A.

JURISDICTION OF THE LABOR ARBITER

As a rule, labor arbiters and the National Labor Relations Commission have
no power or authority to grant reliefs from claims that do not arise from
employer-employee relations. They have no jurisdiction over torts that have
no reasonable causal connection to any of the claims provided for in the
Labor Code, other labor statutes, or collective bargaining agreements.
We stress that the case does not involve the adjudication of a labor
dispute, but the recovery of damages based on a quasi delict. The
jurisdiction of labor tribunals is limited to disputes arising from
employer-employee relations, as we ruled in ​Georg Grotjahn GMBH & Co.
v. Isnani​:16
​
"Not every dispute between an employer and employee involves matters
that only labor arbiters and the NLRC can resolve in the exercise of their
adjudicatory or quasi-judicial powers. The jurisdiction of labor arbiters and
the NLRC under Article 217 of the Labor Code is limited to disputes arising
from an employer-employee relationship which can only be resolved by
reference to the Labor Code, other labor statutes, or their collective
bargaining agreement."​17
The pivotal question is whether the Labor Code has any relevance to the
relief sought by petitioner. From her paper, it is evident that the primary
reliefs she seeks are as follows: (a) loss of earning capacity denominated
therein as "actual damages" or "lost income" and (b) blacklisting. The loss
she claims does not refer to the actual earnings of the deceased, but to his
earning capacity based on a life expectancy of 65 years. This amount is
recoverable if the action is based on a quasi delict as provided for in Article
2206 of the Civil Code,​18​ but not in the Labor Code.
W​hile it is true that labor arbiters and the NLRC have jurisdiction to
award not only reliefs provided by labor laws, but also damages
governed by the Civil Code,​19​ these reliefs must still he based on an
action that has a reasonable causal connection with the Labor Code,
other labor statutes, or collective bargaining agreements.​20
The central issue is determined essentially from the relief sought in the
complaint. In ​San Miguel Corporation v. NLRC​,21​ ​ this Court held:
"It is the character of the ​principal relief​ sought that appears essential in
this connection. Where such ​principal relief​ is to be granted under labor
legislation or a collective bargaining agreement, the case should fall within
the jurisdiction of the Labor Arbiter and the NLRC, even though a claim for
damages might be asserted as an incident to such claim."​22
The labor arbiter found private respondents to be grossly negligent. He
ruled that Captain Tolosa, who died at age 58, could expect to live up to 65
years and to have an earning capacity of US$176,400.
It must be noted that a worker's loss of earning capacity and blacklisting
are not to be equated with wages, overtime compensation or separation
pay, and other labor benefits that are generally cognized in labor disputes.
The loss of earning capacity is a relief or claim resulting from a quasi delict
or a similar cause within the realm of civil law.
"Claims for damages under paragraph 4 of Article 217 must have a
reasonable causal connection with any of the claims provided for in
the article in order to be cognizable by the labor arbiter. ​Only if there is
such a connection with the other claims can the claim for damages be
considered as arising from employer-employee relations."​23​ In the present
case, petitioner's claim for damages is not related to any other claim under
Article 217, other labor statutes, or collective bargaining agreements.
Petitioner cannot anchor her claim for damages to Article 161 of the Labor
Code, which does not grant or specify a claim or relief. This provision is
only a safety and health standard under Book IV of the same Code. The
enforcement of this labor standard rests with the labor secretary.​24​ Thus,
claims for an employer's violation thereof are beyond the jurisdiction of the
labor arbiter. In other words, petitioner cannot enforce the labor standard
provided for in Article 161 by suing for damages before the labor arbiter.
It is not the NLRC but the regular courts that have jurisdiction over actions
for damages, in which the employer-employee relation is merely incidental,
and in which the cause of action proceeds from a different source of
obligation such as a tort.​25​ Since petitioner's claim for damages is
predicated on a quasi delict or tort that has no reasonable causal
connection with any of the claims provided for in Article 217, other labor
statutes, or collective bargaining agreements, jurisdiction over the action
lies with the regular courts​26​ -- not with the NLRC or the labor arbiters.
(​Tolosa vs. NLRC, G.R. No. 149578, April 10, 2003)
The case at bar does not concern an ecclesiastical or purely religious affair
as to bar the State from taking cognizance of the same. An ecclesiastical
affair is "one that concerns doctrine, creed, or form of worship of the
church, or the adoption and enforcement within a religious association of
needful laws and regulations for the government of the membership, and
the power of excluding from such associations those deemed unworthy of
membership.​21​ Based on this definition, an ecclesiastical affair involves the
relationship between the church and its members and relate to matters of
faith, religious doctrines, worship and governance of the congregation. To
be concrete, examples of this so-called ecclesiastical affairs to which the
State cannot meddle are proceedings for excommunication, ordinations of
religious ministers, administration of sacraments and other activities with
attached religious significance. The case at bar does not even remotely
concern any of the abovecited examples. While the matter at hand relates
to the church and its religious minister it does not ​ipso facto​ give the case a
religious significance. ​Simply stated, what is involved here is the
relationship of the church as an employer and the minister as an
employee. It is purely secular and has no relation whatsoever with the
practice of faith, worship or doctrines of the church. In this case, petitioner
was not ex-communicated or expelled from the membership of the SDA but
was terminated from employment. Indeed, the matter of terminating an
employee, which is purely secular in nature, is different from the
ecclesiastical act of expelling a member from the religious congregation.
As pointed out by the OSG in its memorandum, the grounds invoked for
petitioner's dismissal, namely: misappropriation of denominational funds,
willful breach of trust, serious misconduct, gross and habitual neglect of
duties and commission of an offense against the person of his employer's
duly authorized representative, are all based on Article 282 of the Labor
Code which enumerates the just causes for termination of
employment.​22​ By this alone, it is palpable that the reason for petitioner's
dismissal from the service is not religious in nature. Coupled with this is the
act of the SDA in furnishing NLRC with a copy of petitioner's letter of
termination. As aptly stated by the OSG, this again is an eloquent
admission by private respondents that NLRC has jurisdiction over the case.
Aside from these, SDA admitted in a certification​23​ issued by its officer, Mr.
Ibesate, that petitioner has been its employee for twenty-eight (28) years.
SDA even registered petitioner with the Social Security System (SSS) as its
employee. As a matter of fact, the worker's records of petitioner have been
submitted by private respondents as part of their exhibits. From all of these
it is clear that when the SDA terminated the services of petitioner, it was
merely exercising its management prerogative to fire an employee which it
believes to be unfit for the job. As such, the State, through the Labor Arbiter
and the NLRC, has the right to take cognizance of the case and to
determine whether the SDA, as employer, rightfully exercised its
management prerogative to dismiss an employee. This is in consonance
with the mandate of the Constitution to afford full protection to labor.
Under the Labor Code, the provision which governs the dismissal of
employees, is comprehensive enough to include religious corporations,
such as the SDA, in its coverage. Article 278 of the Labor Code on
post-employment states that "the provisions of this Title shall apply to all
establishments or undertakings, whether for profit or not." Obviously, the
cited article does not make any exception in favor of a religious corporation.
This is made more evident by the fact that the Rules Implementing the
Labor Code, particularly, Section 1, Rule 1, Book VI on the Termination of
Employment and Retirement, categorically includes religious institutions in
the coverage of the law, to wit:
Sec. 1. ​Coverage​. — This Rule shall apply to all establishments and
undertakings, whether operated for profit or not, including educational,
medical, charitable and religious institutions and organizations, in cases of
regular employment with the exception of the Government and its political
subdivisions including government-owned or controlled corporations.​24
With this clear mandate, the SDA cannot hide behind the mantle of
protection of the doctrine of separation of church and state to avoid its
responsibilities as an employer under the Labor Code.
Finally, as correctly pointed out by petitioner, private respondents are
estopped from raising the issue of lack of jurisdiction for the first time on
appeal. It is already too late in the day for private respondents to question
the jurisdiction of the NLRC and the Labor Arbiter since the SDA had fully
participated in the trials and hearings of the case from start to finish. The
Court has already ruled that the active participation of a party against
whom the action war brought, coupled with his failure to object to the
jurisdiction of the court or quasi-judicial body where the action is pending, is
tantamount to an invocation of that jurisdiction and a willingness to abide by
the resolution of the case and will bar said party from later on impugning
the court or body's jurisdiction.​25​ Thus, the active participation of private
respondents in the proceedings before the Labor Arbiter and the NLRC
mooted the question on jurisdiction. ​(A ​ ustria vs. NLRC, 312 SCRA 413)
Article 217 of the Labor Code of the Philippines, as amended by Rep. Act
No. 6715 which took effect on March 21, 1989 reads:
ART. 217. Jurisdiction of Labor Arbiters and the Commission.(a) Except as
otherwise provided under this Code the Labor Arbiters shall have original
and exclusive jurisdiction to hear and decide within thirty (30) calendar
days after the submission of the case by the parties for decision without
extension, even in the absence of stenographic notes, the following cases
involving all workers, whether agricultural or non-agricultural:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases that workers
may file involving wages, rates of pay, hours of work and other terms and
conditions of employment;
4. Claims for actual, moral, exemplary and other forms of damages arising
from the employer-employee relations.
Case law has it that the nature of an action and the subject matter thereof,
as well as which court has jurisdiction over the same, are determined by
the material allegations of the complaint and the reliefs prayed for in
relation to the law involved.
Not every controversy or money claim by an employee against the
employer or vice-versa is within the exclusive jurisdiction of the labor
arbiter. A money claim by a worker against the employer or vice-versa is
within the exclusive jurisdiction of the labor arbiter only if there is a
reasonable causal connection between the claim asserted and
employee-employer relation. Absent such a link, the complaint will be
cognizable by the regular courts of justice.​8
Actions between employees and employer where the employer-employee
relationship is merely incidental and the cause of action precedes from a
different source of obligation is within the exclusive jurisdiction of the
regular court.​9​ In Georg Grotjahn GMBH & Co. v. Isnani,​10​ we held that the
jurisdiction of the Labor Arbiter under Article 217 of the Labor Code, as
amended, is limited to disputes arising from an employer-employee
relationship which can only be resolved by reference to the Labor Code of
the Philippines, other labor laws or their collective bargaining agreements.
In Singapore Airlines Limited v. Pao,​11​ the complaint of the employer
against the employee for damages for wanton justice and refusal without
just cause to report for duty, and for having maliciously and with bad faith
violated the terms and conditions of their agreement for a course of
conversion training at the expense of the employer, we ruled that
jurisdiction over the action belongs to the civil court:
On appeal to this court, we held that jurisdiction over the controversy
belongs to the civil courts. We stated that the action was for breach of a
contractual obligation, which is intrinsically a civil dispute. We further stated
that while seemingly the cause of action arose from employer-employee
relations, the employers claim for damages is grounded on wanton failure
and refusal without just cause to report to duty coupled with the averment
that the employee maliciously and with bad faith violated the terms and
conditions of the contract to the damage of the employer. Such averments
removed the controversy from the coverage of the Labor Code of the
Philippines and brought it within the purview of the Civil Law.
Jurisprudence has evolved the rule that claims for damages under
paragraph 4 of Article 217, to be cognizable by the Labor Arbiter, must
have a reasonable causal connection with any of the claims provided for in
that article. Only if there is such a connection with the other claims can the
claim for damages be considered as arising from employer-employee
relations.​12​cräläwvirtualibräry
The claims were the natural consequences flowing from a breach of an
obligation, intrinsically civil in nature.
In Medina v. Castro-Bartolome,​13​ we held that a complaint of an employee
for damages against the employer for slanderous remarks made against
him was within the exclusive jurisdiction of the regular courts of justice
because the cause of action of the plaintiff was for damages for tortious
acts allegedly committed by the employer. The fact that there was between
the parties an employer-employee relationship does not negate the
jurisdiction of the trial court.
In Singapore Airlines Ltd. v. Pao,​14​ we held that:
Stated differently, petitioner seeks protection under the civil laws and
claims no benefits under the Labor Code. The primary relief sought is for
liquidated damages for breach of a contractual obligation. The other items
demanded are not labor benefits demanded by workers generally taken
cognizance of in labor disputes, such as payment of wages, overtime
compensation or separation pay. The items claimed are the natural
consequences flowing from breach of an obligation, intrinsically a civil
dispute.
In Dai-Chi Electronics Manufacturing Corporation v. Villarama, Jr.,​15​ the
petitioner sued its employee Adonis Limjuco for breach of contract which
reads:
That for a period of two (2) years after termination of service from
EMPLOYER, EMPLOYEE shall not in any manner be connected, and/or
employed, be a consultant and/or be an informative body directly or
indirectly, with any business firm, entity or undertaking engaged in a
business similar to or in competition with that of the
16​
EMPLOYER.​ cräläwvirtualibräry
The petitioner alleged in its complaint with the trial court that:
Petitioner claimed that private respondent became an employee of Angel
Sound Philippines Corporation, a corporation engaged in the same line of
business as that of petitioner, within two years from January 30, 1992, the
date of private respondents resignation from petitioners employ. Petitioner
further alleged that private respondent is holding the position of Head of the
Material Management Control Department, the same position he held while
in the employ of petitioner.​17​cräläwvirtualibräry
The trial court dismissed the case for lack of jurisdiction over the subject
matter because the cause of action for damages arose out of the parties
employer-employee relationship. We reversed the order of the trial court
and held, thus:
Petitioner does not ask for any relief under the Labor Code of the
Philippines. It seeks to recover damages agreed upon in the contract as
redress for private respondents breach of his contractual obligation to its
damage and prejudice (Rollo, p. 57). Such cause of action is within the
realm of Civil Law, and jurisdiction over the controversy belongs to the
regular courts. More so when we consider that the stipulation refers to the
post-employment relations of the parties.​18​cräläwvirtualibräry
In this case, the private respondents first cause of action for damages is
anchored on the petitioners employment of deceit and of making the private
respondent believe that he would fulfill his obligation under the employment
contract with assiduousness and earnestness. The petitioner volte
face when, without the requisite thirty-day notice under the contract and the
Labor Code of the Philippines, as amended, he abandoned his office and
rejoined his former employer; thus, forcing the private respondent to hire a
replacement. The private respondent was left in a lurch, and its corporate
plans and program in jeopardy and disarray. Moreover, the petitioner took
off with the private respondents computer diskette, papers and documents
containing confidential information on employee compensation and other
bank matters. On its second cause of action, the petitioner simply walked
away from his employment with the private respondent sans any written
notice, to the prejudice of the private respondent, its banking operations
and the conduct of its business. Anent its third cause of action, the
petitioner made false and derogatory statements that the private
respondent reneged on its obligations under their contract of employment;
thus, depicting the private respondent as unworthy of trust.
It is evident that the causes of action of the private respondent against the
petitioner do not involve the provisions of the Labor Code of the Philippines
and other labor laws but the New Civil Code. Thus, the said causes of
action are intrinsically civil. ​There is no causal relationship between the
causes of action of the private respondents causes of action against
the petitioner and their employer-employee relationship. The fact that
the private respondent was the erstwhile employer of the petitioner
under an existing employment contract before the latter abandoned
his employment is merely incidental. In fact, the petitioner had already
been replaced by the private respondent before the action was filed against
the petitioner. ​(Eviota vs. Court of Appeals, 407 SCRA 394)
Clutching at straws, petitioners fault the appellate court for failure to
recognize the final and executory nature of the June 24, 1996 NLRC
Decision rendered in the consolidated cases and for affirming the
nullification of said decision, with respect to respondent, which could be
 attacked only by direct action.​44

Contrary to petitioners’ position, the validity of a judgment or order of a

court or quasi-judicial tribunal which has become final and executory may
be attacked when the records show that it lacked jurisdiction to render the
 judgment.​45​ For ​a​ ​judgment rendered against one in a case where

jurisdiction over his person was not acquired is void, and a void judgment
maybe assailed or impugned at any time​ either ​directly​ or ​collaterally​ by
means of a petition filed in the same or separate case, or ​by resisting such
 
​
judgment in any action or proceeding wherein it is invoked​.46
Petitioners in fact do not even dispute respondent’s claim that no summons
was ever issued and served on him either personally or through registered
mail as required under Rule III, Sections 3 and 6 of the Rules of Procedure
of the NLRC, as amended by Resolution No. 01-02, Series of 2002:
SEC. 3. ​Issuance of Summons.​ Within two (2) days from receipt of a
case, the Labor Arbiter shall issue the required summons, attaching thereto
a copy of the complaint/petition and supporting documents, if any. The
summons, together with a copy of the complaint, shall specify the date,
time and place of the conciliation and mediation conference in two (2)
settings.
xxx
SEC. 6. ​Service of Notices and Resolutions.​ a) Notices or summonses
and copies of orders, shall be served on the parties to the case personally
by the bailiff or duly authorized public officer within three (3) days from
receipt thereof or by registered mail, provided that in special
circumstances, service of summons may be effected in accordance with
the pertinent provisions of the Rules of Court; xxx
Supplementary or applied by analogy to these provisions are the provisions
and prevailing jurisprudence in Civil Procedure. ​Where there is then no
service of summons on or a voluntary general appearance by the
defendant, the court acquires no jurisdiction to pronounce a judgment in the
 cause.​47

At all events, even if administrative tribunals exercising quasi-judicial

powers are not strictly bound by procedural requirements, they are
still bound by law and equity to observe the fundamental
 requirements of due process.​48

Res inter alios acta nocere non debet.​ Things done between strangers
 ought not to injure those who are not parties to them.​49 ​(D ​ ynamic
Signmaker Outdoor Advertising Services vs. Potongan, G.R. No. 156589,
June 27, 2005)
The rulings in​ Lozon v. NLRC​45​ addresses the issue at hand. This Court
came up with a clear rule as to when jurisdiction by estoppel applies and
when it does not:
Lack of jurisdiction over the subject matter of the suit is yet another matter.
Whenever it appears that the court has no jurisdiction over the subject
matter, the action shall be dismissed (Section 2, Rule 9, Rules of Court).
This defense may be interposed at any time, during appeal (​Roxas vs.
Rafferty,​ 37 Phil. 957) or even after final judgment (​Cruzcosa vs. Judge
Concepcion, et al.,​ 101 Phil. 146). Such is understandable, as this kind of
jurisdiction is conferred by law and not within the courts, let alone the
parties, to themselves determine or conveniently set aside. In ​People vs.
Casiano​ (111 Phil. 73, 93-94), this Court, on the issue of estoppel, held:
"The operation of the principle of estoppel on the question of jurisdiction
seemingly depends upon whether the lower court actually had jurisdiction
or not. ​If it had no jurisdiction, but the case was tried and decided
upon the theory that it had jurisdiction, the parties are not barred, on
appeal, from assailing such jurisdiction, for the same 'must exist as a
matter of law, and may not be conferred by consent of the parties or
by estoppel​' (5 C.J.S., 861-863). ​However, if the lower court had
jurisdiction, and the case was heard and decided upon a given theory,
such, for instance, as that the court had no jurisdiction, the party who
induced it to adopt such theory will not be permitted, on appeal, to
assume an inconsistent position—that the lower court had
jurisdiction​. Here, the principle of estoppel applies. The rule that
jurisdiction is conferred by law, and does not depend upon the will of the
parties, has no bearing thereon.​46​ (Emphasis supplied)
Verily,​ Lozon, Union Motors, Dy ​and​ De Rossi​ aptly resolve the
jurisdictional issue obtaining in this case. Applying the guidelines in ​Lozon,​
the labor arbiter assumed jurisdiction when he should not. In fact, the
NLRC correctly reversed the labor arbiter’s decision and ratiocinated:
What appears at first blush to be an issue which pertains to the propriety of
complainant’s reassignment to another job on account of his having
contracted a private loan, is one which may be considered as falling within
the jurisdiction of the Office of the Labor Arbiter. Nevertheless, since the
complainant is a union member, he should be bound by the covenants
provided for in the Collective Bargaining Agreement.​47
....
Based on the foregoing considerations, it appears that the issue of validity
of complainant’s reassignment stemmed from the exercise of a
management prerogative which is a matter apt for resolution by a
Grievance Committee, the parties having opted to consider such as a
grievable issue. Further, a review of the records would show that the matter
of reassignment is one not directly related to the charge of complainant’s
having committed an act which is inimical to respondents’ interest, since
the latter had already been addressed to by complainant’s service of a
suspension order. The transfer, in effect, is one which properly falls under
Section 1, Article IV of the Collective Bargaining Agreement and, as such,
questions as to the enforcement thereof is one which falls under the
jurisdiction of the labor arbiter."​48
In line with the cases cited above and applying the general rule that
estoppel does not confer jurisdiction, petitioner is not estopped from
assailing the jurisdiction of the labor arbiter before the NLRC on appeal.
Respondent relied solely on estoppel to oppose petitioner’s claim of lack of
jurisdiction on the part of the labor arbiter. He adduced no other legal
ground in support of his contention that the Labor Arbiter had jurisdiction
over the case. Thus, his claim falls flat in light of our pronouncement, and
more so considering the NLRC’s correct observation that jurisdiction over
grievance issues, such as the propriety of the reassignment of a union
member falls under the jurisdiction of the voluntary arbitrator.
Since jurisdiction does not lie with the Labor Arbiter, it is futile to discuss
about the computation of the 13th month pay. ​(​Metromedia Times Corp.,
vs. Pastorin, G.R. No. 154295, July 29, 2005)
At the outset, we take note of the fact that the 2-year prohibition against
employment in a competing company which petitioner seeks to enforce thru
injunction, had already expired sometime in February 2004. Necessarily,
upon the expiration of said period, a suit seeking the issuance of a writ of
injunction becomes ​functus oficio​ and therefore moot. As things go,
however, it was not possible for us, due to the great number of cases
awaiting disposition, to have decided the instant case earlier. However, the
issue of damages remains unresolved. In ​Philippine National Bank v.
CA​,[5] we declared:

In the instant case, aside from the principal action for damages,
private respondent sought the issuance of a temporary
restraining order and writ of preliminary injunction to enjoin the
foreclosure sale in order to prevent an alleged irreparable injury
to private respondent. It is settled that these injunctive reliefs
are preservative remedies for the protection of substantive
rights and interests. Injunction is not a cause of action in itself
but merely a provisional remedy, an adjunct to a main suit.
When the act sought to be enjoined ha[s] become ​fait accompli,​
only the prayer for provisional remedy should be denied.
However, the trial court should still proceed with the
determination of the principal action so that an adjudication of
the rights of the parties can be had.

