Saturday, January 30, 2010

Supreme Court harvest of January 21, 2010

Fourteen decisions highlight the Supreme Court's day on January 21, 2010 with rulings on various topics.

On taxation, the Supreme Court discusses the effects of the BIR'sVoluntary Assessment Program and the Commissioner's futile attempt to avoid it in a case against a taxpayer who failed to file income tax returns. The Court also ruled that a taxpayer failed to file an appeal on time with Court of Tax Appeals and resolved the issue of the tax liabilities of pawnshops for VAT and Documentary Stamps Tax on pawn tickets

On immigration, the Court rules on
the deportation of an undocumented Korean.

In criminal law, the Court declares that an affidavit of desistance failed to obtain the intended results in this case for frustrated murder, while it affirms conviction of a man who raped his stepdaughter . In another rape case, the Court denies the appeal of a rapist who employed the "sweetheart defense".

The Supreme Court outlines the circumstances that will merit execution pending appeal, and considers piercing the veil of corporate fiction in resolving a case regarding the lease of a property in Tagaytay for 90 years.

In civil law, the Court upholds the extinction of the easement of right of way upon consolidation in one person of the ownership of the dominant and the servient estates. while discussing the Parole Evidence rule on the same case.

A slew of technical errors in a summary judgment case forces the Supreme Court to recite the classic mantras on technicalities.

In the field of labor law, the Court grants the claims for total disability of a sea farer who suffered a stroke, but was certified by the company physician as fit to work more than five months after. The Court also sides with labor on the issue of constructive dismissal by an employee who tendered a resignation letter.

Most interesting is how the Supreme Court berates ABS-CBN in a labor case in a manner that will not be written in the news,

The termination of employment of the four drivers occurred under highly questionable circumstances and with plain and unadulterated bad faith.

The records show that the regularization case was in fact the root of the resulting bad faith as this case gave rise and led to the dismissal case. First, the regularization case was filed leading to the labor arbiter’s decision declaring the petitioners, including Fulache, Jabonero, Castillo and Lagunzad, to be regular employees. ABS-CBN appealed the decision and maintained its position that the petitioners were independent contractors.

In the course of this appeal, ABS-CBN took matters into its own hands and terminated the petitioners’ services, clearly disregarding its own appeal then pending with the NLRC. Notably, this appeal posited that the petitioners were not employees (whose services therefore could be terminated through dismissal under the Labor Code); they were independent contractors whose services could be terminated at will, subject only to the terms of their contracts. To justify the termination of service, the company cited redundancy as its authorized cause but offered no justificatory supporting evidence. It merely claimed that it was contracting out the petitioners’ activities in the exercise of its management prerogative.

ABS-CBN’s intent, of course, based on the records, was to transfer the petitioners and their activities to a service contractor without paying any attention to the requirements of our labor laws; hence, ABS-CBN dismissed the petitioners when they refused to sign up with the service contractor. In this manner, ABS-CBN fell into a downward spiral of irreconcilable legal positions, all undertaken in the hope of saving itself from the decision declaring its “talents” to be regular employees.

By doing all these, ABS-CBN forgot labor law and its realities.

It forgot that by claiming redundancy as authorized cause for dismissal, it impliedly admitted that the petitioners were regular employees whose services, by law, can only be terminated for the just and authorized causes defined under the Labor Code.

Likewise ABS-CBN forgot that it had an existing CBA with a union, which agreement must be respected in any move affecting the security of tenure of affected employees; otherwise, it ran the risk of committing unfair labor practice – both a criminal and an administrative offense. It similarly forgot that an exercise of management prerogative can be valid only if it is undertaken in good faith and with no intent to defeat or circumvent the rights of its employees under the laws or under valid agreements.

Lastly, it forgot that there was a standing labor arbiter’s decision that, while not yet final because of its own pending appeal, cannot simply be disregarded. By implementing the dismissal action at the time the labor arbiter’s ruling was under review, the company unilaterally negated the effects of the labor arbiter’s ruling while at the same time appealling the same ruling to the NLRC. This unilateral move is a direct affront to the NLRC’s authority and an abuse of the appeal process.

All these go to show that ABS-CBN acted with patent bad faith. A close parallel we can draw to characterize this bad faith is the prohibition against forum-shopping under the Rules of Court. In forum-shopping, the Rules characterize as bad faith the act of filing similar and repetitive actions for the same cause with the intent of somehow finding a favorable ruling in one of the actions filed. ABS-CBN’s actions in the two cases, as described above, are of the same character, since its obvious intent was to defeat and render useless, in a roundabout way and other than through the appeal it had taken, the labor arbiter’s decision in the regularization case. Forum-shopping is penalized by the dismissal of the actions involved. The penalty against ABS-CBN for its bad faith in the present case should be no less.

The errors and omissions do not belong to ABS-CBN alone. The labor arbiter himself who handled both cases did not see the totality of the company’s actions for what they were. He appeared to have blindly allowed what he granted the petitioners with his left hand, to be taken away with his right hand, unmindful that the company already exhibited a badge of bad faith in seeking to terminate the services of the petitioners whose regular status had just been recognized. He should have recognized the bad faith from the timing alone of ABS-CBN’s conscious and purposeful moves to secure the ultimate aim of avoiding the regularization of its so-called “talents.”

The NLRC, for its part, initially recognized the presence of bad faith when it originally ruled that:

While notice has been made to the employees whose positions were declared redundant, the element of good faith in abolishing the positions of the complainants appear to be wanting. In fact, it remains undisputed that herein complainants were terminated when they refused to sign an employment contract with Able Services which would make them appear as employees of the agency and not of ABS-CBN. Such act by itself clearly demonstrates bad faith on the part of the respondent in carrying out the company’s redundancy program x x x.

On motion for reconsideration by both parties, the NLRC reiterated its “pronouncement that complainants were illegally terminated as extensively discussed in our Joint Decision dated December 15, 2004.” Yet, in an inexplicable turnaround, it reconsidered its joint decision and reinstated not only the labor arbiter’s decision of January 17, 2002 in the regularization case, but also his illegal dismissal decision of April 21, 2003. Thus, the NLRC joined the labor arbiter in his error that we cannot but characterize as grave abuse of discretion.

The Court cannot leave unchecked the labor tribunals’ patent grave abuse of discretion that resulted, without doubt, in a grave injustice to the petitioners who were claiming regular employment status and were unceremoniously deprived of their employment soon after their regular status was recognized. Unfortunately, the CA failed to detect the labor tribunals’ gross errors in the disposition of the dismissal issue. Thus, the CA itself joined the same errors the labor tribunals committed.

The injustice committed on the petitioners/drivers requires rectification. Their dismissal was not only unjust and in bad faith as the above discussions abundantly show. The bad faith in ABS-CBN’s move toward its illegitimate goal was not even hidden; it dismissed the petitioners – already recognized as regular employees – for refusing to sign up with its service contractor. Thus, from every perspective, the petitioners were illegally dismissed.

By law, illegally dismissed employees are entitled to reinstatement without loss of seniority rights and other privileges and to full backwages, inclusive of allowances, and to other benefits or their monetary equivalent from the time their compensation was withheld from them up to the time of their actual reinstatement. The four dismissed drivers deserve no less.

Moreover, they are also entitled to moral damages since their dismissal was attended by bad faith.For having been compelled to litigate and to incur expenses to protect their rights and interest, the petitioners are likewise entitled to attorney’s fees.

No comments: