You are on page 1of 60

Republic of the Philippines

Supreme Court
Manila

EN BANC

PHILIPPINE GUARDIANS G.R. No. 190529


BROTHERHOOD, INC. (PGBI),
represented by its Secretary- Present:
General GEORGE FGBF PUNO, C.J.,
GEORGE DULDULAO, CARPIO,
Petitioner, CORONA,
CARPIO MORALES,
VELASCO, JR.,
NACHURA,
LEONARDO-DE CASTRO,
BRION,
PERALTA,
- versus - BERSAMIN,
DEL CASTILLO,
ABAD,
VILLARAMA, JR.,
PEREZ, and
MENDOZA, JJ.
Promulgated:
COMMISSION ON ELECTIONS,
Respondent. April 29, 2010
x----------------------------------------------------------------------------------------------------------x

RESOLUTION

BRION, J.:

The Philippine Guardians Brotherhood, Inc. (PGBI) seeks in this petition


for certiorari[1] and in the motion for reconsideration it subsequently filed to
nullify Commission on Elections (COMELEC) Resolution No. 8679 dated October
13, 2009 insofar as it relates to PGBI, and the Resolution dated December 9, 2009
denying PGBIs motion for reconsideration in SPP No. 09-004 (MP). Via these
resolutions, the COMELEC delisted PGBI from the roster of registered national,
regional or sectoral parties, organizations or coalitions under the party-list system.

BACKGROUND

Section 6(8) of Republic Act No. 7941 (RA 7941), otherwise known as the
Party-List System Act, provides:

Section 6. Removal and/or Cancellation of Registration. The COMELEC


may motu proprio or upon verified complaint of any interested party, remove or
cancel, after due notice and hearing, the registration of any national, regional or
sectoral party, organization or coalition on any of the following grounds:

xxxx

(8) It fails to participate in the last two (2) preceding elections or fails to
obtain at least two per centum (2%) of the votes cast under the party-list system in
the two (2) preceding elections for the constituency in which it has
registered.[Emphasis supplied.]

The COMELEC replicated this provision in COMELEC Resolution No. 2847 the
Rules and Regulations Governing the Election of the Party-List Representatives
through the Party-List System which it promulgated on June 25, 1996.

For the upcoming May 2010 elections, the COMELEC en banc issued on October
13, 2009 Resolution No. 8679 deleting several party-list groups or organizations
from the list of registered national, regional or sectoral parties, organizations or
coalitions. Among the party-list organizations affected was PGBI; it was
delisted because it failed to get 2% of the votes cast in 2004 and it did not
participate in the 2007 elections. Nevertheless, the COMELEC stated in this
Resolution that any national, regional sectoral party or organizations or coalitions
adversely affected can personally or through its authorized representative file a
verified opposition on October 26, 2009.

PGBI filed its Opposition to Resolution No. 8679, but likewise sought, through its
pleading, the admission ad cautelam of its petition for accreditation as a party-list
organization under the Party-List System Act. Among other arguments, PGBI
asserted that:

(1) The assailed resolution negates the right of movant and those similarly
situated to invoke Section 4 of R.A. No. 7941, which allows any party,
organization and coalition already registered with the Commission to no
longer register anew; the party though is required to file with the
Commission, not later than ninety (90) days before the election, a
manifestation of its desire to participate in the party-list system; since
PGBI filed a Request/Manifestation seeking a deferment of its
participation in the 2007 elections within the required period prior to the
2007 elections, it has the option to choose whether or not to participate in
the next succeeding election under the same conditions as to rights
conferred and responsibilities imposed;

(2) The Supreme Courts ruling in G.R. No. 177548 Philippine Mines Safety
Environment Association, also known as MINERO v. Commission on
Elections cannot apply in the instant controversy for two reasons: (a) the
factual milieu of the cited case is removed from PGBIs; (b)
MINERO, prior to delisting, was afforded the opportunity to be heard,
while PGBI and the 25 others similarly affected by Resolution No. 8679
were not. Additionally, the requirement of Section 6(8) has been relaxed
by the Courts ruling in G.R. No. 179271 (Banat v. COMELEC) and the
exclusion of PGBI and the 25 other party-list is a denial of the equal
protection of the laws;

(3) The implementation of the challenged resolution should be suspended


and/or aborted to prevent a miscarriage of justice in view of the failure to
notify the parties in accordance with the same Section 6(8) or R.A. No.
7941.[2]

The COMELEC denied PGBIs motion/opposition for lack of merit.

First, the COMELEC observed that PGBI clearly misunderstood the import
of Section 4 of R.A. 7941.[3] The provision simply means that without the required
manifestation or if a party or organization does not participate, the exemption from
registration does not arise and the party, organization or coalition must go through
the process again and apply for requalification; a request for deferment would not
exempt PGBI from registering anew.

Second, the MINERO ruling is squarely in point, as MINERO failed to get


2% of the votes in 2001 and did not participate at all in the 2004 elections.
Third, PGBI was given an opportunity to be heard or to seek the
reconsideration of the action or ruling complained of the essence of due process;
this is clear from Resolution No. 8679 which expressly gave the adversely affected
parties the opportunity to file their opposition.

As regards the alternative relief of application for accreditation, the COMELEC


found the motion to have been filed out of time, as August 17, 2009 was the
deadline for accreditation provided in Resolution 8646. The motion was obviously
filed months after the deadline.

PGBI came to us in its petition for certiorari, arguing the same positions it raised
with the COMELEC when it moved to reconsider its delisting.
We initially dismissed the petition in light of our ruling in Philippine Mines Safety
Environment Association, also known as MINERO v. Commission on
Elections (Minero);[4] we said that no grave abuse of discretion exists in a ruling
that correctly applies the prevailing law and jurisprudence.Applying Section 6(8)
of RA 7941, the Court disqualified MINERO under the following reasoning:

Since petitioner by its own admission failed to get 2% of the votes in 2001 and
did not participate at all in the 2004 elections, it necessarily failed to get at least
two per centum (2%) of the votes cast in the two preceding elections. COMELEC,
therefore, is not duty bound to certify it.

PGBI subsequently moved to reconsider the dismissal of its petition. Among


other arguments, PGBI claimed that the dismissal of the petition was contrary to
law, the evidence and existing jurisprudence. Essentially, PGBI asserts that Section
6(8) of RA 7941 does not apply if one is to follow the tenor and import of the
deliberations inclusive of the interpellations in Senate Bill No. 1913 on October
19, 1994. It cited the following excerpts from the Records of the Senate:

Senator Gonzales: On the other hand, Mr. President, under ground no. (7),
Section 5 there are actually two grounds it states: Failure to participate in the
last two (2) preceding elections or its failure to obtain at least ten percent (10%)
of the votes case under the party-list system in either of the last two (2) preceding
elections for the constituency in which it has registered

In short, the first ground is that, it failed to participate in the last two (2) preceding
elections. The second is, failure to obtain at least 10 percent of the votes cast
under the party-list system in either of the last two preceding elections, Mr.
President,

Senator Tolentino: Actually, these are two separate grounds.

Senator Gonzales: There are actually two grounds, Mr. President.

Senator Tolentino: Yes, Mr. President.[5] [Underscoring supplied.]

PGBI thus asserts that Section 6(8) does not apply to its situation, as it is obvious
that it failed to participate in one (1) but not in the two (2) preceding
elections. Implied in this is that it also failed to secure the required percentage in
one (1) but not in the two (2) preceding elections.

Considering PGBIs arguments, we granted the motion and reinstated the petition in
the courts docket.

THE ISSUES
We are called upon to resolve: (a) whether there is legal basis for delisting
PGBI; and (b) whether PGBIs right to due process was violated.

OUR RULING

We find the petition partly impressed with merit.

a. The Minero Ruling

Our Minero ruling is an erroneous application of Section 6(8) of RA 7941; hence,


it cannot sustain PGBIs delisting from the roster of registered national, regional or
sectoral parties, organizations or coalitions under the party-list system.

First, the law is clear the COMELEC may motu proprio or upon verified
complaint of any interested party, remove or cancel, after due notice and hearing,
the registration of any national, regional or sectoral party, organization or coalition
if it: (a) fails to participate in the last two (2) preceding elections; or (b) fails to
obtain at least two per centum (2%) of the votes cast under the party-list system in
the two (2) preceding elections for the constituency in which it has
registered.[6]The word or is a disjunctive term signifying disassociation and
independence of one thing from the other things enumerated; it should, as a rule,
be construed in the sense in which it ordinarily implies, as a disjunctive
word.[7] Thus, the plain, clear and unmistakable language of the law provides for
two (2) separate reasons for delisting.

Second, Minero is diametrically opposed to the legislative intent of Section


6(8) of RA 7941, as PGBIs cited congressional deliberations clearly show.

Minero therefore simply cannot stand. Its basic defect lies in its
characterization of the non-participation of a party-list organization in an
election as similar to a failure to garner the 2% threshold party-list
vote. What Minero effectively holds is that a party list organization that does not
participate in an election necessarily gets, by default, less than 2% of the party-list
votes. To be sure, this is a confused interpretation of the law, given the laws clear
and categorical language and the legislative intent to treat the two scenarios
differently. A delisting based on a mixture or fusion of these two different and
separate grounds for delisting is therefore a strained application of the law in
jurisdictional terms, it is an interpretation not within the contemplation of the
framers of the law and hence is a gravely abusive interpretation of the law.[8]

What we say here should of course take into account our ruling in Barangay
Association for Advancement and National Transparency v. COMELEC[9] (Banat)
where we partly invalidated the 2% party-list vote requirement provided in RA
7941 as follows:

We rule that, in computing the allocation of additional seats, the


continued operation of the two percent threshold for the distribution of the
additional seats as found in the second clause of Section 11(b) of R.A. No. 7941
is unconstitutional. This Court finds that the two percent threshold makes it
mathematically impossible to achieve the maximum number of available party list
seats when the number of available party list seats exceeds 50. The continued
operation of the two percent threshold in the distribution of the additional seats
frustrates the attainment of the permissive ceiling that 20% of the members of the
House of Representatives shall consist of party-list representatives.
The disqualification for failure to get 2% party-list votes in two (2) preceding
elections should therefore be understood in light of the Banat ruling that party-list
groups or organizations garnering less than 2% of the party-list votes may yet
qualify for a seat in the allocation of additional seats.

We need not extensively discuss Banats significance, except to state that a party-
list group or organization which qualified in the second round of seat
allocation cannot now validly be delisted for the reason alone that it garnered less
than 2% in the last two elections. In other words, the application of this
disqualification should henceforth be contingent on the percentage of party-list
votes garnered by the last party-list organization that qualified for a seat in the
House of Representatives, a percentage that is less than the 2% threshold
invalidated in Banat. The disqualification should now necessarily be read to apply
to party-list groups or organizations that did not qualify for a seat in the two
preceding elections for the constituency in which it registered.

To reiterate, (a) Section 6(8) of RA 7941 provides for two separate grounds for
delisting; these grounds cannot be mixed or combined to support delisting; and (b)
the disqualification for failure to garner 2% party-list votes in two preceding
elections should now be understood, in light of the Banat ruling, to mean failure to
qualify for a party-list seat in two preceding elections for the constituency in which
it has registered. This, we declare, is how Section 6(8) of RA 7941 should be
understood and applied. We do so under our authority to state what the law
is,[10] and as an exception to the application of the principle of stare decisis.

The doctrine of stare decisis et non quieta movere (to adhere to precedents
and not to unsettle things which are established) is embodied in Article 8 of the
Civil Code of the Philippines which provides, thus:

ART. 8. Judicial decisions applying or interpreting the laws or the


Constitution shall form a part of the legal system of the Philippines.

The doctrine enjoins adherence to judicial precedents. It requires courts in a


country to follow the rule established in a decision of its Supreme Court. That
decision becomes a judicial precedent to be followed in subsequent cases by all
courts in the land. The doctrine of stare decisis is based on the principle that once a
question of law has been examined and decided, it should be deemed settled and
closed to further argument.[11] The doctrine is grounded on the necessity for
securing certainty and stability of judicial decisions, thus:

Time and again, the court has held that it is a very desirable and necessary
judicial practice that when a court has laid down a principle of law as applicable
to a certain state of facts, it will adhere to that principle and apply it to all future
cases in which the facts are substantially the same. Stare decisis et non quieta
movere. Stand by the decisions and disturb not what is settled. Stare
decisis simply means that for the sake of certainty, a conclusion reached in one
case should be applied to those that follow if the facts are substantially the
same, even though the parties may be different. It proceeds from the first
principle of justice that, absent any powerful countervailing considerations,
like cases ought to be decided alike. Thus, where the same questions relating to
the same event have been put forward by the parties similarly situated as in a
previous case litigated and decided by a competent court, the rule of stare
decisis is a bar to any attempt to relitigate the same issue.[12]
The doctrine though is not cast in stone for upon a showing that
circumstances attendant in a particular case override the great benefits derived by
our judicial system from the doctrine of stare decisis, the Court is justified in
setting it aside.[13]
As our discussion above shows, the most compelling reason to
abandon Minero exists; it was clearly an erroneous application of the law an
application that the principle of stability or predictability of decisions alone cannot
sustain. Minero did unnecessary violence to the language of the law, the intent of
the legislature, and to the rule of law in general. Clearly, we cannot allow PGBI to
be prejudiced by the continuing validity of an erroneous ruling. Thus, we now
abandon Minero and strike it out from our ruling case law.

We are aware that PGBIs situation a party list group or organization that failed to
garner 2% in a prior election and immediately thereafter did not participate in the
preceding election is something that is not covered by Section 6(8) of RA
7941. From this perspective, it may be an unintended gap in the law and as such is
a matter for Congress to address. We cannot and do not address matters over which
full discretionary authority is given by the Constitution to the legislature; to do so
will offend the principle of separation of powers. If a gap indeed exists, then the
present case should bring this concern to the legislatures notice.
b. The Issue of Due Process
On the due process issue, we agree with the COMELEC that PGBIs right to due
process was not violated for PGBI was given an opportunity to seek, as it did seek,
a reconsideration of Resolution No. 8679. The essence of due process, we have
consistently held, is simply the opportunity to be heard; as applied to
administrative proceedings, due process is the opportunity to explain ones side or
the opportunity to seek a reconsideration of the action or ruling complained of. A
formal or trial-type hearing is not at all times and in all instances essential. The
requirement is satisfied where the parties are afforded fair and reasonable
opportunity to explain their side of the controversy at hand. What is frowned upon
is absolute lack of notice and hearing x x x.[14] We find it obvious under the
attendant circumstances that PGBI was not denied due process. In any case, given
the result of this Resolution, PGBI has no longer any cause for complaint on due
process grounds.

WHEREFORE, premises considered, we GRANT the petition and


accordingly ANNUL COMELEC Resolution No. 8679 dated October 13, 2009
insofar as the petitioner PGBI is concerned, and the Resolution dated December 9,
2009 which denied PGBIs motion for reconsideration in SPP No. 09-004
(MP). PGBI is qualified to be voted upon as a party-list group or organization in
the coming May 2010 elections.

SO ORDERED.

ARTURO D. BRION
Associate Justice

WE CONCUR:

REYNATO S. PUNO
Chief Justice

RENATO C. CORONA
ANTONIO T. CARPIO Associate Justice
Associate Justice

PRESBITERO J. VELASCO, JR.


Associate Justice
CONCHITA CARPIO MORALES
Associate Justice

TERESITA J. LEONARDO-DE CASTRO


ANTONIO EDUARDO B. NACHURA Associate Justice
Associate Justice

LUCAS P. BERSAMIN
DIOSDADO M. PERALTA Associate Justice
Associate Justice

ROBERTO A. ABAD
MARIANO C. DEL CASTILLO Associate Justice
Associate Justice

MARTIN S. VILLARAMA, JR. JOSE PORTUGAL PEREZ


Associate Justice Associate Justice

JOSE C
JOSE CATRAL MENDOZA
Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified


that the conclusions in the above Resolution had been reached in consultation
before the case was assigned to the writer of the opinion of the Court.

REYNATO S. PUNO
Chief Justice

[1]
Filed under Rule 65 of the RULES OF COURT.
[2]
Rollo, pp. 42-48.
[3]
Sec. 4. Manifestation to Participate in the Party-List System. Any party, organization or coalition already
registered with the Commission need not register anew. However, such party, organization or coalition shall file
with the Commission, not later than ninety (90) days before the election, a manifestation of its desire to participate
in the party-list system.
[4]
G.R. No. 177548, May 10, 2007; see rollo of G.R. No. 177548, pp. 46-48.
[5]
Rollo, pp. 74-75.
[6]
Numbering supplied.
[7]
Agpalo, Statutory Construction, p. 204 (2003); see also The Heirs of George Poe v. Malayan Insurance Company,
Inc. G.R. No. 156302, April 7, 2009.

[8]
See Varias v. Commission on Elections, G.R. No. 189078, February 11, 2010 where we held that the use of wrong
considerations is an act not in contemplation of law a jurisdictional error for this is one way of gravely abusing
ones discretion.
[9]
G.R. No. 179271, April 21, 2009.
[10]
Marbury v. Madison (1 Cranch [5 US] 137, 2 L ed 60 [1803]) holds that it is emphatically the province and
duty of the judicial department to say what the law is.
[11]
See Lazatin v. Desierto, G.R. No. 147097, June 5, 2009, citing Fermin v. People, G.R. No. 157643, March 28,
2008, 550 SCRA 132.
[12]
Id., citing Chinese Young Men's Christian Association of the Philippine Islands v. Remington Steel
Corporation, G.R. No. 159422, March 28, 2008, 550 SCRA 180.
[13]
Ibid.
[14]
Bautista v. Comelec, 460 Phil, 459, 478 (2003).
THIRD DIVISION

CARMELO F. LAZATIN, MARINO G.R. No. 147097


A. MORALES, TEODORO L. DAVID Present:
and ANGELITO A. PELAYO, YNARES-SANTIAGO, J.,
Petitioner, Chairperson,
CARPIO,
CORONA,
- versus - NACHURA, and
PERALTA, JJ.
HON. ANIANO A. DESIERTO as Promulgated:
OMBUDSMAN, and June 5, 2009
SANDIGANBAYAN, THIRD
DIVISION,
Respondents.

x----------------------------------------------------------x

DECISION

PERALTA, J.:

This resolves the petition for certiorari under Rule 65 of the Rules
of Court, praying that the Ombudsman's disapproval of the Office of the Special
Prosecutor's (OSP) Resolution[1] dated September 18, 2000, recommending
dismissal of the criminal cases filed against herein petitioners, be reversed and
set aside.
The antecedent facts are as follows.
On July 22, 1998, the Fact-Finding and Intelligence Bureau of the Office of the
Ombudsman filed a Complaint-Affidavit docketed as OMB-0-98-1500, charging
herein petitioners with Illegal Use of Public Funds as defined and penalized
under Article 220 of the Revised Penal Code and violation of Section 3,
paragraphs (a) and (e) of Republic Act (R.A.) No. 3019, as amended.
The complaint alleged that there were irregularities in the use by then
Congressman Carmello F. Lazatin of his Countrywide Development Fund
(CDF) for the calendar year 1996, i.e., he was both proponent and implementer
of the projects funded from his CDF; he signed vouchers and supporting papers
pertinent to the disbursement as Disbursing Officer; and he received, as
claimant, eighteen (18) checks amounting to P4,868,277.08. Thus, petitioner
Lazatin, with the help of petitioners Marino A. Morales, Angelito A. Pelayo and
Teodoro L. David, was allegedly able to convert his CDF into cash.
A preliminary investigation was conducted and, thereafter, the Evaluation and
Preliminary Investigation Bureau (EPIB) issued a Resolution[2] dated May 29,
2000 recommending the filing against herein petitioners of fourteen (14) counts
each of Malversation of Public Funds and violation of Section 3 (e) of R.A. No.
3019. Said Resolution was approved by the Ombudsman; hence, twenty-eight
(28) Informations docketed as Criminal Case Nos. 26087 to 26114 were filed
against herein petitioners before the Sandiganbayan.
Petitioner Lazatin and his co-petitioners then filed their respective Motions for
Reconsideration/Reinvestigation, which motions were granted by the
Sandiganbayan (Third Division). The Sandiganbayan also ordered the
prosecution to re-evaluate the cases against petitioners.

