IN BANC

G.R. No. L-1347 May 12, 1948

YELLOW TAXI AND PASAY TRANSPORTATION WORKER'S UNION (CLO), appellant, v. MANILA

YELLOW TAXI CAB COMPANY, INC., respondent.

Mr Severino P. Izon on behalf of the appellant.

D. Amado B. de Leon and D. Isaac N. Lico on behalf of the respondent.

PABLO, M.: 

This is a certiorari appeal against the decision of the Industrial Relations Tribunal. 

The appellant, instead of disputing the conclusion of the Court - that there is no industrial dispute between the
parties because the claim was filed one day after the suspension of the company's business - maintains that the
Industrial Relations Tribunal has the power (a) to resolve the dispute between the respondent and her workers
who amount to more than 30 and who were dispatched from their work without prior notification and (b ) to
determine the compensation thereof. 

The factual conclusions of the Industrial Relations Tribunal in its appealed decision are as follows: "the company
under appeal before the outbreak of the war was engaged in the transportation business by means
of taxicabs with a certificate of public convenience. After the liberation of the City of Manila and its suburbs, he
reopened his business but suspended his operation again on September 11, 1946. Due to this suspension, 42
drivers, 15 mechanics and a boy, a gas supplier, had to cease their work. Of this number of dismissed employees,
37 drivers, a mechanic and a gas supplier are members of the recurring union that is the Yellow Taxi and Pasay
Transportation Workers' Union (CLO). Later, four or five of the affected drivers were taken out by the defendant
company to handle the service choches and two of these are members of the recurrent union; whereas, before
the suspension of the operation, no action had been brought against the company appealed against by the
appellant union; that before the suspension, the defendant company had 24 cars in operation, for the handling of
which the drivers alternated, receiving a commission of 20% of the total collections registered by the taximertros;
that the days of payment were the 1st, 11th and 21st dates of each month; whereas the appellant union is a
workers' organisation whose registration is under consideration with the Department of Labour, and is affiliated
with the Congress of Workers' Organisations (CLO); that the suspension of the operation of the respondent's
taxicab business, as well as the sale of its cars and other materials related to its operation, are in accordance with
the resolution adopted by the Board of Directors on September 4, 1946; whereas on 14 October 1946 the
defendant obtained an order from the Public Services Commission (Exhibit 1) authorizing her to withdraw 17 cars
from public service, subject to certain conditions; whereas the spare parts needed for the repair
of taxicabs during their operation could only be obtained at prices 4 to 27 times higher than pre-war prices
(Exhibits 2 to 12) so that the maintenance of their cars proved very costly to the company; that five months
before the suspension of its operation, the profits of the company began to decline to such an extent that in the
month of August 1946 it was already recorded lost and, in the following month, September, a loss, much larger
because there was no longer income from the suspension of its operation; but in the meantime it retained office
workers. 
"The examination by the Tribunal's auditor reveals that the net profits of the company during its operation until
the end of September 1946, and which were transferred to the surplus, were P12,762.12; that in August 1946,
the respondent suffered a net loss of P533.65, and in September 1946, P6,784.22. 

This examination also shows that the item of expenditure that has consumed a very large portion of the profits of
the business is that of 'Repairs of the cars,' whose total on September 30, 1946, amounted to P27,808.89, which
is larger than the expenditure for 'Office Salaries' amounting to P26,316.10, corresponding to that period." 

Following several decisions of this High Court, issued in accordance with Article 2, Rule 44 of the Regulations, we
do not review these findings of fact. But from them we can deduce that the temporary suspension of the
defendant's transport business was not due to the unjust desire to deprive the workers of their work: it was the
forced result of the uselessness of the cars, which could no longer provide the public with an adequate and,
above all, safe service. If the respondent, being in a position to repair the old cars and did not do so, it can be
concluded that she had the insane intention of depriving the appellant's members of their jobs; then the
suspension of the business was not justified. In such a case, the members of the appellant who lost their jobs
have the right to seek due compensation. In the present case, there was no unjustified stoppage. 

Assuming for a moment that a fire had broken out in the garage of the respondent and that all the cars had been
burned - instead of the old cigar cars being rendered useless and that it was not possible to repair them without
having to buy spare parts at a price of 4 to 27 times higher than in normal time - we would force the respondent
to pay compensation or compensation to the drivers because, without warning, did they lose their job? Under
such circumstances, we do not believe that such a resolution is fair because the suspension of the business has
not been done in bad faith or with the purpose of depriving the workers of their work. Ordering the respondent to
pay compensation to the drivers who did not provide any service because the cars were already useless is not
administering justice: it is fomenting injustice. 

Section 4 of the Commonwealth Act No. 559 provides that "The Court shall take cognizance ... of any conflict ...
industrial that motivates or gives rise to a strike or stoppage because of differences that arise in the question of
wages, participation or compensation, dismissals, dismissals or suspensions of employees or workers." In
accordance with the literal meaning of this provision, the Industrial Relations Tribunal decided that in the present
case there is no dispute between the parties because the claim of the members of the appellant was filed one day
after the suspension of the operation of the defendant's business. This interpretation of the law is untenable. The
spirit that informs the law must be the light that is to guide the courts in the application of its provisions. They
should not abide by the letter of the dley when the literal interpretation is separated from the intention of the
legislature and especially when it leads to conclusions incompatible with the manifest object of the law. When
there is a conflict between the literal interpretation and the interpretation based on the purpose of the law, the
latter must prevail. (2 Sutherland Statutory Construction, 693; Vergara v  Limjap, 56 Jur. Phil., 153.) 

The legislature's intention in passing the law creating the Industrial Relations Tribunal was to provide workers
with a quick and simple remedy to obtain justice in their disputes with the employer. It is obvious that a worker
who has been unduly deprived of his work by the employer on the occasion of unemployment must have the
right to be consulted by the Industrial Relations Tribunal. Assuming that instead of a justified suspension, as
there has been in the present case, the respondent, without losing in her business, but, on the contrary,
marginalized good profits, and only with the purpose of throwing the drivers and other workers out of service,
has declared unemployment, Do not these have the right to go to the Industrial Relations Tribunal to ask for a
remedy for their undue cessation? Should they go to the ordinary courts? Do you not have the right to seek
compensation for having lost your job because the company, without justified reason and in bad faith, suspended
your business? The strike and the strike do not only harm the parties - the employer and the worker - but also
the general public. Hence, the State in the exercise of its police power is obliged to intervene in one case or
another. The Industrial Relations Tribunal must not only take cognizance of industrial disputes arising before the
declaration of the strike or stoppage but also of those that arise afterwards. The claims about damage caused to
the workers by their cessation on the occasion of the strike must necessarily arise later and cannot be before. If
the Industrial Relations Tribunal does not have the power or jurisdiction to hear such claims arising after the
strike has been declared, then those thrown out of work without any justification would be left helpless. The
employer would then have an indirect procedure of dispatching the workers without any remedy on their part,
which is contrary to the constitutional mandate that "the State shall protect all workers ... and it shall regulate the
relations between labour and capital." (Title XIII, section 6 of the Constitution.) And the primary purpose of the
law creating the Industrial Relations Tribunal is to "provide for the protection of the worker." 

After mature consideration we declare that the Industrial Relations Tribunal has the power to decide the workers'
claim even if it has been presented after the suspension of the employer's business, or after the strike. In such a
case, the Industrial Relations Tribunal must investigate whether the closure of the business is justified or not,
whether it has been done in good or bad faith. If this is not justified, then it is in order to determine what
compensation the employer must pay to workers who have ceased their work without prior notice within a
reasonable time. 

In the present case we declare that according to the conclusions of the Industrial Relations Tribunal, the
suspension of the operation of the taxis was justified. It is not fair to force a company to continue operating its
business that is losing. 

The appeal is dismissed. 

Moran, Pres., Fair. Bengzon, Briones, and Tuason, MM., are satisfied.

Hilado and Padilla, JJ., concur in the result.

Separate Opinions 

PERFECTO, J.,  concurring and dissenting:

Petitioner complains of the decision of the Court of Industrial Relations, dated December 16, 1946, dismissing
petitioner's complaint filed in case No. 34-V, where they alleged that respondent company dismissed them from
the service without previous notice or warning or justification, only because the majority of the employees are
members of the petitioning union. 

The lower court ruled that, because petitioner's demands were presented to the respondent company on
September 12, 1946, one day after the suspension of the operation of the company's business, the latter has not
committed any unfair labor competition and there is no industrial dispute between the parties. 

Petitioner prays for the reversal of the decision of dismissal and that it be granted a new trial, maintaining that
the Court of Industrial Relations erred in declaring that there is no industrial dispute between the parties, the
declaration implying that there is no such matter upon which to exercise its jurisdiction. 

Petitioner invokes the provisions of section 1 and 4 of Commonwealth Act No. 103, in connection with the
constitutional provisions that "the promotion of social justice to insure the well-being and economic security of all
the people should be the concern of the state" and that "the state shall afford protection to labor ... and shall
regulate the relations between landowner and tenant and between labor and capital in industry and agriculture." 

The Court of Industrial Relations adopted a narrow-minded point of view when it ruled that there is no industrial
dispute between the parties upon the simple fact that petitioners presented to respondent company their
demands only on September 12, 1946, one day after the employees of said company who are members of the
petitioning labor union have been dismissed or laid off. The presentation of said demands was and is not an
essential element for the existence of a labor dispute between employer and employees. In the present case,
from the very instant that the members of the complaining labor union were dismissed or laid off without their
consent, there arose a labor dispute. Section 4 of Commonwealth Act No. 103 should be interpreted to
comprehend a situation such as is presented in the present case. The sentence "causing or likely to cause a strike
or lockout" embodied in said section should not be read as limitative but rather as descriptive of the nature or
import of the dispute of which the Court of Industrial Relations is to take cognizance for settlement. 

From the very facts found by the Court of Industrial Relations, we are convinced that the members of the
petitioning labor union were unjustifiably laid off, the respondent company using as a pretext a temporary
suspension of the business because its old equipment could no longer be continued to be operated at a profit,
and that action of the company was motivated by the affiliation of the members of the petitioning union with the
Congress of Labor Organizations (CLO). 

Forty-two drivers, fifteen mechanics and a gas boy were laid off from work. Of their number, thirty-seven drivers,
one mechanic, and the gas boy are members of the petitioning union. 

Four or five drivers were later taken back to man the service cars of the company. 

According to respondent's answer, the company has acquired new 1947 cars. 

If the laying off of the members of the petitioning labor union was due to the going down of the profits of the
business of the company during the five months before the suspension of the business to the extent that in
August, 1946, the operation already registered a loss, why has the company dismissed its employees suddenly on
September 11, 1946, without any previous advice or hint to the affected drivers and mechanics, so that they may
have time to look for other jobs and not just leave them empty-handed in the streets? If the company was to
acquire and had acquired brand new cars to replace the old ones, what is the reason for a sudden suspension of
the business while waiting for the new cars to be put in operation? 

For all the foregoing, we vote for the reversal of the decision of the Court of Industrial Relations, dated December
16, 1946, and to order said court to proceed with the retrial of the case so as to determine the relief that should
be granted to the members of the petitioning union in accordance with the pronouncements made hereof.

PARAS, J.:

I concur in the foregoing concurring and dissenting opinion of Mr. Justice Perfecto.