SECOND DIVISION

[G.R. No. 177114. January 21, 2010.]

MANOLO A. PEÑAFLOR , petitioner, vs. OUTDOOR CLOTHING

MANUFACTURING CORPORATION, NATHANIEL T. SYFU,
President, MEDYLENE M. DEMOGENA, Finance Manager,
and PAUL U. LEE, Chairman, respondents.

DECISION

BRION, J : p

Petitioner Manolo A. Peñaflor (Peñaflor) seeks the reversal of the Court

of Appeals (CA) decision 1 dated December 29, 2006 and its resolution 2
dated March 14, 2007, through the present petition for review on certiorari
filed under Rule 45 of the Rules of Court. The assailed CA decision affirmed
the September 24, 2002 decision 3 of the National Labor Relations
Commission (NLRC) that in turn reversed the August 15, 2001 decision4 of
the Labor Arbiter. 5
THE FACTUAL ANTECEDENTS
Peñaflor was hired on September 2, 1999 as probationary Human
Resource Department (HRD) Manager of respondent Outdoor Clothing
Manufacturing Corporation (Outdoor Clothing or the company). As HRD head,
Peñaflor was expected to (1) secure and maintain the right quality and
quantity of people needed by the company; (2) maintain the harmonious
relationship between the employees and management in a role that supports
organizational goals and individual aspirations; and (3) represent the
company in labor cases or proceedings. Two staff members were assigned to
work with him to assist him in undertaking these functions.
Peñaflor claimed that his relationship with Outdoor Clothing went well
during the first few months of his employment; he designed and created the
company's Policy Manual, Personnel Handbook, Job Expectations, and
Organizational Set-Up during this period. His woes began when the
company's Vice President for Operations, Edgar Lee (Lee), left the company
after a big fight between Lee and Chief Corporate Officer Nathaniel Syfu
(Syfu). Because of his close association with Lee, Peñaflor claimed that he
was among those who bore Syfu's ire.
When Outdoor Clothing began undertaking its alleged downsizing
program due to negative business returns, Peñaflor alleged that his
department had been singled out. On the pretext of retrenchment, Peñaflor's
two staff members were dismissed, leaving him as the only member of
Outdoor Clothing's HRD and compelling him to perform all personnel-related
work. He worked as a one-man department, carrying out all clerical,
administrative and liaison work; he personally went to various government
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 offices to process the company's papers. cCTaSH