Along similar vein, the damage aspect of the present suit was never
rendered moot by the lapse of the 2-year prohibitive period against
employment in a competing company.

This brings us to the sole issue of whether petitioner's claim for damages
arose from employer-employee relations between the parties.

We rule in the negative.

Actually, the present case is not one of first impression. In a kindred

case, ​Dai-Chi Electronics Manufacturing vs. Villarama​,[6] with a
substantially similar factual backdrop, ​we held that an action for breach
of contractual obligation is intrinsically a civil dispute.

There, a complaint for damages was filed with the regular court by an
employer against a former employee who allegedly violated the
non-compete provision of their employment contract when, within two years
from the date of the employee's resignation, he applied with, and was hired
by a corporation engaged in the same line of business as that of his former
employer. The employer sought to recover liquidated damages. The trial
court ruled that it had no jurisdiction over the subject matter of the
controversy because the complaint was for damages arising from
employer-employee relations, citing Article 217 (4) of the Labor Code, as
amended by R.A. No. 6715, which stated that it is the Labor Arbiter who
had original and exclusive jurisdiction over the subject matter of the case.

When the case was elevated to this Court, we held that the claim for
damages did not arise from employer-employee relations, to wit:
Petitioner does not ask for any relief under the Labor Code of
the Philippines. It seeks to recover damages agreed upon in the
contract as redress for private respondent's breach of his
 contractual obligation to its "damage and prejudice". Such
cause of action is within the realm of Civil Law, and jurisdiction
over the controversy belongs to the regular courts. More so
when we consider that the stipulation refers to the
post-employment relations of the parties.

[W]hile seemingly the cause of action arose from

employer-employee relations, the employer's claim for
damages is grounded on wanton failure and refusal without just
cause to report to duty coupled with the averment that the
employee maliciously and with bad faith violated the terms and
conditions of the contract to the damage of the employer. Such
averments removed the controversy from the coverage of the
Labor Code of the Philippines and brought it within the purview
of Civil Law.

Indeed, jurisprudence has evolved the rule that claims for damages under
paragraph 4 of Article 217, to be cognizable by the Labor Arbiter, must
have a reasonable causal connection with any of the claims provided for in
that article. Only if there is such a connection with the other claims can a
claim for damages be considered as arising from employer-employee
relations.

Article 217, as amended by Section 9 of RA 6715, provides:

Art. 217. Jurisdiction of Labor Arbiters and the Commission. -
(a) Except as otherwise provided under this Code, the Labor
Arbiters shall have original and exclusive jurisdiction to hear
and decide, within thirty (30) calendar days after the submission
of the case by the parties for decision without extension, even
in the absence of stenographic notes, the following cases
involving all workers, whether agricultural or non-agricultural:

xxx xxx xxx

4. Claims for actual, moral, exemplary and other

forms of damages arising from the
employer-employee relations;"

xxx xxx xxx

In ​San Miguel Corporation vs. National Labor Relations Commission​,[7] we

had occasion to construe Article 217, as amended by B.P. Blg. 227. Article
217 then provided that the Labor Arbiter had jurisdiction over all money
claims of workers, but the phrase "arising from employer-employee
relation" was deleted. We ruled thus:
While paragraph 3 above refers to "all money claims of
workers," it is not necessary to suppose that the entire universe
 of money claims that might be asserted by workers against their
employers has been absorbed into the original and exclusive
jurisdiction of Labor Arbiters. ​In the first place, paragraph 3
should be read not in isolation from but rather within the
context formed by paragraph 1 (relating to unfair labor
practices), paragraph 2 (relating to claims concerning
terms and conditions of employment), paragraph 4 (claims
relating to household services, a particular species of
employer-employee relations), and paragraph 5 (relating to
certain activities prohibited to employees or employers)​. It
is evident that there is a unifying element which runs through
paragraph 1 to 5 and that is, that they all refer to cases or
disputes arising out of or in connection with an
employer-employee relationship. This is, in other words, a
situation where the rule of ​noscitur a sociis​ may be usefully
invoked in clarifying the scope of paragraph 3, and any other
paragraph of Article 217 of the Labor Code, as amended. We
reach the above conclusion from an examination of the terms
themselves of Article 217, as last amended by B.P. Blg 227,
and even though earlier versions of Article 217 of the Labor
Code expressly brought within the jurisdiction of the Labor
Arbiters and the NLRC "cases arising from employer-employee
relations," which clause was not expressly carried over, in
printer's ink, in Article 217 as it exists today. For it cannot be
presumed that money claims of workers which do not arise out
of or in connection with their employer-employee relationship,
and which would therefore fall within the general jurisdiction of
regular courts of justice, were intended by the legislative
authority to be taken away from the jurisdiction of the courts
and lodged with Labor Arbiters on an exclusive basis. The
Court, therefore, believes and so holds that the "money claims
of workers" referred to in paragraph 3 of Article 217 embraces
money claims which arise out of or in connection with the
employer-employee relationship, or some aspect or incident of
such relationship. Put a little differently, that money claims of
workers which now fall within the original and exclusive
jurisdiction of Labor Arbiters are those money claims which
have some ​reasonable causal connection​ with the
employer-employee relationship.

When, as here, the cause of action is based on a quasi-delict or tort, which

has no reasonable causal connection with any of the claims provided for in
Article 217, jurisdiction over the action is with the regular courts.[8]

As it is, petitioner does not ask for any relief under the Labor Code. It
merely seeks to recover damages based on the parties' contract of
employment as redress for respondent's breach thereof. Such cause of
action is within the realm of Civil Law, and jurisdiction over the controversy
belongs to the regular courts. More so must this be in the present case,
what with the reality that the stipulation refers to the post-employment
relations of the parties.

For sure, a plain and cursory reading of the complaint will readily reveal
that the subject matter is one of claim for damages arising from a breach of
contract, which is within the ambit of the regular court's jurisdiction.[9]

It is basic that jurisdiction over the subject matter is determined upon the
allegations made in the complaint, irrespective of whether or not the plaintiff
is entitled to recover upon the claim asserted therein, which is a matter
resolved only after and as a result of a trial. Neither can jurisdiction of a
court be made to depend upon the defenses made by a defendant in his
answer or motion to dismiss. If such were the rule, the question of
jurisdiction would depend almost entirely upon the defendant. (​Yusen Air &
Sea Service Phils vs. Villamor, G.R. No. 154060, August 16, 2005)

Respondent Mojica is a civil service employee; therefore, jurisdiction is

lodged not with the NLRC, but with the Civil Service Commission.
 As provided under Presidential Decree (PD) No. 564,​10​ PTA is a corporate
body attached to the DOT. As an attached agency, the recruitment,
transfer, promotion and dismissal of all its personnel was governed by a
 
merit system established in accordance with the civil service rules.​11​ In fact,
all PTA officials and employees are subject to the Civil Service rules and
 
regulations.​12
Accordingly, since DFP is under the exclusive authority of the PTA, it
follows that its officials and employees are likewise subject to the Civil
Service rules and regulations. Clearly then, Mojica’s recourse to the Labor
Arbiter was not proper. He should have followed the procedure laid down in
DFP’s merit system and the Civil Service rules and regulations.
 PD No. 807 or ​The Civil Service Decree of the Philippines13​ ​ d
​ eclared that
the Civil Service Commission shall be the central personnel agency to set
standards and to enforce the laws governing the discipline of civil
 
servants.​14​ It categorically described the scope of Civil Service as
embracing every branch, agency, subdivision, and instrumentality of the
government, including every government-owned or controlled corporation
 whether performing governmental or proprietary function.​15​ It construed an

agency to mean any bureau, office, commission, administration, board,

committee, institute, corporation, whether performing governmental or
proprietary function, or any other unit of the National Government, as well
 as provincial, city or municipal government, except as otherwise provided.​16
 
Subsequently, EO No. 180​17​ defined "government employees" as all
employees of all branches, subdivisions, instrumentalities, and agencies, of
the Government, including government-owned or controlled corporations
 
with original charters.​18​ It provided that the Civil Service and labor laws
shall be followed in the resolution of complaints, grievances and cases
 
involving government employees.​19
EO No. 292 or ​The Administrative Code of 1987​ empowered the Civil
Service Commission to hear and decide administrative cases instituted by
or brought before it directly or on appeal, including contested appointments,
and review decisions and actions of its offices and of the agencies attached
 to it.​20
 
Thus, we held in ​Zamboanga City Water District v. Buat​21​ that:
There is no dispute that petitioner, a water district with an original charter,
is a government-owned and controlled corporation. The established rule is
that the hiring and firing of employees of government-owned and controlled
corporations are governed by provisions of the Civil Service Law and Civil
Service Rules and Regulations. Jurisdiction over the strike and the
dismissal of private respondents is therefore lodged not with the NLRC but
with the Civil Service Commission. (Citations omitted)
 
In ​Philippine Amusement and Gaming Corp. v. Court of Appeals22​ ​ we also
held that:
It is now settled that, conformably to Article IX-B, Section 2(1), [of the 1987
Constitution] government-owned or controlled corporations shall be
considered part of the Civil Service only if they have original charters, as
distinguished from those created under general law.
PAGCOR belongs to the Civil Service because it was created directly by
PD 1869 on July 11, 1983. Consequently, controversies concerning the
relations of the employee with the management of PAGCOR should come
under the jurisdiction of the Merit System Protection Board and the Civil
Service Commission, conformably to the Administrative Code of 1987.
Section 16(2) of the said Code vest in the Merit System Protection Board
the power ​inter alia​ to:
a) Hear and decide on appeal administrative cases involving officials and
employees of the Civil Service. Its decision shall be final except those
involving dismissal or separation from the service which may be appealed
to the Commission.
Applying this rule, we have upheld the jurisdiction of Civil Service
Authorities, as against that of the labor authorities, in controversies
involving the terms of employment, and other related issues, of the Civil
Service official and employees...
EO No. 292 provided that civil service employees have the right to present
their complaints or grievances to management and have them adjudicated
as expeditiously as possible in the best interest of the agency, the
government as a whole, and the employee concerned. Such complaint or
grievances shall be resolved at the lowest possible level in the department
or agency, as the case may be, and the employee shall have the right to
appeal such decision to higher authorities. In case any dispute remains
unresolved after exhausting all the available remedies under existing laws
and procedure, the parties may jointly refer the dispute in the Public Sector
 
Labor Management Council for appropriate action.​23
In sum, the labor arbiter and the NLRC erred in taking cognizance of the
complaint as jurisdiction over the complaint for illegal dismissal is lodged
with the Civil Service Commission. The Court of Appeals likewise erred in
sustaining the labor arbiter. ​(​Duty Free Phils., vs. Mojica, G.R. No. 166365,
September 30, 2005)
We shall rule first on the issue of jurisdiction as it is decisive. If the NLRC
had no jurisdiction, then it would be unnecessary to consider the validity of
respondent’s dismissal.
Petitioner argues that since respondent was a "corporate officer," the
NLRC had no jurisdiction over the subject matter under PD 902-A. In
 
support of its contention, petitioner invokes ​Paguio v. NLRC 4 ​ ​ where we
held that the removal of a corporate officer, whether elected or appointed,
is an intra-corporate controversy over which the NLRC has no jurisdiction.
 The petitioner also cites our ruling in ​de Rossi v. NLRC 5 ​ ​ to the effect that
the SEC, not the NLRC, has original and exclusive jurisdiction over cases
involving the removal of corporate officers.
Under Section 5 of PD 902-A, the law applicable at the time this
 controversy arose,​6 ​the SEC, not the NLRC, had original and exclusive

jurisdiction over cases involving the removal of corporate officers. Section

5(c) of PD 902-A applied to a corporate officer’s dismissal for his dismissal
 was a corporate act and/or an intra-corporate controversy.​7

However, it had to be first established that the person removed or

dismissed was a corporate officer before the removal or dismissal could
properly fall within the jurisdiction of the SEC and not the NLRC. Here,
aside from its bare allegation, petitioner failed to show that respondent was
in fact a corporate officer.
"Corporate officers" in the context of PD 902-A are those officers of a
corporation who are given that character either by the Corporation Code or
 by the corporation’s by-laws.​8 ​Under Section 25 of the Corporation Code,

the "corporate officers" are the president, secretary, treasurer and such
other officers as may be provided for in the by-laws.
A careful look at ​de Rossi​ (as well as the line of cases involving the
removal of corporate officers where we held that it was the SEC and not
 the NLRC which had jurisdiction​9 ​) will show that the person whose removal

was the subject of the controversy was a corporate officer whose position
was provided for in the by-laws. ​That is not by any means the case here.
The burden of proof is on the party who makes the allegation.​10 ​Here,
petitioner merely alleged that respondent was a corporate officer. However,
it failed to prove that its by-laws provided for the office of "vice president for
nationwide expansion." Since petitioner failed to satisfy the burden of proof
that was required of it, we cannot sanction its claim that respondent was a
"corporate officer" whose removal was cognizable by the SEC under PD
902-A and not by the NLRC under the Labor Code.
An "office" is created by the charter of the corporation and the officer is
elected by the directors or stockholders.​11 ​On the other hand, an employee
occupies no office and generally is employed not by the action of the
directors or stockholders but by the managing officer of the corporation who
also determines the compensation to be paid to such employee.​12
In this case, respondent was appointed vice president for nationwide
expansion by Malonzo, petitioner’s general manager, not by the board
of directors of petitioner. It was also Malonzo who determined the
compensation package of respondent. Thus, respondent was ​an employee,
not a "corporate officer." T ​ he CA was therefore correct in ruling that
jurisdiction over the case was properly with the NLRC, not the SEC.
 ​ asycall Communication Phils., vs. King, G.R. No. 145901, December 15,
(E
2005)
SMFI argues that the allegations in the Union’s complaint filed before the
Labor Arbiter do not establish a cause of action for ULP, the Union having
merely contended that SMFI was guilty thereof without specifying the
ultimate facts upon which it was based. It cites Section 1 of Rule 8 of the
Rules of Court as applying suppletorily to the proceedings before the Labor
Arbiter, which Section reads:
Section 1. ​In general.​ – Every pleading shall contain in a methodical and
logical form, a plain concise and direct statement of the ultimate facts on
which the party pleading relies for his claim . . .
Alleging that the Union failed to comply with this Rule, SMFI concludes that
the Labor Arbiter has no jurisdiction over its complaint.
A perusal of the complaint shows that, indeed, the particular acts of ULP
alleged to have been committed by SMFI were not specified; neither were
the ultimate facts in support thereof. In its Position Paper, however, the
Union detailed the particular acts of ULP attributed to SMFI and the
ultimate facts in support thereof.
Section 7, Rule V of the New Rules of Procedure of the NLRC provides:
Nature of Proceedings​. – ​The proceedings before the Labor Arbiter
shall be non-litigious in nature​. Subject to the requirements of due
process, ​the technicalities of law and procedure and ​the rules
obtaining in the courts of law shall not strictly apply thereto​.​ The
Labor Arbiter may avail himself of all reasonable means to ascertain the
facts of the controversy speedily, including ocular inspection and
examination of well-informed persons. (Emphasis and underscoring
supplied)
Section 1 of Rule 8 of the Rules of Court should thus not be strictly applied
to a case filed before a Labor Arbiter. In determining jurisdiction over a
case, allegations made in the complaint, as well as those in the position
paper, may thus be considered.
As stated above, the Union, in its Position Paper, mentioned the particular
acts of ULP and the ultimate facts in support thereof. Thus it alleged:
This is a complaint for unfair labor practices pursuant to ​Article 248 (e)
and (i) of the Labor Code​, as amended, which reads:
Art. 248. Unfair labor practices of employers. – It shall be unlawful for an
employer to commit any of the following unfair labor practices:
xxxx
(e) To discriminate in regard to wages, hours of work, and other terms
and conditions of employment in order to encourage or discourage
membership in any labor organization.
xxxx
(i) to violate a collective bargaining agreement.
and which was committed by herein respondents as follows​:
1. ​large scale and wanton unjust discrimination in matters of
promotion​, particularly upon the following members of complainant: Ellen
Ventura, Julie Geronimo, Ronnie Cruz, Rita Calasin, Romy de Peralta,
Malou Alano, And E. M. Moraleda, all assigned with the Finance
Department or respondent SMFI.
2. ​gross​ and blatant violations by respondent SMFI of Section 5,
Article III (​Job​ ​Security​) and Section 4, Article VIII
(​Grievance​ ​Machinery​) of the current collective bargaining agreement
(CBA)​ between complainant and respondent SMFI, which provisions of
said CBA are hereunder quoted for easy reference. (Emphasis and
underscoring supplied)
On the questioned promotions, the Union did not allege that they were
done to encourage or discourage membership in a labor organization. In
fact, those promoted were members of the complaining Union. The
promotions do not thus amount to ULP under Article 248(e) of the Labor
Code.
As for the alleged ULP committed under Article 248(i), for violation of a
CBA, this Article is qualified by Article 261 of the Labor Code, the pertinent
portion of which latter Article reads:
x x x ​violations of a Collective Bargaining Agreement, ​except those
which are gross in character​, shall no longer be treated as unfair labor
practice and ​shall be resolved as grievances under the Collective
Bargaining Agreement​. ​For purposes of this article, gross violations of
Collective Bargaining Agreement shall mean flagrant and/or malicious
refusal to comply with the ​economic​ provisions of such
agreement.​ (Emphasis and underscoring supplied)
Silva v. NLRC​ instructs that for a ULP case to be cognizable by the Labor
Arbiter, and the NLRC to exercise its appellate jurisdiction, the allegations
in the complaint should show ​prima facie​ the ​concurrence of two things​,
namely: ​(1) gross violation of the CBA; AND (2) the violation pertains
to the economic provisions of the CBA​.17​ ​ (Emphasis and underscoring
supplied)
As reflected in the above-quoted allegations of the Union in its Position
Paper, the Union charges SMFI to have violated the grievance machinery
provision in the CBA. The grievance machinery provision in the CBA is not
an economic provision, however, hence, the second requirement for a
Labor Arbiter to exercise jurisdiction of a ULP is not present.
The Union likewise charges SMFI, however, to have violated the Job
Security provision in the CBA, specifically the seniority rule, in that SMFI
"appointed less senior employees to positions at its Finance Department,
consequently intentionally by-passing more senior employees who are
deserving of said appointment."
Article 4 of the Labor Code provides that "All doubts in the implementation
and interpretation of the provisions of this Code, including implementing
rules and regulations, shall be resolved in favor of labor." Since the
seniority rule in the promotion of employees has a bearing on salary and
benefits, it may, following a liberal construction of Article 261 of the Labor
Code, be considered an "economic provision" of the CBA.
As above-stated, the Union charges SMFI to have promoted less senior
employees, thus bypassing others who were more senior and equally or
more qualified. It may not be seriously disputed that this charge is a gross
or flagrant violation of the seniority rule under the CBA, a ULP over which
the Labor Arbiter has jurisdiction.
SMFI, at all events, questions why the Court of Appeals came out with a
finding that it (SMFI) disregarded the seniority rule under the CBA when its
petition before said court merely raised a question of jurisdiction. The Court
of Appeals having affirmed the NLRC decision finding that the Labor Arbiter
has jurisdiction over the Union’s complaint and thus remanding it to the
Labor Arbiter for continuation of proceedings thereon, the appellate court’s
said finding may be taken to have been made only for the purpose of
determining jurisdiction. ​(S​ an Miguel Foods Inc., vs. San Miguel Corp
Employees Union-PTGWO, G.R. No. 168569, October 5, 2007)
Section 2, Rule 43 of the 1997 Rules of Civil Procedure which provides
that:
SEC. 2. ​Cases not covered​. - This Rule shall not apply to judgments or final
orders issued under the Labor Code of the Philippines.
​ uzon Development Bank.​ Section 2, Rule
did not alter the Court's ruling in L
42 of the 1997 Rules of Civil Procedure, is nothing more than a reiteration
 of the exception to the exclusive appellate jurisdiction of the CA,​29​ as
 
provided for in Section 9, ​Batas Pambansa Blg.​ 129,​30​ as amended by
 Republic Act No. 7902:​31