Subsequently, the OSP submitted to the Ombudsman its


[3]
Resolution dated September 18, 2000. It recommended the dismissal of the
cases against petitioners for lack or insufficiency of evidence.

The Ombudsman, however, ordered the Office of the Legal Affairs (OLA) to
review the OSP Resolution. In a Memorandum[4] dated October 24, 2000, the
OLA recommended that the OSP Resolution be disapproved and the OSP be
directed to proceed with the trial of the cases against petitioners. On October 27,
2000, the Ombudsman adopted the OLA Memorandum, thereby disapproving
the OSP Resolution dated September 18, 2000 and ordering the aggressive
prosecution of the subject cases. The cases were then returned to the
Sandiganbayan for continuation of criminal proceedings.

Thus, petitioners filed the instant petition.


Petitioners allege that:
I.
THE OMBUDSMAN ACTED WITH GRAVE ABUSE OF DISCRETION
OR ACTED WITHOUT OR IN EXCESS OF HIS JURISDICTION.

II.
THE QUESTIONED RESOLUTION WAS BASED ON
MISAPPREHENSION OF FACTS, SPECULATIONS, SURMISES AND
CONJECTURES.[5]
Amplifying their arguments, petitioners asseverate that the Ombudsman had no
authority to overturn the OSP's Resolution dismissing the cases against
petitioners because, under Section 13, Article XI of the 1987 Constitution, the
Ombudsman is clothed only with the power to watch, investigate and
recommend the filing of proper cases against erring officials, but it was not
granted the power to prosecute. They point out that under the Constitution, the
power to prosecute belongs to the OSP (formerly the Tanodbayan), which was
intended by the framers to be a separate and distinct entity from the Office of the
Ombudsman. Petitioners conclude that, as provided by the Constitution, the OSP
being a separate and distinct entity, the Ombudsman should have no power and
authority over the OSP. Thus, petitioners maintain that R.A. No. 6770 (The
Ombudsman Act of 1989), which made the OSP an organic component of the
Office of the Ombudsman, should be struck down for being unconstitutional.

Next, petitioners insist that they should be absolved from any liability because
the checks were issued to petitioner Lazatin allegedly as reimbursement for the
advances he made from his personal funds for expenses incurred to ensure the
immediate implementation of projects that are badly needed by the Pinatubo
victims.

The Court finds the petition unmeritorious.

Petitioners' attack against the constitutionality of R.A. No. 6770 is stale. It has
long been settled that the provisions of R.A. No. 6770 granting the Office of the
Ombudsman prosecutorial powers and placing the OSP under said office have
no constitutional infirmity. The issue of whether said provisions of R.A. No.
6770 violated the Constitution had been fully dissected as far back as 1995
in Acop v. Office of the Ombudsman.[6]

Therein, the Court held that giving prosecutorial powers to the Ombudsman is in
accordance with the Constitution as paragraph 8, Section 13, Article XI provides
that the Ombudsman shall exercise such other functions or duties as may be
provided by law. Elucidating on this matter, the Court stated:

x x x While the intention to withhold prosecutorial powers from the


Ombudsman was indeed present, the Commission [referring to the
Constitutional Commission of 1986] did not hesitate to recommend that the
Legislature could, through statute, prescribe such other powers, functions,
and duties to the Ombudsman. x x x As finally approved by the
Commission after several amendments, this is now embodied in paragraph
8, Section 13, Article XI (Accountability of Public Officers) of the
Constitution, which provides:

Sec.13. The Office of the Ombudsman shall have the


following powers, functions, and duties:

xxxx

Promulgate its rules and procedure and exercise such other


functions or duties as may be provided by law.

Expounding on this power of Congress to prescribe other powers, functions,


and duties to the Ombudsman, we quote Commissioners Colayco and
Monsod during interpellation by Commissioner Rodrigo:
xxxx

MR. RODRIGO:
Precisely, I am coming to that. The last of the enumerated
functions of the Ombudsman is: to exercise such powers or
perform such functions or duties as may be provided by
law. So, the legislature may vest him with powers taken away
from the Tanodbayan, may it not?

MR. COLAYCO:
Yes.

MR. MONSOD:
Yes.

xxxx
MR. RODRIGO:
Madam President. Section 5 reads: The Tanodbayan shall
continue to function and exercise its powers as provided by
law.

MR. COLAYCO:
That is correct, because it is under P.D. No. 1630.

MR. RODRIGO:
So, if it is provided by law, it can be taken away by law, I
suppose.

MR. COLAYCO:
That is correct.

MR. RODRIGO:
And precisely, Section 12(6) says that among the functions
that can be performed by the Ombudsman are such functions
or duties as may be provided by law. The sponsors admitted
that the legislature later on might remove some powers from
the Tanodbayan and transfer these to the Ombudsman.

MR. COLAYCO:
Madam President, that is correct.

xxxx

MR. RODRIGO:
Madam President, what I am worried about is, if we create a
constitutional body which has neither punitive nor
prosecutory powers but only persuasive powers, we might be
raising the hopes of our people too much and then disappoint
them.

MR. MONSOD:
I agree with the Commissioner.

MR. RODRIGO:
Anyway, since we state that the powers of the Ombudsman
can later on be implemented by the legislature, why not leave
this to the legislature?
xxxx

MR. MONSOD: (reacting to statements of Commissioner


Blas Ople):

xxxx
With respect to the argument that he is a toothless
animal, we would like to say that we are promoting the
concept in its form at the present, but we are also saying that
he can exercise such powers and functions as may be
provided by law in accordance with the direction of the
thinking of Commissioner Rodrigo. We do not think that at
this time we should prescribe this, but we leave it up to
Congress at some future time if it feels that it may need to
designate what powers the Ombudsman need in order that he
be more effective. This is not foreclosed.
So, this is a reversible disability, unlike that of a
eunuch; it is not an irreversible disability.[7]
The constitutionality of Section 3 of R.A. No. 6770, which subsumed the
OSP under the Office of the Ombudsman, was likewise upheld by the Court
in Acop. It was explained, thus:
x x x the petitioners conclude that the inclusion of the Office of the Special
Prosecutor as among the offices under the Office of the Ombudsman in
Section 3 of R.A. No. 6770 (An Act Providing for the Functional and
Structural Organization of the Office of the Ombudsman and for Other
Purposes) is unconstitutional and void.

The contention is not impressed with merit. x x x

xxxx
x x x Section 7 of Article XI expressly provides that the then existing
Tanodbayan, to be henceforth known as the Office of the Special
Prosecutor, shall continue to function and exercise its powers as now or
hereafter may be provided by law, except those conferred on the Office of
the Ombudsman created under this Constitution. The underscored phrase
evidently refers to the Tanodbayan's powers under P.D. No. 1630 or
subsequent amendatory legislation. It follows then that Congress may
remove any of the Tanodbayan's/Special Prosecutor's powers under P.D.
No. 1630 or grant it other powers, except those powers conferred by the
Constitution on the Office of the Ombudsman.

Pursuing the present line of reasoning, when one considers that by express
mandate of paragraph 8, Section 13, Article XI of the Constitution, the
Ombudsman may exercise such other powers or perform functions or duties
as may be provided by law, it is indubitable then that Congress has the
power to place the Office of the Special Prosecutor under the Office of the
Ombudsman. In the same vein, Congress may remove some of the powers
granted to the Tanodbayan by P.D. No. 1630 and transfer them to the
Ombudsman; or grant the Office of the Special Prosecutor such other
powers and functions and duties as Congress may deem fit and wise. This
Congress did through the passage of R.A. No. 6770.[8]
The foregoing ruling of the Court has been reiterated in Camanag v.
Guerrero.[9] More recently, in Office of the Ombudsman v. Valera,[10] the Court,
basing its ratio decidendi on its ruling in Acop and Camanag, declared that the
OSP is merely a component of the Office of the Ombudsman and may only act
under the supervision and control, and upon authority of the Ombudsman and
ruled that under R.A. No. 6770, the power to preventively suspend is lodged
only with the Ombudsman and Deputy Ombudsman.[11] The Court's ruling
in Acop that the authority of the Ombudsman to prosecute based on R.A. No.
6770 was authorized by the Constitution was also made the foundation for the
decision in Perez v. Sandiganbayan,[12] where it was held that the power to
prosecute carries with it the power to authorize the filing of informations, which
power had not been delegated to the OSP. It is, therefore, beyond cavil that
under the Constitution, Congress was not proscribed from legislating the grant
of additional powers to the Ombudsman or placing the OSP under the Office of
the Ombudsman.
Petitioners now assert that the Court's ruling on the constitutionality of the
provisions of R.A. No. 6770 should be revisited and the principle of stare
decisis set aside. Again, this contention deserves scant consideration.
The doctrine of stare decisis et non quieta movere (to adhere to precedents and
not to unsettle things which are established) is embodied in Article 8 of the Civil
Code of the Philippines which provides, thus:
ART. 8. Judicial decisions applying or interpreting the laws or the
Constitution shall form a part of the legal system of the Philippines.

It was further explained in Fermin v. People[13] as follows:

The doctrine of stare decisis enjoins adherence to judicial precedents. It


requires courts in a country to follow the rule established in a decision of
the Supreme Court thereof. That decision becomes a judicial precedent to
be followed in subsequent cases by all courts in the land. The doctrine
of stare decisis is based on the principle that once a question of law has been
examined and decided, it should be deemed settled and closed to further
argument.[14]

In Chinese Young Men's Christian Association of the Philippine Islands v.


Remington Steel Corporation,[15] the Court expounded on the importance of the
foregoing doctrine, stating that:

The doctrine of stare decisis is one of policy grounded on the necessity


for securing certainty and stability of judicial decisions, thus:

Time and again, the court has held that it is a very desirable and
necessary judicial practice that when a court has laid down a
principle of law as applicable to a certain state of facts, it will
adhere to that principle and apply it to all future cases in which the
facts are substantially the same. Stare decisis et non quieta
movere. Stand by the decisions and disturb not what is
settled. Stare decisis simply means that for the sake of certainty,
a conclusion reached in one case should be applied to those
that follow if the facts are substantially the same, even though
the parties may be different. It proceeds from the first principle of
justice that, absent any powerful countervailing considerations,
like cases ought to be decided alike. Thus, where the same
questions relating to the same event have been put forward by the
parties similarly situated as in a previous case litigated and
decided by a competent court, the rule of stare decisis is a bar to
any attempt to relitigate the same issue.[16]

The doctrine has assumed such value in our judicial system that the Court has ruled
that [a]bandonment thereof must be based only on strong and compelling
reasons, otherwise, the becoming virtue of predictability which is expected from
this Court would be immeasurably affected and the public's confidence in the
stability of the solemn pronouncements diminished.[17] Verily, only upon showing
that circumstances attendant in a particular case override the great benefits derived
by our judicial system from the doctrine of stare decisis, can the courts be justified
in setting aside the same.
In this case, petitioners have not shown any strong, compelling reason to convince
the Court that the doctrine of stare decisis should not be applied to this case. They
have not successfully demonstrated how or why it would be grave abuse of
discretion for the Ombudsman, who has been validly conferred by law with the
power of control and supervision over the OSP, to disapprove or overturn any
resolution issued by the latter.

The second issue advanced by petitioners is that the Ombudsman's disapproval of


the OSP Resolution recommending dismissal of the cases is based on
misapprehension of facts, speculations, surmises and conjectures. The question is
really whether the Ombudsman correctly ruled that there was enough evidence to
support a finding of probable cause. That issue, however, pertains to a mere error
of judgment. It must be stressed that certiorari is a remedy meant to correct only
errors of jurisdiction, not errors of judgment. This has been emphasized in First
Corporation v. Former Sixth Division of the Court of Appeals,[18] to wit:

It is a fundamental aphorism in law that a review of facts and evidence is not the
province of the extraordinary remedy of certiorari, which is extra ordinem -
beyond the ambit of appeal. In certiorariproceedings, judicial review does not
go as far as to examine and assess the evidence of the parties and to weigh
the probative value thereof. It does not include an inquiry as to the
correctness of the evaluation of evidence. Any error committed in the
evaluation of evidence is merely an error of judgment that cannot be
remedied by certiorari. An error of judgment is one which the court may
commit in the exercise of its jurisdiction. An error of jurisdiction is one where
the act complained of was issued by the court without or in excess of
jurisdiction, or with grave abuse of discretion, which is tantamount to lack or in
excess of jurisdiction and which error is correctible only by the extraordinary
writ of certiorari. Certiorari will not be issued to cure errors of the trial
court in its appreciation of the evidence of the parties, or its conclusions
anchored on the said findings and its conclusions of law. It is not for this
Court to re-examine conflicting evidence, re-evaluate the credibility of the
witnesses or substitute the findings of fact of the court a quo.[19]

Evidently, the issue of whether the evidence indeed supports a finding of


probable cause would necessitate an examination and re-evaluation of the
evidence upon which the Ombudsman based its disapproval of the OSP
Resolution. Hence, the Petition for Certiorari should not be given due course.
Likewise noteworthy is the holding of the Court in Presidential Ad Hoc Fact-
Finding Committee on Behest Loans v. Desierto,[20] imparting the value of the
Ombudsman's independence, stating thus:

Under Sections 12 and 13, Article XI of the 1987 Constitution and RA 6770
(The Ombudsman Act of 1989), the Ombudsman has the power to investigate
and prosecute any act or omission of a public officer or employee when such
act or omission appears to be illegal, unjust, improper or inefficient. It has
been the consistent ruling of the Court not to interfere with the
Ombudsman's exercise of his investigatory and prosecutory powers as
long as his rulings are supported by substantial evidence. Envisioned as the
champion of the people and preserver of the integrity of public service, he has
wide latitude in exercising his powers and is free from intervention from
the three branches of government. This is to ensure that his Office is
insulated from any outside pressure and improper influence.[21]

Indeed, for the Court to overturn the Ombudsman's finding of probable cause, it
is imperative for petitioners to clearly prove that said public official acted with
grave abuse of discretion. In Presidential Commission on Good Government v.
Desierto,[22] the Court elaborated on what constitutes such abuse, to wit:
Grave abuse of discretion implies a capricious and whimsical exercise of
judgment tantamount to lack of jurisdiction. The Ombudsman's exercise of
power must have been done in an arbitrary or despotic manner which must be
so patent and gross as to amount to an evasion of a positive duty or a virtual
refusal to perform the duty enjoined or to act at all in contemplation of
law. x x x[23]

In this case, petitioners failed to demonstrate that the Ombudsman acted in a


manner described above. Clearly, the Ombudsman was acting in accordance
with R.A. No. 6770 and properly exercised its power of control and supervision
over the OSP when it disapproved the Resolution dated September 18, 2000.

It should also be noted that the petition does not question any order or action of
the Sandiganbayan Third Division; hence, it should not have been included as a
respondent in this petition.

IN VIEW OF THE FOREGOING, the petition is DISMISSED for lack of


merit. No costs.
SO ORDERED.

DIOSDADO M. PERALTA
Associate Justice

WE CONCUR:

CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson

ANTONIO T. CARPIO RENATO C. CORONA


Associate Justice Associate Justice

ANTONIO EDUARDO B. NACHURA


Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Courts Division.

CONSUELO YNARES-SANTIAGO
Associate Justice
Third Division, Chairperson
CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division
Chairpersons Attestation, I certify that the conclusions in the above Decision were
reached in consultation before the case was assigned to the writer of the opinion of
the Courts Division.

REYNATO S. PUNO
Chief Justice

Designated to sit as an additional member, per Special Order No. 646 dated May 15, 2009.

Designated to sit as an additional member, per Special Order No. 631 dated April 29, 2009.
[1]
Rollo, pp. 48-57.
[2]
Id. at 58-70.
[3]
Supra note 1.
[4]
Rollo, pp. 114-117.
[5]
Id. at 13.
[6]
G.R. No. 120422, September 27, 1995, 248 SCRA 566.
[7]
Id. at 575-579.
[8]
Id. at 580-582.
[9]
G.R. No. 164250, September 30, 2005, 268 SCRA 473.
[10]
G.R. No. 121017, February 17, 1997, 471 SCRA 715.
[11]
Id. at 743
[12]
G.R. No. 166062, September 26, 2006, 503 SCRA 252.
[13]
G.R. No. 157643, March 28, 2008, 550 SCRA 132.
[14]
Id. at 145, citing Castillo v. Sandiganbayan, 427 Phil. 785, 793 (2002). (Emphasis supplied).
[15]
G.R. No. 159422, March 28, 2008, 550 SCRA 180.
[16]
Id. at 197-198. (Emphasis supplied).
[17]
Pepsi-Cola Products, Phil., Inc. v. Pagdanganan, G.R. No. 167866, October 12, 2006, 504 SCRA 549, 564.
[18]
G.R. No. 171989, July 4, 2007, 526 SCRA 564.
[19]
Id. at 578. (Emphasis supplied).
[20]
G.R. No. 138142, September 19, 2007, 533 SCRA 571.
[21]
Id. at 581-582. (Emphasis supplied).
[22]
G.R. No. 139296, November 23, 2007, 538 SCRA 207.
[23]
Id. at 216.
SECOND DIVISION

G.R. No. 179408, March 05, 2014

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, Petitioner, v. ABIGAIL R. RAZON ALVAREZ


AND VERNON R. RAZON, Respondents.

DECISION

BRION, J.:

Before the Court is a petition for review on certiorari1 assailing the decision2 dated August 11, 2006 and the
resolution3 dated August 22, 2007 of the Court of Appeals (CA) in CAG.R. SP No. 89213 on the validity of
the four search warrants issued by the Regional Trial Court (RTC) of Pasay City, Branch 115.

The CA rulings (i) quashed the first two search warrants, similarly docketed as Search Warrant No. 03063,
issued for violation of Article 308, in relation to Article 309, of the Revised Penal Code (RPC), and (ii)
declared void paragraphs 7, 8 and 9 of the other two search warrants, also similarly docketed as Search
Warrant No. 03064, issued for violation of Presidential Decree (PD) No. 401.4

FACTUAL ANTECEDENTS

Philippine Long Distance Telephone Company (PLDT) is the grantee of a legislative franchise5 which
authorizes it to carry on the business of providing basic and enhanced telecommunications services in and
between areas in the Philippines and between the Philippines and other countries and territories,6and,
accordingly, to establish, operate, manage, lease, maintain and purchase telecommunications system for
both domestic and international calls.7 Pursuant to its franchise, PLDT offers to the public wide range of
services duly authorized by the National Telecommunications Commission (NTC).

