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G.R. No. 191008.  April 11, 2011. *

QUIRICO LOPEZ, petitioner vs. ALTURAS GROUP OF
COMPANIES and/or MARLITO UY, respondents.

Labor Law; Termination of Employment; Due Process;

Dismissals have two facets: the legality of the act of dismissal,
which constitutes substantive due process, and the legality of the
manner of dismissal which constitutes procedural due process.—
Dismissals have two facets: the legality of the act of dismissal,
which constitutes substantive due process, and the legality of the
manner of dismissal which constitutes procedural due process. As
to substantive due process, the Court finds that respondent
company’s loss of trust and confidence arising from petitioner’s
smuggling out of the scrap iron, conpounded by his past acts of
unauthorized selling cartons belonging to respondent company,
constituted just cause for terminating his services.
Same; Same; Right to Counsel;  The right to counsel and the
assistance of one in investigations involving termination cases is
neither indispensable nor mandatory, except when the employee
himself requests for one or that he manifests that he wants a
formal hearing on the charges against him.—The right to counsel
and the assistance of one in investigations involving termination
cases is neither indis-

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* THIRD DIVISION.

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Lopez vs. Alturas Group of Companies

pensable nor mandatory, except when the employee himself

requests for one or that he manifests that he wants a formal
hearing on the charges against him. In petitioner’s case, there is
no showing that he requested for a formal hearing to be conducted
or that he be assisted by counsel. Verily, since he was furnished a
second notice informing him of his dismissal and the grounds
therefor, the twin-notice requirement had been complied with to
call for a deletion of the appellate court’s award of nominal
damages to petitioner.

PETITION for review on certiorari of a decision of the

Court of Appeals.
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   The facts are stated in the opinion of the Court.

  E.B. Ramos & Associates for respondents.

CARPIO-MORALES,  J.:
Quirico Lopez (petitioner) was hired by respondent
Alturas Group of Companies in 1997 as truck driver. Ten
years later or sometime in November 2007, he was
dismissed after he was allegedly caught by respondent’s
security guard in the act of attempting to smuggle out of
the company premises 60 kilos of scrap iron worth P840
aboard respondents’ Isuzu Cargo Aluminum Van with
Plate Number PHP 271 that was then assigned to him.
When questioned, petitioner allegedly admitted to the
security guard that he was taking out the scrap iron
consisting of lift springs out of which he would make axes.
Petitioner, in compliance with the Show Cause Notice1
dated December 5, 2007 issued by respondent company’s
Human Resource Department Manager, denied the
allegations by a handwritten explanation written in the
Visayan dialect.
Finding petitioner’s explanation unsatisfactory,
respondent company terminated his employment by Notice
of Termina-

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1 Records, p. 24.

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Lopez vs. Alturas Group of Companies

tion2 effective December 14, 2007 on the grounds of loss of

trust and confidence, and of violation of company rules and
regulations. In issuing the Notice, respondent company
also took into account the result of an investigation
showing that petitioner had been smuggling out its cartons
which he had sold, in conspiracy with one Maritess Alaba,
for his own benefit to thus prompt it to file a criminal case
for Qualified Theft3 against him before the Regional Trial
Court (RTC) of Bohol. It had in fact earlier filed another
criminal case for Qualified Theft4 against petitioner arising
from the theft of the scrap iron.
Petitioner thereupon filed a complaint against
respondent company for illegal dismissal and
underpayment of wages. He claimed that the smuggling
charge against him was fabricated to justify his illegal
dismissal; that the filing of the charge came about after he
reported the loss of the original copy of his pay slip, which
report, he went on to claim, respondent company took to
mean that he could use the pay slip as evidence for filing a
complaint for violation of labor laws; and that on account of

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the immediately stated concern of respondent, it forced him

into executing an affidavit that if the pay slip is eventually
found, it could not be used in any proceedings between
them.
By Decision5 of June 30, 2008, the Labor Arbiter,
holding that the pendency of the criminal case involving
the scrap iron did not warrant the suspension of the
proceedings before him, held that petitioner’s dismissal
was justified, for he, a truck driver, held a position of trust
and confidence, and his act of stealing company property
was a violation of the trust reposed upon him.

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2 Id., at p. 25.
3 Id., at p. 82.
4 Id., at p. 88.
5 Records, pp. 122-126. Penned by Labor Arbiter Fructuoso Villarin, IV.