(3) Exclusive appellate jurisdiction over all final judgments, decisions,

resolutions, orders or awards of Regional Trial Courts and quasi-judicial
agencies, instrumentalities, boards or commissions, including the
Securities and Exchange Commission, the Employees’ Compensation
Commission and the Civil Service Commission, except those falling within
the appellate jurisdiction of the Supreme Court in accordance with the
Constitution, the Labor Code of the Philippines under Presidential Decree
No. 442, as amended, the provisions of this Act and of subparagraph (1) of
the third paragraph and subparagraph (4) of the fourth paragraph of
Section 17 of the Judiciary Act of 1948.
The Court took into account this exception in Luzon Development Bank but,
nevertheless, held that the decisions of voluntary arbitrators issued
pursuant to the Labor Code do not come within its ambit, thus:
x x x. ​The fact that [the voluntary arbitrator’s] functions and powers
are provided for in the Labor Code does not place him within the
exceptions to said Sec. 9 since he is a quasi-judicial instrumentality
as contemplated therein. It will be noted that, although the Employees’
Compensation Commission is also provided for in the Labor Code, Circular
No. 1-91, which is the forerunner of the present Revised Administrative
Circular No. 1-95, laid down the procedure for the appealability of its
decisions to the Court of Appeals under the foregoing rationalization, and
this was later adopted by Republic Act No. 7902 in amending Sec. 9 of B.P.
129.
A fortiori, the decision or award of the voluntary arbitrator or panel of
arbitrators should likewise be appealable to the Court of Appeals, in
line with the procedure outlined in Revised Administrative Circular
No. 1-95, just like those of the quasi-judicial agencies, boards and
commissions enumerated therein.
This would be in furtherance of, and consistent with, the original purpose of
Circular No. 1-91 to provide a uniform procedure for the appellate review of
adjudications of all quasi-judicial entities not expressly excepted from the
coverage of Sec. 9 of B.P. 129 by either the Constitution or another statute.
Nor will it run counter to the legislative intendment that decisions of the
NLRC be reviewable directly by the Supreme Court since, precisely, the
cases within the adjudicative competence of the voluntary arbitrator are
 excluded from the jurisdiction of the NLRC or the labor arbiter.​32
 
This ruling has been repeatedly reiterated in subsequent cases​33​ and
continues to be the controlling doctrine. Thus, the general rule is that the
proper remedy from decisions of voluntary arbitrators is a petition for review
under Rule 43 of the Rules of Court.
Nonetheless, a special civil action for certiorari under Rule 65 of the Rules
of Court is the proper remedy for one who complains that the tribunal,
board or officer exercising judicial or quasi-judicial functions ​acted in total
 disregard of evidence material to or decisive of the controversy​.34​ ​ As
 
this Court elucidated in Garcia v. National Labor Relations Commission​35​ -
[I]n Ong v. People, we ruled that ​certiorari​ can be properly resorted
to ​where the factual findings complained of are not supported by the
evidence on record​. Earlier, in Gutib v. Court of Appeals, we emphasized
thus:
[I]t has been said that a wide breadth of discretion is granted a court of
justice in ​certiorari​ proceedings. The cases in which certiorari will issue
cannot be defined, because to do so would be to destroy its
comprehensiveness and usefulness. So wide is the discretion of the court
that authority is not wanting to show that ​certiorari​ is more discretionary
than either prohibition or mandamus. In the exercise of our superintending
control over inferior courts, we are to be guided by all the circumstances of
each particular case "as the ends of justice may require." So it is that the
writ will be granted where necessary to prevent a substantial wrong or to do
 substantial justice. 36 ​
In addition, while the settled rule is that an independent action
for ​certiorari​ may be availed of only when there is no appeal or any plain,
speedy and adequate remedy in the ordinary course of
 
law​37​ and ​certiorari​ is not a substitute for the lapsed remedy of
 appeal,​38​ there are a few significant exceptions when the extraordinary

remedy of certiorari may be resorted to despite the availability of an appeal,

namely: (a) when public welfare and the advancement of public policy
dictate; ​(​b) ​when the broader interests of justice so require;​ (c) when
the writs issued are null; and (d) when the questioned order amounts to an
 
oppressive exercise of judicial authority.​39
 In this case, while the petition was filed on July 27, 2002,​40​ 15 days after

July 12, 2002, the expiration of the 15-day reglementary period for filing an
appeal under Rule 43, the broader interests of justice warrant relaxation of
the rules on procedure. Besides, petitioner alleges that the Voluntary
Arbitrator’s conclusions have no basis in fact and in law; hence, the petition
should not be dismissed on procedural grounds. ​(​Leyte IV Electric
Cooperative Inc vs. LEYECO IV Employees Union-ALU, G.R. No. 1577745,
October 19, 2007)
The issue raised by Atty. Garcia – whether the termination or removal of an
officer of a corporation is an intra-corporate controversy that falls under the
original exclusive jurisdiction of the regional trial courts – is not novel. The
Supreme Court, in a long line of cases, has decreed that a corporate
officer’s dismissal or removal is always a corporate act and/or an
intra-corporate controversy, over which the Securities and Exchange
 
Commission [SEC] (now the Regional Trial Court)​87​ has original and
 exclusive jurisdiction.​88

We have ruled that an intra-corporate controversy is one which pertains to

any of the following relationships: (1) between the corporation, partnership
or association and the public; (2) between the corporation, partnership or
association and the State insofar as the former’s franchise, permit or
license to operate is concerned; (3) between the corporation, partnership or
association and its stockholders, partners, members or officers; and (4)
 
among the stockholders, partners or associates themselves.​89​ In Lozon v.
 National Labor Relations Commission,​90​ we declared that Presidential

Decree No. 902-A confers on the SEC original and exclusive jurisdiction to
hear and decide controversies and cases involving intra-corporate and
partnership relations between or among the corporation, officers and
stockholders and partners, including their elections or appointments x x x.
Before a dismissal or removal could properly fall within the jurisdiction of
the SEC, it has to be first established that the person removed or dismissed
 was a corporate officer.​91​ "Corporate officers" in the context of Presidential
 
Decree No. 902-A​92​ are those officers of the corporation who are given that
 character by the Corporation Code or by the corporation’s by-laws.​93​ There

are three specific officers whom a corporation must have under Section 25
 of the Corporation Code.​94​ These are the president, secretary and the

treasurer. The number of officers is not limited to these three. A corporation

may have such other officers as may be provided for by its by-laws like, but
not limited to, the vice-president, cashier, auditor or general manager. The
number of corporate officers is thus limited by law and by the corporation’s
by-laws.1avvphi1
In the case before us, the by-laws of ETPI provide:
ARTICLE V
Officers
Section 1. Number. – The officers of the Company shall be a Chairman of
the Board, a President, one or more Vice-Presidents, a Treasurer, a
Secretary, an Assistant Secretary, and such other officers as may be from
time to time be elected or appointed by the Board of Directors. One person
 may hold any two compatible offices.​95

Atty. Garcia tries to deny he is an officer of ETPI. Not being a corporate

officer, he argues that the Labor Arbiter has jurisdiction over the case. One
of the corporate officers provided for in the by-laws of ETPI is the
Vice-President. It can be gathered from Atty. Garcia’s complaint-affidavit
that he was Vice President for Business Support Services and Human
Resource Departments of ETPI when his employment was terminated
effective 16 April 2000. It is therefore clear from the by-laws and from Atty.
Garcia himself that he is a corporate officer. One who is included in the
by-laws of a corporation in its roster of corporate officers is an officer of
 
said corporation and not a mere employee.​96​ Being a corporate officer, his
removal is deemed to be an intra-corporate dispute cognizable by the SEC
and not by the Labor Arbiter.
We agree with both the NLRC and the Court of Appeals that Atty. Garcia’s
ouster as Vice-President, who is a corporate officer of ETPI, partakes of the
nature of an intra-corporate controversy, jurisdiction over which is vested in
the SEC (now the RTC). The Labor Arbiter thus erred in assuming
jurisdiction over the case filed by Atty. Garcia, because he had no
jurisdiction over the subject matter of the controversy.
Having ruled which body has jurisdiction over the instant case, we find it
unnecessary, due to mootness, to further discuss and rule on the issues
raised by ETPI and Atty. Hizon regarding the NLRC order dated 23 August
2004 granting Atty. Garcia’s Motion to Set Aside Finality of Judgment with
Opposition to Motion to Discharge Appeal Bond, and its resolution dated 10
January 2005 denying their motion for reconsideration thereon. The
decision of the Labor Arbiter, who had jurisdiction over the case, was
properly dismissed by the NLRC. Consequently, Supersedeas Bond No.
JCL (15) 00823 SICI Bond No. 75069 dated 18 November 2002, posted by
ETPI as a requirement for the filing of an appeal before the NLRC, is
ordered discharged. (​Atty Garcia vs. Eastern Telecommunications Phils., et
al., GR No. 173115 & 173163-64, April 16, 2009)
Not every controversy or money claim by an employee against the
employer or vice-versa is within the exclusive jurisdiction of the labor
arbiter. Actions between employees and employer where the
employer-employee relationship is merely incidental and the cause of
action precedes from a different source of obligation is within the
exclusive jurisdiction of the regular ​ Here,
court​.18​ the
employer-employee relationship between the parties is merely incidental
and the cause of action ultimately arose from different sources of
obligation, i.e., the Constitution and CEDAW.
Thus, where the principal relief sought is to be resolved not by reference to
the Labor Code or other labor relations statute or a collective bargaining
agreement but by the general civil law, the jurisdiction over the dispute
belongs to the regular courts of justice and not to the labor arbiter and the
NLRC. In such situations, resolution of the dispute requires expertise, not in
labor management relations nor in wage structures and other terms and
conditions of employment, but rather in the application of the general civil
law. Clearly, such claims fall outside the area of competence or expertise
ordinarily ascribed to labor arbiters and the NLRC and the rationale for
granting jurisdiction over such claims to these agencies disappears.​19
If We divest the regular courts of jurisdiction over the case, then which
tribunal or forum shall determine the constitutionality or legality of the
assailed CBA provision?
This Court holds that the grievance machinery and voluntary arbitrators do
not have the power to determine and settle the issues at hand. They have
no jurisdiction and competence to decide constitutional issues relative to
the questioned compulsory retirement age. Their exercise of jurisdiction is
futile, as it is like vesting power to someone who cannot wield it.
In ​Gonzales v. Climax Mining Ltd.​,20​ ​ this Court affirmed the jurisdiction of
courts over questions on constitutionality of contracts, as the same involves
the exercise of judicial power. The Court said:
Whether the case involves void or voidable contracts is still a judicial
question. It may, in some instances, involve questions of fact especially
with regard to the determination of the circumstances of the execution of
the contracts. But the resolution of the validity or voidness of the contracts
remains a legal or judicial question as it requires the exercise of judicial
function. It requires the ascertainment of what laws are applicable to the
dispute, the interpretation and application of those laws, and the rendering
of a judgment based thereon. Clearly, the dispute is not a mining conflict. It
is essentially judicial. The complaint was not merely for the determination of
rights under the mining contracts since the very validity of those contracts
is put in issue.
In ​Saura v. Saura, Jr.,​ 21​
​ this Court emphasized the primacy of the regular
court's judicial power enshrined in the Constitution that is true that the trend
is towards vesting administrative bodies like the SEC with the power to
adjudicate matters coming under their particular specialization, to insure a
more knowledgeable solution of the problems submitted to them. This
would also relieve the regular courts of a substantial number of cases that
would otherwise swell their already clogged dockets. ​But as expedient as
this policy may be, it should not deprive the courts of justice of their
power to decide ordinary cases in accordance with the general laws
that do not require any particular expertise or training to interpret and
apply. Otherwise, the creeping take-over by the administrative
agencies of the judicial power vested in the courts would render the
judiciary virtually impotent in the discharge of the duties assigned to
it by the Constitution.​
To be sure, in ​Rivera v. Espiritu​,22​
​ after Philippine Airlines (PAL) and PAL
Employees Association (PALEA) entered into an agreement, which
includes the provision to suspend the PAL-PALEA CBA for 10 years,
several employees questioned its validity via a petition for certiorari directly
to the Supreme Court. They said that the suspension was unconstitutional
and contrary to public policy. Petitioners submit that the suspension was
inordinately long, way beyond the maximum statutory life of 5 years for a
CBA provided for in Article 253-A of the Labor Code. By agreeing to a
10-year suspension, PALEA, in effect, abdicated the workers' constitutional
right to bargain for another CBA at the mandated time.
In that case, this Court denied the petition for certiorari, ruling that there is
available to petitioners a plain, speedy, and adequate remedy in the
ordinary course of law. The Court said that while the petition was
denominated as one for certiorari and prohibition, its object was actually the
nullification of the PAL-PALEA agreement. As such, petitioners' proper
remedy is an ordinary civil action for annulment of contract, an action which
properly falls under the jurisdiction of the regional trial courts.
The change in the terms and conditions of employment, should Section 144
of the CBA be held invalid, is but a necessary and unavoidable
consequence of the principal relief sought, i.e., nullification of the alleged
discriminatory provision in the CBA. Thus, it does not necessarily follow
that a resolution of controversy that would bring about a change in the
terms and conditions of employment is a labor dispute, cognizable by labor
tribunals. It is unfair to preclude petitioners from invoking the trial court's
jurisdiction merely because it may eventually result into a change of the
terms and conditions of employment. Along that line, the trial court is not
asked to set and fix the terms and conditions of employment, but is called
upon to determine whether CBA is consistent with the laws.
Although the CBA provides for a procedure for the adjustment of
grievances, such referral to the grievance machinery and thereafter to
voluntary arbitration would be inappropriate to the petitioners, because the
union and the management have unanimously agreed to the terms of the
CBA and their interest is unified.
​ this Court held that:
In ​Pantranco North Express, Inc., v. NLRC,23​
x x x Hence, only disputes involving the union and the company shall be
referred to the grievance machinery or voluntary arbitrators.
In the instant case, both the union and the company are united or have
come to an agreement regarding the dismissal of private respondents. No
grievance between them exists which could be brought to a grievance
machinery. The problem or dispute in the present case is between the
union and the company on the one hand and some union and non-union
members who were dismissed, on the other hand. The dispute has to be
settled before an impartial body. The grievance machinery with members
designated by the union and the company cannot be expected to be
impartial against the dismissed employees. Due process demands that the
dismissed workers’ grievances be ventilated before an impartial body. x x x
.
Applying the same rationale to the case at bar, it cannot be said that the
"dispute" is between the union and petitioner company because both have
previously agreed upon the provision on "compulsory retirement" as
embodied in the CBA. Also, it was only private respondent on his own who
questioned the compulsory retirement. x x x.
In the same vein, the dispute in the case at bar is not between FASAP and
respondent PAL, who have both previously agreed upon the provision on
the compulsory retirement of female flight attendants as embodied in the
CBA. The dispute is between respondent PAL and several female flight
attendants who questioned the provision on compulsory retirement of
female flight attendants. Thus, applying the principle in the aforementioned
case cited, referral to the grievance machinery and voluntary arbitration
would not serve the interest of the petitioners.
Besides, a referral of the case to the grievance machinery and to the
voluntary arbitrator under the CBA would be futile because respondent
already implemented Section 114, Part A of PAL-FASAP CBA when
several of its female flight attendants reached the compulsory retirement
age of 55.
Further, FASAP, in a letter dated July 12, 2004, addressed to PAL,
submitted its association's bargaining proposal for the remaining period of
2004-2005 of the PAL-FASAP CBA, which includes the renegotiation of the
subject Section 144. However, FASAP's attempt to change the questioned
provision was shallow and superficial, to say the least, because it exerted
no further efforts to pursue its proposal. When petitioners in their individual
capacities questioned the legality of the compulsory retirement in the CBA
before the trial court, there was no showing that FASAP, as their
representative, endeavored to adjust, settle or negotiate with PAL for the
removal of the difference in compulsory age retirement between its female
and male flight attendants, particularly those employed before November
22, 1996. Without FASAP's active participation on behalf of its female flight
attendants, the utilization of the grievance machinery or voluntary
arbitration would be pointless.
The trial court in this case is not asked to interpret Section 144, Part A of
the PAL-FASAP CBA. Interpretation, as defined in Black's Law Dictionary,
is the art of or process of discovering and ascertaining the meaning of a
 
statute, will, contract, or other written document.​24​ The provision regarding
the compulsory retirement of flight attendants is not ambiguous and does
not require interpretation. Neither is there any question regarding the
implementation of the subject CBA provision, because the manner of
implementing the same is clear in itself. The only controversy lies in its
intrinsic validity.
Although it is a rule that a contract freely entered between the parties
should be respected, since a contract is the law between the parties, said
rule is not absolute.
 
In ​Pakistan International Airlines Corporation v. Ople,​25​ this Court held that:
The principle of party autonomy in contracts is not, however, an absolute
principle. The rule in Article 1306, of our Civil Code is that the contracting
parties may establish such stipulations as they may deem convenient,
"provided they are not contrary to law, morals, good customs, public order
or public policy." Thus, counter-balancing the principle of autonomy of
contracting parties is the equally general rule that provisions of applicable
law, especially provisions relating to matters affected with public policy, are
deemed written into the contract. Put a little differently, the governing
principle is that parties may not contract away applicable provisions of law
especially peremptory provisions dealing with matters heavily impressed
with public interest. The law relating to labor and employment is clearly
such an area and 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.
Moreover, the relations between capital and labor are not merely
contractual. They are so impressed with public interest that labor contracts
 
must yield to the common good.x x x 26​ ​ The supremacy of the law over
contracts is explained by the fact that labor contracts are not ordinary
contracts; these are imbued with public interest and therefore are subject to
 the police power of the state.​27​ It should not be taken to mean that

retirement provisions agreed upon in the CBA are absolutely beyond the
ambit of judicial review and nullification. A CBA, as a labor contract, is not
merely contractual in nature but impressed with public interest. If the
retirement provisions in the CBA run contrary to law, public morals, or
 public policy, such provisions may very well be voided.​28