PLDTs network is principally composed of the Public Switch Telephone Network, telephone handsets and/or
telecommunications equipment used by its subscribers, the wires and cables linking these handsets and/or
equipment, antennae, transmission facilities, the international gateway facility (IGF) and other
telecommunications equipment providing interconnections.8 To safeguard the integrity of its network, PLDT
regularly conducts investigations on various prepaid cards marketed and sold abroad to determine
alternative calling patterns (ACP) and network fraud that are being perpetrated against it.

To prevent or stop network fraud, PLDTs ACP Detection Division (ACPDD) regularly visits foreign countries
to conduct market research on various prepaid phone cards offered abroad that allow their users to make
overseas calls to PLDT subscribers in the Philippines at a cheaper rate.

The ACPDD bought The Number One prepaid card a card principally marketed to Filipinos residing in the
United Kingdom for calls to the Philippines to make test calls using two telephone lines: the dialing
phone an IDDcapable9 telephone line which makes the call and through which the access
number and the PIN number printed at the back of the card are entered; and the receiving phone a
caller identification (caller id) unitequipped telephone line which would receive the call and reflect the
incoming callers telephone number.

During a test call placed at the PLDTACPDD office, the receiving phone reflected a PLDT telephone number
(28243285) as the calling number used, as if the call was originating from a local telephone in Metro
Manila. Upon verification with the PLDTs Integrated Customer Management (billing) System, the ACPDD
learned that the subscriber of the reflected telephone number is Abigail R. Razon Alvarez, with address at 17
Dominic Savio St., Savio Compound, Barangay Don Bosco, Paraaque City. It further learned that several
lines are installed at this address with Abigail and Vernon R. Razon (respondents), among others, as
subscribers.10

To validate its findings, the ACPDD conducted the same test calls on November 5, 2003 at the premises of
the NTC in Quezon City (and in the presence of an NTC representative11) using the same prepaid card
(validation test). The receiving phone at the NTC premises reflected the telephone numbers registered in the
name of Abigail as the calling number from the United Kingdom.12
Similar test calls subsequently conducted using the prepaid cards Unity Card and IDT Supercalling
Card revealed the same results. The calleridequipped receiving phone reflected telephone numbers13 that
are in the names of Experto Enterprises and Experto Phils, as subscribers, with a common address at No. 38
Indonesia St., Better Living Subdivision, Barangay Don Bosco, Paraaque City. It turned out that the actual
occupant of these premises is also Abigail. Subsequently, a validation test was also conducted, yielding
several telephone numbers registered in the name of Experto Phils./Experto Enterprises as the calling
numbers supposedly from the United Kingdom.14

According to PLDT, had an ordinary and legitimate call been made, the screen of the calleridequipped
receiving phone would not reflect a local number or any number at all. In the cards they tested, however,
once the caller enters the access and pin numbers, the respondents would route the call via the internet to a
local telephone number (in this case, a PLDT telephone number) which would connect the call to the
receiving phone. Since calls through the internet never pass the toll center of the PLDTs IGF, users of these
prepaid cards can place a call to any point in the Philippines (provided the local line is NDDcapable) without
the call appearing as coming from abroad.15

On November 6, 2003 and November 19, 2003, Mr. Lawrence Narciso of the PLDTs Quality Control Division,
together with the operatives of the Philippine National Police (PNP), conducted an ocular inspection at 17
Dominic Savio St., Savio Compound and at No. 38 Indonesia St., Better Living Subdivision both in
Barangay Don Bosco, Paranaque City and discovered that PLDT telephone lines were connected to several
pieces of equipment.16 Mr. Narciso narrated the results of the inspection, thus
10. During [the] ocular inspection [at 17 Dominic Savio St., Savio Compound], Ms. Abigail Razon Alvarez
allowed us to gain entry and check the telephone installations within their premises. First, we checked the
location of the telephone protectors that are commonly installed at a concrete wall boundary inside the
compound. Some of these protectors are covered with a fabricated wooden cabinet. Other protectors are
installed beside the said wooden cabinet, xxx. The inside wiring installations from telephone protectors to
connecting block were routed to the said adjacent room passing through the house ceiling.

11. xxx. Upon entering the socalled adjacent room, we immediately noticed that the PLDT telephone lines
were connected to the equipment situated at multilayered rack. The equipment room contains the
following:
a. 6 Quintum router;

b. 13 Com router;

c. 1 Cisco 800 router;

d. 1 Nokia Modem for PLDT DSL;

e. 1 Meridian Subscribers Unit[;]

f. 5 Personal Computers[;]

g. 1 Computer Printer[; and]

h. 1 Flatbed Scanner[.]
12. We also noticed that these routers are connected to the Meridians subscriber unit ("SU ) that has an
outdoor antenna installed on the top of the roof. Meridians SU and outdoor antenna are service components
used to connect with wireless broadband internet access service of Meridian Telekoms.

xxxx

18. During the site inspection [at No. 38 Indonesia St., Better Living Subdivision], we noticed that the
protector of each telephone line/number xxx were enclosed in a fabricated wooden cabinet with safety
padlock. Said wooden cabinet was situated on the concrete wall inside the compound near the garage
entrance gate. The telephone inside the wiring installations from the protector to the connecting blocks were
placed in a plastic electrical conduit routed to the adjacent room at the second floor.17
On December 3, 2003, Police Superintendent Gilbert C. Cruz filed a consolidated application for a search
warrant18 before Judge Francisco G. Mendiola of the RTC, for the crimes of theft and violation of PD No. 401.
According to PLDT, the respondents are engaged in a form of network fraud known as International Simple
Resale (ISR) which amounts to theft under the RPC.
ISR is a method of routing and completing international long distance calls using lines, cables, antennae
and/or wave frequencies which are connected directly to the domestic exchange facilities of the country
where the call is destined (terminating country); and, in the process, bypassing the IGF at the terminating
country.19

Judge Mendiola found probable cause for the issuance of the search warrants applied for. Accordingly, four
search warrants20 were issued for violations of Article 308, in relation to Article 309, of the RPC (SW A1 and
SW A2) and of PD No. 401, as amended (SW B1 and SW B2) for the ISR activities being conducted at 17
Dominic Savio St., Savio Compound and at No. 38 Indonesia St., Better Living Subdivision, both in Barangay
Don Bosco, Paranaque City. The four search warrants enumerated the objects to be searched and seized as
follows:
1. MERIDIAN SUBSCRIBERS UNIT AND PLDT DSL LINES and/or CABLES AND ANTENNAS and/or similar
equipment or device capable of transmitting air waves or frequency, such as a Meridian Subscribers Unit,
Broadband DSL and telephone lines;

2. PERSONAL COMPUTERS or any similar equipment or device capable of accepting information applying the
prescribed process of the information and supplying the result of this process;

3. NOKIA MODEM or any similar equipment or device that enables data terminal equipment such as
computers to communicate with other data terminal equipment via a telephone line;

4. QUINTUM Equipment or any similar equipment capable of receiving digital signals from the internet and
converting those signals to voice;

5. QUINTUM, 3COM AND CISCO Routers or any similar equipment capable of switching packets of data to
their assigned destination or addresses;

6. LINKS DSL SWITCH or any similar equipment capable of switching data;

7. COMPUTER PRINTERS AND SCANNERS or any similar equipment or device used for copying and/or
printing data and/or information;

8. SOFTWARE, DISKETTES, TAPES or any similar equipment or device used for recording or storing
information; and

9. Manuals, phone cards, access codes, billing statements, receipts, contracts, checks, orders,
communications and documents, lease and/or subscription agreements or contracts, communications and
documents relating to securing and using telephone lines and/or equipment[.]21
On the same date, the PNP searched the premises indicated in the warrants. On December 10, 2003, a
return was made with a complete inventory of the items seized.22 On January 14, 2004, the PLDT and the
PNP filed with the Department of Justice a joint complaintaffidavit for theft and for violation of PD No. 401
against the respondents.23

On February 18, 2004, the respondents filed with the RTC a motion to quash24 the search warrants
essentially on the following grounds: first, the RTC had no authority to issue search warrants which were
enforced in Paraaque City; second, the enumeration of the items to be searched and seized lacked
particularity; and third, there was no probable cause for the crime of theft.

On March 12, 2004, PLDT opposed the respondents' motion.25

In a July 6, 2004 order,26 the RTC denied the respondents' motion to quash. Having been rebuffed27in their
motion for reconsideration,28 the respondents filed a petition for certiorari with the CA. 29

RULING OF THE CA

On August 11, 2006, the CA rendered the assailed decision and resolution, granting the respondents'
petition for certiorari. The CA quashed SW Al and SW A2 (for theft) on the ground that they were
issued for nonexistent crimes. 30 According to the CA, inherent in the determination of probable cause for
the issuance of search warrant is the accompanying determination that an offense has been committed.
Relying on this Courts decision in Laurel v. Judge Abrogar,31 the CA ruled that the respondents could not
have possibly committed the crime of theft because PLDTs business of providing telecommunication services
and these services themselves are not personal properties contemplated under Article 308 of the RPC.
With respect to SW Bl and SW B2 (for violation of PD No. 401), the CA upheld paragraphs one to six of
the enumeration of items subject of the search. The CA held that the stock phrase or similar equipment or
device found in paragraphs one to six of the search warrants did not make it suffer from generality since
each paragraphs enumeration of items was sufficiently qualified by the citation of the specific objects to be
seized and by its functions which are inherently connected with the crime allegedly committed.

The CA, however, nullified the ensuing paragraphs, 7, 8 and 9, for lack of particularity and ordered the
return of the items seized under these provisions. While the same stock phrase appears in paragraphs 7 and
8, the properties described therein i.e., printer and scanner, software, diskette and tapes include even
those for the respondents' personal use, making the description of the things to be seized too general in
nature.

With the denial of its motion for reconsideration,32 PLDT went to this Court via this Rule 45 petition.

THE PETITIONER'S ARGUMENTS

PLDT faults the CA for relying on Laurel on three grounds: first, Laurel cannot be cited yet as an authority
under the principle of stare decisis because Laurel is not yet final and executory; in fact, it is the subject of a
pending motion for reconsideration filed by PLDT itself; second, even assuming that Laurel is already final,
the facts in Laurel vary from the present case. Laurel involves the quashal of an information on the ground
that the information does not charge any offense; hence, the determination of the existence of the elements
of the crime of theft is indispensable in resolving the motion to quash. In contrast, the present case involves
the quashal of a search warrant. Third, accordingly, in resolving the motion, the issuing court only has to be
convinced that there is probable cause to hold that: (i) the items to be seized are connected to a criminal
activity; and (ii) these items are found in the place to be searched. Since the matter of quashing a search
warrant may be rooted on matters extrinsic of the search warrant, 33 the issuing court does not need to
look into the elements of the crime allegedly committed in the same manner that the CA did in Laurel.

PLDT adds that a finding of grave abuse of discretion in the issuance of search warrant may be justified only
when there is disregard of the requirements for the issuance of a search warrant[.] 34In the present case,
the CA did not find (and could not have found) any grave abuse of discretion on the part of the RTC because
at the time the RTC issued the search warrants in 2003, Laurel had not yet been promulgated.

In defending the validity of the nullified provisions of SW Bl and SW B2, PLDT argues that PD No. 401 also
punishes unauthorized installation of telephone connections. Since the enumerated items are connected to
the computers that are illegally connected to PLDT telephone lines, then these items bear a direct relation to
the offense of violation of PD No. 401, justifying their seizure.

The enumeration in paragraph 8 is likewise a proper subject of seizure because they are the fruits of the
offense as they contain information on PLDTs business profit and other information relating to the
commission of violation of PD No. 401. Similarly, paragraph 9 specifies the fruits and evidence of violation of
PD No. 401 since it supports PLDTs claim that the respondents have made a business out of their illegal
connections to PLDT lines.

THE RESPONDENTS' ARGUMENTS

The respondents counter that while Laurel may not yet be final, at least it has a persuasive effect as the
current jurisprudence on the matter. Even without Laurel, the CAs nullification of SW Al and SW A2 can
withstand scrutiny because of the novelty of the issue presented before it. The nullification of paragraphs 7,
8 and 9 of SW Bl and SW B2 must be upheld not only on the ground of broadness but for lack of any
relation whatsoever with PD No. 401 which punishes the theft of electricity.

OUR RULING

We partially grant the petition.

Laurel and its reversal by the Court En Banc

Before proceeding with the case, a review of Laurel is in order as it involves substantially similar facts as in
the present case.
Baynet Co., Ltd. (Baynet) sells prepaid cards, Bay Super Orient Card, that allow their users to place a call
to the Philippines from Japan. PLDT asserted that Baynet is engaged in ISR activities by using an
international private leased line (IPL) to course Baynets incoming international long distance calls. The IPL
is linked to a switching equipment, which is then connected to PLDT telephone lines/numbers and
equipment, with Baynet as subscriber.

To establish its case, PLDT obtained a search warrant. On the strength of the items seized during the search
of Baynets premises, the prosecutor found probable cause for theft against Luis Marcos Laurel (Laurel) and
other Baynet officials. Accordingly, an information was filed, alleging that the Baynet officials take, steal
and use the international long distance calls belonging to PLDT by [ISR activities] xxx effectively stealing
this business from PLDT while using its facilities in the estimated amount of P20,370,651.92 to the damage
and prejudice of PLDT[.] 35

Laurel moved to quash the information on the bold assertion that ISR activities do not constitute a crime
under Philippine law. Laurel argued that an ISR activity cannot entail taking of personal property because
the international long distance telephone calls using PLDT telephone lines belong to the caller himself; the
amount stated in the information, if at all, represents the rentals due PLDT for the callers usage of its
facilities. Laurel argued that the business of providing international long distance calls, i.e., PLDTs service,
and the revenue derived therefrom are not personal property that can be appropriated.

Laurel went to the Court after failing to secure the desired relief from the trial and appellate courts,36raising
the core issue of whether PLDTs business of providing telecommunication services for international long
distance calls is a proper subject of theft under Article 308 of the RPC. The Courts First Division granted
Laurels petition and ordered the quashal of the information.

Taking off from the basic rule that penal laws are construed strictly against the State, the Court ruled that
international long distance calls and the business of providing telecommunication or telephone services by
PLDT are not personal properties that can be the subject of theft.
One is apt to conclude that personal property standing alone, covers both tangible and intangible
properties and are subject of theft under the Revised Penal Code. But the words Personal property under
the Revised Penal Code must be considered in tandem with the word take in the law. The statutory
definition of taking and movable property indicates that, clearly, not all personal properties may be the
proper subjects of theft. The general rule is that, only movable properties which have physical or material
existence and susceptible of occupation by another are proper objects of theft, xxx.

xxxx

xxx. Business, like services in business, although are properties, are not proper subjects of theft under the
Revised Penal Code because the same cannot be taken or occupied. If it were otherwise, xxx there would
be no juridical difference between the taking of the business of a person or the services provided by him for
gain, visavis, the taking of goods, wares or merchandise, or equipment comprising his business. If it was
its intention to include business as personal property under Article 308 of the Revised Penal Code, the
Philippine Legislature should have spoken in language that is clear and definite: that business is personal
property under Article 308 of the Revised Penal Code.

xxxx

The petitioner is not charged, under the Amended Information, for theft of telecommunication or telephone
services offered by PLDT. Even if he is, the term personal property under Article 308 of the Revised Penal
Code cannot be interpreted beyond its seams so as to include telecommunication or telephone services or
computer services for that matter. xxx. Even at common law, neither time nor services may be taken and
occupied or appropriated. A service is generally not considered property and a theft of service would not,
therefore, constitute theft since there can be no caption or asportation. Neither is the unauthorized use of
the equipment and facilities of PLDT by [Laurel] theft under [Article 308].

If it was the intent of the Philippine Legislature, in 1930, to include services to be the subject of theft, it
should have incorporated the same in Article 308 of the Revised Penal Code. The Legislature did not. In fact,
the Revised Penal Code does not even contain a definition of services.37
PLDT38 moved for reconsideration and referral of the case to the Court En Banc. The Courts First Division
granted the referral.

On January 13, 2009 (or while the present petition was pending in court), the Court En Banc unanimously
granted PLDTs motion for reconsideration.39 The Court ruled that even prior to the passage of the RPC,
jurisprudence is settled that any personal property, tangible or intangible, corporeal or incorporeal, capable
of appropriation can be the object of theft. 40 This jurisprudence, in turn, applied the prevailing legal
meaning of the term personal property under the old Civil Code as anything susceptible of appropriation
and not included in the foregoing chapter (not real property). 41 PLDTs telephone service or its business of
providing this was appropriable personal property and was, in fact, the subject of appropriation in an ISR
operation, facilitated by means of the unlawful use of PLDTs facilities.
In this regard, the Amended Information inaccurately describes the offense by making it appear that what
[Laurel] took were the international long distance telephone calls, rather than respondent PLDTs business.

xxxx

Indeed, while it may be conceded that international long distance calls, the matter alleged to be stolen
xxx, take the form of electrical energy, it cannot be said that such international long distance calls were
personal properties belonging to PLDT since the latter could not have acquired ownership over such calls.
PLDT merely encodes, augments, enhances, decodes and transmits said calls using its complex
communications infrastructure and facilities. PLDT not being the owner of said telephone calls, then it could
not validly claim that such telephone calls were taken without its consent. It is the use of these
communications facilities without the consent of PLDT that constitutes the crime of theft, which is the
unlawful taking of the telephone services and business.

Therefore, the business of providing telecommunication and the telephone service are personal property
under Article 308 of the Revised Penal Code, and the act of engaging in ISR is an act of subtraction
penalized under said article.42
The Court En Bancs reversal of its Laurel Division ruling during the pendency of this petition significantly
impacts on how the Court should resolve the present case for two reasons: chanRoblesvi rtua lLaw lib rary

First, the Laurel En Banc ruling categorically equated an ISR activity to theft under the RPC. In so doing,
whatever alleged factual variance there may be between Laurel and the present case cannot
render Laurel inapplicable.

Second, and more importantly, in a Rule 45 petition, the Court basically determines whether the CA was
legally correct in determining whether the RTC committed grave abuse of discretion. Under this premise, the
CA ordinarily gauges the grave abuse of discretion at the time the RTC rendered its assailed resolution. In
quashing SW Al and SW A2, note that the CA relied on the Laurel Division ruling at the time when it was
still subject of a pending motion for reconsideration. The CA, in fact, did not expressly impute grave abuse
of discretion on the RTC when the RTC issued the search warrants and later refused to quash these.
Understandably, the CA could not have really found the presence of grave abuse of discretion for there was
no Laurel ruling to speak of at the time the RTC issued the search warrants.

These peculiar facts require us to more carefully analyze our prism of review under Rule 45.

Requisites for the issuance of search warrant; probable cause requires the probable existence of
an offense

Section 2, Article III of the 1987 Constitution guarantees the right of persons to be free from unreasonable
searches and seizures.
Section 2. The right of the people to be secure in their persons, houses, papers, and effects against
unreasonable searches and seizures of whatever nature and for any purpose shall be inviolable, and no
search warrant or warrant of arrest shall issue except upon probable cause to be determined
personally by the judge after examination under oath or affirmation of the complainant and the witnesses he
may produce, and particularly describing the place to be searched and the persons or things to be seized.
The purposes of the constitutional provision against unlawful searches and seizures are to: (i) prevent the
officers of the law from violating private security in person and property and illegally invading the sanctity of
the home; and (ii) give remedy against such usurpations when attempted or committed.43

The constitutional requirement for the issuance of a search warrant is reiterated under Sections 4 and 5,
Rule 126 of the Revised Rules of Criminal Procedure. These sections lay down the following requirements for
the issuance of a search warrant: (1) the existence of probable cause; (2) the probable cause must be
determined personally by the judge; (3) the judge must examine, in writing and under oath or affirmation,
the complainant and the witnesses he or she may produce; (4) the applicant and the witnesses testify on
the facts personally known to them; and (5) the warrant specifically describes the place to be searched and
the things to be seized.44 Should any of these requisites be absent, the party aggrieved by the issuance and
enforcement of the search warrant may file a motion to quash the search warrant with the issuing court or
with the court where the action is subsequently instituted.45

A search warrant proceeding is a special criminal and judicial process akin to a writ of discovery. It is
designed by the Rules of Criminal Procedure to respond only to an incident in the main case, if one has
already been instituted, or in anticipation thereof. Since it is at most incidental to the main criminal case, an
order granting or denying a motion to quash a search warrant may be questioned only via a petition
for certiorari under Rule 65.46

When confronted with this petition, the higher court must necessarily determine the validity of the lower
courts action from the prism of whether it was tainted with grave abuse of discretion. By grave abuse of
discretion, jurisprudence refers to the capricious and whimsical exercise of judgment equivalent to lack of
jurisdiction, or to the exercise of power in an arbitrary or despotic manner by reason of passion or personal
hostility or in a manner so patent and gross as to amount to an invasion of positive duty or to the virtual
refusal to perform the duty enjoined or to act at all in contemplation of the law.47

In a certiorari proceeding, the determination translates to an inquiry on whether the requirements and
limitations provided under the Constitution and the Rules of Court were properly complied with, from the
issuance of the warrant up to its implementation. In view of the constitutional objective of preventing
stealthy encroachment upon or the gradual depreciation of the rights secured by the Constitution, strict
compliance with the constitutional and procedural requirements is required. A judge who issues a search
warrant without complying with these requirements commits grave abuse of discretion.48

One of the constitutional requirements for the validity of a search warrant is that it must be issued based on
probable cause which, under the Rules, must be in connection with one specific offense. In search warrant
proceedings, probable cause is defined as such facts and circumstances that would lead a reasonably
discreet and prudent man to believe that an offense has been committed and that the objects sought in
connection with the offense are in the place sought to be searched.49

In the determination of probable cause, the court must necessarily determine whether an offense exists to
justify the issuance or quashal of the search warrant50 because the personal properties that may be subject
of the search warrant are very much intertwined with the one specific offense requirement of probable
cause.51 Contrary to PLDTs claim, the only way to determine whether a warrant should issue in connection
with one specific offense is to juxtapose the facts and circumstances presented by the applicant with the
elements of the offense that are alleged to support the search warrant.

Reviewing the RTCs denial of the motion to quash SWAl and SW A2

a. From the prism of Rule 65

The facts of the present case easily call to mind the case of Columbia Pictures, Inc. v. CA52 involving
copyright infringement. In that case, the CA likewise voided the search warrant issued by the trial court by
applying a doctrine that added a new requirement (i.e., the production of the master tape for comparison
with the allegedly pirate copies) in determining the existence of probable cause for the issuance of search
warrant in copyright infringement cases. The doctrine referred to was laid down in 20th Century Fox Film
Corporation v. Court of Appeals. 20th Century Fox, however, was promulgated more than eight months after
the search warrants were issued by the RTC. In reversing the CA, the Court ruled: chanRob les virtua lLawl ibra ry

Mindful as we are of the ramifications of the doctrine of stare decisis and the rudiments of fair play, it is our
considered view that the 20th Century Fox ruling cannot be retroactively applied to the instant case to justify
the quashal of Search Warrant No. 87053. [The] petitioners' consistent position that the order of the lower
court[,] xxx [which denied the respondents'] motion to lift the order of search warrant^] was properly
issued, [because there was] satisfactory compliance with the then prevailing standards under the law for
determination of probable cause, is indeed well taken. The lower court could not possibly have expected
more evidence from petitioners in their application for a search warrant other than what the law and
jurisprudence, then existing and judicially accepted, required with respect to the finding of probable cause.53

Columbia could easily be cited in favor of PLDT to sustain the RTCs refusal to quash the search warrant.
Indeed, in quashing SW Al and SW A2, the CA never intimated that the RTC disregarded any of the
requisites for the issuance of a search warrant as these requirements were interpreted and observed under
the then prevailing jurisprudence. The CA could not have done so because precisely the issue of whether
telephone services or the business of providing these services could be the subject of theft under the RPC
had not yet reached the Court when the search warrants were applied for and issued.

However, what distinguishes Columbia from the present case is the focus of Columbias legal
rationale. Columbias focus was not on whether the facts and circumstances would reasonably lead to the
conclusion that an offense has been or is being committed and that the objects sought in connection with
the offense were in the place to be searched the primary points of focus of the present
case. Columbias focus was on whether the evidence presented at the time the search warrant was
applied for was sufficient to establish the facts and circumstances required for establishing probable
cause to issue a search warrant.

Nonetheless, Columbia serves as a neat guide for the CA to decide the respondents' certiorari petition.
In Columbia, the Court applied the principle of nonretroactivity of its ruling in 20th Century Fox, whose
finality was not an issue, in reversing a CA ruling. The Courts attitude in that case should have been
adopted by the CA in the present case a fortiori since the ruling that the CA relied upon was not yet final at
the time the CA resolved to quash the search warrants.

b. Supervening events justifying a broader review under Rule 65

Ordinarily, the CAs determination under Rule 65 is limited to whether the RTC gravely abused its discretion
in granting or denying the motion to quash based on facts then existing. Nonetheless, the Court recognizes
that supervening facts may transpire after the issuance and implementation of the search warrant that may
provide justification for the quashal of the search warrant via a petition for certiorari.

For one, if the offense for which the warrant is issued is subsequently decriminalized during the pendency of
the petition for certiorari, then the warrant may be quashed.54 For another, a subsequent ruling from the
Court that a similar set of facts and circumstances does not constitute an offense, as alleged in the search
warrant application, may be used as a ground to quash a warrant.55In both instances, the underlying reason
for quashing the search warrant is the absence of probable cause which can only possibly exist when the
combination of facts and circumstances points to the possible commission of an offense that may be
evidenced by the personal properties sought to be seized. To the CA, the second instance mentioned
justified the quashal of the search warrants.

We would have readily agreed with the CA if the Laurel Division ruling had not been subsequently reversed.
As things turned out, however, the Court granted PLDTs motion for reconsideration of the Court First
Divisions ruling in Laurel and ruled that the act of engaging in ISR is xxx penalized under xxx article [308
of the RPC]. 56 As the RTC itself found, PLDT successfully established in its application for a search warrant
a probable cause for theft by evidence that Laurels ISR activities deprived PLDT of its telephone services
and of its business of providing these services without its consent.

b1. the stare decisis aspect

With the Court En Bancs reversal of the earlier Laurel ruling, then the CAs quashal of these warrants would
have no leg to stand on. This is the dire consequence of failing to appreciate the full import of the doctrine
of stare decisis that the CA ignored.

Under Article 8 of the Civil Code, the decisions of this Court form part of the countrys legal system. While
these decisions are not laws pursuant to the doctrine of separation of powers, they evidence the laws'
meaning, breadth, and scope and, therefore, have the same binding force as the laws themselves.57 Hence,
the Courts interpretation of a statute forms part of the law as of the date it was originally passed because
the Courts construction merely establishes the contemporaneous legislative intent that the interpreted law
carries into effect.58

Article 8 of the Civil Code embodies the basic principle of stare decisis et non quieta movere (to adhere to
precedents and not to unsettle established matters) that enjoins adherence to judicial precedents embodied
in the decision of the Supreme Court. That decision becomes a judicial precedent to be followed in
subsequent cases by all courts in the land. The doctrine of stare decisis, in turn, is based on the principle
that once a question of law has been examined and decided, it should be deemed settled and closed to
further argument.59 The doctrine of (horizontal) stare decisis is one of policy, grounded on the necessity of
securing certainty and stability of judicial decisions.60

In the field of adjudication, a case cannot yet acquire the status of a decided case that is
deemed settled and closed to further argument if the Courts decision is still the subject of a motion for
reconsideration seasonably filed by the moving party. Under the Rules of Court, a party is expressly allowed
to file a motion for reconsideration of the Courts decision within 15 days from notice.61 Since the doctrine of
stare decisis is founded on the necessity of securing certainty and stability in law, then these attributes will
spring only once the Courts ruling has lapsed to finality in accordance with law. In Ting v. VelezTing,62 we
ruled that:
The principle of stare decisis enjoins adherence by lower courts to doctrinal rules established by this Court in
its final decisions. It is based on the principle that once a question of law has been examined and decided,
it should be deemed settled and closed to further argument.
In applying Laurel despite PLDTs statement that the case is still subject of a pending motion for
reconsideration,63 the CA legally erred in refusing to reconsider its ruling that largely relied on a nonfmal
ruling of the Court. While the CAs dutiful desire to apply the latest pronouncement of the Court in Laurel is
expected, it should have acted with caution, instead of excitement, on being informed by PLDT of its
pending motion for reconsideration; it should have then followed the principle of stare decisis. The appellate
courts application of an exceptional circumstance when it may order the quashal of the search warrant on
grounds not existing at the time the warrant was issued or implemented must still rest on prudential
grounds if only to maintain the limitation of the scope of the remedy of certiorari as a writ to correct errors
of jurisdiction and not mere errors of judgment.

Still, the respondents attempt to justify the CAs action by arguing that the CA would still rule in the way it
did64 even without Laurel. As PLDT correctly pointed out, there is simply nothing in the CAs decision that
would support its quashal of the search warrant independently of Laurel. We must bear in mind that the CAs
quashal of SW Al and SW A2 operated under the strictures of a certiorari petition, where the presence of
grave abuse of discretion is necessary for the corrective writ to issue since the appellate court exercises its
supervisory jurisdiction in this case. We simply cannot secondguess what the CAs action could have been.

Lastly, the CAs reliance on Savage v. Judge Taypin65 can neither sustain the quashal of SW Al and SW A
2. In Savage, the Court granted the certiorari petition and quashed the search warrant because the alleged
crime (unfair competition involving design patents) that supported the search warrant had already been
repealed, and the act complained of, if at all, gave rise only to civil liability (for patent infringement). Having
been decriminalized, probable cause for the crime alleged could not possibly exist.

In the present case, the issue is whether the commission of an ISR activity, in the manner that PLDTs
evidence shows, sufficiently establishes probable cause for the issuance of search warrants for the crime
of theft. Unlike in Savage, the Court in Laurel was not confronted with the issue of decriminalization (which
is a legislative prerogative) but whether the commission of an ISR activity meets the elements of the offense
of theft for purposes of quashing an information. Since the Court, in Laurel, ultimately ruled then an ISR
activity justifies the elements of theft that must necessarily be alleged in the information a fortiori, the RTCs
determination should be sustained on certiorari.

The requirement of particularity in SWB1 and SWB2

On the issue of particularity in SW Bl and SW B2, we note that the respondents have not appealed to us
the CA ruling that sustained paragraphs 1 to 6 of the search warrants. Hence, we shall limit our discussion
to the question of whether the CA correctly ruled that the RTC gravely abused its discretion insofar as it
refused to quash paragraphs 7 to 9 of SW Bl and SWB2.

Aside from the requirement of probable cause, the Constitution also requires that the search warrant must
particularly describe the place to be searched and the things to be seized. This requirement of particularity
in the description, especially of the things to be seized, is meant to enable the law enforcers to readily
identify the properties to be seized and, thus, prevent the seizure of the wrong items. It seeks to leave the
law enforcers with no discretion at all regarding these articles and to give life to the constitutional provision
against unreasonable searches and seizures.66 In other words, the requisite sufficient particularity is aimed
at preventing the law enforcer from exercising unlimited discretion as to what things are to be taken under
the warrant and ensure that only those connected with the offense for which the warrant was issued shall be
seized.67

The requirement of specificity, however, does not require technical accuracy in the description of the
property to be seized. Specificity is satisfied if the personal properties' description is as far as the
circumstances will ordinarily allow it to be so described. The nature of the description should vary according
to whether the identity of the property or its character is a matter of concern.68 One of the tests to
determine the particularity in the description of objects to be seized under a search warrant is when the
things described are limited to those which bear direct relation to the offense for which the warrant is being
issued.69

Additionally, the Rules require that a search warrant should be issued in connection with one specific
offense to prevent the issuance of a scattershot warrant.70 The onespecificoffense requirement
reinforces the constitutional requirement that a search warrant should issue only on the basis of probable
cause.71 Since the primary objective of applying for a search warrant is to obtain evidence to be used in a
subsequent prosecution for an offense for which the search warrant was applied, a judge issuing a particular
warrant must satisfy himself that the evidence presented by the applicant establishes the facts and
circumstances relating to this specific offense for which the warrant is sought and issued.72 Accordingly, in a
subsequent challenge against the validity of the warrant, the applicant cannot be allowed to maintain its
validity based on facts and circumstances that may be related to other search warrants but are extrinsic to
the warrant in question.

Under the Rules, the following personal property may be subject of search warrant: (i) the subject of the
offense; (ii) fruits of the offense; or (iii) those used or intended to be used as the means of committing an
offense. In the present case, we sustain the CAs ruling nullifying paragraphs 7, 8 and 9 of SW Bl and SW
B2 for failing the test of particularity. More specifically, these provisions do not show how the enumerated
items could have possibly been connected with the crime for which the warrant was issued, i.e., P.D. No.
401. For clarity, PD No. 401 punishes:
Section 1. Any person who installs any water, electrical, telephone or piped gas connection without
previous authority from xxx the Philippine Long Distance Telephone Company, xxx, tampers and/or
uses tampered water, electrical or gas meters, jumpers or other devices whereby water, electricity or piped
gas is stolen; steals or pilfers water, electric or piped gas meters, or water, electric and/or telephone wires,
or piped gas pipes or conduits; knowingly possesses stolen or pilfered water, electrical or gas meters as well
as stolen or pilfered water, electrical and/or telephone wires, or piped gas pipes and conduits, shall, upon
conviction, be punished with prision correccional in its minimum period or a fine ranging from two thousand
to six thousand pesos, or both.73
Paragraphs 7 to 8 of SW Bl and SW B2 read as follows:
7. COMPUTER PRINTERS AND SCANNERS or any similar equipment or device used for copying and/or
printing data and/or information;

8. SOFTWARE, DISKETTES, TAPES or any similar equipment or device used for recording or storing
information; and

9. Manuals, phone cards, access codes, billing statements, receipts, contracts, checks, orders,
communications and documents, lease and/or subscription agreements or contracts, communications and
documents relating to securing and using telephone lines and/or equipment[.]74
According to PLDT, the items in paragraph 7 have a direct relation to violation of PD No. 401 because the
items are connected to computers that, in turn, are linked to the unauthorized connections to PLDT
telephone lines. With regard to the software, diskette and tapes in paragraph 8, and the items in paragraph
9, PLDT argues that these items are fruits of the offense and that the information it contains constitutes
the business profit of PLDT. According to PLDT, it corroborates the fact that the respondents have made a
business out of their illegal connections to its telephone lines.

We disagree with PLDT. The fact that the printers and scanners are or may be connected to the other illegal
connections to the PLDT telephone lines does not make them the subject of the offense or fruits of the
offense, much less could they become a means of committing an offense.

It is clear from PLDTs submission that it confuses the crime for which SW Bl and SW B2 were issued
with the crime for which SW Al and SWA2 were issued: SW Bl and SW B2 were issued for violation of
PD No. 401, to be enforced in two different places as identified in the warrants. The crime for which these
search warrants were issued does not pertain to the crime of theft where matters of personal property
and the taking thereof with intent to gain become significant but to PD No. 401.

These items could not be the subject of a violation of PD No. 401 since PLDT itself does not claim that these
items themselves comprise the unauthorized installations. For emphasis, what PD No. 401 punishes is the
unauthorized installation of telephone connection without the previous consent of PLDT. In the present case,
PLDT has not shown that connecting printers, scanners, diskettes or tapes to a computer, even if connected
to a PLDT telephone line, would or should require its prior authorization.

Neither could these items be a means of committing a violation of PD No. 401 since these copying, printing
and storage devices in no way aided the respondents in making the unauthorized connections. While these
items may be accessory to the computers and other equipment linked to telephone lines, PD No. 401 does
not cover this kind of items within the scope of the prohibition. To allow the seizure of items under the
PLDTs interpretation would, as the CA correctly observed, allow the seizure under the warrant of properties
for personal use of the respondents.

If PLDT seeks the seizure of these items to prove that these installations contain the respondents' financial
gain and the corresponding business loss to PLDT, then that purpose is served by SW Al and SW A2 since
this is what PLDT essentially complained of in charging the respondents with theft. However, the same
reasoning does not justify its seizure under a warrant for violation of PD No. 401 since these items are not
directly connected to the PLDT telephone lines and PLDT has not even claimed that the installation of these
items requires prior authorization from it.

WHEREFORE, premises considered, the petition is PARTIALLY GRANTED. The decision and the resolution
of the Court of Appeals in CAG.R. SP No. 89213 are hereby MODIFIED in that SW Al and SW A2 are
hereby declared valid and constitutional.

SO ORDERED.

Carpio, (Chairperson), Del Castillo, Perez, and PerlasBernabe, JJ., concur.

Endnotes:

1
Under Rule 45 of the Rules of Court.

2
Penned by Associate Justice Rebecca de GuiaSalvador, and concurred in by Presiding Justice Ruben T.
Reyes (now a retired member of this Court) and Associate Justice Vicente Q. Roxas; rollo, pp. 6081.

3
Id. at 84.

4
Penalizing the Unauthorized Installation of Water, Electrical or Telephone Connections, the Use of
Tampered Water or Electrical Meters and Other Acts.

5
Republic Act No. 7082.

6
Republic Act No. 7082, Section 1.

Rollo, p. 90.
7

8
Id. at 807808.

9
International Direct Dialing. An IDD capable phone enables the caller to access the tollfree number of the
prepaid card.

10
Teresita S. Alcantara, Dante S. Cunanan and Abigail; rollo, p. 94.

11
Engr. Policarpio G. Tolentino, Jr.; ibid.

12
The following are the telephone numbers and their subscribers: 28222363 Abigail; 28210268
Vernon; 27764922 Abigail; 27764909 Abigail; 28243817 Abigail; and 28243285 Abigail; id. at
95.

13
28245911 and 28245244; id. at 9596.

14
The following are the telephone numbers and their subscribers: 28245056 Experto Phils.; 2 8224192
Experto Phils.; 28247704 Experto Enterprises; 28245786 Experto Enterprises; and 2 8245245
Experto Enterprises; id. at 97.

15
Id. at 98.

16
Id. at 811.
17
Id. at 122124; citation omitted.

18
Id. at 206214. The application attached the affidavits of Wilfredo Abad, Jr., a Section Supervisor of the
PLDTs ACPDD, and of Mr. Narciso. a Revenue Assurance Analyst of the PLDTs ACPDD.

Rollo, p. 92.
19

20
Id. at 358369; Search Warrant No. 03063 covering two different places and Search Warrant No. 03
064 covering, as well, two different places.

21
Id. at 360.

22
Id. at 371375.

23
Id. at 438446.

24
Subsequently, the respondents also filed an Amended Motion to Quash Search Warrants; id. at 391401.

25
Id. at 405435.

26
Id. at 455459.

27
Id. at 479.

28
Id. at 461464.

29
Id. at 481502.

30
Id. at 66.

31
518 Phil. 409 (2006).

Rollo, pp. 614637.


32

33
Citing Abuan v. People, 536 Phil. 672, 692 (2006).

34
Citing Uy v. Bureau of Internal Revenue, 397 Phil. 892, 903 (2000).

Laurel v. Judge Abrogar, supra note 31, at 422.


35

36
Under Rule 45 of the Rules of Court.

Laurel v. Judge Abrogar, supra note 3 1, at 434441; citations omitted, underscore ours.
37

Rollo, pp. 640717. Joined by the Office of the Solicitor General.


38

39
In its Urgent Manifestation and Motion with Leave of Court, PLDT called the Courts attention of this recent
ruling; id. at 872875.

Laurel v. Abrogar, G.R. No. 155076, January 13, 2009. 576 SCRA 41, 5051.
40

41
Id. at 51, citing Article 335 of the Civil Code of Spain.

42
Id. at 5557; underscores ours.

Silva v. Presiding Judge, RTC of Negros Oriental, Br. XXXIII, G.R. No. 81756, October 21, 1991, 203 SCRA
43

140, 144.

Abuan v. People, G.R. No. 168773, October 27, 2006, 505 SCRA 799, 822.
44

45
Rules of Court, Rule 126, Section 14.
Vallejo v. Court of Appeals, 471 Phil. 670 (2004).
46

Dra. Nepomuceno v. Court of Appeals, 363 Phil. 304, 307308 (1999).


47

48
Vallejo v. Court of Appeals, supra note 46, at 686; and Uy v. Bureau of Internal Revenue, supra note 34,
at 906.

Del Castillo v. People, G.R. No. 185128, January 30, 2012, 664 SCRA 430, 438439.
49

50
Solid Triangle Sales Corp. v. Sheriff, RTC, Q.C., Br. 93, 422 Phil. 72 (2001); and Manly Sportwear Mfg.,
Inc. v. Dadodette Enterprises, and/or Hermes Sports Center, 507 Phil. 375 (2005).

51
Under Section 3, Rule 126 of the Revised Rules of Criminal Procedure, the personal properties that may
be subject of seizure under a search warrant are the subject, the fruits and/or the means of committing the
offense.

52
329 Phil. 875(1996).

53
Id. at 905; italics supplied.

54
See Savage v. Judge Taypin, 387 Phil. 718, 728 (2000).

55
CIVIL CODE, Article 8.

Laurel v. Abrogar, supra note 40, at 57.


56

People v. Jabinal, 154 Phil. 565, 571 (1974), cited in Columbia Pictures, Inc. v. CA, supra note 52, at 906
57

908.

58
Civil Code of the Philippines, Commentaries and Jurisprudence, Volume I, Arturo M. Tolentino, p. 37.

Philippine Guardians Brotherhood, Inc. (PGBI) v. Commission on Elections, G.R. No. 190529, April 29,
59

2010, 619 SCRA 585, 594595.

Chinese Young Mens Christian Association of the Philippine Islands v. Remington Steel Corporation, G.R.
60

No. 159422, March 28, 2008, 550 SCRA 180, 197198.

61
RULES OF COURT, Rule 52, Section 1, in relation to Rule 56, Section 1.

62
G.R. No. 166562, March 31, 2009, 582 SCRA 694, 704; citation omitted, italics supplied, emphasis ours.

63
See PLDTs motion for reconsideration before the CA; rollo, p. 616.

64
Memorandum of Respondents; id. at 865.

Supra note 54.


65

Hon Ne Chan v. Honda Motor Co., Ltd., 565 Phil. 545, 557 (2007).
66

Vallejo v. Court of Appeals, supra note 46, at 686687.


67

Microsoft Corp. v. Maxicorp, Inc., 481 Phil 550, 568571 (2004).


68

Bache and Co. (Phil.), Inc. v. Ruiz, No. L32409, February 27, 1971, 37 SCRA 823, 835, cited in Al
69

Ghoulv. Court of Appeals, 416 Phil. 759, 771 (2001).

Tambasen v. People, 316 Phil. 237, 243244 (1995).


70

71
See Stonehill v. Diokno, No. L19550, June 19, 1967. 20 SCRA 383, 391392.

72
See Tambasen v. People, supra note 70.
73
Emphases and underscores ours.

Supra note 21
74
SECOND DIVISION

G.R. No. 202047, June 08, 2016

LIGHT RAIL TRANSIT AUTHORITY, Petitioner, v. NOEL B. PILI, MEDEL I. LIRIO, RODERICK B.
JAMON, VICTORINO A. MACHICA, RONNIE C. VALORIA, VIRGILIO M. FLORES, RENATO C. PALMA,
ANGELITO V. GUINTO, RAMIRO M. FELICIANO, ENRIQUE L. CIUBAL, ELMER P. TABIGAN,
VENANCIO T. MADRIA, MAXIMO M. VITANGCOL, RODOLFO L. PAGUIO, ARNEL F. MAGSALIN,
JULIANA N. DOLOR, NOEL C. CRUZ, SANDY C. JARILLA, BERTITO I. SERVIDAD, ALAN R. CORPUZ,
ROBERT D. PABLO, ROBERT H. MONTEREY, HENRY L. LIAO, ROLANDO C. CEBANICO, VELIENTE S.
FANTASTICO, MA. EMILIAN S. CRUZ, EDGARDO G. GAMBAYAN, GERARDO M. RUMBAWA, DANTE D.
PALOMARA, MA. TERESA B. DE LOS REYES, JOSE ALLAN S. PACIFICO, RESTITUTO R. MALAPO,
EARL G. PONGCO, LUCILO C. DEL MONTE, RUEL F. MAGBALANA, MARLYN V. VILLANUEVA, JUDITH
C. BANEZ, GERMAN N. DE LUNA, FREDERICK B. DEL CORRO, CLODUALDO B. PASIOLAN, ROLANDO
I. NAVARRO, AND PACIANO J. VILLANUEVA,* Respondents.

DECISION

CARPIO, ACTING C.J.:

The Case

This is a petition for review on certiorari under Rule 45 of the Rules of Court. Petitioner Light Rail Transit
Authority (LRTA) challenges the 1 June 2011 Decision1 and 23 May 2012 Resolution2 of the Court of Appeals
(CA) in CA-G.R. SP No. 107593 which set aside the 24 June 2008 Resolution3 of the National Labor Relations
Commission (NLRC) and reinstated the 27 October 2005 Decision4 of the Labor Arbiter.

The Facts

LRTA is a government-owned and controlled corporation created under Executive Order (EO) No. 6035 for
the "construction, operation, maintenance, and/or lease of light rail transit systems in the Philippines."6 It
entered into a ten-year operations and management agreement (Agreement) with Meralco Transit
Organization, Inc. (MTOI) from 8 June 1984 to 8 June 1994. MTOI, a corporation organized under the
Corporation Code, hired its own employees and thereafter entered into collective bargaining agreements
(CBAs) with the unions of its employees. However, on 7 April 1989, the Commission on Audit declared the
Agreement between LRTA and MTOI void. As a result, on 9 June 1989, LRTA purchased all the shares of
stock of MTOI and renamed MTOI to Metro Transit Organization, Inc. (Metro) and formally declared Metro as
its wholly-owned subsidiary.

The Agreement between LRTA and Metro expired on 8 June 1994, and was thereafter extended on a month-
to-month basis. On 25 July 2000, the union of rank-and-file employees of Metro staged a strike over a
bargaining deadlock which resulted in the paralysis in the operations of Metro. On 31 July 2000, the
Agreement expired when LRTA decided no longer to renew. On 30 September 2000, Metro ceased its
operations.

Respondents7 were employees of Metro who have been terminated upon the expiration of the Agreement.
While the rest of the respondents filed cases involving purely monetary claims in the form of separation
pays, balances of separation pays, and other unpaid claims, respondent Noel B. Pili (Pili), in addition to his
monetary claims, alleged that he was illegally dismissed.

Pili was employed by Metro on 29 November 1984, and was holding the position of Liaison Assistant when
he was dismissed on 30 September 2000, when Metro stopped its operations. He received the first fifty
percent (50%) of his separation pay in accordance with the CBA with Metro. On 29 May 2003, he received
the amount of P63,l 17.65 as financial assistance for which he was compelled to execute a Release, Waiver
and Quitclaim. Based on the foregoing, Pili argues that his dismissal was illegal and violative of his security
of tenure. He alleges that the mere fact of the expiration of the Agreement was not sufficient to justify his
dismissal. He also claims that the Release, Waiver and Quitclaim he executed does not bar him from
demanding the benefits to which he is legally entitled to or from contesting the legality of his dismissal.

On the other hand, the rest of the respondents filed cases for purely monetary claims. They assert that
under Article 4.05 of the Agreement, LRTA contractually bound itself to shoulder and provide all "Operating
Expenses" of Metro. Operating Expenses is defined in the Agreement as:
chanRoble svirtual Lawlib ra ry

x x x all salaries, wages and fringe benefits (both direct and indirect) up to the rank of Manager, and a lump
sum amount to be determined annually as top Management compensation (above the rank of Manager up to
the President).8 ChanRoble sVi rt ualawlib ra ry

The respondents, except Pili, further allege that LRTA sanctioned and approved all the CBAs Metro entered
with its employees; that LRTA and Metro jointly declared the continued implementation of the Agreement;
and that there would be no interruption in the employment of the employees of the former MTOI (now
Metro). On 17 November 1997, LRTA approved the severance pay of the employees of Metro amounting to
one and a half months salary per year of service. They claim that this shows that the LRTA bound itself
solidarity liable with Metro.

On 28 July 2000, the Board of Directors of LRTA issued Resolution No. 00-44 where LRTA officially assumed
the obligation to ensure that the Metro Inc. Employees Retirement Fund is updated and that it fully covers
all retirement benefits payable to the employees of Metro. Based on the foregoing, the respondents - except
Pili - argue that the LRTA is liable for their monetary claims.

LRTA, on the other hand, argues that NLRC cannot exercise jurisdiction over it as it is a government-owned
and controlled corporation, and that only the Civil Service Commission (CSC) can take cognizance of the
matter. Further, LRTA maintains that it has a separate legal personality from Metro, and thus there can be
no illegal dismissal and no basis for the monetary claims of the employees of Metro.

The Ruling of the Labor Arbiter

On 27 October 2005, Labor Arbiter Catalino R. Laderas rendered his Decision in favor of Pili and the rest of
the respondents. The Labor Arbiter found that Pili was illegally dismissed and that LRTA was solidarity liable
with Metro for the monetary claims. The dispositive portion of the Decision states:
chanRoble svirtual Lawlib ra ry

WHEREFORE, premises considered, judgment is hereby rendered as follows:

1. Ordering the respondents Metro Transit Organization and LRTA to pay complainant Noel Pili jointly and
severally the amount of P379,710 representing backwages for eight (8) months and balance of his
separation pay plus ten [sic] (10%) of the monetary award as attorney's fee.

a. unpaid wages/salaries for August and September 2000 of:


chanRoble svirtual Lawlib ra ry

P31,848.00 to Arnel F. Magsalin

P31,548.00 to Angelito V. Guinto

P30,928.00 to Enrique L. Ciubal

P31,538.00 to Ronnie C. Valoria

P31,046.00 to Maximo M. Vitangcol

P31,046.00 to Ramiro M. Feliciano

P31,538.00 to Virgilio M. Flores

P31,046.00 to Vena[n]cio T. Madria

P30,906.00 to Ruel F. Magbalana

P30,728.00 to Renato C. Palima

P28,004.00 to Victorino A. Machica


P27,804.00 to Rodolfo L. Paguio

P21,136.00 to Roderick B. Jamon

P18,170.00 to Elmer P. Tabigan


b. unpaid 13th month and earned leave benefits of:
chanRoble svirtual Lawlib ra ry

P42,097.68 to Angelito V. Guinto

P25,749.91 to Enrique L. Ciubal

P36,138.16 to Ronnie C. Valoria

P36,178.90 to Ramiro M. Feliciano

P39,400.82 to Virgilio M. Flores

P28,015.96 to Vena[n]cio T. Madria

P45,626.15 to Renato C. Palima

P31,948.09 to Victorino A. Machica

P15,381.08 to Roderick B. Jamon


c. unpaid hazard pays for August and September 2000 of:
chanRoble svirtual Lawlib ra ry

P1,400.00 to Arnel F. Magsalin

P1,400.00 to Angelito V. Guinto

P1,400.00 to Enrique L. Ciubal

P1,400.00 to Ronnie C. Valoria

P1,400.00 to Maximo M. Vitangcol

P1,400.00 to Ramiro M. Feliciano

P1,400.00 to Virgilio M. Flores

P1,400.00 to Vena[n]cio T. Madria

P1,400.00 to Ruel F. Magbalana

P1,400.00 to Renato C. Palima

P1,400.00 to Victorino A. Machica


P1,400.00 to Rodolfo L. Paguio

P1,400.00 to Roderick B. Jamon

P1,400.00 to Elmer P. Tabigan


d. amounts of unsupplied rice subsidiaries for August and September 2000 of:
chanRoble svirtual Lawlib ra ry

P2,000.00 to Arnel F. Magsalin

P2,000.00 to Angelito V. Guinto

P2,000.00 to Enrique L. Ciubal

P2,000.00 to Ronnie C. Valoria

P2,000.00 to Maximo M. Vitangcol

P2,000.00 to Ramiro M. Feliciano

P2,000.00 to Virgilio M. Flores

P2,000.00 to Vena[n]cio T. Madria

P2,000.00 to Ruel F. Magbalana

P2,000.00 to Renato C. Palima

P2,000.00 to Victorino A. Machica

P2,000.00 to Rodolfo L. Paguio

P2,000.00 to Roderick B. Jamon

P2,000.00 to Elmer P. Tabigan


e. reimbursement for over deductions for settled accountabilities and/or 10% retention from the first fifty
percent (50%) separation pay of:
chanRoble svirtual Lawlib ra ry

P45,557.33 to Ma. Theresa B. Delos Reyes

P 8,471.82 to Roberto H. Monterey

P 8,994.75 to Edgardo G. Gambayan


f. Fifty percent (50%) balance of separation pay of:
chanRoble svirtual Lawlib ra ry

P455,473.32 to Ma. Theresa B. Delos Reyes

P294,703.50 to Juliana N. Dolor


P198,428.25 to Roberto H. Monterey

P201,429.92 to Rolando C. Cebanico

P193.301.85 to Edgardo G. Gambayan

P281,203.02 to Rolando I. Navarro

P189,300.00 to Jose Allan S. Pacifico

P212,148.00 to Lucilo C. Del Monte

P184,884.00 to Earl G. Ponco

P188,640.00 to Allan R. Corpuz

P188,520.00 to Ma. Emilian S. Cruz

P236.748.00 to German N. De Luna

P186,396.00 to Robert D. Pablo

P236,808.00 to Frederick B. Del Corro

P186,648.00 to Medel I. Lirio

P242,628.00 to Paciano J. Villavieja, Jr.

P224,376.00 to Noel C. Cruz

P179.061.58 to V[e]liente S. Fantastico

P185/786.68 to Sandy C. Jarilla

P204,556.18 to Dante D. Palomara

P177,686.46 to Henry L. Liao

P107,383.32 to Bertito I. Servidad

P105,592.08 to Gerardo M. Rumbawa

P 91,719.00 to Clodualdo B. Pasiolan

P 74,550.00 to Judith C. Banez

P 53,866.71 to Marlyn V. Villanueva

P 51,035.63 to Restituto R. Malapo


with legal interests thereon from June 1, 2001 until actually and fully paid; and

g. severance pays of:


chanRoble svirtual Lawlib ra ry

P406,062.00 to Arnel F. Magsalin

P378,576.00 to Angelito V. Guinto

P371.136.00 to Enrique L. Ciubal

P378,456.00 to Ronnie C. Valoria

P372,552.00 to Maximo M. Vitangcol

P359,978.37 to Ramiro M. Feliciano

P365,683.11 to Virgilio M. Flores

P358.581.30 to Vena[n]cio T. Madria

P356,964.30 to Ruel F. Magbalana

P345,690.00 to Renato C. Palima

P213,600.51 to Victorino A. Machica

P194,558.49 to Rodolfo L. Paguio

P 79,260.00 to Roderick B. Jamon

P 60,760.73 to Elmer P. Tabigan


with legal interest thereon from October 1, 2000 until actually and fully paid.

Respondents are further ordered to pay solidarity to complainants an amount equivalent to ten percent
(10%) of the total awards, as and by way of attorney's fees.

Other claims dismissed.

SO ORDERED.9 ChanRoblesVi rtualaw lib rary

On 5 December 2005, LRTA appealed to the NLRC. LRTA averred that the Labor Arbiter acted with grave
abuse of discretion in (1) taking cognizance of the case against LRTA despite the fact that it is a
government-owned and controlled corporation with an original charter; (2) holding LRTA guilty of illegal
dismissal despite the lack of employer-employee relationship between LRTA and Pili; and (3) awarding
separation pay and other benefits to the respondents despite the utter lack of factual and legal basis.10

The Ruling of the NLRC

On 24 June 2008, the NLRC found that there was no illegal dismissal as Pili's dismissal was valid on account
of the termination of the Agreement between Metro and LRTA.11 The NLRC issued a Resolution modifying in
part the Decision of the Labor Arbiter, to wit:
chanRoble svirtual Lawlib ra ry

WHEREFORE, premises considered the separate appeals are partly GRANTED and the Decision dated 27
October 2005 is MODIFIED deleting the finding of illegal dismissal and award of backwages to complainant-
appellee Pili, ordering respondents-appellants METRO and LRTA to pay complainant-appellee Pili the balance
of his separation pay in the amount of P165,398.35 plus ten percent (10%) of the award as attorney's fees
and affirming the monetary awards in the appealed Decision in its entirety including the 10% attorney's fees
to complainants-appellees Lirio, et al.

SO ORDERED.12 ChanRoblesVi rtua lawlib rary

The Motion for Partial Reconsideration13 filed by LRTA was denied by the NLRC. Thereafter, LRTA filed a
petition for certiorari under Rule 65 before the CA on 10 November 2008.14

The Ruling of the CA

In a Decision dated 1 June 2011, the CA set aside the Resolution of the NLRC and reinstated the 27 October
2005 Decision of the Labor Arbiter in toto.15 The CA found that Pili was illegally dismissed as the expiration
of the Agreement between LRTA and Metro was not a valid ground to terminate Pili's employment. The CA
held:
chanRoble svirtual Lawlib ra ry

Indeed, and as stated above, Article 283 allows an employer to terminate the services of his employees in
case of closure of business as a result of grave financial losses. But the employer must comply with the
clearance or report required under the Labor Code and its implementing rules before the employment of the
employees.

Nevertheless, employers who contemplate terminating the services of their workers cannot be so arbitrary
and ruthless as to find flimsy excuses for their decisions. Thus must be so, considering that the dismissal of
an employee from work involves not only the loss of his position but more important, his means of
livelihood.

xxxx

In the case at bar, private respondent Pili's employment was terminated on account of the expiration of the
management contract between petitioner LRTA and Metro. Such cause for termination of employment is not
within the contemplation of Article 283. Further, there is no indication that Metro was closing shop after the
termination of its management contract with petitioner LRTA. Much less, it was not proved that Metro was
closing its business due to financial losses or business reverses. Thus, the termination of Pili's employment
by Metro cannot be justified and, therefore, illegal.16 Cha nRobles Vi rtua lawlib rary

In a Resolution dated 23 May 2012, the CA denied the Motion for Reconsideration17 filed by LRTA. Hence,
this petition.

The Issues

In this petition, the LRTA seeks a reversal of the decision of the CA, and raises the following arguments:
chanRoble svirtual Lawlib ra ry

A. THE HONORABLE COURT OF APPEALS DECIDED A QUESTION OF LAW NOT IN ACCORD WITH THE
APPLICABLE DECISION OF THIS HONORABLE COURT ON THE LACK OF JURISDICTION OF THE LABOR
ARBITER AND THE NATIONAL LABOR RELATIONS COMMISSION OVER PETITIONER AND THE LABOR
COMPLAINTS AGAINST PETITIONER; and

B. ASSUMING ARGUENDO THAT THE LABOR ARBITER AND THE NLRC HAVE SUCH JURISDICTION, THE
HONORABLE COURT OF APPEALS DECIDED A QUESTION OF SUBSTANCE NOT IN ACCORD WITH THE
APPLICABLE LAW AND DECISIONS OF THIS HONORABLE COURT ON ARTICLE[S] 106 AND 107 OF THE
LABOR CODE GOVERNING THE EXTENT OF LIABILITIES OF INDIRECT EMPLOYERS.18 ChanRobles Vi rtua lawlib rary

The Ruling of the Court

The petition has no merit.

Jurisdiction of the NLRC over LRTA - Monetary Claims

We find error with the NLRC taking cognizance of the cases against Metro and LRTA as far as the monetary
claims are concerned. This is despite the fact that LRTA is a government-owned and controlled corporation
with an original charter.

All of the respondents allege that they were employed by Metro. Thus, there is no real issue as far as the
employer-employee relationship is concerned - the respondents themselves do not claim to be employed by
LRTA. While Pili claims that LRTA should also be considered his true employer based on the doctrine of
piercing the corporate veil, this argument, as discussed below is baseless and erroneous. The employees
were employed solely by Metro as Metro and LRTA each maintained their separate juridical personalities. We
have already consistently recognized, in clear and categorical terms, that LRTA, even after it purchased all
the shares of stock of Metro, maintained and continued to have its separate and juridical
personality.19 Nonetheless, the argument of LRTA that only the CSC may exercise jurisdiction over it - even
for monetary claims, must necessarily fail.

The NLRC acquired jurisdiction over LRTA not because of the employer-employee relationship of the
respondents and LRTA (because there is none) but rather because LRTA expressly assumed the monetary
obligations of Metro to its employees. In the Agreement, LRTA was obligated to reimburse Metro for the
latter's Operating Expenses which included the salaries, wages and fringe benefits of certain employees of
Metro. Moreover, the Board of Directors of LRTA issued Resolution No. 00-44 where again, LRTA assumed
the monetary obligations of Metro more particularly to update the Metro Inc. Employees Retirement Fund
and to ensure that it fully covers all the retirement benefits payable to the employees of Metro.

It is clear from the foregoing, and it is also not denied by LRTA, that it has assumed the monetary
obligations of Metro to its employees. As such, the NLRC may exercise jurisdiction over LRTA on the issue of
the monetary obligations. To repeat, NLRC can exercise jurisdiction over LRTA not because of the existence
of any employer-employee relationship between LRTA and the respondents, but rather because LRTA clearly
assumed voluntarily the monetary obligations of Metro to its employees. We therefore find no error on the
part of NLRC when it exercised jurisdiction over LRTA which solidarity obligated itself to pay the monetary
obligations of Metro.

Jurisdiction of the NLRC over LRTA - Illegal Dismissal

However, as far as the claim of illegal dismissal is concerned, we find that NLRC cannot exercise jurisdiction
over LRTA. The NLRC and Labor Arbiter erred when it took cognizance of such matter.

In Hugo v. LRTA,20 we have already addressed the issue of jurisdiction in relation to illegal dismissal
complaints. In the said case, the employees of Metro filed an illegal dismissal and unfair labor practice
complaint against Metro and LRTA. We held that the Labor Arbiter and NLRC did not have jurisdiction over
LRTA, to wit:
chanRoble svirtual Lawlib ra ry

The Labor Arbiter and the NLRC do not have jurisdiction over LRTA. Petitioners themselves admitted in
their complaint that LRTA "is a government agency organized and existing pursuant to an original charter
(Executive Order No. 603)" and that they are employees of METRO.21 (Emphasis and underscoring in the
original)
Pili admits that he was employed by Metro. However, in the same breath, he argues that the doctrine of
piercing the corporate veil should be applied and LRTA should also be considered his employer. We find this
argument untenable. Pili cannot claim to be employed by LRTA merely on the bare allegation that the
corporate veil must be pierced based on LRTA's ownership of the shares of stock of Metro. This Court has
already rejected such proposition - there is no sufficient evidence to support the application of the doctrine
of piercing the corporate veil and LRTA, even after it purchased all the shares of stock of Metro, maintained
and continued to have its separate juridical personality.22

Worse, if LRTA was his true employer, as he claims, it is CSC which would have jurisdiction to hear his
complaint against LRTA. LRTA is a government-owned and controlled corporation - any allegation of illegal
dismissal against it by its employees should have been brought to the CSC. However, the fact remains that
Pili was an employee of Metro alone - the Labor Arbiter and NLRC could not have acquired jurisdiction over
LRTA insofar as the illegal dismissal complaint is concerned.

Monetary Claims of the Former Employees of Metro

The respondents, except Pili, all have purely monetary claims against LRTA. They all anchor their claims on
the Agreement, more particularly the definition of Operating Expenses in relation to Article 4.05.1 thereof,
which states that LRTA shall reimburse Metro for the latter's Operating Expenses. Moreover, LRTA's
Resolution No. 00-44 provides that LRTA assumes the obligation to ensure full payment of the
retirement/separation pay of the employees of Metro. LRTA had already paid the first fifty percent (50%) of
the separation pay to some of the employees of Metro. Therefore, the respondents, except Pili, are merely
claiming their unpaid balance, or the unpaid separation pay, unpaid wages and other benefits which have
accrued during their employment with Metro.

This Court has already resolved this very issue on the monetary claims of the employees of Metro as
against LRTA. In LRTA v. Mendoza,23 we found that LRTA is liable for the monetary claims of the employees
of Metro. The respondents in the said case were employees of Metro who, similar to the respondents in this
case, have been separated due to the expiration of the Agreement between LRTA and Metro. We held:
chanRoble svirtual Lawlib ra ry
First. LRTA obligated itself to fund METRO'S retirement fund to answer for the retirement or
severance/resignation of METRO employees as part of METRO'S "operating expenses." Under Article 4.05.1
of the O & M agreement between LRTA and Metro, "The Authority shall reimburse METRO for x x x
OPERATING EXPENSES x x x." In the letter to LRTA dated July 12, 2001, the Acting Chairman of the METRO
Board of Directors at the time, Wilfredo Trinidad, reminded LRTA that funding provisions for the retirement
fund have always been considered operating expenses of Metro. The coverage of operating expenses to
include provisions for the retirement fund has never been denied by LRTA.

xxxx

The clear language of Resolution No. 00-44, to our mind, established the LRTA's obligation for the 50%
unpaid balance of the respondents' separation pay. Without doubt, it bound itself to provide the necessary
funding to METRO'S Employee Retirement Fund to fully compensate the employees who had been
involuntary retired by the cessation of operations of METRO. This is not at all surprising considering that
METRO was a wholly owned subsidiary of the LRTA.

Second. Even on the assumption that the LRTA did not obligate itself to fully cover the separation benefits of
the respondents and others similarly situated, it still cannot avoid liability for the respondents' claim. It is
solidarity [sic] liable as an indirect employer under the law for the respondents' separation pay. This liability
arises from the O & M agreement it had with METRO, which created a principal-job contractor relationship
between them, an arrangement it admitted when it argued before the CA that METRO was an independent
job contractor who, it insinuated, should be solely responsible for the respondents' claim.24 ChanRobles Vi rtua lawlib rary

Thus, based on (1) the Agreement where LRTA bound itself to be liable for the Operating Expenses of Metro;
(2) Resolution No. 00-44 which contained LRTA's declaration to bind itself for the payment of the separation
pay of Metro's employees; and (3) the solidary liability of an indirect employer under Articles 10725 and
10926 of the Labor Code and Department Order No. 18-02, s. 2002 (which implements Articles 106-109 of
the Labor Code),27 we found LRTA liable for the monetary claims of the respondents therein.

Accordingly, we find that the application of the doctrine of stare decisis is in order. The doctrine of stare
decisis et non quieta movere means "to adhere to precedents, and not to unsettle things which are
established."28 Under this doctrine, when this Court has once laid down a principle of law as applicable to a
certain state of facts, it will adhere to that principle, and apply it to all future cases, where facts are
substantially the same; regardless of whether the parties and property are the same.29

The basic facts in this petition are the same as those in the case of LRTA v. Mendoza.30 Thus, we find that
LRTA is solidarity liable for the monetary claims of respondents, in light of this Court's findings in said case.
It is the duty of the Court to apply the previous ruling in LRTA v. Mendoza31 in accordance with the doctrine
of stare decisis. Once a case has been decided one way, any other case involving exactly the same point at
issue, as in the present case, should be decided in the same manner.32

We find no reversible error in the CA ruling, insofar as the monetary claims are concerned. chan roble slaw

WHEREFORE, we DENY the petition.

SO ORDERED. cralawlawlibra ry

Del Castillo, Mendoza, and Leonen, JJ., concur.


Brion, J., on official leave. chanrob lesvi rtua llawlib rary

Endnotes:

*
Also referred to in the records as Paciano J. Villavieja, Jr.

1
Rollo, pp. 190-204. Penned by Associate Justice Danton Q. Bueser, with Associate Justices Hakim S.
Abdulwahid and Ricardo R. Rosario concurring.

2
Id. at 219-222.

3
Id. at 111-126.

4
Id. at 71-90.
5
Entitled "Creating a Light Rail Transit Authority, Vesting the Same with Authority to Construct and Operate
the Light Rail Transit (LRT) Project and Providing Funds Therefor." Issued on 12 July 1980.

6
Section 2, Article 1, EO No. 603.

7
Noel B. Pili, Medel I. Lirio, Roderick B. Jamon, Victorino A. Machica, Ronnie C. Valoria, Virgilio M. Flores,
Renato C. Palma, Angelito V. Guinto, Ramiro M. Feliciano, Enrique L. Ciubal, Elmer P. Tabigan, Venancio T.
Madria, Maximo M. Vitangcol, Rodolfo L. Paguio, Arnel F. Magsalin, Juliana N. Dolor, Noel C. Cruz, Sandy C.
Jarilla, Bertito I. Servidad, Alan R. Corpuz, Robert D. Pablo, Robert H. Monterey, Henry L. Liao, Rolando C.
Cebanico, Veliente S. Fantastico, Ma. Emilian S. Cruz, Edgardo G. Gambayan, Gerardo M. Rumbawa, Dante
D. Palomara, Ma. Teresa B. De los Reyes, Jose Allan S. Pacifico, Restituto R. Malapo, Earl G. Pongco, Lucilo
C. Del Monte, Ruel F. Magbalana, Marlyn V. Villanueva, Judith C. Banez, German N. De luna, Frederick B.
Del Corro, Clodualdo B. Pasiolan, Rolando I. Navarro, and Paciano J. Villanueva.

8
Article 1.05, Agreement.

Rollo, pp. 87-90.


9

10
Id. at 91-108.

11
Id. at 111-126.

12
Id. at 125.

13
Id. at 127-142.

14
Id. at 148-178.

15
Id. at 203-204.

16
Id. at 202-203.

17
Id. at 205-216.

18
Id. at 23.

19
See Light Rail Transit Authority v. Venus, Jr., 520 Phil. 233 (2006) and Hugo v. Light Rail Transit
Authority, 630 Phil. 145 (2010).

20
630 Phil. 145(2010).

21
Id. at 151.

22
See Light Rail Transit Authority v. Venus, Jr., 520 Phil. 233 (2006) and Hugo v. Light Rail Transit
Authority, supra note 19.

23
G.R. No. 202322, 19 August 2015.

24
Id. cralawred

25
Art. 107. Indirect employer. The provisions of the immediately preceding article shall likewise apply to any
person, partnership, association or corporation which, not being an employer, contracts with an independent
contractor for the performance of any work, task, job or project.

26
Art. 109. Solidary liability. The provisions of existing laws to the contrary notwithstanding, every employer
or indirect employer shall be held responsible with his contractor or subcontractor for any violation of any
provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they
shall be considered as direct employers. c ralawred

27
Section 19. x x x. In addition, the principal shall also be solidarily liable in case the contract between the
principal and contractor or subcontractor is preterminated for reasons not attributable to the fault of the
contractor or subcontractor.

Ty v. Banco Filipino Savings and Mortgage Bank, 689 Phil. 603 (2012).
28

29
Id.

30
Supra note 23.

31
Supra note 23.

Ty v. Banco Filipino Savings and Mortgage Bank, supra note 28.


32
EN BANC

G.R. No. 210565, June 28, 2016

EMMANUEL D. QUINTANAR, BENJAMIN O. DURANO, CECILIO C. DELAVIN, RICARDO G GABORNI,


ROMEL G GERARMAN, JOEL JOHN P. AGUILAR, RAMIRO T. GAVIOLA, RESTITUTO D. AGSALUD,
MARTIN E. CELIS, PATRICIO L. ARIOS, MICHAEL S. BELLO, LORENZO C. QUINLOG, JUNNE G.
BLAYA, SANTIAGO B. TOLENTINO, JR., NESTOR A. MAGNAYE, ARNOLD S. POLVORIDO, ALLAN A.
AGAPITO, ARIEL E. BAUMBAD, JOSE T. LUTIVA, EDGARDO G. TAPALLA, ROLDAN C. CADAYONA,
REYNALDO V. ALBURO, RUDY C. ULTRA, MARCELO R. CABILI, ARNOLD B. ASIATEN, REYMUNDO R.
MACABALLUG, JOEL R. DELEA, DANILO T. OQUIO, GREG B. CAPARAS AND ROMEO T.
ESCARTIN, Petitioners, v. COCA-COLA BOTTLERS, PHILIPPINES, INC., Respondent.

DECISION

MENDOZA, J.:

At bench is a Petition for Review on Certiorari under Rule 45 of the Rules of Court assailing the July 11, 2013
Decision1 and the December 5, 2013 Resolution2 of the Court of Appeals (CA) in CA-G.R. SP No. 115469,
which reversed and set aside the March 25, 2010 Decision3 and the May 28, 2010 Resolution4 of the National
Labor Relations Commission (NLRC), affirming the August 29, 2008 Decision of the Labor Arbiter (LA), in a
case for illegal dismissal, damages and attorney's fees filed by the petitioners against respondent Coca-Cola
Bottlers Philippines, Inc. (Coca-Cola).

The gist of the subject controversy, as narrated by the LA and adopted by the NLRC and the CA, is as
follows:
ChanRob les Virtualawl ibra ry

Complainants allege that they are former employees directly hired by respondent Coca-Cola on different
dates from 1984 up to 2000, assigned as regular Route Helpers under the direct supervision of the Route
Sales Supervisors. Their duties consist of distributing bottled Coca-Cola products to the stores and
customers in their assigned areas/routes, and they were paid salaries and commissions at the average of
P3,000.00 per month. After working for quite sometime as directly-hired employees of Coca-Cola,
complainants were allegedly transferred successively as agency workers to the following manpower
agencies, namely, Lipercon Services, Inc., People's Services, Inc., ROMAC, and the latest being respondent
Interserve Management and Manpower Resources, Inc.

Further, complainants allege that the Department of Labor and Employment (DOLE) conducted an inspection
of Coca-Cola to determine whether it is complying with the various mandated labor standards, and relative
thereto, they were declared to be regular employees of Coca-Cola, which was held liable to pay
complainants the underpayment of their 13th month pay, emergency cost of living allowance (ECOLA), and
other claims. As soon as respondents learned of the filing of the claims with DOLE, they were dismissed on
various dates in January 2004. Their claims were later settled by the respondent company, but the
settlement allegedly did not include the issues on reinstatement and payment of CBA benefits. Thus, on
November 10, 2006, they filed their complaint for illegal dismissal.

In support of their argument that they were regular employees of Coca-Cola, the complainants relied on the
pronouncement of the Supreme Court in the case of CCBPI vs. NOWM, G.R. No. 176024, June 18, 2007, as
follows:
ChanRob les Virtualawl ibra ry

"In the case at bar, individual complainants were directly hired by respondent Coca-Cola as Route Helpers.
They assist in the loading and unloading of softdrinks. As such they were paid by respondent Coca-Cola their
respective salaries plus commission. It is of common knowledge in the sales of softdrinks that salesmen are
not alone in making a truckload of softdrinks for delivery to customers. Salesmen are usually provided with
route helpers or utility men who does the loading and unloading. The engagement of the individual
complainants to such activity is usually necessary in the usual business of respondent Coca-Cola.

Contrary to the Labor Arbiter's conclusion that respondent Coca-Cola is engaged solely in the manufacturing
is erroneous as it is also engaged in the sales of the softdrinks it manufactured.

Moreover, having been engaged to perform, such activity for more than a year all the more bolsters
individual complainants' status as regular employees notwithstanding the contract, oral or written, or even if
their employment was subsequently relegated to a labor contractor."
Respondent Coca-Cola denies employer-employee relationship with the complainants pointing to respondent
Interserve with whom it has a service agreement as the complainants' employer. As alleged independent
service contractor of respondent Coca-Cola, respondent Interserve "is engaged in the business of rendering
substitute or reliever delivery services to its own clients and for CCBPI in particular, the delivery of CCBPI's
softdrinks and beverage products." It is allegedly free from the control and direction of CCBPI in all matters
connected with the performance of the work, except as to the results thereof, pursuant to the service
agreement. Moreover, respondent Interserve is allegedly highly capitalized with a total of P21,658,220.26
and with total assets of P27,509,716.32.

Further, respondent Coca-Cola argued that all elements of employer-employee relationship exist between
respondent Interserve and the complainants. It was allegedly Interserve which solely selected and engaged
the services of the complainants, which paid the latter their salaries, which was responsible with respect to
the imposition of appropriate disciplinary sanctions against its erring employees, including the complainants,
without any participation from Coca-Cola, which personally monitors the route helpers' performance of their
delivery services pointing to Noel Sambilay as the Interserve Coordinator. Expounding on the power of
control, respondent Coca-Cola vigorously argued that: ChanRobles Vi rtualawl ib rary

"12. According to Mr. Sambilay, he designates who among the route helpers, such as complainants herein,
will be assigned for each of the delivery trucks. Based on the route helpers' performance and rapport with
the truck driver and the other route helpers, he groups together a team of three (3) to five (5) route helpers
to undertake the loading and unloading of the softdrink products to the delivery trucks and to their
designated delivery point. It is his exclusive discretion to determine who among the route helpers will be
grouped together to comprise an effective team to render the most efficient delivery service of CCBPI's
products.

"13. Similarly, it is Interserve, through Mr. Sambilay, who takes charge of monitoring the attendance of the
route helpers employed by Interserve. At the start of the working day, Mr. Sambilay would position himself
at the gate of the CCBPI premises to check the attendance of the route helpers. He also maintains a logbook
to record the time route helpers appear for work. In case a route helper is unable to report for duty, Mr.
Sambilay reassigns another route helper to take his place."
On its part, respondent Interserve merely filed its position paper, pertaining only to complainants Quintanar
and Cabili totally ignoring all the other twenty-eight (28) complainants. It maintains that it is a legitimate
job contractor duly registered as such and it undertakes to perform utility, janitorial, packaging, and assist
in transporting services by hiring drivers. Complainants Quintanar and Cabili were allegedly hired as clerks
who were assigned to CCBPI Mendiola Office, under the supervision of Interserve supervisors. Respondent
Coca-Cola does not allegedly interfere with the manner and the methods of the complainants' performance
at work as long as the desired results are achieved. While admitting employer-employee relationship with
the complainants, nonetheless, respondent Interserve avers that complainants are not its regular employees
as they were allegedly mere contractual workers whose employment depends on the service contracts with
the clients and the moment the latter sever said contracts, respondent has allegedly no choice but to either
deploy the complainants to other principals, and if the latter are unavailable, respondent cannot allegedly be
compelled to retain them.5 ch anro blesvi rt ua llawlib rary

The Decision of the LA

On August 29, 2008, the LA rendered its decision granting the prayer in the complaint. In its assessment,
the LA explained that the documentary evidence submitted by both parties confirmed the petitioners'
allegation that they had been working for Coca-Cola for quite some time. It also noted that Coca-Cola never
disputed the petitioners' contention that after working for Coca-Cola through the years, they were
transferred to the various service contractors engaged by it, namely, Interim Services, Inc. (ISI), Lipercon
Services, Inc. (Lipercon), People Services, Inc. (PSI), ROMAC, and lastly, Interserve Management and
Manpower Resources, Inc. (Interserve). In view of said facts, the LA concluded that the petitioners were
simply employees of Coca-Cola who were "seconded" to Interserve.6 chanroble slaw

The LA opined that it was highly inconceivable for the petitioners, who were already enjoying a stable job at
a multi-national company, to leave and become mere agency workers. He dismissed the contention of Coca-
Cola that the petitioners were employees of Interserve, stressing that they enjoyed the constitutional right
to security of tenure which Coca-Cola could not compromise by entering into a service agreement manpower
supply contractors, make petitioners sign employment contracts with them, and convert their employment
status from regular to contractual.7 chanrobles law
Ultimately, the LA ordered Coca-Cola to reinstate the petitioners to their former positions and to pay their
full backwages.8 The dispositive portion of the decision reads: ChanRobles Vi rtualawl ib rary

WHEREFORE, all the foregoing premises being considered, judgment is hereby rendered ordering respondent
Coca-Cola Bottlers Phils., Inc. to reinstate complainants to their former or substantially equivalent positions,
and to pay their full backwages which as of August 29, 2008 already amounts to P15,319,005.00, without
prejudice to recomputation upon subsequent determination of the applicable salary rates and benefits due a
regular route helper or substantially equivalent position on the plantilla of respondent CCBPI.

SO ORDERED.9 chanroblesv irt uallawl ibra ry

The Decision of the NLRC

Similar to the conclusion reached by the LA, the NLRC found that the petitioners were regular employees of
Coca-Cola. In its decision, dated March 25, 2010, it found that the relationship between the parties in the
controversy bore a striking similarity with the facts in the cases of Coca-Cola Bottlers Philippines, Inc. v.
National Organization of Workingmen10(N.O.W.) and Magsalin v. National Organization of Workingmen
(Magsalin).11 The NLRC, thus, echoed the rulings of the Court in the said cases which found the employees
involved, like the petitioners in this case, as regular employees of Coca-Cola. It stated that the entities ISI,
Lipercon, PSI, ROMAC, and Interserve simply "played to feign that status of an employer so that its alleged
principal would be free from any liabilities and responsibilities to its employees."12 As far as it is concerned,
Coca-Cola failed to provide evidence that would place the subject controversy on a different plane
from N.O.W and Magsalin as to warrant a deviation from the rulings made therein.

As for the quitclaims executed by the petitioners, the NLRC held that the same could not be used by Coca-
Cola to shield it from liability. The NLRC noted the Minutes of the National Conciliation and Mediation Board
(NCMB) which stated that the petitioners agreed to settle their claims with Coca-Cola only with respect to
their claims for violation of labor standards law, and that their claims for illegal dismissal would be submitted
to the NLRC for arbitration.13 chan robles law

Coca-Cola sought reconsideration of the NLRC decision but its motion was denied.14 chan robles law

The Decision of the CA

Reversing the findings of the LA and the NLRC, the CA opined that the petitioners were not employees of
Coca-Cola but of Interserve. In its decision, the appellate court agreed with the contention of Coca-Cola that
it was Interserve who exercised the power of selection and engagement over the petitioners considering that
the latter applied for their jobs and went through the pre-employment processes of Interserve. It noted that
the petitioners' contracts of employment and personal data sheets, which were filed with Interserve,
categorically stipulated that Interserve had the sole power to assign them temporarily as relievers for absent
employees of their clients. The CA also noted that the petitioners had been working for other agencies
before they were hired by Interserve.15 cha nro bleslaw

The CA also gave credence to the position of Coca-Cola that it was Interserve who paid the petitioners'
salaries. This, coupled with the CA's finding that Coca-Cola paid Interserve for the services rendered by the
petitioners whenever they substituted for the regular employees of Coca-Cola, led the CA to conclude that it
was Interserve who exercised the power of paying the petitioners' wages.

The CA then took into consideration Interserve's admission that they had to sever the petitioners' from their
contractual employment because its contract with Coca-Cola expired and there was no demand for relievers
from its other clients. The CA equated this with Interserve's exercise of its power to fire the petitioners.16 cha nrob leslaw

Finally, the CA was of the considered view that it was Interserve which exercised the power of control. Citing
the Affidavit17 of Noel F. Sambilay (Sambilay), Coordinator of Interserve, the CA noted that Interserve
exercised the power of control, monitoring the petitioners' attendance, providing them with their
assignments to the delivery trucks of Coca-Cola, and making sure that they were able to make their
deliveries.18
chan robles law

The CA then went on to conclude that Interserve was a legitimate independent contractor. It noted that the
said agency was registered with the Department of Labor and Employment (DOLE) as an independent
contractor which had provided delivery services for other beverage products of its clients, and had shown
that it had substantial capitalization and owned properties and equipment that were used in the conduct of
its business operations. The CA was, thus, convinced that Interserve ran its own business, separate and
distinct from Coca-Cola.19 chanrobleslaw
The petitioners sought reconsideration, but they were rebuffed.20 chan robles law

Hence, this petition, raising the following


GROUNDS FOR THE PETITION/ASSIGNMENT OF ERRORS

THE COURT OF APPEALS IS GUILTY OF GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR


IN EXCESS OF JURISDICTION IN:

I.
chanRoblesvirtual Lawlibr ary

RENDERING A DECISION THAT IS CONTRARY TO LAW AND ESTABLISHED JURISPRUDENCE

II.

MISAPPRECIATING FACTS WHICH GRAVELY PREJUDICED THE RIGHTS OF THE PETITIONERS. 21


In their petition for review on certiorari, the petitioners ascribed grave abuse of discretion on the part of the
CA when it reassessed the evidence and reversed the findings of fact of the LA and the NLRC that ruled in
their favor.22
chan robles law

The petitioners also claimed that the CA violated the doctrine of stare decisis when it ruled that Interserve
was a legitimate job contractor. Citing Coca Cola Bottlers, Philippines, Inc. v. Agito (Agito),23 the petitioners
argued that because the parties therein were the same parties in the subject controversy, then the appellate
court should have followed precedent and declared Interserve as a labor-only contractor.24 chanrob leslaw

In further support of their claim that Interserve was a labor-only contractor and that Coca-Cola, as principal,
should be made ultimately liable for their claims, the petitioners asserted that Interserve had no products to
manufacture, sell and distribute to customers and did not perform activities in its own manner and method
other than that dictated by Coca-Cola. They claimed that it was Coca-Cola that owned the softdrinks, the
trucks and the equipment used by Interserve and that Coca-Cola assigned supervisors to ensure that the
petitioners perform their duties.25 cra lawred chan roble slaw

Lastly, the petitioners insisted that both Coca-Cola and Interserve should be made liable for moral and
exemplary damages, as well as attorney's fees, for having transgressed the petitioners' right to security of
tenure and due process.26 chanro blesl aw

The Court's Ruling

Essentially, the core issue presented by the foregoing petition is whether the petitioners were illegally
dismissed from their employment with Coca-Cola. This, in turn, necessitates a determination of the
characterization of the relationship between route-helpers such as the petitioners, and softdrink
manufacturers such as Coca-Cola, notwithstanding the participation of entities such as ISI, Lipercon, PSI,
ROMAC, and Interserve. The petitioners insist that ISI, Lipercon, PSI, ROMAC, and Interserve are labor-only
contractors, making Coca-Cola still liable for their claims. The latter, on the other hand, asserts that the said
agencies are independent job contractors and, thus, liable to the petitioners on their own.

Procedural Issues

Before the Court proceeds to resolve the case on its merits, it must first be pointed out that the petitioners
erred in resorting to this petition for review on certiorari under Rule 45 of the Rules of Court and alleging, at
the same time, that the CA abused its discretion in rendering the assailed decision.

Well-settled is the rule that grave abuse of discretion or errors of jurisdiction may be corrected only by the
special civil action of certiorari under Rule 65. Such corrective remedies do not avail in a petition for review
on certiorari which is confined to correcting errors of judgment only. Considering that the petitioners have
availed of the remedy under Rule 45, recourse to Rule 65 cannot be allowed either as an add-on or as a
substitute for appeal.27 chanro bles law

Moreover, it is observed that from a perusal of the petitioners' arguments, it is quite apparent that the
petition raises questions of facts, inasmuch as this Court is being asked to revisit and assess anew the
factual findings of the CA and the NLRC. The petitioners fundamentally assail the findings of the CA that the
evidence on record did not support their claims for illegal dismissal against Coca-Cola. In effect, they would
have the Court sift through, calibrate and re-examine the credibility and probative value of the evidence on
record so as to ultimately decide whether or not there is sufficient basis to hold the respondents accountable
for their alleged illegal dismissal. This clearly involves a factual inquiry, the determination of which is the
statutory function of the NLRC.28 chanrob leslaw

Basic is the rule that the Court is not a trier of facts and this doctrine applies with greater force in labor
cases. Questions of fact are for the labor tribunals to resolve.29 Only errors of law are generally reviewed in
petitions for review on certiorari under Rule 45 of the Rules of Court.

In exceptional cases, however, the Court may be urged to probe and resolve factual issues when there is
insufficient or insubstantial evidence to support the findings of the tribunal or the court below, or when too
much is concluded, inferred or deduced from the bare or incomplete facts submitted by the parties or, where
the LA and the NLRC came up with conflicting positions.30 In this case, considering the conflicting findings of
the LA and the NLRC on one hand, and the CA on the other, the Court is compelled to resolve the factual
issues along with the legal ones.

Substantial Issues

The Court finds for the petitioners. The reasons are:

First. Contrary to the position taken by Coca-Cola, it cannot be said that route-helpers, such as the
chanRoble svirtual Lawlib ra ry

petitioners no longer enjoy the employee-employer relationship they had with Coca-Cola since they became
employees of Interserve. A cursory review of the jurisprudence regarding this matter reveals that the
controversy regarding the characterization of the relationship between route-helpers and Coca-Cola is no
longer a novel one.

As early as May 2003, the Court in Magsalin struck down the defense of Coca-Cola that the complainants
therein, who were route-helpers, were its "temporary" workers. In the said Decision, the Court
explained: ChanRob les Vi rtualaw lib rary

The basic law on the case is Article 280 of the Labor Code. Its pertinent provisions read: ChanRobles Virtualawl ibra ry

Art. 280. Regular and Casual Employment. The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be
regular where the employee has been engaged to perform activities which are usually necessary or desirable
in the usual business or trade of the employer, except where the employment has been fixed for a specific
project or undertaking the completion or termination of which has been determined at the time of the
engagement of the employee or where the work or services to be performed is seasonal in nature and the
employment is for the duration of the season.

An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided,
That, any employee who has rendered at least one year of service, whether such service is continuous or
broken, shall be considered a regular employee with respect to the activity in which he is employed and his
employment shall continue while such activity exists.
Coca-Cola Bottlers Phils., Inc. is one of the leading and largest manufacturers of softdrinks in the country.
Respondent workers have long been in the service of petitioner company. Respondent workers, when hired,
would go with route salesmen on board delivery trucks and undertake the laborious task of loading and
unloading softdrink products of petitioner company to its various delivery points.

Even while the language of law might have been more definitive, the clarity of its spirit and intent, i.e., to
ensure a "regular" worker's security of tenure, however, can hardly be doubted. In determining whether an
employment should be considered regular or non-regular, the applicable test is the reasonable connection
between the particular activity performed by the employee in relation to the usual business or trade of the
employer. The standard, supplied by the law itself, is whether the work undertaken is necessary or desirable
in the usual business or trade of the employer, a fact that can be assessed by looking into the nature of the
services rendered and its relation to the general scheme under which the business or trade is pursued in the
usual course. It is distinguished from a specific undertaking that is divorced from the normal activities
required in carrying on the particular business or trade. But, although the work to be performed is only for a
specific project or seasonal, where a person thus engaged has been performing the job for at least one year,
even if the performance is not continuous or is merely intermittent, the law deems the repeated and
continuing need for its performance as being sufficient to indicate the necessity or desirability of that activity
to the business or trade of the employer. The employment of such person is also then deemed to be regular
with respect to such activity and while such activity exists.
The argument of petitioner that its usual business or trade is softdrink manufacturing and that the work
assigned to respondent workers as sales route helpers so involves merely "postproduction activities," one
which is not indispensable in the manufacture of its products, scarcely can be persuasive. If, as so argued by
petitioner company, only those whose work are directly involved in the production of softdrinks may be held
performing functions necessary and desirable in its usual business or trade, there would have then been no
need for it to even maintain regular truck sales route helpers. The nature of the work performed must be
viewed from a perspective of the business or trade in its entirety and not on a confined scope.

The repeated rehiring of respondent workers and the continuing need for their services clearly attest to the
necessity or desirability of their services in the regular conduct of the business or trade of petitioner
company. The Court of Appeals has found each of respondents to have worked for at least one year with
petitioner company. While this Court, in Brent School, Inc. vs. Zamora, has upheld the legality of a fixed-
term employment, it has done so, however, with a stern admonition that where from the circumstances it is
apparent that the period has been imposed to preclude the acquisition of tenurial security by the employee,
then it should be struck down as being contrary to law, morals, good customs, public order and public
policy. The pernicious practice of having employees, workers and laborers, engaged for a fixed period of few
months, short of the normal six-month probationary period of employment, and, thereafter, to be hired on a
day-to-day basis, mocks the law. Any obvious circumvention of the law cannot be countenanced. The fact
that respondent workers have agreed to be employed on such basis and to forego the protection given to
them on their security of tenure, demonstrate nothing more than the serious problem of impoverishment of
so many of our people and the resulting unevenness between labor and capital. A contract of employment is
impressed with public interest. The provisions of applicable statutes are deemed written into the contract,
and "the parties are not at liberty to insulate themselves and their relationships from the impact of labor
laws and regulations by simply contracting with each other."31 chanro blesvi rtua llawli bra ry

Shortly thereafter, the Court in Bantolino v. Coca-Cola,32 among others, agreed with the unanimous finding
of the LA, the NLRC and the CA that the route-helpers therein were not simply employees of Lipercon,
Peoples Specialist Services, Inc. or ISI, which, as Coca-Cola claimed were independent job contractors, but
rather, those of Coca-Cola itself. In the said case, the Court sustained the finding of the LA that the
testimonies of the complainants therein were more credible as they sufficiently supplied every detail of their
employment, specifically identifying their salesmen/drivers were and their places of assignment, aside from
the dates of their engagement and dismissal.

Then in 2008, in Pacquing v. Coca-Cola Philippines, Inc. (Pacquing),33 the Court applied the ruling in
Magsalin under the principle of stare decisis et non quieta movere (follow past precedents and do not disturb
what has been settled). It was stressed therein that because the petitioners, as route helpers, were
performing the same functions as the employees in Magsalin, which were necessary and desirable in the
usual business or trade of Coca- Cola Philippines, Inc., they were considered regular employees of Coca-Cola
entitled to security of tenure.

A year later, the Court in Agito34 similarly struck down Coca-Cola's contention that the salesmen therein
were employees of Interserve, notwithstanding the submission by Coca-Cola of their personal data files from
the records of Interserve; their Contract of Temporary Employment with Interserve; and the payroll records
of Interserve. In categorically declaring Interserve as a labor-only contractor,35 the Court found that the
work of the respondent salesmen therein, constituting distribution and sale of Coca-Cola products, was
clearly indispensable to the principal business of petitioner Coca-Cola.36 chanrobleslaw

As to the supposed substantial capital and investment required of an independent job contractor, the Court
stated that it "does not set an absolute figure for what it considers substantial capital for an independent job
contractor, but it measures the same against the type of work which the contractor is obligated to perform
for the principal."37 The Court reiterated that the contractor, not the employee, had the burden of proof that
it has the substantial capital, investment and tool to engage in job contracting. As applied to Interserve, the
Court ruled:ChanRobles Vi rtua lawlib rary

The contractor, not the employee, has the burden of proof that it has the substantial capital, investment,
and tool to engage in job contracting. Although not the contractor itself (since Interserve no longer appealed
the judgment against it by the Labor Arbiter), said burden of proof herein falls upon petitioner who is
invoking the supposed status of Interserve as an independent job contractor. Noticeably, petitioner failed to
submit evidence to establish that the service vehicles and equipment of Interserve, valued at P510,000.00
and P200,000.00, respectively, were sufficient to carry out its service contract with petitioner. Certainly,
petitioner could have simply provided the courts with records showing the deliveries that were undertaken
by Interserve for the Lagro area, the type and number of equipment necessary for such task, and the
valuation of such equipment. Absent evidence which a legally compliant company could have easily
provided, the Court will not presume that Interserve had sufficient investment in service vehicles and
equipment, especially since respondents' allegation that they were using equipment, such as forklifts and
pallets belonging to petitioner, to carry out their jobs was uncontroverted.