When an Outdoor Clothing employee, Lynn Padilla (Padilla), suffered

injuries in a bombing incident, the company required Peñaflor to attend to
her hospitalization needs; he had to work outside office premises to
undertake this task. As he was acting on the company's orders, Peñaflor
considered himself to be on official business, but was surprised when the
company deducted six days' salary corresponding to the time he assisted
Padilla. According to Finance Manager Medylene Demogena (Demogena), he
failed to submit his trip ticket, but Peñaflor belied this claim as a trip ticket
was required only when a company vehicle was used and he did not use any
company vehicle when he attended to his off-premises work. 6
After Peñaflor returned from his field work on March 13, 2000, his
officemates informed him that while he was away, Syfu had appointed
Nathaniel Buenaobra (Buenaobra) as the new HRD Manager. This
information was confirmed by Syfu's memorandum of March 10, 2000 to the
entire office stating that Buenaobra was the concurrent HRD and Accounting
Manager. 7 Peñaflor was surprised by the news; he also felt betrayed and
discouraged. He tried to talk to Syfu to clarify the matter, but was unable to
do so. Peñaflor claimed that under these circumstances, he had no option
but to resign. He submitted a letter to Syfu declaring his irrevocable
resignation from his employment with Outdoor Clothing effective at the close
of office hours on March 15, 2000. 8
Peñaflor then filed a complaint for illegal dismissal with the labor
arbiter, claiming that he had been constructively dismissed. He included in
his complaint a prayer for reinstatement and payment of backwages,
illegally deducted salaries, damages, attorney's fees, and other monetary
claims.
Outdoor Clothing denied Peñaflor's allegation of constructive dismissal.
It posited instead that Peñaflor had voluntarily resigned from his work.
Contrary to Peñaflor's statement that he had been dismissed from
employment upon Syfu's appointment of Buenaobra as the new HRD
Manager on March 10, 2000, Peñaflor had in fact continued working for the
company until his resignation on March 15, 2000. The company cited as
evidence the security report that Peñaflor himself prepared and signed on
March 13, 2000. 9
Outdoor Clothing disclaimed liability for any of Peñaflor's monetary
claims. Since Peñaflor had voluntarily resigned, Outdoor Clothing alleged
that he was not entitled to any backwages and damages. The company
likewise denied making any illegal deduction from Peñaflor's salary; while
deductions were made, they were due to Peñaflor's failure to report for work
during the dates the company questioned. As a probationary employee, he
was not yet entitled to any leave credit that would offset his absences.
In his August 15, 2001 decision, the labor arbiter found that Peñaflor
had been illegally dismissed. 10 Outdoor Clothing was consequently ordered
to reinstate Peñaflor to his former or to an equivalent position, and to pay
him his illegally deducted salary for six days, proportionate 13th month pay,
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 attorney's fees, moral and exemplary damages.
Outdoor Clothing appealed the labor arbiter's decision with the NLRC. It
insisted that Peñaflor had not been constructively dismissed, claiming that
Peñaflor tendered his resignation on March 1, 2000 because he saw no
future with the corporation due to its dire financial standing. Syfu alleged
that he was compelled to appoint Buenaobra as concurrent HRD Manager
through a memorandum dated March 1, 2000 to cover the position that
Peñaflor would soon vacate. 11 The appointment was also made to address
the personnel matters that had to be taken cared of while Peñaflor was on
unauthorized leave. Incidentally, Outdoor Clothing alleged that Peñaflor had
already been given two notices, on March 6 and 11, 2000 (absence without
official leave memoranda or the AWOL memorandum), or his unauthorized
absences. In a memorandum dated March 3, 2000 addressed to Syfu,
Buenaobra accepted the appointment. 12 ACIDSc

Peñaflor contested Syfu's March l, 2000 memorandum, Buenaobra's

March 3, 2000 memorandum, and the AWOL memoranda, claiming these
pieces of evidence were fabricated and were never presented before the
labor arbiter. He pointed out that nothing in this resignation letter indicated
that it was submitted to and received by Syfu on March 1, 2000. He claimed
that it was submitted on March 15, 2000, the same date he made his
resignation effective. The AWOL memoranda could not be relied on, as he
was never furnished copies of these. Moreover, he could not be on prolonged
absence without official leave, as his residence was just a few meters away
from the office.
The NLRC apparently found Outdoor Clothing's submitted memoranda
sufficient to overturn the labor arbiter's decision. 13 It characterized
Peñaflor's resignation as a response, not to the allegedly degrading and
hostile treatment that he was subjected to by Syfu, but to Outdoor Clothing's
downward financial spiral. Buenaobra's appointment was made only after
Peñaflor had submitted his resignation letter, and this was made to cover
the vacancy Peñaflor's resignation would create. Thus, Peñaflor was not
eased out from his position as HRD manager. No malice likewise was present
in the company's decision to dismiss Peñaflor's two staff members; the
company simply exercised its management prerogative to address the
financial problems it faced. Peñaflor, in fact, drafted the dismissal letters of
his staff members. In the absence of any illegal dismissal, no basis existed
for the monetary awards the labor arbiter granted.
Peñaflor anchored his certiorari petition with the CA on the claim that
the NLRC decision was tainted with grave abuse of discretion, although he
essentially adopted the same arguments he presented before the labor
arbiter and the NLRC.
In a decision dated December 29, 2006, 14 the CA affirmed the NLRC's
decision, stating that Peñaflor failed to present sufficient evidence
supporting his claim that he had been constructively dismissed. The CA ruled
that Peñaflor's resignation was knowingly and voluntarily made. Accordingly,
it dismissed Peñaflor's certiorari petition. It likewise denied the motion for
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 reconsideration that Peñaflor subsequently filed. 15 Faced with these CA
actions, Peñaflor filed with us the present petition for review on certiorari.
THE PARTIES' ARGUMENTS
Peñaflor insists that, contrary to the findings of the NLRC and the CA,
he had been constructively dismissed from his employment with Outdoor
Clothing. He alleges that the dismissal of his two staff members, the
demeaning liaison work he had to perform as HRD Manager, the salary
deduction for his alleged unauthorized absences, and the appointment of
Buenaobra as the new HRD manager even before he tendered his
resignation, were clear acts of discrimination that made his continued
employment with the Outdoor Clothing unbearable. He was thus forced to
resign. aESTAI