Finally, the issue in the petition for certiorari brought before the CA by the
respondent was the alleged exercise of grave abuse of discretion of the
RTC in taking cognizance of the case for declaratory relief. When the CA
annuled and set aside the RTC's order, petitioners sought relief before this
Court through the instant petition for review under Rule 45. A perusal of the
petition before Us, petitioners pray for the declaration of the alleged
discriminatory provision in the CBA against its female flight attendants.
This Court is not persuaded. The rule is settled that pure questions of fact
may not be the proper subject of an appeal by certiorari under Rule 45 of
the Revised Rules of Court. This mode of appeal is generally limited only to
questions of law which must be distinctly set forth in the petition. The
Supreme Court is not a trier of facts.​29
The question as to whether said Section 114, Part A of the PAL-FASAP
CBA is discriminatory or not is a question of fact. This would require the
presentation and reception of evidence by the parties in order for the trial
court to ascertain the facts of the case and whether said provision violates
the Constitution, statutes and treaties. A full-blown trial is necessary, which
jurisdiction to hear the same is properly lodged with the the RTC.
Therefore, a remand of this case to the RTC for the proper determination of
the merits of the petition for declaratory relief is just and proper.
​ alaguena et al., vs. Phil Airlines GR No. 172013, Oct 2, 2009)
(H
The issue revolves mainly on whether petitioner was an employee or a
corporate officer of Slimmers World. Section 25 of the Corporation Code
enumerates corporate officers as the president, secretary, treasurer and
such other officers as may be provided for in the by-laws. In Tabang v.
NLRC,​12​ we held that an "office" is created by the charter of the corporation
and the officer is elected by the directors or stockholders. On the other
hand, an "employee" usually occupies no office and generally is employed
not by action of the directors or stockholders but by the managing officer of
the corporation who also determines the compensation to be paid to such
employee.
In the present case, the respondents, in their motion to dismiss filed before
the labor arbiter, questioned the jurisdiction of the NLRC in taking
cognizance of petitioner’s complaint. In the motion, respondents attached
the General Information Sheet​13​ (GIS) dated 14 April 1998, Minutes​14​ of the
meeting of the Board of Directors dated 14 April 1997 and Secretary’s
Certificate,​15​ and the Amended By-Laws​16​ dated 1 August 1994 of
Slimmers World as submitted to the SEC to show that petitioner was a
corporate officer whose rights do not fall within the NLRC’s jurisdiction. The
GIS and minutes of the meeting of the board of directors indicated that
petitioner was a member of the board of directors, holding one subscribed
share of the capital stock, and an elected corporate officer.
The relevant portions of the Amended By-Laws of Slimmers World which
enumerate the power of the board of directors as well as the officers of the
corporation state:
Article II
The Board of Directors
1. Qualifications and Election – The general management of the
corporation shall be vested in a board of five directors who shall
be stockholders and who shall be elected annually by the
stockholders and who shall serve until the election and
qualification of their successors.
xxx
Article III
 Officers
xxx
4. Vice-President – Like the Chairman of the Board and the
President, the Vice-President shall be elected by the Board of
Directors from [its] own members.
The Vice-President shall be vested with all the powers and
authority and is required to perform all the duties of the
President during the absence of the latter for any cause.
The Vice-President will perform such duties as the Board of
Directors may impose upon him from time to time.
xxx
Clearly, from the documents submitted by respondents, petitioner was a
director and officer of Slimmers World. The charges of illegal suspension,
illegal dismissal, unpaid commissions, reinstatement and back wages
imputed by petitioner against respondents fall squarely within the ambit of
intra-corporate disputes. In a number of cases,​17​ we have held that a
corporate officer’s dismissal is always a corporate act, or an intra-corporate
controversy which arises between a stockholder and a corporation. The
question of remuneration involving a stockholder and officer, not a mere
employee, is not a simple labor problem but a matter that comes within the
area of corporate affairs and management and is a corporate controversy
in contemplation of the Corporation Code.​18
Prior to its amendment, Section 5(c) of Presidential Decree No.
902-A​19​ (PD 902-A) provided that intra-corporate disputes fall within the
jurisdiction of the Securities and Exchange Commission (SEC):
Sec. 5. In addition to the regulatory and adjudicative functions
of the Securities and Exchange Commission over corporations,
partnerships and other forms of associations registered with it
as expressly granted under existing laws and decrees, it shall
have original and exclusive jurisdiction to hear and decide
cases involving:
xxx
c) Controversies in the election or appointments of directors,
trustees, officers or managers of such corporations,
partnerships or associations.
Subsection 5.2, Section 5 of Republic Act No. 8799, which took
effect on 8 August 2000, transferred to regional trial courts the
SEC’s jurisdiction over all cases listed in Section 5 of PD 902-A:
5.2. The Commission’s jurisdiction over all cases enumerated
under Section 5 of Presidential Decree No. 902-A is hereby
transferred to the Courts of general jurisdiction or the
appropriate Regional Trial Court.
xxx
It is a settled rule that jurisdiction over the subject matter is conferred by
law.​20​ The determination of the rights of a director and corporate officer
dismissed from his employment as well as the corresponding liability of a
corporation, if any, is an intra-corporate dispute subject to the jurisdiction of
the regular courts. Thus, the appellate court correctly ruled that it is not the
NLRC but the regular courts which have jurisdiction over the present case.
 ​ kol vs. Slimmer’s World International, et al., G.R. No. 160146, December
(O
11, 2009)
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​.
Light Rail Transit Authority v. Venus, Jr.,​17​ which has a similar factual
backdrop, holds that LRTA, being a government-owned or controlled
corporation created by an original charter, is beyond the reach of the
Department of Labor and Employment which has jurisdiction over workers
in the private sector, viz:
. . . ​[E]mployees of petitioner METRO cannot be considered as employees
of petitioner LRTA​. The employees hired by METRO are covered by the
Labor Code and are under the jurisdiction of the Department of Labor and
Employment, whereas the employees of petitioner LRTA, a
government-owned and controlled corporation with original charter,
are ​covered by civil service rules​. Herein ​private respondent workers
cannot have the best of two worlds, e.g., be considered government
employees of petitioner LRTA, yet allowed to strike as private employees
under our labor laws​. x x x.
xxxx
. . . [I]t is inappropriate to pierce the corporate veil of petitioner METRO. x x
x.
In the instant case, petitioner METRO, formerly Meralco Transit
Organization, Inc., was originally owned by the Manila Electric Company
and registered with the Securities and Exchange Commission more than a
decade before the labor dispute. It then entered into a ten-year agreement
with petitioner LRTA in 1984. And, ​even if petitioner LRTA eventually
purchased METRO in 1989, both parties maintained their separate and
distinct juridical personality ​and allowed the agreement to proceed. In 1990,
this Court, in Light Rail Transit Authority v. Commission on Audit (G.R. No.
88365, January 9, 1990), even upheld the validity of the said agreement.
Consequently, the agreement was extended beyond its ten-year period. In
1995, METRO’s separate juridical identity was again recognized when it
entered into a collective bargaining agreement with the workers’ union. All
these years, METRO’s distinct corporate personality continued quiescently,
separate and apart from the juridical personality of petitioner LRTA.
The labor dispute only arose in 2000, after a deadlock occurred during the
collective bargaining between petitioner METRO and the workers’ union.
This alone is not a justification to pierce the corporate veil of petitioner
METRO and make petitioner LRTA liable to private respondent workers.
There are no badges of fraud or any wrongdoing to pierce the corporate
veil of petitioner METRO.
xxxx
In sum, ​petitioner LRTA cannot be held liable to the employees of petitioner
METRO​.18​ ​ (emphasis and underscoring supplied)
IN FINE, the Labor Arbiter’s decision against LRTA was rendered without
jurisdiction, hence, it is void, thus rendering it improper for the remand of
the case to the NLRC, as ordered by the appellate court, for it (NLRC) to
give due course to LRTA’s appeal.
A final word. It bears emphasis that this Court’s present Decision treats
only with respect to the Labor Arbiter’s decision against respondent LRTA.
​ ugo et al., vs. Light Rail Transit Authority, G.R. No. 181866, March 18,
(H
2010)
Section 25 of the Corporation Code provides:
Section 25.​ ​Corporate officers, quorum.--Immediately after their election,
the directors of a corporation must formally organize by the election of a
president, who shall be a director, a treasurer who may or may not be a
director, a secretary who shall be a resident and citizen of the
Philippines, ​and such other officers as may be provided for in the
by-laws​. Any two (2) or more positions may be held concurrently by the
same person, except that no one shall act as president and secretary or as
president and treasurer at the same time.
The directors or trustees and officers to be elected shall perform the duties
enjoined on them by law and the by-laws of the corporation. Unless the
articles of incorporation or the by-laws provide for a greater majority, a
majority of the number of directors or trustees as fixed in the articles of
incorporation shall constitute a quorum for the transaction of corporate
business, and every decision of at least a majority of the directors or
trustees present at a meeting at which there is a quorum shall be valid as a
corporate act, except for the election of officers which shall require the vote
of a majority of all the members of the board.
Directors or trustees cannot attend or vote by proxy at board meetings.
Conformably with Section 25, a position must be expressly mentioned in
the By-Laws in order to be considered as a corporate office. Thus, the
creation of an office pursuant to or under a By-Law enabling provision is
not enough to make a position a corporate office. Guerrea v. Lezama,​19​ the
first ruling on the matter, held that the only officers of a corporation were
those given that character either by the Corporation Code or by the
By-Laws; the rest of the corporate officers could be considered only as
employees or subordinate officials. Thus, it was held in ​Easycall
Communications Phils., Inc. v. King​:20
​
An "office" is created by the charter of the corporation and the officer is
elected by the directors or stockholders. On the other hand, an employee
occupies no office and generally is employed not by the action of the
directors or stockholders but by the managing officer of the corporation who
also determines the compensation to be paid to such employee.
In this case, respondent was appointed vice president for nationwide
expansion by Malonzo, petitioner’'s general manager, not by the board of
directors of petitioner. It was also Malonzo who determined the
compensation package of respondent. Thus, respondent was ​an employee,
not a "corporate officer." ​The CA was therefore correct in ruling that
jurisdiction over the case was properly with the NLRC, not the SEC (now
the RTC).
This interpretation is the correct application of Section 25 of the
Corporation Code, which plainly states that the corporate officers are the
President, Secretary, Treasurer and such other officers as may be provided
for in the By-Laws. Accordingly, the corporate officers in the context of PD
No. 902-A are exclusively those who are given that character either by the
Corporation Code or by the corporation’s By-Laws.
A different interpretation can easily leave the way open for the Board of
Directors to circumvent the constitutionally guaranteed security of tenure of
the employee by the expedient inclusion in the By-Laws of an enabling
clause on the creation of just any corporate officer position.
It is relevant to state in this connection that the SEC, the primary agency
administering the Corporation Code, adopted a similar interpretation of
Section 25 of the Corporation Code in its Opinion dated November 25,
1993,​21​ to wit:
Thus, pursuant to the above provision (Section 25 of the Corporation
Code), whoever are the corporate officers enumerated in the by-laws are
the exclusive Officers of the corporation and the Board has no power to
create other Offices without amending first the corporate
By-laws. ​However, the Board may create appointive positions other
than the positions of corporate Officers, but the persons occupying
such positions are not considered as corporate officers within the
meaning of Section 25 of the Corporation Code​ a ​ nd are not empowered
to exercise the functions of the corporate Officers, except those functions
lawfully delegated to them. Their functions and duties are to be determined
by the Board of Directors/Trustees.
Moreover, the Board of Directors of Matling could not validly delegate the
power to create a corporate office to the President, in light of Section 25 of
the Corporation Code requiring the Board of Directors itself to elect the
corporate officers. Verily, the power to elect the corporate officers was a
discretionary power that the law exclusively vested in the Board of
Directors, and could not be delegated to subordinate officers or
agents.​22​ The office of Vice President for Finance and Administration
created by Matling’s President pursuant to By Law No. V was an ordinary,
not a corporate, office.
To emphasize, the power to create new offices and the power to appoint
the officers to occupy them vested by By-Law No. V merely allowed
Matling’s President to create non-corporate offices to be occupied by
ordinary employees of Matling. Such powers were incidental to the
President’s duties as the executive head of Matling to assist him in the daily
operations of the business.
The petitioners’ reliance on ​Tabang, supra,​ is misplaced. The statement
in ​Tabang,​ to the effect that offices not expressly mentioned in the By-Laws
but were created pursuant to a By-Law enabling provision were also
considered corporate offices, was plainly ​obiter dictum​ due to the position
subject of the controversy being mentioned in the By-Laws. Thus, the Court
held therein that the position was a corporate office, and that the
determination of the rights and liabilities arising from the ouster from the
position was an intra-corporate controversy within the SEC’s jurisdiction.
In ​Nacpil v. Intercontinental Broadcasting Corporation,23​ ​ w
​ hich​ m
​ ay be the
more appropriate ruling, the position subject of the controversy was not
expressly mentioned in the By-Laws, but was created pursuant to a By-Law
enabling provision authorizing the Board of Directors to create other offices
that the Board of Directors might see fit to create. The Court held there that
the position was a corporate office, relying on the ​obiter dictum ​in ​Tabang​.
Considering that the observations earlier made herein show that the
soundness of their ​dicta​ is not unassailable, ​Tabang a ​ nd​ Nacpil s​ hould no
longer be controlling.
Yet, the petitioners insist that because the respondent was a
Director/stockholder of Matling, and relying on ​Paguio v. National Labor
Relations Commission​24​ and ​Ongkingko v. National Labor Relations
Commission,​25​ the NLRC had no jurisdiction over his complaint,
considering that any case for illegal dismissal brought by a
stockholder/officer against the corporation was an intra-corporate matter
that must fall under the jurisdiction of the SEC conformably with the context
of PD No. 902-A.
The petitioners’ insistence is bereft of basis.
To begin with, the reliance on P ​ aguio ​and ​Ongkingko ​is misplaced. In both
rulings, the complainants were undeniably corporate officers due to their
positions being expressly mentioned in the By-Laws, aside from the fact
that both of them had been duly elected by the respective Boards of
Directors. But the herein respondent’s position of Vice President for
Finance and Administration was not expressly mentioned in the By-Laws;
neither was the position of Vice President for Finance and Administration
created by Matling’s Board of Directors. Lastly, the President, not the Board
of Directors, appointed him.
True it is that the Court pronounced in ​Tabang​ as follows:
Also, an intra-corporate controversy is one which arises between a
stockholder and the corporation. There is no distinction, qualification or any
exemption whatsoever. The provision is broad and covers all kinds of
controversies between stockholders and corporations.​26
However, the Tabang pronouncement is not controlling because it is too
sweeping and does not accord with reason, justice, and fair play. In order
to determine whether a dispute constitutes an intra-corporate controversy
or not, the Court considers two elements instead, namely: (a) the status or
relationship of the parties; and (b) the nature of the question that is the
subject of their controversy. This was our thrust in ​Viray v. Court of
Appeals​:27
​
The establishment of any of the relationships mentioned above will not
necessarily always confer jurisdiction over the dispute on the SEC to the
exclusion of regular courts. The statement made in one case that the rule
admits of no exceptions or distinctions is not that absolute. The better
policy in determining which body has jurisdiction over a case would be to
consider not only the status or relationship of the parties but also the nature
of the question that is the subject of their controversy.
Not every conflict between a corporation and its stockholders involves
corporate matters that only the SEC can resolve in the exercise of its
adjudicatory or quasi-judicial powers. If, for example, a person leases an
apartment owned by a corporation of which he is a stockholder, there
should be no question that a complaint for his ejectment for non-payment of
rentals would still come under the jurisdiction of the regular courts and not
of the SEC. By the same token, if one person injures another in a vehicular
accident, the complaint for damages filed by the victim will not come under
the jurisdiction of the SEC simply because of the happenstance that both
parties are stockholders of the same corporation. A contrary interpretation
would dissipate the powers of the regular courts and distort the meaning
and intent of PD No. 902-A.
In another case, ​Mainland Construction Co., Inc. v. Movilla​,28​ ​ the Court
reiterated these determinants thuswise:
In order that the SEC (now the regular courts) can take cognizance of a
case, the controversy must pertain to any of the following relationships:
a) between the corporation, partnership or association and the public;
b) between the corporation, partnership or association and its stockholders,
partners, members or officers;
c) between the corporation, partnership or association and the State as far
as its franchise, permit or license to operate is concerned; and
d) among the stockholders, partners or associates themselves.
The fact that the parties involved in the controversy are all stockholders or
that the parties involved are the stockholders and the corporation does not
necessarily place the dispute within the ambit of the jurisdiction of SEC.
The better policy to be followed in determining jurisdiction over a case
should be to consider concurrent factors such as the status or relationship
of the parties or the nature of the question that is the subject of their
controversy. In the absence of any one of these factors, the SEC will not
have jurisdiction. Furthermore, it does not necessarily follow that every
conflict between the corporation and its stockholders would involve such
corporate matters as only the SEC can resolve in the exercise of its
adjudicatory or quasi-judicial powers.​29
The criteria for distinguishing between corporate officers who may be
ousted from office at will, on one hand, and ordinary corporate employees
who may only be terminated for just cause, on the other hand, do not
depend on the nature of the services performed, but on the manner of
creation of the office. In the respondent’s case, he was supposedly at once
an employee, a stockholder, and a Director of Matling. The circumstances
surrounding his appointment to office must be fully considered to determine
whether the dismissal constituted an intra-corporate controversy or a labor
termination dispute. We must also consider whether his status as Director
and stockholder had any relation at all to his appointment and subsequent
dismissal as Vice President for Finance and Administration. ​(​Matling
Industrial and Commercial Corp et al., vs. Coros, GR No. 157802, Oct. 13,
2010)
Respondent’s plea that she be spared from complying with MERALCO’s
Memorandum directing her reassignment to the Alabang Sector, under the
guise of a quest for information or data allegedly in possession of
petitioners, does not fall within the province of a writ of habeas data.
Section 1 of the Rule on the Writ of Habeas Data provides:
Section 1. Habeas Data. – The writ of habeas data is a remedy available to
any person whose ​right to privacy in life, liberty or security is violated
or threatened by an unlawful act or omission​ ​of a public official or
employee or of a private individual or entity ​engaged in the gathering,
collecting or storing of data or information​ regarding the person, family,
home and correspondence of the aggrieved party. (emphasis and
underscoring supplied)
The habeas data rule, in general, is designed to protect by means of
judicial complaint the image, privacy, honor, information, and freedom of
information of an individual. It is meant to provide a forum to enforce one’s
right to the truth and to informational privacy, thus safeguarding the
constitutional guarantees of a person’s right to life, liberty and security
against abuse in this age of information technology.
It bears reiteration that like the writ of amparo, habeas data was conceived
as a response, given the lack of effective and available remedies, to
address the extraordinary rise in the number of killings and enforced
disappearances. Its intent is to address violations of or threats to the rights
to life, liberty or security as a remedy independently from those provided
under prevailing Rules.​13
Castillo v. Cruz​14​ underscores the emphasis laid down in Tapuz v. del
Rosario​15​ that the writs of amparo and habeas data will NOT issue to
protect purely ​property​ or commercial concerns nor when the grounds
invoked in support of the petitions therefor are vague or
doubtful.​16​ Employment constitutes a property right under the context of the
due process clause of the Constitution.​17​ It is evident that respondent’s
reservations on the real reasons for her transfer - a legitimate concern
respecting the terms and conditions of one’s employment - are what
prompted her to adopt the extraordinary remedy of habeas data.
Jurisdiction over such concerns is inarguably lodged by law with the NLRC
and the Labor Arbiters.
In another vein, there is no showing from the facts presented that
petitioners committed any unjustifiable or unlawful violation of
respondent’s ​right to privacy​ vis-a-vis the right to life, liberty or security. To
argue that petitioners’ refusal to disclose the contents of reports allegedly
received on the threats to respondent’s safety amounts to a violation of her
right to privacy is at best speculative. Respondent in fact trivializes these
threats and accusations from unknown individuals in her earlier-quoted
portion of her July 10, 2008 letter as "highly suspicious, doubtful or are just
mere jokes if they existed at all."​18​ And she even suspects that her transfer
to another place of work "betray[s] the real intent of management]" and
could be a "punitive move." Her posture unwittingly concedes that the issue
​ anila Electric Co. et al., vs. Lim, GR No. 184769, Oct. 5,
is labor-related. ​(M
2010)
The Promissory Notes uniformly provide:
PROMISSORY NOTE
P_____ Makati, M.M. ____ 19__
FOR VALUE RECEIVED, I/WE _____ jointly and severally
promise to pay to THE HSBC RETIREMENT PLAN (hereinafter
called the "PLAN") at its office in the Municipality of Makati,
Metro Manila, on or before ​until fully paid​ the sum of
PESOS ​___​ (​P___​) Philippine Currency without discount, with
interest from date hereof at the rate of ​Six​ per cent (​6% ​ ) per
annum, payable monthly.
 I/WE agree that the PLAN may, upon written notice, increase
the interest rate stipulated in this note at any time depending on
prevailing conditions.
I/WE hereby expressly consent to any extensions or renewals
hereof for a portion or whole of the principal without notice to
the other(s), and in such a case our liability shall remain joint
and several.1avvphi1
In case collection is made by or through an attorney, I/WE
jointly and severally agree to pay ten percent (10%) of the
amount due on this note (but in no case less than P200.00) as
and for attorney’s fees in addition to expenses and costs of suit.
In case of judicial execution, I/WE hereby jointly and severally
waive our rights under the provisions of Rule 39, Section 12 of
the Rules of Court.​15
In ruling for HSBCL-SRP, we apply the first paragraph of Article 1179 of the
Civil Code:
Art. 1179. Every obligation whose performance does not depend upon a
future or uncertain event, or upon a past event unknown to the parties,
is ​demandable at once​.
x x x. (Emphasis supplied.)
We affirm the findings of the MeTC and the RTC that there is no date of
payment indicated in the Promissory Notes. The RTC is correct in ruling
that since the Promissory Notes do not contain a period, HSBCL-SRP has
the right to demand immediate payment. Article 1179 of the Civil Code
applies. The spouses Broqueza’s obligation to pay HSBCL-SRP is a pure
obligation. The fact that HSBCL-SRP was content with the prior monthly
check-off from Editha Broqueza’s salary is of no moment. Once Editha
Broqueza defaulted in her monthly payment, HSBCL-SRP made a demand
to enforce a pure obligation.
In their Answer, the spouses Broqueza admitted that prior to Editha
Broqueza’s dismissal from HSBC in December 1993, she "religiously paid
the loan amortizations, which HSBC collected through payroll
check-off."​16​ A definite amount is paid to HSBCL-SRP on a specific date.
Editha Broqueza authorized HSBCL-SRP to make deductions from her
payroll until her loans are fully paid. Editha Broqueza, however, defaulted in
her monthly loan payment due to her dismissal. Despite the spouses
Broqueza’s protestations, the payroll deduction is merely a convenient
mode of payment and not the sole source of payment for the loans.
HSBCL-SRP never agreed that the loans will be paid only through salary
deductions. Neither did HSBCL-SRP agree that if Editha Broqueza ceases
to be an employee of HSBC, her obligation to pay the loans will be
suspended. HSBCL-SRP can immediately demand payment of the loans at
anytime because the obligation to pay has no period. Moreover, the
spouses Broqueza have already incurred in default in paying the monthly
installments.
Finally, the enforcement of a loan agreement involves "debtor-creditor
relations founded on contract and does not in any way concern employee
relations. As such it should be enforced through a separate civil action in
the regular courts and not before the Labor Arbiter."​17 (​Hongkong and
Shanghai Banking Corp., vs. Sps. Broqueza, GR No. 178610, Nov. 17,
2010)
"‘Corporate officers’ in the context of Presidential Decree No. 902-A are
those officers of the corporation who are given that character by the
Corporation Code or by the corporation’s by-laws. There are three specific
officers whom a corporation must have under Section 25 of the Corporation
Code. These are the president, secretary and the treasurer. The number of
officers is not limited to these three. A corporation may have such other
officers as may be provided for by its by-laws like, but not limited to, the
vice-president, cashier, auditor or general manager. The number of
corporate officers is thus limited by law and by the corporation’s by-laws."​22
Respondents claim that petitioner was appointed Manager by virtue of
Section 1, Article IV of respondent corporation’s By-Laws which provides:
ARTICLE IV
OFFICER
Section 1. Election/Appointment – Immediately after their
election, the Board of Directors shall formally organize by
electing the President, Vice-President, the Secretary at said
meeting.
The Board, may from time to time, appoint such other
officers as it may determine to be necessary or proper.​ Any
two (2) or more positions may be held concurrently by the same
person, except that no one shall act as President and Treasurer
or Secretary at the same time.
x x x x​23​ (Emphasis ours)
We have however examined the records of this case and we find nothing to
prove that petitioner’s appointment was made pursuant to the
above-quoted provision of respondent corporation’s By-Laws. No copy of
board resolution appointing petitioner as Manager or any other document
showing that he was appointed to said position by action of the board was
submitted by respondents. What we found instead were mere allegations of
respondents in their various pleadings​24​ that petitioner was appointed as
Manager of respondent corporation and nothing more. "The Court has
stressed time and again that allegations must be proven by sufficient
evidence because mere allegation is definitely not evidence."​25
It also does not escape our attention that respondents made the following
conflicting allegations in their Memorandum on Appeal​26​ filed before the
NLRC which cast doubt on petitioner’s status as a corporate officer, to wit:
xxxx
24. Complainant-appellee Renato Real was appointed as the manager of
respondent-appellant Sangu on November 6, 1998. Priorly [sic], he was
working at Atlas Ltd. Co. at Mito-shi, Ibaraki-ken Japan. He was staying in
Japan as an illegal alien for the past eleven (11) years. He had a problem
with his family here in the Philippines which prompted him to surrender
himself to Japan’s Bureau of Immigration and was deported back to the
Philippines. His former employer, Mr. Tsutomo Nogami requested Mr.
Masahiko Shibata, one of respondent-appellant Sangu’s Board of
Directors, if complainant-appellee Renato Real could work as one of its
employees here in the Philippines because he had been blacklisted at
Japan’s Immigration Office and could no longer go back to Japan​.​ ​And so
it was arranged that he would serve as respondent-appellant Sangu’s
manager, receiving a salary of ₱25,000.00​. As such, he was tasked to
oversee the operations of the company. x x x (Emphasis ours)
xxxx
As earlier stated, complainant-appellee Renato Real was ​hired​ as the
manager of respondent-appellant Sangu. As such, his position was
reposed with full trust and confidence. x x x
While respondents repeatedly claim that petitioner was appointed as
Manager pursuant to the corporation’s By-Laws, the above-quoted
inconsistencies in their allegations as to how petitioner was placed in said
position, coupled by the fact that they failed to produce any documentary
evidence to prove that petitioner was appointed thereto by action or with
approval of the board, only leads this Court to believe otherwise. It has
been consistently held that "[a]n ‘office’ is created by the charter of the
corporation and the officer is elected (or appointed) by the directors or
stockholders."​27​ Clearly here, respondents failed to prove that petitioner
was appointed by the board of directors. Thus, we cannot subscribe to their
claim that petitioner is a corporate officer. Having said this, we find that
there is no intra-corporate relationship between the parties insofar as
petitioner’s complaint for illegal dismissal is concerned and that same does
not satisfy the relationship test.
Present controversy does not relate to intra-corporate dispute
We now go to the nature of controversy test. As earlier stated, respondents
terminated the services of petitioner for the following reasons: (1) his
continuous absences at his post at Ogino Philippines, Inc; (2) respondents’
loss of trust and confidence on petitioner; and, (3) to cut down operational
expenses to reduce further losses being experienced by the corporation.
Hence, petitioner filed a complaint for illegal dismissal and sought
reinstatement, backwages, moral damages and attorney’s fees. From
these, it is not difficult to see that the reasons given by respondents for
dismissing petitioner have something to do with his being a Manager of
respondent corporation and nothing with his being a director or stockholder.
For one, petitioner’s continuous absences in his post in Ogino relates to his
performance as Manager. Second, respondents’ loss of trust and
confidence in petitioner stemmed from his alleged acts of establishing a
company engaged in the same line of business as respondent
corporation’s and submitting proposals to the latter’s clients while he was
still serving as its Manager. While we note that respondents also claim
these acts as constituting acts of disloyalty of petitioner as director and
stockholder, we, however, think that same is a mere afterthought on their
part to make it appear that the present case involves an element of
intra-corporate controversy. This is because before the Labor Arbiter,
respondents did not see such acts to be disloyal acts of a director and
stockholder but rather, as constituting willful breach of the trust reposed
upon petitioner as Manager.​28​ It was only after respondents invoked the
Labor Arbiter’s lack of jurisdiction over petitioner’s complaint in the
Supplemental Memorandum of Appeal​29​ filed before the NLRC that
respondents started considering said acts as such. Third, in saying that
they were dismissing petitioner to cut operational expenses, respondents
actually want to save on the salaries and other remunerations being given
to petitioner as its Manager. Thus, when petitioner sought for
reinstatement, he wanted to recover his position as Manager, a position
which we have, however, earlier declared to be not a corporate position. He
is not trying to recover a seat in the board of directors or to any appointive
or elective corporate position which has been declared vacant by the
board. Certainly, what we have here is a case of termination of employment
which is a labor controversy and not an intra-corporate dispute. In sum, we
hold that petitioner’s complaint likewise does not satisfy the nature of
controversy test.
With the elements of intra-corporate controversy being absent in this case,
we thus hold that petitioner’s complaint for illegal dismissal against
respondents is not intra-corporate. Rather, it is a termination dispute and,
consequently, falls under the jurisdiction of the Labor Arbiter pursuant to
Section 217​30​ of the Labor Code.
We take note of the cases cited by respondents and find them inapplicable
to the case at bar. ​Fortune Cement Corporation v. National Labor Relations
Commission31​ ​ involves a member of the board of directors and at the same
time a corporate officer who claims he was illegally dismissed after he was
stripped of his corporate position of Executive Vice-President because of
loss of trust and confidence. On the other hand, ​Philippine School of
Business Administration v. Leano32​ ​ and ​Pearson & George v. National
Labor Relations Commission​ both concern a complaint for illegal
33​

