Inc. filed the illegal strike because members of CLUFEA allegedly disrupted petitioner Club Filipino, Inc.’s business when they staged a strike without complying with the requirements of the law. For their part, Bautista, et al. filed the illegal dismissal case to question the validity of petitioner Club Filipino, Inc.’s retrenchment program.

Although there is no res judicata, the actions have the same subject matter. The subject matter of an action is “the matter or thing from which the dispute has arisen.” Both the illegal strike and illegal dismissal cases involve the dismissal of Bautista, et al. In Bautista, et al.’s action for illegal dismissal, they were found to have been dismissed by virtue of a valid retrenchment program. The NLRC then ordered that they be paid separation pay based on the parties’ collective bargaining agreement.

Because of the cases’ similar subject matter, it was possible that an employee who had already availed of the benefits under the retrenchment program would be declared entitled to separation benefits under the illegal strike case. This is true especially if the retrenched employee did not execute a valid quitclaim upon receiving the benefits under the retrenchment program. Thus, to prevent double compensation, the Court of Appeals ordered that those who already retired and received their benefits may no longer claim full backwages, benefits, and separation pay under the decision in the illegal strike case. This is with respect to respondents Benjamin Bautista and Laureno Fegalquin who already executed their quitclaims.

With respect to respondent Carlito Presentacion who was not a union officer and, therefore, could not have been dismissed under the illegal strike case, the Court of Appeals held that he cannot receive benefits under Court of Appeals’ Decision.

For Bautista, et al. who were not found to have executed a quitclaim with respect to the benefits under the retrenchment program, the Court of Appeals ruled that any benefits received as a result of the decisions of the Labor Arbiter must be deducted from the separation pay received under the illegal strike case. This is with respect to Ronie Sualog, Joel Calida, Roberto de Guzman, and Johnny Arinto.

Since the Court of Appeals ordered that any benefit received from the illegal dismissal case be deducted from any benefit receivable under the Court of Appeals’ Decision, there was no “double compensation” Club Filipino, Inc. claims. The Decision in the illegal dismissal case was not res judicata on the illegal strike case. The NLRC correctly executed the Court of Appeals’ Decision in the illegal strike case.