Outdoor Clothing claims that Peñaflor voluntarily resigned from his

work and his contrary allegations were all unsubstantiated. The HRD was not
singled out for retrenchment, but was simply the first to lose its staff
members because the company had to downsize. Thus, all HRD work had to
be performed by Peñaflor. Instead of being grateful that he was not among
those immediately dismissed due to the company's retrenchment program,
Peñaflor unreasonably felt humiliated in performing work that logically fell
under his department; insisted on having a full staff complement; absented
himself from work without official leave; and demanded payment for his
unauthorized absences.
THE ISSUE and THE COURT'S RULING
The Court finds the petition meritorious.
A preliminary contentious issue is Outdoor Clothing's argument that we
should dismiss the petitions outright because it raises questions of facts, not
the legal questions that should be raised in a Rule 45 petition. 16
We see no merit in this argument as the rule that a Rule 45 petition
deals only with legal issues is not an absolute rule; it admits of exceptions. In
the labor law setting, we wade into factual issues when conflict of factual
findings exists among the labor arbiter, the NLRC, and the CA. This is the
exact situation that obtains in the present case since the labor arbiter found
facts supporting the conclusion that there had been constructive dismissal,
while the NLRC's and the CA's factual findings contradicted the labor
arbiter's findings. 17 Under this situation, the conflicting factual findings
below are not binding on us, and we retain the authority to pass on the
evidence presented and draw conclusions therefrom. 18
The petition turns on the question of whether Peñaflor's undisputed
resignation was a voluntary or a forced one, in the latter case making it a
constructive dismissal equivalent to an illegal dismissal. A critical fact
necessary in resolving this issue is whether Peñaflor filed his letter of
resignation before or after the appointment of Buenaobra as the
new/concurrent HRD manager. This question also gives rise to the side
issue of when Buenaobra's appointment was made. If the resignation letter
was submitted before Syfu's appointment of Buenaobra as new HRD
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 manager, little support exists for Peñaflor's allegation that he had been
forced to resign due to the prevailing abusive and hostile working
environment. Buenaobra's appointment would then be simply intended to
cover the vacancy created by Peñaflor's resignation. On the other hand, if
the resignation letter was submitted after the appointment of Buenaobra,
then factual basis exists indicating that Peñaflor had been constructively
dismissed as his resignation was a response to the unacceptable
appointment of another person to a position he still occupied.
The question of when Peñaflor submitted his resignation letter arises
because this letter — undisputably made — was undated. Despite Peñaflor's
claim of having impressive intellectual and academic credentials, 19 his
resignation letter, for some reason, was undated. Thus, the parties have
directly opposing claims on the matter. Peñaflor claims that he wrote and
filed the letter on the same date he made his resignation effective — March
15, 2000. Outdoor Clothing, on the other hand, contends that the letter was
submitted on March 1, 2000, for which reason Syfu issued a memorandum
of the same date appointing Buenaobra as the concurrent HRD manager;
Syfu's memorandum cited Peñaflor's intention to resign so he could devote
his time to teaching. The company further cites in support of its case
Buenaobra's March 3, 2000 memorandum accepting his appointment.
Another piece of evidence is the Syfu memorandum of March 10, 2000,
which informed the office of the appointment of Buenaobra as the
concurrent head of HRD — the position that Peñaflor occupied. Two other
memoranda are alleged to exist, namely, the AWOL memoranda of March 6
and 11, 2000, allegedly sent to Peñaflor.
cACHSE