dismissal by corporate officers who were not re-elected to their respective

corporate positions. The Court declared all these cases as involving
intra-corporate controversies and thus affirmed the jurisdiction of the SEC
(now the RTC)​34​ over them precisely because they all relate to corporate
officers and their removal or non-reelection to their respective corporate
positions. Said cases are by no means similar to the present case because
as discussed earlier, petitioner here is not a corporate officer.
With the foregoing, it is clear that the CA erred in affirming the decision of
the NLRC which dismissed petitioner’s complaint for lack of jurisdiction. In
cases such as this, the Court normally remands the case to the NLRC and
directs it to properly dispose of the case on the merits. "However, when
there is enough basis on which a proper evaluation of the merits of
petitioner’s case may be had, the Court may dispense with the
time-consuming procedure of remand in order to prevent further delays in
the disposition of the case."​35​ "It is already an accepted rule of procedure
for us to strive to settle the entire controversy in a single proceeding,
leaving no root or branch to bear the seeds of litigation. If, based on the
records, the pleadings, and other evidence, the dispute can be resolved by
us, we will do so to serve the ends of justice instead of remanding the case
to the lower court for further proceedings."​36​ We have gone over the
records before us and we are convinced that we can now altogether
resolve the issue of the validity of petitioner’s dismissal and hence, we shall
proceed to do so. ​(R ​ eal vs. Sangu Phils., Inc., et al., G.R. No. 168757,
January 19, 2011)
Paragraph 4 of Article 217 of the Labor Code appears to have caused the
reliance by the Court of Appeals on the "causal connection between
[Portillo’s] monetary claims against [respondents] and the latter’s claim
from liquidated damages against the former."
Art. 217. Jurisdiction of Labor Arbiters and the Commission. ​– (a)
Except as otherwise provided under this code, the Arbiters shall have
original and exclusive jurisdiction to hear and decide, within thirty (30)
calendar days after the submission of the case by the parties for decision
without extension, even in the absence of stenographic notes, the following
case involving all workers, whether agricultural or nonagricultural:
xxxx
4. Claims for actual, moral, exemplary and other forms of damages arising
from the employer-employee relations; (Underscoring supplied)
Evidently, the Court of Appeals is convinced that the claim for liquidated
damages emanates from the "Goodwill Clause of the employment contract
and, therefore, is a claim for damages arising from the employeremployee
relations."
As early as ​Singapore Airlines Limited v. Paño,​ 18 ​
​ we established that not all
disputes between an employer and his employee(s) fall within the
jurisdiction of the labor tribunals. We differentiated between
abandonment ​per se a ​ nd the manner and consequent effects of such
abandonment and ruled that the first, is a labor case, while the second, is a
civil law case.
Upon the facts and issues involved, jurisdiction over the present
controversy must be held to belong to the civil Courts. While seemingly
petitioner's claim for damages arises from employer-employee relations,
and the latest amendment to Article 217 of the Labor Code under PD No.
1691 and BP Blg. 130 provides that all other claims arising from
employer-employee relationship are cognizable by Labor Arbiters [citation
omitted], in essence, petitioner's claim for damages is grounded on the
"wanton failure and refusal" without just cause of private respondent Cruz
to report for duty despite repeated notices served upon him of the
disapproval of his application for leave of absence without pay. This,
coupled with the further averment that Cruz "maliciously and with bad faith"
violated the terms and conditions of the conversion training course
agreement to the damage of petitioner removes the present controversy
from the coverage of the Labor Code and brings it within the purview of
Civil Law.
Clearly, the complaint was anchored not on the abandonment ​per se b ​ y
private respondent Cruz of his job—as the latter was not required in the
Complaint to report back to work—but on the ​manner a ​ nd ​consequent
effects ​of such abandonment of work translated in terms of the damages
which petitioner had to suffer.
Squarely in point is the ruling enunciated in the case of Quisaba ​vs​. Sta.
Ines Melale Veneer & Plywood, Inc. [citation omitted], the pertinent portion
of which reads:
"Although the acts complained of seemingly appear to constitute 'matter
involving employee-employer' relations as Quisaba's dismissal was the
severance of a pre-existing employee-employer relations, his complaint is
grounded not on his dismissal ​per se​, as in fact he does not ask for
reinstatement or backwages, but on the manner of his dismissal and the
consequent effects of such dismissal.
"Civil law consists of that 'mass of precepts that determine or regulate the
relations . . . that exist between members of a society for the protection of
private interest (1 Sanchez Roman 3).
"The 'right' of the respondents to dismiss Quisaba should not be confused
with the manner in which the right was exercised and the effects flowing
therefrom. If the dismissal was done anti-socially or oppressively as the
complaint alleges, then the respondents violated Article 1701 of the Civil
Code which prohibits acts of oppression by either capital or labor against
the other, and Article 21, which makes a person liable for damages if he
wilfully causes loss or injury to another in a manner that is contrary to
morals, good customs or public policy, the sanction for which, by way of
moral damages, is provided in article 2219, No. 10. [citation omitted]"
Stated differently, petitioner seeks protection under the civil laws and
claims no benefits under the Labor Code. The primary relief sought is
for liquidated damages for breach of a contractual obligation. The
other items demanded are not labor benefits demanded by workers
generally taken cognizance of in labor disputes, such as payment of
wages, overtime compensation or separation pay. The items claimed
are the natural consequences flowing from breach of an obligation,
intrinsically a civil dispute.​19 ​(Emphasis supplied)
Subsequent rulings amplified the teaching in ​Singapore
​ he ​reasonable causal connection ​rule was discussed. Thus,
Airlines. T
in ​San Miguel Corporation v. National Labor Relations Commission​,20 ​ ​ we
held:
While paragraph 3 above refers to "all money claims of workers," it is not
necessary to suppose that the entire universe of money claims that might
be asserted by workers against their employers has been absorbed into the
original and exclusive jurisdiction of Labor Arbiters. In the first place,
paragraph 3 should be read not in isolation from but rather within the
context formed by paragraph 1 (relating to unfair labor practices),
paragraph 2 (relating to claims concerning terms and conditions of
employment), paragraph 4 (claims relating to household services, a
particular species of employer-employee relations), and paragraph 5
(relating to certain activities prohibited to employees or to employers). It is
evident that there is a unifying element which runs through paragraph 1 to
5 and that is, that they all refer to cases or disputes arising out of or in
connection with an employer-employee relationship. This is, in other words,
a situation where the rule of ​noscitur a sociis m​ ay be usefully invoked in
clarifying the scope of paragraph 3, and any other paragraph of Article 217
of the Labor Code, as amended. We reach the above conclusion from an
examination of the terms themselves of Article 217, as last amended by
B.P. Blg. 227, and even though earlier versions of Article 217 of the Labor
Code expressly brought within the jurisdiction of the Labor Arbiters and the
NLRC "cases arising from employer-employee relations, [citation omitted]"
which clause was not expressly carried over, in printer's ink, in Article 217
as it exists today. For it cannot be presumed that money claims of workers
which do not arise out of or in connection with their employer-employee
relationship, and which would therefore fall within the general jurisdiction of
regular courts of justice, were intended by the legislative authority to be
taken away from the jurisdiction of the courts and lodged with Labor
Arbiters on an exclusive basis. T ​ he Court, therefore, believes and so
holds that the "money claims of workers" referred to in paragraph 3 of
Article 217 embraces money claims which arise out of or in
connection with the employer-employee relationship, or some aspect
or incident of such relationship. Put a little differently, that money
claims of workers which now fall within the original and exclusive
jurisdiction of Labor Arbiters are those money claims which have
some ​reasonable causal connection ​with the employer-employee
​ (Emphasis supplied)
relationship​.21 ​
We thereafter ruled that the "reasonable causal connection with the
employer-employee relationship" is a requirement not only in employees’
money claims against the employer but is, likewise, a condition when the
claimant is the employer.
In ​Dai-Chi Electronics Manufacturing Corporation v. Villarama, Jr.,​ 22 ​​ which
reiterated the ​San Miguel r​ uling and allied jurisprudence, we pronounced
that a non-compete clause, as in the "Goodwill Clause" referred to in the
present case, with a stipulation that a violation thereof makes the employee
liable to his former employer for liquidated damages, refers to
post-employment relations of the parties.
In ​Dai-Chi,​ the trial court dismissed the civil complaint filed by the employer
to recover damages from its employee for the latter’s breach of his
contractual obligation. We reversed the ruling of the trial court as we found
that the employer did not ask for any relief under the Labor Code but
sought to recover damages agreed upon in the contract as redress for its
employee’s breach of contractual obligation to its "damage and prejudice."
We iterated that Article 217, paragraph 4 does not automatically cover all
disputes between an employer and its employee(s). We noted that the
cause of action was within the realm of Civil Law, thus, jurisdiction over the
controversy belongs to the regular courts. At bottom, we considered that
the stipulation referred to post-employment relations of the parties.
That the "Goodwill Clause" in this case is likewise a postemployment issue
should brook no argument. There is no dispute as to the cessation of
Portillo’s employment with Lietz Inc.​23 ​She simply claims her unpaid
salaries and commissions, which Lietz Inc. does not contest. At that
juncture, Portillo was no longer an employee of Lietz Inc.​24 ​The "Goodwill
Clause" or the "Non-Compete Clause" is a contractual undertaking effective
after the cessation of the employment relationship between the parties. In
accordance with jurisprudence, breach of the undertaking is a civil law
dispute, not a labor law case.
It is clear, therefore, that while Portillo’s claim for unpaid salaries is a
money claim that arises out of or in connection with an employer-employee
relationship, Lietz Inc.’s claim against Portillo for violation of the goodwill
clause is a money claim based on an act done after the cessation of the
employment relationship. And, while the jurisdiction over Portillo’s claim is
vested in the labor arbiter, the jurisdiction over Lietz Inc.’s claim rests on
the regular courts. Thus:
As it is, petitioner does not ask for any relief under the Labor Code. It
merely seeks to recover damages based on the parties' contract of
employment as redress for respondent's breach thereof. Such cause of
action is within the realm of Civil Law, and jurisdiction over the controversy
belongs to the regular courts. More so must this be in the present case,
what with the reality that the stipulation refers to the postemployment
relations of the parties.
For sure, a plain and cursory reading of the complaint will readily reveal
that the subject matter is one of claim for damages arising from a breach of
contract, which is within the ambit of the regular court's jurisdiction. [citation
omitted]
It is basic that jurisdiction over the subject matter is determined upon the
allegations made in the complaint, irrespective of whether or not the plaintiff
is entitled to recover upon the claim asserted therein, which is a matter
resolved only after and as a result of a trial. Neither can jurisdiction of a
court be made to depend upon the defenses made by a defendant in his
answer or motion to dismiss. If such were the rule, the question of
jurisdiction would depend almost entirely upon the defendant.​25 ​[citation
omitted]
xxxx
Whereas this Court in a number of occasions had applied the jurisdictional
provisions of Article 217 to claims for damages filed by employees [citation
omitted], we hold that by the designating clause "arising from the
employer-employee relations" Article 217 should apply with equal force to
the claim of an ​employer ​for actual damages against its dismissed
employee, where the basis for the claim arises from or is necessarily
connected with the fact of termination, and should be entered as a
counterclaim in the illegal dismissal case.​26
xxxx
This is, of course, to distinguish from cases of actions for damages
where the employer-employee relationship is merely incidental and
the cause of action proceeds from a different source of obligation.
Thus, the jurisdiction of regular courts was upheld where the
damages, claimed for were based on tort ​[citation omitted]​, malicious
prosecution ​[citation omitted]​, or breach of contract, as when the
claimant seeks to recover a debt from a former employee ​[citation
omitted] ​or seeks liquidated damages in enforcement of a prior
employment contract. ​[citation omitted]
Neither can we uphold the reasoning of respondent court that because the
resolution of the issues presented by the complaint does not entail
application of the Labor Code or other labor laws, the dispute is intrinsically
civil. Article 217(a) of the Labor Code, as amended, clearly bestows upon
the Labor Arbiter original and exclusive jurisdiction over claims for
damages arising from employer-employee relations─in other words, the
Labor Arbiter has jurisdiction to award not only the reliefs provided by labor
laws, but also damages governed by the Civil Code.​27 ​(Emphasis supplied)
In the case at bar, the difference in the nature of the credits that one has
against the other, conversely, the nature of the debt one owes another,
which difference in turn results in the difference of the forum where the
different credits can be enforced, prevents the application of compensation.
Simply, the labor tribunal in an employee’s claim for unpaid wages is
without authority to allow the compensation of such claims against the post
employment claim of the former employer for breach of a post employment
condition. The labor tribunal does not have jurisdiction over the civil case of
breach of contract.
We are aware that in ​Bañez v. Hon. Valdevilla, ​we mentioned that:
Whereas this Court in a number of occasions had applied the jurisdictional
provisions of Article 217 to claims for damages filed by employees [citation
omitted], we hold that by the designating clause "arising from the
employer-employee relations" Article 217 should apply with equal force to
the claim of an ​employer ​for actual damages against its dismissed
employee, where the basis for the claim arises from or is necessarily
connected with the fact of termination, and should be entered as a
counterclaim in the illegal dismissal case.​28
While on the surface, ​Bañez ​supports the decision of the Court of Appeals,
the facts beneath premise an opposite conclusion. There, the
salesman-employee obtained from the NLRC a final favorable judgment of
illegal dismissal. Afterwards, the employer filed with the trial court a
complaint for damages for alleged nefarious activities causing damage to
the employer. Explaining further why the claims for damages should be
entered as a counterclaim in the illegal dismissal case, we said:
Even under Republic Act No. 875 (the ‘Industrial Peace Act,’ now
completely superseded by the Labor Code), jurisprudence was settled that
where the plaintiff’s cause of action for damages arose out of, or was
necessarily intertwined with, an alleged unfair labor practice committed by
the union, the jurisdiction is exclusively with the (now defunct) Court of
Industrial Relations, and the assumption of jurisdiction of regular courts
over the same is a nullity. To allow otherwise would be "to sanction split
jurisdiction, which is prejudicial to the orderly administration of justice."
Thus, even after the enactment of the Labor Code, where the damages
separately claimed by the employer were allegedly incurred as a
consequence of strike or picketing of the union, such complaint for
damages is deeply rooted from the labor dispute between the parties, and
should be dismissed by ordinary courts for lack of jurisdiction. As held by
this Court in ​National Federation of Labor vs. Eisma,​ 127 SCRA 419:
Certainly, the present Labor Code is even more committed to the view that
on policy grounds, and equally so in the interest of greater promptness in
the disposition of labor matters, a court is spared the often onerous task of
determining what essentially is a factual matter, namely, the damages that
may be incurred by either labor or management as a result of disputes or
controversies arising from employer-employee relations.​29
Evidently, the ruling of the appellate court is modeled after the basis used
in ​Bañez w​ hich is the "intertwined" facts of the claims of the employer and
the employee or that the "complaint for damages is deeply rooted from the
labor dispute between the parties." Thus, did the appellate court say that:
There is no gainsaying the fact that such "Goodwill Clause" is part and
parcel of the employment contract extended to [Portillo], and such clause is
not contrary to law, morals and public policy. There is thus a causal
connection between [Portillo’s] monetary claims against [respondents] and
the latter’s claim for liquidated damages against the former. Consequently,
we should allow legal compensation or set-off to take place.​30
The Court of Appeals was misguided. Its conclusion was incorrect.
There is no causal connection between the petitioner employees’ claim for
unpaid wages and the respondent employers’ claim for damages for the
alleged "Goodwill Clause" violation. Portillo’s claim for unpaid salaries did
not have anything to do with her alleged violation of the employment
contract as, in fact, her separation from employment is not "rooted" in the
alleged contractual violation. She resigned from her employment. She was
not dismissed. Portillo’s entitlement to the unpaid salaries is not even
contested. Indeed, Lietz Inc.’s argument about legal compensation
necessarily admits that it owes the money claimed by Portillo.
The alleged contractual violation did not arise during the existence of the
employer-employee relationship. It was a post-employment matter, a
post-employment violation. Reminders are apt. That is provided by the
fairly recent case of ​Yusen Air and Sea Services Phils., Inc. v.
Villamor​,31 ​
​ which harked back to the previous rulings on the necessity of
"reasonable causal connection" between the tortious damage and the
damage arising from the employer-employee
relationship. ​Yusen ​proceeded to pronounce that the absence of the
connection results in the absence of jurisdiction of the labor arbiter.
Importantly, such absence of jurisdiction cannot be remedied by raising
before the labor tribunal the tortious damage as a defense. Thus:
When, as here, the cause of action is based on a quasi-delict or tort, which
has no reasonable causal connection with any of the claims provided for in
Article 217, jurisdiction over the action is with the regular courts. [citation
omitted]
As it is, petitioner does not ask for any relief under the Labor Code. It
merely seeks to recover damages based on the parties’ contract of
employment as redress for respondent’s breach thereof. Such cause of
action is within the realm of Civil Law, and jurisdiction over the controversy
belongs to the regular courts. More so must this be in the present case,
what with the reality that the stipulation refers to the postemployment
relations of the parties.
For sure, a plain and cursory reading of the complaint will readily reveal
that the subject matter is one of claim for damages arising from a breach of
contract, which is within the ambit of the regular court’s jurisdiction. [citation
omitted]
It is basic that jurisdiction over the subject matter is determined upon the
allegations made in the complaint, irrespective of whether or not the plaintiff
is entitled to recover upon the claim asserted therein, which is a matter
resolved only after and as a result of a trial. Neither can jurisdiction of a
court be made to depend upon the defenses made by a defendant in his
answer or motion to dismiss. If such were the rule, the question of
jurisdiction would depend almost entirely upon the
 ​ ortillo vs. Rudolf Lietz, Inc. et al.,
defendant.​32 ​(Underscoring supplied). ​(P
G.R. No. 196539, October 10, 2012)
Under the above-quoted constitutional and legal provisions, the voluntary
arbitrator or panel of voluntary arbitrators has original and exclusive
jurisdiction over Fernandez’s disability claim. There is no dispute that the
claim arose out of Fernandez’s employment with the petitioners and that
their relationship is covered by a CBA — the AMOSUP/TCC or the
AMOSUP-VELA CBA. The CBA provides for a grievance procedure for the
resolution of grievances or disputes which occur during the employment
relationship and, like the grievance machinery created under Article 261 of
the Labor Code, it is a two-tiered mechanism, with voluntary arbitration as
the last step.1âwphi1
Contrary to the CA’s reading of the CBA’s Article 14, there is unequivocal
or unmistakable language in the agreement which mandatorily requires the
parties to submit to the grievance procedure any dispute or cause of action
they may have against each other. The relevant provisions of the CBA
state:
14.6 Any Dispute, grievance, or misunderstanding concerning any
ruling, practice, wages or working conditions in the COMPANY or any
breach of the Contract of Employment, or any dispute arising from the
meaning or application of the provisions of this Agreement or a claim
of violation thereof or any complaint or cause of action that any such
Seaman may have against the COMPANY, as well as complaints
which the COMPANY may have against such Seaman shall be brought
to the attention of the GRIEVANCE RESOLUTION COMMITTEE before
either party takes any action, legal or otherwise. Bringing such a
dispute to the Grievance Resolution Committee shall be unwaivable
prerequisite or condition precedent for bringing any action, legal or
otherwise, in any forum and the failure to so refer the dispute shall
bar any and all legal or other actions.
14.7a) ​If by reason of the nature of the Dispute, the parties are unable
to amicably settle the dispute, either party may refer the case to a
MANDATORY ARBITRATION COMMITTEE. ​The MANDATORY
ARBITRATION COMMITTEE shall consist of one representative to be
designated by the UNION, and one representative to be designated by the
COMPANY and a third member who shall act as Chairman and shall be
nominated by mutual choice of the parties. xxx
h) ​Referral of all unresolved disputes from the Grievance Resolution
Committee to the Mandatory Arbitration Committee shall be
unwaivable prerequisite or condition precedent for bringing any
action, claim, or cause of action, legal or otherwise, before any court,
tribunal, or panel in any jurisdiction. The failure by a party or seaman
to so refer and avail oneself to the dispute resolution mechanism
contained in this action shall bar any legal or other action. All parties
expressly agree that the orderly resolution of all claims in the
prescribed manner served the interests of reaching settlements or
claims in an orderly and uniform manner, as well as preserving
peaceful and harmonious labor relations between seaman, the Union,
and the Company​.27 ​​ (emphases ours)
What might have caused the CA to miss the clear intent of the parties in
prescribing a grievance procedure in their CBA is, as the petitioners’ have
intimated, the use of the auxiliary verb "​may​" in Article 14.7(a) of the CBA
which, to reiterate, ​provides that "if by reason of the nature of the
Dispute, the parties are unable to amicably settle the dispute, either
party may refer the case to a MANDATORY ARBITRATION
COMMITTEE​."​28
While the CA did not qualify its reading of the subject provision of the CBA,
it is reasonable to conclude that it viewed as optional the referral of a
dispute to the mandatory arbitration committee when the parties are unable
to amicably settle the dispute.
We find this a strained interpretation of the CBA provision. The CA read the
provision separately, or in isolation of the other sections of Article 14,
especially 14.7(h), which, in clear, explicit language, states that ​the
"referral of all unresolved disputes from the Grievance Resolution
Committee to the Mandatory Arbitration Committee shall be
unwaivable prerequisite or condition precedent for bringing any
action, claim, or cause of action, legal or otherwise, before any court,
tribunal, or panel in any jurisdiction"​29 ​and that the failure by a party
or seaman to so refer the dispute to the prescribed dispute resolution
mechanism shall bar any legal or other action​.
Read in its entirety, the CBA’s Article 14 (Grievance Procedure)
unmistakably reflects the parties’ agreement to submit any unresolved
dispute at the grievance resolution stage to mandatory voluntary arbitration
under Article 14.7(h) of the CBA. And, it should be added that, in
compliance with Section 29 of the POEA-SEC which requires that in cases
of claims and disputes arising from a seafarer’s employment, the parties
covered by a CBA shall submit the claim or dispute to the original and
exclusive jurisdiction of the voluntary arbitrator or panel of voluntary
arbitrators.
Since the parties used unequivocal language in their CBA for the
submission of their disputes to voluntary arbitration (a condition laid down
in ​Vivero ​for the recognition of the submission to voluntary arbitration of
matters within the original and exclusive jurisdiction of labor arbiters), we
find that the CA committed a reversible error in its ruling; it disregarded the
clear mandate of the CBA between the parties and the POEA-SEC for
submission of the present dispute to voluntary arbitration.
Consistent with this finding, Fernandez’s contention — that his complaint
for disability benefits is a money claim that falls within the original and
exclusive jurisdiction of the labor arbiter under Section 10 of R.A. No. 8042
— is untenable. We likewise reject his argument that he never referred his
claim to the grievance machinery (so that no unresolved grievance exists
as required under Article 261 of the Labor Code), and that the parties to the
case are not the union and the employer.​30 ​Needless to state, no such
distinction exists in the parties’ CBA and the POEA-SEC.
It bears stressing at this point that we are upholding the jurisdiction of the
voluntary arbitrator or panel of voluntary arbitrators over the present
dispute, not only because of the clear language of the parties’ CBA on the
matter; more importantly, we so uphold the voluntary arbitrator’s
jurisdiction, in recognition of the State’s express preference for voluntary
modes of dispute settlement, such as conciliation and voluntary arbitration
as expressed in the Constitution, the law and the rules.
In this light, we see no need to further consider the petitioners’ submission
regarding the IRR of the Migrant Workers and Overseas Filipinos Act of
1995, as amended by R.A. No. 10022, except to note that the IRR lends
further support to our ruling.
In closing, we quote with approval a most recent Court pronouncement on
the same issue, thus –
It is settled that when the parties have validly agreed on a procedure
for resolving grievances and to submit a dispute to voluntary
arbitration then that procedure should be strictly observed​. ​(A ​ ce
Navigation Co. Inc. et al., vs. Fernandez, G.R. No. 197309, October 10,
2012)
As regards the issue of jurisdiction, the Court has determined that contrary
to the ruling of the CA, it is the LA, and not the regular courts, which has
the original jurisdiction over the subject controversy. An intra-corporate
controversy, which falls within the jurisdiction of regular courts, has been
regarded in its broad sense to pertain to disputes that involve any of the
following relationships: (1) between the corporation, partnership or
association and the public; (2) between the corporation, partnership or
association and the state in so far as its franchise, permit or license to
operate is concerned; (3) between the corporation, partnership or
association and its stockholders, partners, members or officers; and (4)
among the stockholders, partners or associates, themselves.​29​ Settled
jurisprudence, however, qualifies that when the dispute involves a charge
of illegal dismissal, the action may fall under the jurisdiction of the LAs
upon whose jurisdiction, as a rule, falls termination disputes and claims for
damages arising from employer-employee relations as provided in Article
217 of the Labor Code. Consistent with this jurisprudence, the mere fact
that Cosare was a stockholder and an officer of Broadcom at the time the
subject controversy developed failed to necessarily make the case an
intra-corporate dispute.
In Matling Industrial and Commercial Corporation v. Coros,​30​ the Court
distinguished between a "regular employee" and a "corporate officer" for
purposes of establishing the true nature of a dispute or complaint for illegal
dismissal and determining which body has jurisdiction over it. Succinctly, it
was explained that "[t]he determination of whether the dismissed officer
was a regular employee or corporate officer unravels the conundrum" of
whether a complaint for illegal dismissal is cognizable by the LA or by the
RTC. "In case of the regular employee, the LA has jurisdiction; otherwise,
the RTC exercises the legal authority to adjudicate.​31
Applying the foregoing to the present case, the LA had the original
jurisdiction over the complaint for illegal dismissal because Cosare,
although an officer of Broadcom for being its AVP for Sales, was not a
"corporate officer" as the term is defined by law. We emphasized in Real v.
Sangu Philippines, Inc.​32​ the definition of corporate officers for the purpose
of identifying an intra-corporate controversy. Citing Garcia v. Eastern
Telecommunications Philippines, Inc.,​33​ we held:
" ‘Corporate officers’ in the context of Presidential Decree No. 902-A are
those officers of the corporation who are given that character by the
Corporation Code or by the corporation’s by-laws. There are three specific
officers whom a corporation must have under Section 25 of the Corporation
Code. These are the president, secretary and the treasurer. The number of
officers is not limited to these three. A corporation may have such other
officers as may be provided for by its by-laws like, but not limited to, the
vice-president, cashier, auditor or general manager. The number of
corporate officers is thus limited by law and by the corporation’s
by-laws."​34​ (Emphasis ours)
In Tabang v. NLRC,​35​ the Court also made the following pronouncement on
the nature of corporate offices:
It has been held that an "office" is created by the charter of the corporation
and the officer is elected by the directors and stockholders. On the other
hand, an "employee" usually occupies no office and generally is employed
not by action of the directors or stockholders but by the managing officer of
the corporation who also determines the compensation to be paid to such
employee.​36​ (Citations omitted)
As may be deduced from the foregoing, there are two circumstances which
must concur in order for an individual to be considered a corporate officer,
as against an ordinary employee or officer, namely: (1) the creation of the
position is under the corporation’s charter or by-laws; and (2) the election of
the officer is by the directors or stockholders. It is only when the officer
claiming to have been illegally dismissed is classified as such corporate
officer that the issue is deemed an intra-corporate dispute which falls within
the jurisdiction of the trial courts.
Finally, the mere fact that Cosare was a stockholder of Broadcom at the
time of the case’s filing did not necessarily make the action an intra-
corporate controversy. "Not all conflicts between the stockholders and the
corporation are classified as intra-corporate. There are other facts to
consider in determining whether the dispute involves corporate matters as
 
