CASE DIGEST

Coastal Subic Bay Terminal v. DOLE

Labor II

Court Supreme Court

Citation G.R. No. 157117

Date Nov 20, 2006

Petitioner Coastal Subic Bay Terminal

Respondent DOLE, CSBTI Supervisory Union and CSBTI Rank-and-File Union

Ponente Quisumbing, J.

Relevant topic II. Labor Relations C. Union Chartering/Affiliation: Local and Parent Union Relations

Prepared by Dany

CASE SUMMARY:
CBSTI-RFU and CSBTI-SU filed separate petitions for certification election before the Med-Arbiter. The rank-and-file
union insists that it is a legitimate labor organization having been issued a charter certificate by the ALU, and the
supervisory union by the APSOTEU. The Company opposed. A local union does not owe its existence to the
federation with which it is affiliated. It is a separate and voluntary association owing its creation to the will of its
members. Hence, local unions are considered principals while the federation is deemed to be merely their agent. As
such principals, the unions are entitled to exercise the rights and privileges of a legitimate labor organization, including
the right to seek a certification election. However, there must be no commingling between the labor federations for
their legitimacy to be secured.

FACTS:
● Petitioner Coastal Subic Bay Terminal, Inc. (CSBTI) is unorganized.
● Two unions, private respondents, CBSTI Rank-and-File Union (RFU) and Coastal CBSTI. Supervisory Union
(AU) filed separate petitions for certification election. The unions insist that they are legitimate labor
organizations having been issued a charter certificate by the Associated Labor Union (ALU), and by the
Associated Professional, Supervisory, Office and Technical Employees Union (APSOTEU) correspondingly.
● Med-Arbiter: Dismissed the petition holding that the ALU and APSOTEU are one and the same federation
having a common set of officers. Thus, the supervisory and the rank-and-file unions were in effect affiliated
with only one federation.
● SOLE: Declared CSBTI-RFU and CSBTI-SU as legitimate labor organizations, having been chartered by ALU
and APSOTEU after submitting the requirements with the Bureau of Labor Relations (BLR).
o Accordingly, SOLE ordered the holding of separate certification election.
● CA: Affirmed SOLE.
● CBSTI’s Argument before SC: CBSTI opposed both petitions for certification election alleging that the RFU
and SU were not legitimate labor organizations, and that the proposed bargaining units were not particularly
described.

ISSUE – HELD – RATIO:

ISSUE HELD
W/N the RFU and SU were not particularly described, and were engaged in YES
commingling

RATIO:
● When the personality of the labor organization is questioned in the same manner the veil of corporate fiction is
pierced, the action partakes the nature of a collateral attack (which is not allowed). Thus, APSOTEU and ALU
continue to be distinct and separate federations despite the commonalities.
● Under the IRR, a chartered union acquires legal personality through the charter certificate issued by a
duly registered federation or national union. A local union does not owe its existence to the
federation. It is a separate and distinct voluntary association. The affiliation merely gives rise to a
contract of agency, where the mother federation acts in representation of the chartered local union.
○ However, the local unions are not divested of its own personality and are entitled to exercise the rights
and privileges of a legitimate labor organization.
○ As such principals, the unions are entitled to exercise the rights and privileges of a legitimate labor
organization, including the right to seek certification as the sole and exclusive bargaining agent in the
appropriate employer unit.

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CASE DIGEST
Coastal Subic Bay Terminal v. DOLE
Labor II

● BUT this case is exceptional: RFU and SU both cannot obtain the status of a legitimate labor organization for
as long as they are affiliated with their mother federations. There is a common set of officers (commingling of
officers of a rank-and-file federation with the supervisory federation), giving occasion to possible conflict of
interest among the common officers. In this case, the constitutional policy on labor is circumvented.

RULING:

WHEREFORE, the petition is GRANTED. The Court of Appeals’ Decision is SET ASIDE. The decision of the Med-
Arbiter is hereby AFFIRMED.