Several reasons arising directly from these pieces of evidence lead us

to conclude that Peñaflor did indeed submit his resignation letter on March
15, 2000, i.e., on the same day that it was submitted.
First, we regard the Syfu memorandum of March 1, 2000 and the
memorandum of Buenaobra of March 3, 2000 accepting the position of HRD
Head to be highly suspect. In our view, these memoranda, while dated, do
not constitute conclusive evidence of their dates of preparation and
communication. Surprisingly, Peñaflor was never informed about these
memoranda when they directly concerned him, particularly the turnover of
responsibilities to Buenaobra if indeed Peñaflor had resigned on March 1,
2000 and a smooth turnover to Buenaobra was intended. Even the recipients
of these communications do not appear to have signed for and dated their
receipt. The AWOL memoranda, to be sure, should have been presented with
proof of service if they were to have any binding effect on Peñaflor.
Second, we find it surprising that these pieces of evidence pointing to
a March 1, 2000 resignation — specifically, Syfu's March 1, 2000
memorandum to Buenaobra about Peñaflor's resignation and Buenaobra's
own acknowledgment and acceptance — were only presented to the NLRC
on appeal, not before the labor arbiter. The matter was not even mentioned
in the company's position paper filed with the labor arbiter. 20 While the
presentation of evidence at the NLRC level on appeal is not unheard of in
labor cases, 21 still sufficient explanation must be adduced to explain why
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 this irregular practice should be allowed. In the present case, Outdoor
Clothing totally failed to explain the reason for its omission. This failure, to
us, is significant, as these were the clinching pieces of evidence that allowed
the NLRC to justify the reversal of the labor arbiter's decision.
Third, the circumstances and other evidence surrounding Peñaflor's
resignation support his claim that he was practically compelled to resign
from the company.
Foremost among these is the memorandum of March 10, 2000 signed
by Syfu informing the whole office ("To: All concerned") about the
designation of Buenaobra as concurrent Accounting and HRD Manager. In
contrast with the suspect memoranda we discussed above, this
memorandum properly bore signatures acknowledging receipt and dates of
receipt by at least five company officials, among them the readable
signature of Demogene and one Agbayani; three of them acknowledged
receipt on March 13, 2000, showing that indeed it was only on that day that
the appointment of Buenaobra to the HRD position was disclosed. This
evidence is fully consistent with Peñaflor's position that it was only in the
afternoon of March 13, 2000 that he was told, informally at that, that
Buenaobra had taken over his position. It explains as well why as late as
March 13, 2000, Peñaflor still prepared and signed a security report, 22 and is
fully consistent with his position that on that day he was still working on the
excuse letter of certain sales personnel of the company. 23
We note that the company only belatedly questioned the motivation
that Peñaflor cited for his discriminatory treatment, i.e., that he was caught
in the bitter fight between Syfu and Lee, then Vice President for Operations,
that led the latter to leave the company. 24 After Lee left, Peñaflor alleged
that those identified with Lee were singled out for adverse treatment, citing
in this regard the downsizing of HRD that occurred on or about this time and
which resulted in his one-man HRD operation. We say this downsizing was
only "alleged" as the company totally failed — despite Peñaflor's claim of
discriminatory practice — to adduce evidence showing that there had indeed
been a legitimate downsizing. Other than its bare claim that it was facing
severe financial problems, Outdoor Clothing never presented any evidence
to prove both the reasons for its alleged downsizing and the fact of such
downsizing. No evidence was ever offered to rebut Peñaflor's claim that his
staff members were dismissed to make his life as HRD Head difficult. To be
sure, Peñaflor's participation in the termination of his staff members'
employment cannot be used against him, as the termination of employment
was a management decision that Peñaflor, at his level, could not have
effectively contested without putting his own job on the line. DcCASI