to consider them as intra-corporate controversies."​42​ Time and again, the
Court has ruled that in determining the existence of an intra-corporate
dispute, the status or relationship of the parties and the nature of the
question that is the subject of the controversy must be taken into
 
account.​43​ Considering that the pending dispute particularly relates to
Cosare’s rights and obligations as a regular officer of Broadcom, instead of
as a stockholder of the corporation, the controversy cannot be deemed
intra-corporate. This is consistent with the "controversy test" explained by
the Court in Reyes v. Hon. RTC, Br. 142,​44​ to wit:
Under the nature of the controversy test, the incidents of that relationship
must also be considered for the purpose of ascertaining whether the
controversy itself is intra-corporate. The controversy must not only be
rooted in the existence of an intra-corporate relationship, but must as well
pertain to the enforcement of the parties’ correlative rights and obligations
under the Corporation Code and the internal and intra-corporate regulatory
rules of the corporation. If the relationship and its incidents are merely
incidental to the controversy or if there will still be conflict even if the
relationship does not exist, then no intra-corporate controversy
exists.​45​ (Citation omitted)
It bears mentioning that even the CA’s finding​46​ that Cosare was a director
of Broadcom when the dispute commenced was unsupported by the case
records, as even the General Information Sheet of 2009 referred to in the
CA decision to support such finding failed to provide such detail.
All told, it is then evident that the CA erred in reversing the NLRC’s ruling
that favored Cosare solely on the ground that the dispute was an
intra-corporate controversy within the jurisdiction of the regular courts.
​ osare vs. Broadcom Asia, Inc. GR No. 201298, February 5, 2014, citing
(C
2010 Matling Industrial and Commercial Corp et al., vs. Coros, GR No.
157802 and 2011 Real vs. Sangu Phils., Inc., et al., G.R. No. 168757)
This Court holds that as between the parties, Article 217(a)(4) of the Labor
Code is applicable. Said provision bestows upon the Labor Arbiter original
and exclusive jurisdiction over claims for damages arising from
employer-employee relations. The observation that the matter of SSS
contributions necessarily flowed from the employer-employee relationship
between the parties – shared by the lower courts and the CA – is correct;
thus, petitioners’ claims should have been referred to the labor tribunals. In
this connection, it is noteworthy to state that "the Labor Arbiter has
jurisdiction to award not only the reliefs provided by labor laws, but also
damages governed by the Civil Code."​34
At the same time, it cannot be assumed that since the dispute concerns the
payment of SSS premiums, petitioners’ claim should be referred to the
Social Security Commission (SSC) pursuant to Republic Act No. 1161, as
amended by Republic Act No. 8282.​35​ As far as SSS is concerned, there is
no longer a dispute with respect to petitioners’ accountability to the System;
petitioners already settled their pecuniary obligations to it. Since there is no
longer any dispute regarding coverage, benefits, contributions and
penalties to speak of, the SSC need not be unnecessarily dragged into the
picture.​36​ Besides, it cannot be made to act as a collecting agency for
petitioners’ claims against the respondent; the Social Security Law should
not be so interpreted, lest the SSC be swamped with cases of this sort.
(A​ mecos Innovators Inc. vs. Lopez, GR no. 178055, July 2, 2014)
While we have upheld the present trend to refer worker-employer
controversies to labor courts in light of the aforequoted provision, we have
also recognized that not all claims involving employees can be resolved
solely by our labor courts, specifically when the law provides
otherwise.​36​ For this reason, we have formulated the "reasonable causal
connection rule," wherein if there is a reasonable causal connection
between the claim asserted and the employer-employee relations, then the
case is within the jurisdiction of the labor courts; and in the absence
thereof, it is the regular courts that have jurisdiction.​37​ Such distinction is
apt since it cannot be presumed that money claims of workers which do not
arise out of or in connection with their employer-employee relationship, and
which would therefore fall within the general jurisdiction of the regular
courts of justice, were intended by the legislative authority to be taken away
from the jurisdiction of the courts and lodged with Labor Arbiters on an
exclusive basis.​38
In fact, as early as Medina vs. Hon. Castro-Bartolome,​39​ in negating the
jurisdiction of the LA, although the parties involved were an employer and
two employees, the Court succinctly held that:
The pivotal question to Our mind iswhether or not the Labor Code has any
relevance to the reliefs sought by the plaintiffs. For if the Labor Code has
no relevance, any discussion concerning the statutes amending it and
whether or not they have retroactive effect is unnecessary.
It is obvious from the complaint that the plaintiffs have not alleged any
unfair labor practice. Theirs is a simple action for damages for tortious acts
allegedly committed by the defendants. Such being the case, the governing
statute is the Civil Code and not the Labor Code. It results that the orders
under revieware based on a wrong premise.​40
 Similarly, we ruled in the recent case of Portillo v. Rudolf Lietz, Inc.​41​ that

not all disputes between an employer and his employees fall within the
jurisdiction of the labor tribunals suchthat when the claim for damages is
grounded on the "wanton failure and refusal" without just cause of an
employee to report for duty despite repeated notices served upon him of
the disapproval of his application for leave ofabsence, the same falls within
the purview of Civil Law, to wit:
As early as Singapore Airlines Limited v. Paño, we established that not all
disputes between an employer and his employee(s) fall within the
jurisdiction of the labor tribunals. We differentiated between abandonment
per seand the manner and consequent effects of such abandonment and
ruled that the first, is a labor case, while the second, is a civil law case.
Upon the facts and issues involved, jurisdiction over the present
controversy must be held to belong to the civil Courts. While seemingly
petitioner's claim for damages arises from employer-employee relations,
and the latest amendment to Article 217 of the Labor Code under PD No.
1691 and BP Blg. 130 provides that all other claimsarising from
employer-employee relationship are cognizable by Labor Arbiters [citation
omitted], in essence, petitioner's claim for damages is grounded on the
"wanton failure and refusal"without just cause of private respondent Cruz to
report for duty despite repeated notices served upon him of the disapproval
of his application for leave of absence without pay. This, coupled with the
further averment that Cruz "maliciously and with bad faith" violated the
terms and conditions of the conversion training course agreement to the
damage of petitioner removes the present controversy from the coverage of
the Labor Code and brings it within the purview of Civil Law.
Clearly, the complaint was anchored not on the abandonment per seby
private respondent Cruz of his job—as the latter was not required in the
Complaint to report back to work—but on the manner and consequent
effects of such abandonmentof work translated in terms of the damages
which petitioner had to suffer. x x x.​42
Indeed, jurisprudence has evolved the rule that claims for damages under
Article 217(a)(4) of the Labor Code, to be cognizable by the LA, must have
a reasonable causal connection withany of the claims provided for in that
article.​43​ Only if there is such a connection with the other claims can a claim
for damages be considered as arising from employer-employee relations.​44
In the case at bench, we find that such connection is nil.
Our ruling in Portillo, is instructive, thus:
There is no causal connection between private respondent’s claim for
damages and the respondent employers’ claim for damages for the alleged
"Goodwill Clause" violation. Portillo’s claim for unpaid salaries did not have
anything to do with her alleged violation of the employment contract as, in
fact, her separation from employmentis not "rooted" in the alleged
contractual violation. She resigned from her employment. She was not
dismissed. Portillo’s entitlementto the unpaid salaries is not even
contested. Indeed, Lietz Inc.’s argument about legal compensation
 
necessarily admits that it owesthe money claimed by Portillo.​57
Further, it cannot be gainsaid that the claim for damages occurred afterthe
employer-employee relationship of petitioner and respondent has ceased.
Given that respondent no longer demands for any relief under the Labor
Code as well as the rules and regulations pertinent thereto, Article
217(a)(4) of the Labor Code is inapplicable to the instant case, as
emphatically held in Portillo, to wit:
It is clear, therefore, that while Portillo’s claim for unpaid salaries is a
money claim that arises out ofor in connection with an employeremployee
relationship, Lietz Inc.’s claim against Portillo for violation of the goodwill
clause is a money claim based on an act done after the cessation of the
employment relationship. And, while the jurisdiction over Portillo’s claim is
vested in the labor arbiter, the jurisdiction over Lietz Inc.’s claim rests on
the regular courts. Thus:
As it is, petitioner does not ask for any relief under the Labor Code. It
merely seeks to recover damages based on the parties' contract of
employment as redress for respondent's breach thereof. Such cause of
action is within the realm of Civil Law, and jurisdiction over the controversy
belongs to the regular courts. More so must this be in the present case,
what with the reality that the stipulation refers to the post-employment
 
relations of the parties.​58
Where the resolution of the dispute requires expertise, not in labor
management relations nor in wage structures and other terms and
conditions of employment, but rather in the application of the general civil
law, such claim falls outside the area of competence of expertise ordinarily
 ascribed to the LA and the NLRC.​59 ​(I​ ndophil Textile Mills Inc. vs. Engr.

Adviento, GR No. 171212, August 4, 2014)