In sum, Interserve did not have substantial capital or investment in the form of tools, equipment,
machineries, and work premises; and respondents, its supposed employees, performed work which was
directly related to the principal business of petitioner. It is, thus, evident that Interserve falls under the
definition of a labor-only contractor, under Article 106 of the Labor Code; as well as Section 5(1) of the
Rules Implementing Articles 106-109 of the Labor Code, as amended.38 chanroble svirtuallaw lib rary

As for the certification issued by the DOLE stating that Interserve was an independent job contractor, the
Court ruled:ChanRobles Vi rtua lawlib rary

The certification issued by the DOLE stating that Interserve is an independent job contractor does not sway
this Court to take it at face value, since the primary purpose stated in the Articles of Incorporation of
Interserve is misleading. According to its Articles of Incorporation, the principal business of Interserve is to
provide janitorial and allied services. The delivery and distribution of Coca-Cola products, the work for which
respondents were employed and assigned to petitioner, were in no way allied to janitorial services. While the
DOLE may have found that the capital and/or investments in tools and equipment of Interserve were
sufficient for an independent contractor for janitorial services, this does not mean that such capital and/or
investments were likewise sufficient to maintain an independent contracting business for the delivery and
distribution of Coca-Cola products.39 chanrob lesvi rtua llawli bra ry

Finally, the Court determined the existence of an employer-employee relationship between the parties
therein considering that the contract of service between Coca-Cola and Interserve showed that the former
indeed exercised the power of control over the complainants therein.40 chanrob leslaw

The Court once more asserted the findings that route-helpers were indeed employees of Coca-Cola in Coca-
Cola Bottlers Philippines, Inc. v. Dela Cruz41 and, recently, in Basan v. Coca-Cola Bottlers Philippines,
Inc.42 and that the complainants therein were illegally dismissed for want of just or authorized cause. Similar
dispositions by the CA were also upheld by this Court in N.O.W43 and Ostani,44 through minute resolutions.

It bears mentioning that the arguments raised by Coca-Cola in the case at bench even bear a striking
similarity with the arguments it raised before the CA in N.O.W45 and Ostani.46 chanroble slaw

From all these, a pattern emerges by which Coca-Cola consistently resorts to various methods in order to
deny its route-helpers the benefits of regular employment. Despite this, the Court, consistent with sound
pronouncements above, adopts the rulings made in Pacquing that Interserve was a labor-only contractor
and that Coca-Cola should be held liable pursuant to the principle of stare decisis et non quieta movere.

It should be remembered that the doctrine of stare decisis et non quieta movere is embodied in Article 8 of
the Civil Code of the Philippines which provides: ChanRob les Virtualawl ibra ry

ART. 8. Judicial decisions applying or interpreting the laws or the Constitution shall form a part of the legal
system of the Philippines.
And, as explained in Fermin v. People:47
The doctrine of stare decisis enjoins adherence to judicial precedents. It requires courts in a country to
follow the rule established in a decision of the Supreme Court thereof. That decision becomes a
judicial precedent to be followed in subsequent cases by all courts in the land. The doctrine of stare
decisis is based on the principle that once a question of law has been examined and decided, it should be
deemed settled and closed to further argument.48 chanrob leslaw

[Emphasis supplied]
The Court's ruling in Chinese Young Men's Christian Association of the Philippine Islands v. Remington Steel
Corporation is also worth citing, viz:49
Time and again, the court has held that it is a very desirable and necessary judicial practice that when
a court has laid down a principle of law as applicable to a certain state of facts, it will adhere to that
principle and apply it to all future cases in which the facts are substantially the same. Stare decisis et non
quieta movere. Stand by the decisions and disturb not what is settled. Stare decisis simply means that for
the sake of certainty, a conclusion reached in one case should be applied to those that follow if
the facts are substantially the same, even though the parties may be different. It proceeds from the first
principle of justice that, absent any powerful countervailing considerations, like cases ought to be
decided alike. Thus, where the same questions relating to the same event have been put forward by the
parties similarly situated as in a previous case litigated and decided by a competent court, the rule of stare
decisis is a bar to any attempt to relitigate the same issue.50 chanrobles law

[Emphases Supplied]
Verily, the doctrine has assumed such value in our judicial system that the Court has ruled that
"[a]bandonment thereof must be based only on strong and compelling reasons, otherwise, the
becoming virtue of predictability which is expected from this Court would be immeasurably affected and the
public's confidence in the stability of the solemn pronouncements diminished."51 Thus, only upon showing
that circumstances attendant in a particular case override the great benefits derived by our judicial system
from the doctrine of stare decisis, can the courts be justified in setting it aside.

In this case, Coca-Cola has not shown any strong and compelling reason to convince the Court that the
doctrine of stare decisis should not be applied. It failed to successfully demonstrate how or why both the LA
and the NLRC committed grave abuse of discretion in sustaining the pleas of the petitioners that they were
its regular employees and not of Interserve.

Second. A reading of the decision of the CA and the pleadings submitted by Coca-Cola before this Court
reveals that they both lean heavily on the service agreement52 entered into by Coca-Cola and Interserve;
the admission by Interserve that it paid the petitioners' salaries; and the affidavit of Sambilay who attested
that it was Interserve which exercised the power of control over the petitioners.

The service agreements entered into by Coca-Cola and Interserve, the earliest being that dated January
1998,53 (another one dated July 11, 2006)54 and the most recent one dated March 21, 200755 - all reveal
that they were entered into One, after the petitioners were hired by Coca-Cola (some of whom were hired
as early as 1984); Two, after they were dismissed from their employment sometime in January 2004;
and Three, after the petitioners filed their complaint for illegal dismissal on November 10, 2006 with the LA.

To quote with approval the observations of the LA: ChanRoblesVirt ualawli bra ry

x x x The most formidable obstacle against the respondent's theory of lack of employer-employee
relationship is that complainants have [been] performing the tasks of route-helpers for several years and
that practically all of them have been rendering their services as such even before respondent
Interserve entered into a service agreement with Coca-Cola sometime in 1998. Thus, the
complainants in their position paper categorically stated the record of their service with Coca-Cola as having
started on the following dates: Emmanuel Quintanar - October 15, 1994; Benjamin Durano - November 16,
[1987]; Cecilio Delaving - June 10, 1991; Ricardo Gaborni - September 28, 1992; Romel Gerarman - June
20, 1995; Ramilo Gaviola - October 10, 1988; Joel John Aguilar - June 1, 1992; Restituto Agsalud -
September 7, 1989; Martin Celis - August 15, 1995; Patricio Arios - June 2, 1989; Michael Bello - February
15, 1992; Lorenzo Quinlog - May 15, 1992; Junne Blaya - September 15, 1997; Santiago Tolentino, Jr. -
May 29, 1989; Nestor Magnaye - February 15, 1996; Arnold Polvorido - February 8, 1996; Allan Agapito -
April 15, 1995; Ariel Baumbad - January 15, 1995; Jose Lutiya - February 15, 1995; Edgardo Tapalla -
August 15, 1994; Roldan Cadayona - May 14, 1996; Raynaldo Alburo - September 15, 1996; Rudy Ultra -
February 28, 1997; Marcelo Cabili - November 15, 1995; Arnold Asiaten - May 2, 1992; Raymundo
Macaballug - July 31, 1995; Joel Delena - January 15, 1991; Danilo Oquino - September 15, 1990; Greg
Caparas - August 15, 1995; and Romeo Escartin - May 15, 1986.

It should be mentioned that the foregoing allegation of the complainants' onset of their services with
respondent Coca-Cola has been confirmed by the Bio-Data Sheets submitted in evidence by the said
respondent [Coca-Cola]. Thus, in the Bio-Data Sheet of complainant Quintanar (Annex "4"), he stated
therein that he was in the service of respondent Coca-Cola continuously from 1993 up to 2002. Likewise,
complainant Quinlog indicated in his Bio-data Sheet submitted to respondent Interserve that he was already
in the employ of respondent Coca-Cola from 1992 (Annex "12"). Complainant Edgardo Tapalla also indicated
in his Bio-Data Sheet that he was already in the employ of Coca-Cola since 1995 until he was seconded to
Interserve in 2002 (Annex "20").

As a matter of fact, complainants' allegation that they were directly hired by respondent Coca-Cola and had
been working with the latter for quite sometime when they were subsequently referred to successive
agencies such as Lipercon, ROMAC, People's Services, and most recently, respondent Interserve, has not
been controverted by the respondents. Even when respondent Coca-Cola filed its reply to the
complainants' position paper, there is nothing therein which disputed complainant's statements of their
services directly with the respondent even before it entered into service agreement with respondent
Interserve.56
chanroble svi rtual lawlib rary

As to the payment of salaries, although the CA made mention that it was Interserve which paid the
petitioners' salaries, no reference was made to any evidence to support such a conclusion. The Court, on the
other hand, gives credence to the petitioners' contention that they were employees of Coca-Cola. Aside from
their collective account that it was Coca-Cola's Route Supervisors who provided their daily schedules for the
distribution of the company's products, the petitioners' payslips,57 tax records,58 SSS59 and Pag-
Ibig60 records more than adequately showed that they were being compensated by Coca-Cola. More
convincingly, the petitioners even presented their employee Identification Cards,61 which expressly indicated
that they were "[d]irect hire[es]" of Coca-Cola.

As for the affidavit of Sambilay, suffice it to say that the same was bereft of evidentiary weight, considering
that he failed to attest not only that he was already with Interserve at the time of the petitioners hiring, but
also that he had personal knowledge of the circumstances surrounding the hiring of the petitioners following
their alleged resignation from Coca-Cola.

Third. As to the characterization of Interserve as a contractor, the Court finds that, contrary to the
conclusion reached by the CA, the petitioners were made to suffer under the prohibited practice of labor-
only contracting. Article 106 of the Labor Code provides the definition of what constitutes labor-only
contracting. Thus:

Article 106. Contractor or subcontractor. - x x x


chanRoble svirtual Lawlib ra ry

There is "labor-only" contracting where the person supplying workers to an employer does not have
substantial capital or investment in the form of tools, equipment, machineries, work premises, among
others, and the workers recruited and placed by such person are performing activities which are directly
related to the principal business of such employer. In such cases, the person or intermediary shall be
considered merely as an agent of the employer who shall be responsible to me workers in the same manner
and extent as if the latter were directly employed by him.
Expounding on the concept, the Court in Agito explained: ChanRobles Vi rtua lawlib rary

The law clearly establishes an employer-employee relationship between the principal employer and the
contractor's employee upon a finding that the contractor is engaged in "labor-only" contracting. Article 106
of the Labor Code categorically states: "There is labor-only' contracting where the person supplying workers
to an employer does not have substantial capital or investment in the form of tools, equipment,
machineries, work premises, among others, and the workers recruited and placed by such persons are
performing activities which are directly related to the principal business of such employer." Thus,
performing activities directly related to the principal business of the employer is only one of the
two indicators that "labor-only" contracting exists; the other is lack of substantial capital or
investment. The Court finds that both indicators exist in the case at bar.

[Emphases and Underscoring Supplied]


In this case, the appellate court considered the evidence of Interserve that it was registered with the DOLE
as independent contractor and that it had a total capitalization of P27,509,716.32 and machineries and
equipment worth P12,538859.55.62 As stated above, however, the possession of substantial capital is
only one element. Labor-only contracting exists when any of the two elements is present.63 Thus, even if
the Court would indulge Coca-Cola and admit that Interserve had more than sufficient capital or investment
in the form of tools, equipment, machineries, work premises, still, it cannot be denied that the petitioners
were performing activities which were directly related to the principal business of such employer. Also, it has
been ruled that no absolute figure is set for what is considered 'substantial capital' because the same is
measured against the type of work which the contractor is obligated to perform for the principal.64 c han robles law

More importantly, even if Interserve were to be considered as a legitimate job contractor, Coca-Cola failed
to rebut the allegation that petitioners were transferred from being its employees to become the employees
of ISI, Lipercon, PSI, and ROMAC, which were labor-only contractors. Well-settled is the rule that "[t]he
contractor, not the employee, has the burden of proof that it has the substantial capital, investment, and
tool to engage in job contracting."65 In this case, the said burden of proof lies with Coca-Cola although it
was not the contractor itself, but it was the one invoking the supposed status of these entities as
independent job contractors.

Fourth. In this connection, even granting that the petitioners were last employed by Interserve, the record is
bereft of any evidence that would show that the petitioners voluntarily resigned from their employment with
Coca-Cola only to be later hired by Interserve. Other than insisting that the petitioners were last employed
by Interserve, Coca-Cola failed not only to show by convincing evidence how it severed its employer
relationship with the petitioners, but also to prove that the termination of its relationship with them was
made through any of the grounds sanctioned by law.

The rule is long and well-settled that, in illegal dismissal cases such as the one at bench, the burden of proof
is upon the employer to show that the employees' termination from service is for a just and valid
cause.66 The employer's case succeeds or fails on the strength of its evidence and not the weakness of that
adduced by the employee,67 in keeping with the principle that the scales of justice must be tilted in favor of
the latter in case doubts exist over the evidence presented by the parties.68chan roble slaw

For failure to overcome this burden, the Court concurs in the observation of the LA that it was highly
inconceivable for the petitioners, who were already enjoying a stable job at a multi-national company, to
leave and become mere agency workers. Indeed, it is contrary to human experience that one would leave a
stable employment in a company like Coca-Cola, only to become a worker of an agency like Interserve, and
be assigned back to his original employer Coca-Cola.

Although it has been said that among the four (4) tests to determine the existence of any employer-
employee relationship, it is the "control test" that is most persuasive, the courts cannot simply ignore the
other circumstances obtaining in each case in order to determine whether an employer-employee
relationship exists between the parties.

WHEREFORE, the petition is GRANTED. The July 11, 2013 Decision and the December 5, 2013 Resolution
of the Court of Appeals, in CA-G.R. SP No. 115469 are REVERSED and SET ASIDE and the August 29,
2008 Decision of the Labor Arbiter in NLRC Case Nos. 12-13956-07 and 12-14277-07, as affirmed in toto by
the National Labor Relations Commission, is hereby REINSTATED.

SO ORDERED. chanRoblesvirt ual Lawlib rary

Sereno, C.J., Carpio, Velasco, Jr., Leonardo-De Castro, Brion, Peralta, Bersamin, Perez, Reyes, Perlas-
Bernabe, Leonen, and Caguioa, JJ., concur.
Del Castillo, J., on leave.
Jardeleza, J., no part.

Endnotes:

1
Penned by Associate Justice Edwin D. Sorongon with Associate Justices Hakim S. Abdulwahid (now retired)
and Marlene Gonzales-Sison, concurring; rollo, pp. 1730-1753.

2
Id. at 1843-1845.

3
Id. at 726-743. Penned by Commissioner Nieves E. Vivar-de Castro.

4
Id. at 552-559. Penned by Labor Arbiter Jose G. De Vera, concurred in by Presiding Commissioner
Benedicto R. Palacol and Commissioner Isabel G. Panganiban-Ortiquerra.

5
Id. at 553-555.

6
Id. at 556-557.

7
Id. at 557.

8
Id. at 559.

9
Id.

10
Docketed as G.R. 176024; Disposed by the Court via Minute Resolution, dated June 18, 2007; id. at 531-
532. See also Minute Resolutions, id. at 547-548.

11
451 Phil. 254 (2003).

12
Id. at 736-737.

13
Id. at 741-742.

14
Id. at 778-779.

15
Id. at 1745-1746.

16
Id. at 1746-1747.
17
Id. at 351-352.

18
Id. at 1747-1748.

19
Id. at 1750-1751.

20
Id. at 1843-1845.

21
Id. at 12-13.

22
Id. at 13-14.

23
598 Phil. 909 (2009).

Rollo, pp. 14-16.


24

25
cralaw red Id. at 16-22.

26
Id. at 22-23.

Prudential Guarantee and Assurance Employee Labor Union, et al. v. National Labor Relations Commission,
27

687 Phil. 351, 360-361 (2012); and Cebu Woman's Club v. de la Victoria, 384 Phil. 264, 270 (2000).

CBL Transit, Inc. v. National Labor Relations Commission, 469 Phil. 363, 371 (2004).
28

Alfaro v. Court of Appeals, 416 Phil. 310, 318 (2001).


29

Nisda v. Sea Serve Maritime Agency, 611 Phil. 291, 311 (2009).
30

Magsalin v. National Organization of Workingmen, supra note 11, at 260-262.


31

32
451 Phil. 839 (2003).

33
567 Phil. 323, 333 (2008).

Supra note 23.


34

35
Id. at 934.

36
Id. at 925.

37
Id. at 927.

38
Id. at 929-930.

39
Id. at 934.

40
Id. at 930-934.

41
622 Phil. 886 (2009).

42
G.R. Nos. 174365-66, February 4, 2015, 749 SCRA 541.

43
Resolutions, G.R. 176024, dated March 14, 2007 and June 18, 2007; See rollo, pp. 531-532.

44
Resolutions, G.R. No. 1771996, dated June 4, 2007 and September 3, 2007; id. at 547-548.

45
See Decision of the Court of Appeals in CA-G.R. SP No. 82457, the subject of the Court's Minute
Resolution in G.R. 176024; id. at 520-530.

46
See Decision of the Court of Appeals in CA-G.R. SP No. 84524, the subject of the Court's Minute
Resolution in G.R. No. 1771996; id. at 533-546.

47
573 Phil. 278 (2008).

48
Id. at 287, citing Castillo v. Sandiganbayan, 427 Phil. 785, 793 (2002).

49
573 Phil. 320 (2008).

50
Id. at 337, citing Ty v. Banco Filipino Savings and Mortgage Bank, 511 Phil. 510, 520-521 (2005).

Pepsi-Cola Products, Phil., Inc. v. Pagdanganan, 535 Phil. 540, 554-555 (2006).
51

52
Denominated as Contract for Substitute or Reliever Services. Rollo, pp. 170-175.

53
Id. at 384-388.

54
Id. at 58-62.

55
Id. at 170-174.

56
Id. at 639-640.

57
Id. at 1315-1318, 1320-1321, 1338-1339, 1342, 1346, 1353-1355.

58
Id. at 1331, 1337, 1351.

59
Id. at 1310, 1326-1327, 1333, 1336, 1343, 1344-1345, 1347.

60
Id. at 1348-1350.

61
Id. at 1312, 1314, 1319, 1322, 1324, 1328, 1329.

62
Id. at 1751.

Aliviado v. Procter and Gamble, Inc., 665 Phil. 542, 554 (2011).
63

Coca Cola Bottlers, Philippines, Inc. v. Agito, supra note 23 at 927.


64

65
Id. at 929.

Harborview Restaurant v. Labro, 605 Phil. 349, 354 (2009).


66

Philippine Long Distance Telephone Company, Inc. v. Tiamson, 511 Phil. 384, 394 (2005).
67

Triple Eight Integrated Services, Inc. v. National Labor Relations Commission, 359 Phil. 955, 964 (1998).
68