Peñaflor's own service with the company deserves close scrutiny. He

started working for the company on September 2, 1999 so that by March 1,
2000, his probationary period would have ended and he would have become
a regular employee. We find it highly unlikely that Peñaflor would resign on
March 1, 2000 and would then simply leave given his undisputed record of
having successfully worked within his probationary period on the company's
Policy Manual, Personnel Handbook, Job Expectations, and Organizational
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 Set-up. It does not appear sound and logical to us that an employee would
tender his resignation on the very same day he was entitled by law to be
considered a regular employee, especially when a downsizing was taking
place and he could have availed of its benefits if he would be separated from
the service as a regular employee. It was strange, too, that he would submit
his resignation on March 1, 2000 and keep completely quiet about this
development until its effective date on March 15, 2000. In the usual course,
the turnover alone of responsibilities and work loads to the successor in a
small company would have prevented the matter from being completely
under wraps for 10 days before any announcement was ever made. That
Peñaflor was caught by surprise by the turnover of his post to Buenaobra is
in fact indicated by the company's own evidence that Peñaflor still submitted
a security report on March 13, 2000. On the whole, Peñaflor's record with the
company is not that of a company official who would simply and voluntarily
tender a precipitate resignation on the excuse that he would devote his time
to teaching — a lame excuse at best considering that March is the month the
semester usually ends and is two or three months away from the start of
another school year.
In our view, it is more consistent with human experience that Peñaflor
indeed learned of the appointment of Buenaobra only on March 13, 2000
and reacted to this development through his resignation letter after realizing
that he would only face hostility and frustration in his working environment.
Three very basic labor law principles support this conclusion and militate
against the company's case.
The first is the settled rule that in employee termination disputes, the
employer bears the burden of proving that the employee's dismissal was for
just and valid cause. 25 That Peñaflor did indeed file a letter of resignation
does not help the company's case as, other than the fact of resignation, the
company must still prove that the employee voluntarily resigned. 26 There
can be no valid resignation where the act was made under compulsion or
under circumstances approximating compulsion, such as when an
employee's act of handing in his resignation was a reaction to circumstances
leaving him no alternative but to resign. 27 In sum, the evidence does not
support the existence of voluntariness in Peñaflor's resignation.
Another basic principle is that expressed in Article 4 of the Labor Code
— that all doubts in the interpretation and implementation of the Labor Code
should be interpreted in favor of the workingman. This principle has been
extended by jurisprudence to cover doubts in the evidence presented by the
employer and the employee. 28 As shown above, Peñaflor has, at very least,
shown serious doubts about the merits of the company's case, particularly in
the appreciation of the clinching evidence on which the NLRC and CA
decisions were based. In such contest of evidence, the cited Article 4
compels us to rule in Peñaflor's favor. Thus, we find that Peñaflor was
constructively dismissed given the hostile and discriminatory working
environment he found himself in, particularly evidenced by the escalating
acts of unfairness against him that culminated in the appointment of another
HRD manager without any prior notice to him. Where no less than the
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 company's chief corporate officer was against him, Peñaflor had no
alternative but to resign from his employment. 29 STCDaI

Last but not the least, we have repeatedly given significance in

abandonment and constructive dismissal cases to the employee's reaction to
the termination of his employment and have asked the question: is the
complaint against the employer merely a convenient afterthought
subsequent to an abandonment or a voluntary resignation? We find from the
records that Peñaflor sought almost immediate official recourse to contest
his separation from service through a complaint for illegal dismissal. 30 This
is not the act of one who voluntarily resigned; his immediate complaints
characterize him as one who deeply felt that he had been wronged.
WHEREFORE, we G R A N T the petitioner's petition for review on
certiorari, and REVERSE the decision and resolution of the Court of Appeals
in CA-G.R. SP No. 87865 promulgated on December 29, 2006 and March 14,
2007, respectively. We REINSTATE the decision of the labor arbiter dated
August 15, 2001, with the MODIFICATION that, due to the strained relations
between the parties, respondents are additionally ordered to pay separation
pay equivalent to the petitioner's one month's salary.
Costs against the respondents.
SO ORDERED.
Carpio, Del Castillo, Abad and Perez, JJ., concur.

Footnotes
1. Penned by Associate Justice Edgardo P. Cruz, with Associate Justice Jose C.
Reyes and Associate Justice Enrico A. Lanzanas (retired) concurring; rollo, pp.
22-31
2. Id. at 40.
3. Penned by Commissioner Alberto R. Quimpo, and concurred in by Commissioner
Roy V. Señeres and Commissioner Vicente S.E. Veloso; id. at 85-100.
4. Id. at 45-52.
5. Labor Arbiter Florentino R. Darlucio.
6. Rollo, p. 161.

7. Id. at 66; the March 10, 2000 memorandum reads:

To: All concerned
From: Accounting Department
Date: March 10, 2000

Re: Human Resources Department

This is to inform you that Mr. Edwin Buenaobra is concurrently our
Accounting and Human Resources Department Manager. Aside from his
present task in Accounting, he is now responsible to oversee the operation of
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 Human Resources Department, which includes acquiring, motivating,
maintaining, and developing people in their jobs for the achievement of
individual, company and society's goal.

Any transaction and problems pertaining to Human Resources can now be

coursed through him. This memo shall take effect immediately.

For your information and guidance. Thank you.

Nathaniel Syfu
President and COO
Cc: All departments, Bulletin Board
8. CA rollo, p. 203; the resignation letter reads:

Mr. Nathaniel Y. Syfu

Chief Corporate Officer
Outdoor Clothing Manufacturing Corporation
Sir:
Please accept my irrevocable resignation effective at the close of office on
March 15, 2000.
Thank you.

Very truly Yours,

Manolo A. Peñaflor
9. Id. at 204.
10. Supra note 4.
11. Rollo, p. 66; Syfu's March 1, 2000 memorandum reads:

To: Edwin Buenaobra

From: Nathaniel Syfu
Date: March 1, 2000
Subject: HR Manager Resignation

Mr. Manolo A. Peñaflor has informed me of his intention to resign effective

March 15, 2000 to be a full time teacher in a school he is presently
connected with.
As such, due to the limited time provided, management has no other
alternative but to appoint you as concurrent Human Resources Head to fill in
the position of Manolo A. Peñaflor. We will formalize this announcement prior
to March 15, 2000. Meanwhile, please coordinate with Manny for the pending
HR matters labor cases now with him. He was already advised of this stopgap
measure.
I trust you will handle this added assignment to the best of your capacity.

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 Nathaniel Syfu
Chief Corporate Officer.
12. Id. at 67.
13. Supra note 3.

14. Supra note 1.

15. Supra note 2.
16. RULES OF COURT, Rule 45, Section 1.
17. The labor arbiter cited the performance of clerical and liaison work by an HRD
manager and the appointment of a new HRD manager as basis for
concluding that Peñaflor's resignation letter was involuntarily executed. On
the other hand, the NLRC declared the Peñaflor tendered his resignation
because he saw no future in becoming a regular employee because Outdoor
Clothing was financially unstable; see rollo, pp. 49-51 and 97-98.
18. R&E Transport, Inc. et al. v. Latag, 467 Phil. 355 (2004); Mendoza v. NLRC, 369
Phil. 1113 (1999).
19. Rollo, p. 9.
20. CA rollo, pp. 91-95.
21. See PAL Employees Savings and Loan Association, Inc. v. NLRC, et al., 329 Phil.
581 (1996).
22. Supra note 8.

23. CA rollo, p. 101.

24. Outdoor Clothing never disputed that there was a fight between Syfu and Lee
in any of the pleadings it filed before the labor arbiter, the NLRC, and the CA.
It was only in the Memorandum it filed before the Court that it denied such
allegation.
25. Consolidated Broadcasting System, Inc. v. Oberio, et al., G.R. No. 168424, June
8, 2007, 524 SCRA 365.
26. Vicente v. Court of Appeals, G.R. No. 175988, August 24, 2007, 531 SCRA 240.
27. See Metro Transit Organization, Inc. v. NLRC, 348 Phil. 334 (1998).

28. Fujitsu Computer Products Corporation of the Philippines v. Court of Appeals,

494 Phil. 697 (2005).
29. Unicorm Safety Glass, Inc. v. Basarte, 486 Phil. 493 (2004).

30. The records do not contain a categorical statement when the illegal dismissal
complaint was actually filed before the labor arbiter. Peñaflor stated in his
Memorandum before the Court that it was filed on March 14, 2000 — a day
after he learned of Buenaobra's appointment, but Outdoor Clothing stated in
its appeal with the NLRC that the complaint was filed on May 20, 2000. Either
way, the Court believes that Peñaflor sought recourse against his illegal
dismissal within a reasonable period.

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