The Voluntary Arbitrator has no
jurisdiction to settle tax matters
The Labor Code vests the Voluntary Arbitrator original and exclusive
jurisdiction to hear and decide all unresolved grievances arising from the
interpretation or implementation of the Collective Bargaining Agreement
and those arising from the interpretation or enforcement of company
personnel policies.​14​ Upon agreement of the parties, the Voluntary
Arbitrator shall also hear and decide allother labor disputes, including unfair
labor practices and bargaining deadlocks.​15
In short, the Voluntary Arbitrator’s jurisdiction is limited to labor disputes.
Labor dispute means "any controversy or matter concerning terms and
conditions of employment or the association or representation of persons in
negotiating, fixing, maintaining, changing, or arranging the terms and
conditions of employment, regardless of whether the disputants stand in
the proximate relation of employer and employee."​16
The issues raised before the Panel of Voluntary Arbitrators are: (1) whether
the cash conversion of the gasoline allowance shall be subject to fringe
benefit tax or the graduated income tax rate on compensation; and (2)
whether the company wrongfully withheld income tax on the converted gas
allowance.
The Voluntary Arbitrator has no competence to rule on the taxability of the
gas allowance and on the propriety of the withholding of tax. These issues
are clearly tax matters, and do not involve labor disputes. To be exact, they
involve tax issues within a labor relations setting as they pertain to
questions of law on the application of Section 33 (A) of the NIRC. They do
not require the application of the Labor Code or the interpretation of the
MOA and/or company personnel policies. Furthermore, the company and
the union cannot agree or compromise on the taxability of the gas
allowance. Taxation is the State’s inherent power; its imposition cannot be
subject to the will of the parties.
Under paragraph 1, Section 4 of the NIRC, the CIR shall have the exclusive
and original jurisdiction to interpret the provisions of the NIRC and other tax
laws, subject to review by the Secretary of Finance. Consequently, if the
company and/or the union desire/s to seek clarification of these issues,
it/they should have requested for a tax ruling​17​ from the Bureau of Internal
Revenue (BIR). Any revocation, modification or reversal of the CIR’s ruling
shall not be given retroactive application if the revocation, modification or
reversal will be prejudicial to the taxpayers, except in the following cases:
(a) Where the taxpayer deliberately misstates or omits material facts from
his return or any document required of him by the BIR;
(b) Where the facts subsequently gathered by the BIR are materially
different from the facts on which the ruling is based; or
(c) Where the taxpayer acted in bad faith.​18
On the other hand, if the union disputes the withholding of tax and desires
a refund of the withheld tax, it should have filed an administrative claim for
refund with the CIR. Paragraph 2, Section 4 of the NIRC expressly vests
the CIR original jurisdiction over refunds of internal revenue taxes, fees or
other charges, penalties imposed in relation thereto, or other tax matters.
The union has no cause of action against the company
Under the withholding tax system, the employer as the withholding agent
acts as both the government and the taxpayer’s agent. Except in the case
of a minimum wage earner, every employer has the duty to deduct and
withhold upon the employee’s wages a tax determined in accordance with
the rules and regulations to be prescribed by the Secretary of Finance,
upon the CIR’s recommendation.​19​ As the Government’s agent, the
employer collects tax and serves as the payee by fiction of law.​20​ As the
employee’s agent, the employer files the necessary income tax return and
remits the tax to the Government.​21
Based on these considerations, we hold that the union has no cause of
action against the company.1âwphi1 The company merely performed its
statutory duty to withhold tax based on its interpretation of the NIRC, albeit
that interpretation may later be found to be erroneous. The employer did
not violate the employee's right by the mere act of withholding the tax that
may be due the government.​22 ​(​Honda Car Phils vs. Honda cars Technical
Specialist & Supervisors Union GR No. 204142, Nov. 19 2014)
Nevertheless, the Court has thoroughly reviewed the records in this case
and finds that the NLRC did not commit any grave abuse of its discretion
amounting to lack or in excess of jurisdiction in rendering its decision in
favor of the respondents. The CA acted in accord with the evidence on
record and case law when it dismissed the petition and affirmed the
assailed decision and resolution of the NLRC.
In the case at bar, October 26, 1997 and November 24, 1997 appear on
record to be the dates when the petitioners’ employment were terminated
by TTCI. The antecedent facts that gave rise to the petitioners’ dismissal
from employment are not disputed in this case. There is no question about
the fact that the petitioners’ complaints for unfair labor practice and money
claims have already prescribed. The petitioners however argue that their
complaints for illegal dismissal were duly filed within the four-year
prescriptive period since the period during which their cases were pending
should be deducted from the period of prescription. On the other hand, the
respondents insist that said complaints have already prescribed. Hence,
the pivotal question in resolving the issues hinges on the resolution of
whether the period during which the petitioners’ cases were pending should
be excluded from the period of prescription.
Settled is the rule that when one is arbitrarily and unjustly deprived of his
job or means of livelihood, the action instituted to contest the legality of
one’s dismissal from employment constitutes, in essence, an action
predicated upon an injury to the rights of the plaintiff, as contemplated
under Article 1146​35​ of the New Civil Code, which must be brought within
four years.​36
The petitioners contend that the period when they filed a labor case on May
14, 1998 but withdrawn on March 22, 1999 should be excluded from the
computation of the four-year prescriptive period for illegal dismissal cases.
However, the Court had already ruled that the prescriptive period continues
even after the withdrawal of the case as though no action has been filed at
all. The applicability of Article 115537 of the Civil Code in labor cases was
upheld in the case of Intercontinental Broadcasting Corporation v.
Panganiban​38​ where the Court held that "although the commencement of a
civil action stops the running of the statute of prescription or limitations, its
dismissal or voluntary abandonment by plaintiff leaves the parties in exactly
the same position as though no action had been commenced at all."​39
In like manner, while the filing of the complaint for illegal dismissal before
the LA interrupted the running of the prescriptive period, its voluntary
withdrawal left the petitioners in exactly the same position as though no
complaint had been filed at all. The withdrawal of their complaint effectively
erased the tolling of the reglementary period.
A prudent review of the antecedents of the claim reveals that it has in fact
prescribed due to the petitioners’ withdrawal of their labor case docketed as
NLRC RAB-I-01-1007.​40​ Hence, while the filing of the said case could have
interrupted the running of the four-year prescriptive period, the voluntary
withdrawal of the petitioners effectively cancelled the tolling of the
prescriptive period within which to file their illegal dismissal case, leaving
them in exactly the same position as though no labor case had been filed at
all. The running of the four-year prescriptive period not having been
interrupted by the filing of NLRC RAB-I-01-1007, the petitioners’ cause of
action had already prescribed in four years after their cessation of
employment on October 26, 1997 and November 24, 1997. Consequently,
when the petitioners filed their complaint for illegal dismissal, separation
pay, retirement benefits, and damages in 2002, their claim, clearly, had
already been barred by prescription.​41
Sadly, the petitioners have no one but themselves to blame for their own
predicament. By their own allegations in their respective complaints, they
have barred their remedy and extinguished their right of action. Although
the Constitution is committed to the policy of social justice and the
protection of the working class, it does not necessary follow that every
labor dispute will be automatically decided in favor of labor. The
management also has its own rights. Out of concern for the less privileged
in life, this Court, has more often than not inclined, to uphold the cause of
the worker in his conflict with the employer. Such leaning, however, does
not blind the Court to the rule that justice is in every case for the deserving,
to be dispensed in the light of the established facts and applicable law and
doctrine.​42 ​(M​ ontero vs. Times Transportation GR No. 1980828, March 16,
2015)A ​ . Relationship Test
A dispute is considered an intra-corporate controversy under
the ​relationship test​ when the relationship between or among the
disagreeing parties is any one of the following: (a) between the corporation,
partnership, or association and the public; (b) between
the ​corporation,​ partnership, or association and
its ​stockholders,​ partners, members, or ​officers;​ (c) between the
corporation, partnership, or association and the State as far as its
franchise, permit or license to operate is concerned; and (d) among the
stockholders, partners, or associates themselves.​29
In the present case, petitioners Cacho and North Star allege that
respondent Balagtas, as petitioner North Star's ​Executive Vice
President,​ was its ​corporate officer.​ On the other hand, while respondent
Balagtas admits to have occupied said position, she argues she
was ​Executive Vice​ ​President​ merely by name and she did not discharge
any of the responsibilities lodged in a corporate officer.
Given the parties' conflicting views, We must now determine whether or not
the ​Executive Vice President​ position is a corporate office so as to
establish the intra-corporate relationship between the parties.
In ​Easycall Communications Phils., Inc. v. King,​30​ the Court ruled that a
corporate office is created by the charter of the corporation ​and​ the officer
is elected thereto by the directors or stockholders. In other words, one shall
be considered a corporate officer only if two conditions are met, ​viz.:​ (1) the
position occupied was created by charter/by-laws, and (2) the officer was
elected (or appointed) by the corporation's board of directors to occupy said
position.
1. The Executive Vice President
position is one of the corporate
offices provided in petitioner
North Star's By-laws
The rule is that corporate officers are those officers of a corporation who
are given that character either by the Corporation Code or by the
corporation's by-laws.​31
Section 25 of the Corporation Code​32​ explicitly provides for the election of
the corporation's president, treasurer, secretary, and such other officers as
may be provided for in the by-laws. In interpreting this provision, the Court
has ruled that if the position is other than the corporate president, treasurer,
or secretary, it must be expressly mentioned in the bylaws in order to be
considered as a corporate office.​33
In this regard, petitioner North Star's by-laws​34​ provides the following:
ARTICLE IV
OFFICERS
Section 1. Election/ Appointment - Immediately after their
election, the Board of Directors shall formally organize by
electing the Chairman, the President, one or more
Vice-President (sic), the Treasurer, and the Secretary, at said
meeting.
The Board may, from time to time, appoint such other officers
as it may determine to be necessary or proper.
Any two (2) or more positions may be held concurrently by the
same person, except that no one shall act as President and
Treasurer or Secretary at the same time.
Clearly, there may be one or more vice president positions in petitioner
North Star and, by virtue of its by-laws, all such positions shall be corporate
offices.1âшphi1
Consequently, the next question that begs to be asked is whether or not
the phrase "one or more vice president" in the above-cited provision of the
by-laws includes the ​Executive Vice President​ position held by respondent
Balagtas.
In ruling that respondent Balagtas was not a corporate officer of petitioner
North Star, the Court of Appeals pointed out that the NLRC should not have
assumed that the ​"Vice President"​ position is the same as the ​"Executive
Vice President"​ position that Balagtas admittedly occupied. In other words,
that the exact and complete name of the position must appear in the
by-laws, otherwise it is an ordinary office whose occupant shall be
regarded as a regular employee rather than a corporate officer.
The appellate court's interpretation of the phrase "one or more vice
president" unduly restricts one of petitioner North Star's inherent corporate
powers, ​viz.:​ to adopt its own by-laws, provided that it is not contrary to law,
morals, or public policy​35​ for its internal affairs, to regulate the conduct and
prescribe the rights and duties of its members towards itself and among
themselves in reference to the management of its affairs.​36
The use of the phrase "one or more" in relation to the establishment of vice
president positions without particular exception indicates an intention to
give petitioner North Star's Board ample freedom to make several
vice-president positions available as it may deem fit and in consonance
with sound business practice.
To require that particular designation/variation of each
vice-president ​(i.e.,​ executive vice president) be specified and enumerated
is to invalidate the by-laws' true intention and to encroach upon petitioner
North Star's inherent right and authority to adopt its own set of rules and
regulations to govern its internal affairs. Whether the creation of several
vice-president positions in a company is reasonable is a question of policy
that courts of law should not interfere with. Where the reasonableness of a
by-law is a mere matter of judgment, and one upon which reasonable
minds must necessarily differ, a court would not be warranted in
substituting its judgment instead of the judgment of those who are
authorized to make bylaws and who have exercised their authority.​37
Thus, by name, the ​Executive Vice President​ position is embraced by the
phrase "one or more vice president" in North Star's by-laws.
2. Respondent Balagtas was
appointed by the Board as
petitioner North Star's
Executive Vice President
While a corporate office is ​created​ by an express provision either in the
Corporation Code or the By-laws, what makes one a corporate officer is
his ​election or appointment​ thereto by the board of directors. Thus, there
must be documentary evidence to prove that the person alleged to be a
corporate officer was appointed by action or with approval of the board.​38
In the present case, petitioners Cacho and North Star assert that
respondent Balagtas was elected as ​Executive Vice President​ by the Board
as evidenced by the Secretary's Certificate dated April 22, 2003, which
provides:
I, MOLINA A. CABA, of legal age, Filipino citizen, x x x after
being duly sworn to in accordance with law, depose and state:
That-
1. I am the duly appointed Corporate Secretary of North Star
International Travel, Inc. x x x.
2. As such Corporate Secretary of the Corporation, I hereby
certify that at the Regular/Special meeting of the Board of
Directors and Stockholders of the Corporation which was held
on March 31, 2003 during which meeting ​a quor​ um was present
and majority of the stockholders were in attendance, the
following resolutions were unanimously passed and adopted:
"RESOLVED, AS IT IS HEREBY RESOLVED, that ​during a
meeting of the Board of Directors held last March 31, 2003,
the following members of the Board were elected to the
corporate position opposite their names:"
NAME POSITION

NORMA D. CACHO Chairman

VIRGINIA D. BALAGTAS Executive Vice President​39
(Emphasis supplied)
On the other hand, respondent Balagtas assails the validity of the
above-cited Secretary's Certificate for being forged and fabricated.
However, aside from these bare allegations, the NLRC observed that she
did not present other competent proof to support her claim. To the contrary,
respondent Balagtas even admitted that she was elected by the Board as
petitioner North Star's ​Executive Vice President​ and argued that she could
not be removed as such without another valid board resolution to that
effect. To support this claim, respondent Balagtas submitted the very same
Secretary's Certificate as an attachment to her Position Paper before the
Labor Arbiter.​40​ That she is now casting doubt over a document she herself
has previously relied on belies her own claim that the Secretary's
Certificate is a fake.
Thus, the above-cited Secretary's Certificate overcomes respondent
Balagtas's contention that she was merely the ​Executive Vice President​ by
name and was never empowered to exercise the functions of a corporate
officer. Notably, she did not offer any proof to show that her duties,
functions, and compensation were all determined by petitioner Cacho as
petitioner North Star's President.
In any case, that the ​Executive Vice President's​ duties and responsibilities
are determined by the President instead of the Board is irrelevant. In
determining whether a position is a corporate office, the board of directors'
appointment or election thereto is controlling. Article IV, Section 4 of North
Star's By-laws provides:
Section 4. The Vice-President(s) - If one or more
Vice-Presidents are appointed, he/they shall have such powers
and shall perform such duties as may from time to time be
assigned to him/them by the Board of Directors ​or​ by the
President. [Emphasis supplied.]
When Article IV, Section 4 is read together with Section 1 thereof, it is clear
that while petitioner North Star may have one or more vice presidents and
the President is authorized to determine each one's scope of work, their
appointment or election still devolves upon the Board.
At this point, it is best to emphasize that the manner of creation ​(i.e.,​ under
the express provisions of the Corporation Code or by-laws) and the manner
by which it is filled ​(i.e.,​ by election or appointment of the board of directors)
are sufficient in vesting a position the character of a corporate office.
Respondent Balagtas also denies her status as one of petitioner North
Star's corporate officers because she was not listed as such in petitioner
North Star's 2003 General Information Sheet (GIS).
This is of no moment.
The GIS neither governs nor establishes whether or not a position is
an ordinary or corporate office.​ At best, if one is listed in the GIS as an
officer of a corporation, his/her position as indicated therein could only be
deemed a regular office, and not a corporate office as it is defined under
the Corporation Code.​41
Based on the above discussion, as ​Executive Vice President,​ respondent
Balagtas was one of petitioner North Star's corporate officers. Thus, there
is an intra-corporate ​relationship​ existing between the parties.
B. Nature of the Controversy Test
The existence of an intra-corporate controversy does not wholly rely on the
relationship of the parties. The ​incidents​ of their relationship must also be
considered. Thus, under the ​nature of the controversy test,​ the
disagreement must not only be rooted in the existence of an
intra-corporate ​relationship,​ but must as well pertain to the enforcement of
the parties' correlative rights and obligations under the Corporation Code
and the internal and intra-corporate regulatory rules of the corporation. If
the relationship and its incidents are merely incidental to the controversy or
if there will still be conflict even if the relationship does not exist, then no
intra-corporate controversy exists.​42
Verily, in a long line of cases,​43​ the Court consistently ruled that a corporate
officer's dismissal is ​always​ a corporate act, or an intra-corporate
controversy which arises between a stockholder and a corporation.
However, a closer look at these cases will reveal that the intra-corporate
nature of the disputes therein did not hinge solely on the fact that the
subject of the dismissal was a corporate officer.
In ​Philippine School of Business Administration​ v. ​Leano,44​ ​ the complainant
questioned the validity of his dismissal after his position was declared
vacant and he was not re-elected thereto. The cases of ​Fortune​ ​Cement
Corporation v. National Labor Relations Commission​45​ and L ​ ocsin v.
Nissan Lease Phils. Inc.​ also share similar factual milieu.
46​

On the other hand, the complainant in ​Espino v. National Labor Relations

Commission​47​ also contested the failure of the board of directors to re-elect
him as a corporate officer. The Court found that the board of directors
deferred his re-election in light of previous administrative charges filed
against the complainant. Later on, the board of directors deemed him
resigned from service and his position was subsequently abolished.
Finally, in ​Pearson and George, (S.E. Asia), Inc. v. National Labor
Relations Commission,48​ ​ the complainant lost his corporate office primarily
because he was not re-elected as a member of the corporation's board of
directors. The Court found that the corporate office in question- required
the occupant to be at the same time a director. Thus, he should lose his
position as a corporate officer because he ceased to be a director for any
reason (e.g., he was not re-elected as such), such loss is not dismissal but
failure to qualify or to maintain a prerequisite for that position.
The dismissals in these cases were all considered intra-corporate
controversies not only because the complainants were corporate officers,
but also, and more importantly, because they were not re-elected to their
respective corporate offices and, thus, terminated from the corporation.
"The matter of whom to elect is a prerogative that belongs to the Board,
and involves the exercise of deliberate choice and the faculty of
discriminative selection. Generally speaking, the relationship of a person to
a corporation, whether as officer or as agent or employee, is not
determined by the nature of the services performed, but by the incidents of
the relationship as they actually exist."​49
In other words, the dismissal must relate to any of the circumstances and
incidents surrounding the parties' intra-corporate relationship. To be
considered an intra-corporate controversy, the dismissal of a corporate
officer must have something to do with the duties and responsibilities
attached to his/her corporate office or performed in his/her official
 
capacity.​50
In respondent Balagtas's Position Paper filed before the Labor Arbiter she
alleged as follows: (a) petitioner Cacho informed her, through a letter, that
she had been preventively suspended by the Board; (b) she opposed the
.suspension, was unduly prevented from re-assuming her position
 as ​Executive Vice President,​51​ and thereafter constructively dismissed; (c)

the Board did not authorize either her suspension and removal from office;
and (d) as a result of her illegal dismissal, she is entitled to separation pay
in lieu of her reinstatement to her previous positions, plus back wages,
 allowances, and other benefits.​52

The foregoing allegations mainly relate to incidents involving her capacity

as ​Executive Vice President,​ a position above-declared as a corporate
office, ​viz.: first,​ respondent Balagtas's claim of dismissal without prior
authority from the Board reveals her understanding that the appointment
and removal of a corporate officer like the ​Executive Vice President​ could
only be had through an official act by the Board. And, s​ econd,​ she sought
separation pay in lieu of reinstatement to her former positions, one of which
was as ​Executive Vice President.​ Even her prayer for full back wages,
allowances, commissions, and other monetary benefits all relate to her
 
corporate office.​53
On the other hand, petitioners Cacho and North Star terminated
respondent Balagtas for the following reasons: (a) for allegedly
appropriating company funds for her personal gain; (b) for abandonment of
work; (c) violation of a lawful order of the corporation; and (d) loss of trust
 and confidence.​54​ In their Position Paper, petitioners Cacho and North Star
 
described in detail the latter's fund disbursement process,​55​ emphasizing
respondent Balagtas's role as the one who approves payment vouchers
and the signatory on issued checks-responsibilities specifically devolved
upon her as the ​vice president.​ And as the ​vice president,​ respondent
Balagtas actively participated in the whole process, if not controlled it
altogether. As a result, petitioners Cacho and North Star accused
respondent Balagtas of gravely abusing the confidence the Board has
reposed in her as ​vice president​ and misappropriating company funds for
her own personal gain.
From these, it is clear that the termination complained of is intimately and
inevitably linked to respondent Balagtas's role as petitioner North
Star's ​Executive Vice President: first,​ the alleged misappropriations were
committed by respondent Balagtas in her capacity as ​vice president,​ one of
the officers responsible for approving the disbursements and signing the
checks. And, ​second,​ these alleged misappropriations breached petitioners
Cacho's and North Star's trust and confidence specifically reposed m
respondent Balagtas as ​vice president.
That all these incidents are adjuncts of her corporate office lead the Court
to conclude that respondent Balagtas's dismissal is an intra-corporate
controversy, not a mere labor dispute.
Petitioners Cacho and North Star not
estopped from questioning
jurisdiction
Respondent Balagtas insists that petitioners belatedly raised the issue of
the Labor Arbiter's lack of jurisdiction before the NLRC. Relying on ​Tijam​ v.
 Sibonghanoy,​56​ she avers that petitioners, after actively participating in the

proceedings before the Labor Arbiter and obtaining an unfavorable

judgment, are barred by laches from attacking the latter's jurisdiction.
We disagree with respondent Balagtas.
The Court has already held that the ruling in ​Tijam​ v. ​Sibonghanoy​ remains
only as an exception to the general rule. Estoppel by laches will only bar a
litigant from raising the issue of lack of jurisdiction in exceptional cases
similar to the factual milieu of ​Tijam v. Sibonghanoy.​ To recall, the Court
in ​Tijam​ v. ​Sibonghanoy​ ruled that the plea of lack of jurisdiction may no
longer be raised for being barred by laches because it was raised for the
first time in a motion to dismiss filed almost 15 years after the questioned
ruling had been rendered.​57
These exceptional circumstances are not present in this case. Thus, the
general rule must apply: that the issue of jurisdiction may be raised at any
stage of the proceedings, even on appeal, and is not lost by waiver or by
estoppel. In ​Espino​ v. ​National Labor Relations Commission,​58​ We ruled:
The principle of estoppel cannot be invoked to prevent this
Court from taking up the question, which has been apparent on
the face of the pleadings since the start of the litigation before
the Labor Arbiter. In the case of ​Dy v. NLRC,​ supra, the Court,
citing the case of ​Calimlim v. Ramirez,​ reiterated that the
decision of a tribunal not vested with appropriate jurisdiction is
null and void. Again, the Court in ​Southeast Asian Fisheries
Development Center-Aquaculture Department v. NLRC​ restated
the rule that the invocation of estoppel with respect to the issue
of jurisdiction is unavailing because estoppel does not apply to
confer jurisdiction upon a tribunal that has none over the cause
of action. The instant case does not provide an exception to the
said rule.​59​ (Emphasis supplied.)
All told, the issue in the present case is an intra-corporate controversy, a
matter outside the Labor Arbiter's jurisdiction. ​(​Norma Cacho, et. al. vs.
Virginia Balagtas, GR No. 202974, February 7, 2018)
The presumption under this provision is that the parties have an
employer-employee relationship. Otherwise, the case would be cognizable
in different tribunals even if the action involves a termination dispute.
Petitioner Malcaba alleges that the Court of Appeals erred m dismissing his
complaint for lack of jurisdiction, insisting that he was an employee of
respondent, not a corporate officer.
At the time of his alleged dismissal, petitioner Malcaba was the President of
respondent corporation. Strangely, this same petitioner disputes this
position as respondents' bare assertion,​78​ yet he also insists that his name
appears as President in the corporation's General Information Sheet for
2007.​79
Under Section 25 of the Corporation Code,​80​ the President of a corporation
is considered a corporate officer. The dismissal of a corporate officer is
considered an intra-corporate dispute, not a labor dispute. Thus, in ​Tabang
v. National Labor Relations Commission​:81 ​
 A corporate officer's dismissal is always a corporate act, or an
intra-corporate controversy, and the nature is not altered by the
reason or wisdom with which the Board of Directors may have
in taking such action. Also, an intra-corporate controversy is
one which arises between a stockholder and. the corporation.
There is no distinction, qualification, nor any exemption
whatsoever. The provision is broad and covers all kinds of
controversies between stockholders and corporations.​82
Further, in ​Matling Industrial and Commercial Corporation v. Coros​,83​ ​ this
Court stated that jurisdiction over intra-corporate disputes involving the
illegal dismissal of corporate officers was with the Regional Trial Court, not
with the Labor Arbiter:
Where the complaint for illegal dismissal concerns a corporate
officer, however, the controversy falls under the jurisdiction of
the Securities and Exchange Commission (SEC), because the
controversy arises out of intra-corporate or partnership relations
between and among stockholders, members, or associates, or
between any or all of them and the corporation, partnership, or
association of which they are stockholders, members, or
associates, respectively; and between such corporation,
partnership, or association and the State insofar as the
controversy concerns their individual franchise or right to exist
as such entity; or because the controversy involves the election
or appointment of a director, trustee, officer, or manager of such
corporation, partnership, or association. Such controversy,
among others, is known as an intra-corporate dispute.
Effective on August 8, 2000, upon the passage of Republic Act
No. 8799, otherwise known as The Securities Regulation Code,
the SEC's jurisdiction over all intra-corporate disputes was
transferred to the RTC, pursuant to Section 5.2 of RA No. 8799,
to wit:
5.2. The Commission's jurisdiction over all cases
enumerated under Section 5 of Presidential Decree
No. 902-A is hereby transferred to the Courts of
general jurisdiction or the appropriate Regional Trial
Court: Provided, that the Supreme Court in the
exercise of its authority may designate the Regional
Trial Court branches that shall exercise jurisdiction
over these cases. The Commission shall retain
jurisdiction over pending cases involving
intra-corporate disputes submitted for final
resolution which should be resolved within one (1)
year from the enactment of this Code. The
Commission shall retain jurisdiction over pending
suspension of payments/rehabilitation cases filed as
of 30 June 2000 until finally disposed.​84
The mere designation as a high-ranking employee, however, is not enough
to consider one as a corporate officer. In Tabang, this Court discussed the
distinction between an employee and a corporate officer, regardless of
designation:
The president, vice-president, secretary and treasurer are
commonly regarded as the principal or executive officers of a
corporation, and modern corporation statutes usually designate
them as the officers of the corporation. However, other offices
are sometimes created by the charter or by-laws of a
corporation, or the board of directors may be empowered under
the by-laws of a corporation to create additional offices as may
be necessary.
It has been held that an "office" is created by the charter of the
corporation and the officer is elected by the directors or
stockholders. On the other hand, an "employee" usually
occupies no office and generally is employed not by action of
the directors or stockholders but by the managing officer of the
corporation who also determines the compensation to be paid
to such employee.​85
The clear weight of jurisprudence clarifies that to be considered a corporate
officer, ​first,​ the office must be created by the charter of the corporation,
and ​second​, the officer must be elected by the board of directors or by the
stockholders.
Petitioner Malcaba was an incorporator of the corporation and a member of
the Board of Directors.​86​ Respondent corporation's By-Laws creates the
office of the President.
This case is similar to ​Locsin v. Nissan Lease Philippines:​ 88
​
Locsin was undeniably Chairman and President, and was
elected to these positions by the Nissan board pursuant to its
By-laws. As such, he was a corporate officer, not an employee.
The CA reached this conclusion by relying on the submitted
facts and on Presidential Decree 902-A, which defines
corporate officers as "those officers of a corporation who are
given that character either by the Corporation Code or by the
corporation's by-laws." Likewise, Section 25 of Batas
Pambansa Blg. 69, or the Corporation Code of the Philippines
(Corporation Code) provides that corporate officers are
the ​president​, secretary, ​treasurer​ and such ​other officers as
may be provided for in the by-laws​.89​ ​ (Emphasis in the
original)
Petitioners cite ​Prudential Bank and Trust Company v. Reyes90​ ​ as basis
that even high-ranking officers may be considered regular employees, not
corporate officers.​91​Prudential Bank,​ however, is not applicable to this case.
In Prudential Bank, an employer was considered estopped from raising the
argument of an intra-corporate dispute since this was only raised when the
case was filed with this Court. This Court also noted that an employee rose
from the ranks and was regularly performing tasks integral to the business
of the employer throughout the length of her tenure, thus:
It appears that private respondent was appointed Accounting
Clerk by the Bank on July 14, 1963. From that position she rose
to become supervisor. Then in 1982, she was appointed
 Assistant Vice-President which she occupied until her illegal
dismissal on July 19, 1991. The bank's contention that she
merely holds an elective position and that in effect she is not a
regular employee is belied by the nature of her work and her
length of service with the Bank. As earlier stated, she rose from
the ranks and has been employed with the Bank since 1963
until the termination of her employment in 1991. As Assistant
Vice President of the foreign department of the Bank, she is
tasked, among others, to collect checks drawn against
overseas banks payable in foreign currency and to ensure the
collection of foreign bills or checks purchased, including the
signing of transmittal letters covering the same. It has been
stated that "the primary standard of determining regular
employment is the reasonable connection between the
particular activity performed by the employee in relation to the
usual trade or business of the employer.["] Additionally, "an
employee is regular because of the nature of work and the
length of service, not because of the mode or even the reason
for hiring them." As Assistant Vice-President of the Foreign
Department of the Bank she performs tasks integral to the
operations of the bank and her length of service with the bank
totaling 28 years speaks volumes of her status as a regular
employee of the bank. In fine, as a regular employee, she is
entitled to security of tenure; that is, her services may be
terminated only for a just or authorized cause. This being in
truth a case of illegal dismissal, it is no wonder then that the
Bank endeavored to the very end to establish loss of trust and
confidence and serious misconduct on the part of private
respondent but, as will be discussed later, to no avail.​92
An "Assistant Vice President" is not among the officers stated in Section 25
of the Corporation Code.​93​ A corporation's President, however, is explicitly
stated as a corporate officer.
Finding that petitioner Malcaba is the President of respondent corporation
and a corporate officer, any issue on his alleged dismissal is beyond the
jurisdiction of the Labor Arbiter or the National Labor Relations
Commission. Their adjudication on his money claims is void for lack of
jurisdiction. As a matter of equity, petitioner Malcaba must, therefore, return
all amounts received as judgment award pending final adjudication of his
claims. This Court's dismissal of petitioner Malcaba's claims, however, is
without prejudice to his filing of the appropriate case in the proper forum.
(​Nicanor Macalba vs. Pro Health Pharma Phils., GR No. 209085, June 6,
2018)
Labor tribunals have jurisdiction
over actions for damages arising
from a labor strike.
Under Article 21 7 [now Article 224] of the Labor Code, as amended by
Section 9 of R.A. No. 6715, the LA and the NLRC have jurisdiction to
resolve cases involving claims for damages arising from
employer-employee relationship, to wit:
 ART. 217. Jurisdiction of Labor Arbiters and the Commission-
(a) Except as otherwise provided under this Code, the Labor
Arbiters shall have original and exclusive jurisdiction to hear
and decide, within thirty (30) calendar days after the submission
of the case by the parties for decision without extension, even
in the absence of stenographic notes, the following cases
involving all workers, whether agricultural or nonagricultural:
1. Unfair labor practice​ cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases
that workers may file involving wages, rates of pay, hours of
work and other terms and conditions of employment;
4. Claims for actual, moral, exemplary and other forms of
damages arising from employer-employee relations;
5.​ Cases ​arising from any violation of Article 264 of this
Code including questions involving the legality of strikes
and lockouts; and
6. Except claims for Employees Compensation, Social Security,
Medicare and maternity benefits, all other claims, arising from
employer-employee relations, including those of persons in
domestic or household service, involving an amount exceeding
five thousand pesos (₱5,000.00) regardless of whether
accompanied with a claim for reinstatement.
[emphases supplied]
It is settled, however, that not every controversy or money claim by an
employee against the employer or vice-versa falls within the jurisdiction of
the labor arbiter.​16​ Intrinsically, civil disputes, although involving the claim of
an employer against its employees, are cognizable by regular courts.​17
To determine whether a claim for damages under paragraph 4 of Article
217 is properly cognizable by the labor arbiter, jurisprudence has evolved
the "reasonable connection rule" which essentially states that the claim for
damages must have reasonable causal connection with any of the claims
provided for in that article. A money claim by a worker against the employer
or vice-versa is within the exclusive jurisdiction of the labor arbiter only if
there is a "reasonable causal connection" between the claim asserted and
employee-employer relations. Only if there is such a connection with the
other claims can the claim for damages be considered as arising from
employer-employee relations.​18​ Absent such a link, the complaint will be
cognizable by the regular courts.
The appellate court was of the opinion that, applying the reasonable
connection rule, PAL's claims for damages have no relevant connection
whatsoever to the employer-employee relationship between the parties.
Thus, the claim is within the exclusive jurisdiction of the regular courts. It
explained that Article 217 of the Labor Code does not include a claim for
damages wherein the employer-employee relation is merely incidental, and
where the claim is largely civil in character.
The appellate court is mistaken.
The Court agrees with PAL that its claim for damages has reasonable
connection with its employer-employee relationship with the respondents.
Contrary to the pronouncements made by the appellate court, PAL's cause
of action is not grounded on mere acts of ​quasi-delict.​ The claimed
damages arose from the illegal strike and acts committed during the same
which were in turn closely related and intertwined with the respondents'
allegations of unfair labor practices against PAL. This could not even be
disputed as even the appellate court recognized this fact. In its 26 August
2011 Decision, the CA made the following statements:
The damages caused by the willful act of the ​striking pilots​ in
abandoning their aircrafts, together with the passengers and
cargo, which resulted in injury to petitioner's business is
recoverable under civil law.​19​ [emphasis supplied]
xxx
1) The ​complaint for damages arising from the illegal
strike​ claimed by petitioner lies not within the jurisdiction of the
DOLE Secretary or the Labor Arbiter but with the regular courts;
xxx​20​ [emphasis supplied]
Since the loss and injury from which PAL seeks compensation have
reasonable causal connection with the alleged acts of unfair labor practice,
a claim provided for in Article 217 of the Labor Code, the question of
damages becomes a labor controversy and is therefore an employment
relationship dispute.
This issue is not novel. It has been previously decided by the Court in
several cases.
In ​Goodrich Employees Association v. Hon. Flores,21​ ​ the Court stressed the
rule that cases involving unfair labor practices are within the jurisdiction of
the Court of Industrial Relations ​(CIR),​ the labor tribunal at that time. The
Court further emphasized that where the subject matter is within the
exclusive jurisdiction of the CIR, it must be deemed to have jurisdiction
over all incidental matters connected to the main issue.
Thus, in ​Holganza v. Hon. Apostol,​22​ the Court reaffirmed the exclusive
jurisdiction of the labor tribunal over actions for damages arising from labor
controversies. In the said case, the Social Security System (SSS) filed with
the then Court of First Instance ​(CFI)​ of Rizal a complaint for damages with
writ of preliminary attachment against several of its employees. It alleged
that it sustained damages as a consequence of the picketing carried on by
its striking employees during a strike held against it. The striking employees
moved for the dismissal of the complaint on the ground of lack of
jurisdiction, but the trial court denied the same. Eventually, the issue
reached this Court which opined that the trial court is devoid of any
jurisdiction to entertain the said complaint for damages. In so ruling, the
Court declared that exclusive jurisdiction over disputes of this character
belonged to the then CIR. To hold otherwise would be to sanction split
jurisdiction which is obnoxious to the orderly administration of justice.
A similar controversy arose in ​Philippine Long Distance Telephone
Company v. Free Telephone Workers Union.23​ ​ The Court reiterated the rule
that regular courts are devoid of any jurisdiction over claims for damages
arising from a labor strike, thus:
It is clear from the records that the subject complaint for
damages is intertwined with or deeply rooted from the 1964
 certified labor dispute between appellant and appellees. As can
be gleaned from the aforesaid complaint, appellant is claiming
against appellees damages it allegedly sustained as a
consequence of the strikes declared by the appellees. It is
therefore obvious in the light of the established jurisprudence as
aforestated that the lower court, Court of First Instance of
Manila, Branch XII, did not have jurisdiction over the aforesaid
complaint for damages; hence, all the proceedings taken
therein are void for lack of jurisdiction.​24
The rule stands even if the strike is illegal. In ​Antipolo Highway Lines
Employees Union v. Hon. Aquino.​25​ Francisco De Jesus, the owner of Anti
polo Highway Lines ​(AHL),​ instituted a complaint for damages with
injunction against AHL Employees Union ​(AHLEU)​ and its officers before
the CFI of Rizal. De Jesus alleged that AHLEU staged a strike and posted
picket lines along AHL's compound, thereby preventing its employees from
performing their work and causing it to suffer losses and damages from the
non-operation of its buses. The Court ruled that the trial court lacked
jurisdiction over the complaints for damages and injunction because the
illegal strike and picket which allegedly caused damages to De Jesus were
mere incidents of the labor dispute between the parties, to wit:
Although it was artfully made to appear that the suit was one for
damages that did not divest the Court of Industrial Relations of
its jurisdiction. The Complaint itself, in paragraph 5, adverted to
an "illegal strike" and "picket lines," which are but mere
incidents or consequences of the unfair labor practice
complained against by petitioner Union. In other words, it is
clear that the cause of action for damages "arose out of or was
necessarily intertwined with" an alleged unfair labor practice
committed by DE JESUS in refusing to sit at the bargaining
table. It is still the labor court'. therefore, that has jurisdiction,
particularly under the principle that split jurisdiction is not to be
countenanced for being "obnoxious to the orderly administration
of justice."​26
Indeed, the aforecited cases were decided by this Court under R.A. No.
875 or the Industrial Peace Act. The Court is also not unmindful of the fact
that R.A. No. 875 had been completely superseded in 1974 by Presidential
Decree (P.D.) No. 442 or the Labor Code of the Philippines. Nevertheless,
it could not be denied that the underlying rationale for the rule finds
application even with the effectivity of the Labor Code. As in the Industrial
Peace Act, splitting of jurisdiction is abhorred under the Labor Code.​27
A case in point is ​National Federation of Labor​ v. ​Hon. Eisma,​28​ decided by
the Court under the provisions of the Labor Code. In case, as in those
cited, the employer, Zamboanga Wood Products, Inc., filed, before the CFI
of Zamboanga City, a complaint for damages against the officers and
members of the labor union. The employer alleged that it incurred damages
because the union officers and members blockaded the road leading to its
manufacturing division, thus preventing customers and suppliers free
ingress to or egress from their premises. The labor union, however,
contended that jurisdiction over the controversy belongs to the labor arbiter
because the acts complained of were incidents of picketing by the
defendants who were then on strike against the employer.
The Court ruled in favor of the labor union and nullified the proceedings
before the trial court. The Court opined that the complaint for damages is
deeply rooted in the labor dispute between the parties and thus should be
dismissed by the regular court for lack of jurisdiction. The Court stressed
that the wordings of Article 217 of the Labor Code is explicit and clear
enough to mean that exclusive jurisdiction over suits for damages arising
from a strike belongs to the labor arbiter, thus:
Article 217 is to be applied the way it is worded. The exclusive
original jurisdiction of a labor arbiter is therein provided for
explicitly. It means, it can only mean, that a court of first
instance judge then, a regional trial court judge now, certainly
acts beyond the scope of the authority conferred on him by law
when he entertained the suit for damages, arising from
picketing that accompanied a strike. That was squarely within
the express terms of the law. Any deviation cannot therefore be
tolerated. So it has been the constant ruling of this Court even
prior to ​Lizarraga Hermanos v. Yap Tico,​ a 1913 decision. The
ringing words of the ​ponencia​ of Justice Moreland still call for
obedience. Thus, "The first and fundamental duty of courts, in
our judgment, is to apply the law. Construction and
interpretation come only after it has been demonstrated that
application is impossible or inadequate without them." It is so
even after the lapse of sixty years.​29​ [Citations omitted]
Jurisprudence dictates that where the plaintiffs cause of action for damages
arose out of or was necessarily intertwined with an alleged unfair labor
practice, the jurisdiction is exclusively with the labor tribunal. Likewise,
where the damages separately claimed by the employer were allegedly
incurred as a consequence of strike or picketing of the union, such
complaint for damages is deeply rooted in the labor dispute between the
parties and within the exclusive jurisdiction of the labor arbiter.
Consequently, the same should be dismissed by ordinary courts for lack of
jurisdiction.​30
From the foregoing, it is clear that the regular courts do not have
jurisdiction over PAL's claim of damages, the same being intertwined with
its labor dispute with the respondents over which the SOLE had assumed
jurisdiction. It is erroneous, therefore, for the CA to even suggest that PAL's
complaint should have been ventilated before the trial court.
A separate complaint for damages
runs counter to the rule against
split jurisdiction.
While there is merit in the contention that regular courts do not have
jurisdiction over claims for damages arising from a labor controversy, the
Court opines that PAL could no longer recover the alleged damages.
It must be recalled that the SOLE assumed jurisdiction over the labor
dispute between PAL and the respondents on 23 December 1997. In this
regard, it is settled that the authority of the SOLE to assume jurisdiction
over a labor dispute causing or likely to cause a strike or lockout in an
industry indispensable to national interest includes and extends to all
questions and controversies arising therefrom.​31​ It has also been opined
that when the very reason for the SOLE's assumption of jurisdiction is the
declaration of strike, any issue regarding the strike is not merely incidental
to but is essentially involved in the labor dispute itself.​32
It bears emphasis, even at the risk of being repetitious, that it is beyond
question that the issue on damages is a controversy which arose from the
labor dispute between the parties herein. Consequently, when the SOLE
assumed jurisdiction over the labor dispute, the claim for damages was
deemed included therein. Thus, the issue on damages was also deemed
resolved when the SOLE decided the main controversy in its 1 June 1999
resolution declaring the illegality of the strike and the loss of employment
status of the striking officers of ALP AP, as well as when the case was
finally settled by this Court in its 10 April 2002 Resolution in G.R. No.
152306. This is true even if the respective resolutions of the SOLE, CA,
and this Court were silent with respect to the damages.
To insist that PAL may recover the alleged damages through its complaint
before the LA would be to sanction a relitigation of the issue of damages
separately from the main issue of the legality of the strike from which it is
intertwined. This runs counter to the proscription against split jurisdiction -
the very principle invoked by PAL.
Likewise, PAL's claim for damages is barred under the doctrine of
immutability of final judgment. Under the said doctrine, a decision that has
acquired finality becomes immutable and unalterable, and may no longer
be modified in any respect, even if the modification is meant to correct
erroneous conclusions of fact and law, and whether it is made by the court
that rendered it or by the Highest Court of the land. Any act which violates
this principle must immediately be struck down.​33
Whether the damages claimed by PAL are recoverable and to what extent
would depend on the evidence in the illegal strike case which had long
attained finality.​34​ PAL's recovery, therefore, would entail a relitigation of the
illegal strike case. The subject claim for damages would ultimately require
the modification of a final judgment. This cannot be done. The dismissal of
the present petition as well as the complaint for damages is therefore in
order.
In any event, PAL only has itself to blame for this blunder.1âшphi1 It was
already aware that it had sustained damages even before the SOLE issued
its resolution. It must be remembered that the damages allegedly sustained
by PAL were incurred as a consequence of the acts committed by the
respondents on the second day of the strike on 6 June 1998, or almost a
year prior to the issuance of the SOLE's resolution. However, PAL did not
assert its claim during the proceedings before the SOLE and, instead,
acted on it only after the decision on the main case attained finality. This is
a grave error on the part of PAL.1aшphi1
The proper recourse for PAL should have been to assert its claim for
damages before the SOLE and, as aptly stated by the LA, to elevate the
case to the CA when the SOLE failed to rule on the matter of damages.
The 22 April 2008 LA decision, therefore, deserves reinstatement insofar
as it dismissed PAL's 22 April 2003 complaint for lack of jurisdiction for the
reason that the SOLE has exclusive jurisdiction over the same. Thus, the
Court quotes with approval the following pronouncements by the LA:
The respondents maintain that the complainant simply slept on
its rights when it failed to elevate the matter of damages to the
Court of Appeals. In this regard, we find the argument of the
respondents availing considering that upon the assumption of
jurisdiction of the Secretary of Labor over the labor disputes at
PAL, all other issues had been subsumed therein including the
claim for damages arising from the strike. This is clear from the
language of Article 263(g) of the Labor Code granting the
Secretary to order the "dismissal or loss of employment status
or payment by the locking-out employer of back wages,
damages and other affirmative relief even criminal prosecution
against either or both."
xxx
There is no quarrel regarding the jurisdiction of labor arbiters to
rule on the legality of strikes and lock-outs under Article
217(a)(4) but this refers to strikes or lock-outs in establishments
that are not indispensable to national interest. However, if in his
opinion the dispute affects industries imbued with national
interest, the Secretary of Labor who has the authority, may
assume jurisdiction over the dispute and may opt to hear the
same until its final disposition as is obtaining at bar, or to certify
the same for compulsory arbitration to the NLRC, where it is the
Commission that will hear and dispose of the certified cases
under Rule VIII of the Revised Rules of the NLRC. Even in
voluntary arbitration, should the disputants agree to submit the
dispute to voluntary arbitration, the Voluntary Arbitrator is not
precluded from awarding damages.
As the issue on the illegality of the strikes of June 5, 1998 has
already been passed upon by the Secretary of Labor when he
assumed jurisdiction to the exclusion of all others, all incidents
arising from the main issue of the legality of the strike are
presumed to have been ruled upon because they are deemed
subsumed by the assumption by the Secretary of Labor.​35
In sum, the Court finds meritorious PAL's claim that the CA erred in its
decision. Indeed, the CA erred when it ruled that regular courts have
jurisdiction to entertain claims for damages arising from strike as the same
violates the proscription against splitting of jurisdiction. The Court, however,
also finds that the LA was already divested of its jurisdiction to entertain
PAL's claim for damages as such issue was deemed included in the issue
of legality of strike of which the SOLE had assumed jurisdiction, pursuant to
the rule against splitting of jurisdiction. Unfortunately, for PAL's failure to
raise the claim during the pendency of the illegal strike case before the
SOLE, the same is deemed waived. (​PAL vs. Airline Pilots Assoc., GR No.
200088, March 27, 2018)