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Lopez vs. Alturas Group of Companies

Respecting the charge of underpayment of wages, the

Labor Arbiter noted that on the basis of the records,
petitioner had been paid the correct wages and benefits
mandated by law.
The Labor Arbiter accordingly dismissed petitioner’s
complaint.
On appeal, the National Labor Relations Commission’s
(NLRC) Fourth Division (Cebu City) set aside the Labor
Arbiter’s Decision by Decision6 dated December 22, 2008,
finding that respondent’s evidence did not suffice to
warrant the termination of petitioner’s services; and that
petitioner’s alleged admission of taking the scrap iron was
belied by his vehement denial, as even the security guard,
one Gerardo Luega, who allegedly witnessed the
asportation and before whom the alleged admission was
made, did not even execute an affidavit in support thereof.
Citing Salaw v. NLRC,7 the NLRC went on to hold that
petitioner should have been afforded, or at least advised of
the right to counsel. It thus held that “any evaluation
which was based only on the explanation to the show-cause
letter and any so-called investigation but without
confrontation of the vital witnesses, do[es] not suffice.”
Respondent company’s motion for reconsideration was
denied by Resolution8 of April 30, 2009, hence, it appealed
to the Court of Appeals.

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6  Records, pp. 219-221. Penned by Presiding Commissioner Violeta

Ortiz-Bantug and concurred in by Commissioners Oscar S. Uy and Aurelio
D. Menzon.
7 G.R. No. 90786, September 27, 1991, 202 SCRA 7.
8  Records, pp. 280-281. Penned by Presiding Commissioner Violeta
Ortiz-Bantug and concurred in by Commissioners Oscar S. Uy and Aurelio
D. Menzon.

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Lopez vs. Alturas Group of Companies

By Report9 of December 18, 2009, the appellate court

reversed the NLRC ruling. It held that respondent company
was justified in terminating petitioner’s employment on the
ground of loss of trust and confidence, his alleged act of
smuggling out the scrap iron having been sufficiently
established through the affidavits of Patrocinio Borja and
Zalde Tare, supervisor and junior supervisor, respectively,
of its Supermarket Motorpool.
The appellate court further held that “the evidence
supporting the criminal charge, found after preliminary
investigation are [sic] sufficient to show prima facie guilt,
which constitutes just cause for [petitioner’s dismissal]
based on loss of trust and confidence”; and that petitioner’s
subsequent acquittal in the criminal case “did not
automatically preclude a determination that he is guilty of
acts inimical to the employer’s interest resulting in loss of
trust and confidence.”
Albeit the appellate court found that petitioner’s
dismissal was for a just cause, it held that due process was
not observed when respondent company failed to give him a
chance to defend his side in a proper hearing. Following
Agabon v. NLRC,10 the appellate court thus ordered
respondent to pay nominal damages of P30,000.
Thus the appellate court disposed:

“WHEREFORE, in view of the foregoing, the Decision of the

NLRC dated December 22, 2008 is hereby MODIFIED. Private
respondent’s dismissal from employment is upheld on the ground
of loss of trust and confidence, a just cause for termination.
However, for failure to comply fully with the procedural due
process, petitioner is ORDERED to pay private respondent the
amount of P30,000.00 as nominal damages.”11 (underscoring
supplied)

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9    Rollo, pp. 325-333. Penned by Associate Justice Amy C. Lazaro-

Javier and concurred in by Associate Justices Rodil V. Zalameda and
Agnes Reyes-Carpio.
10 G.R. No. 158693, November 17, 2004, 442 SCRA 573.

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11 CA Rollo, p. 315.

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Lopez vs. Alturas Group of Companies

Hence, the present petition for review on certiorari.

Dismissals have two facets: the legality of the act of
dismissal, which constitutes substantive due process, and
the legality of the manner of dismissal which constitutes
procedural due process.12
As to substantive due process, the Court finds that
respondent company’s loss of trust and confidence arising
from petitioner’s smuggling out of the scrap iron,
conpounded by his past acts of unauthorized selling cartons
belonging to respondent company, constituted just cause
for terminating his services.
Loss of trust and confidence as a ground for dismissal of
employees covers employees occupying a position of trust
who are proven to have breached the trust and confidence
reposed on them. Apropos is Cruz v. Court of Appeals13
which explains the basis and quantum of evidence of loss of
trust and confidence, viz.:

“In addition, the language of Article 282(c) of the Labor Code

states that the loss of trust and confidence must be based on
willful breach of the trust reposed in the employee by his
employer. Such breach is willful if it is done intentionally,
knowingly, and purposely, without justifiable excuse, as
distinguished from an act done carelessly, thoughtlessly,
heedlessly or inadvertently. Moreover, it must be based on
substantial evidence and not on the employer’s whims or
caprices or suspicions otherwise, the employee would eternally
remain at the mercy of the employer. Loss of confidence must not
be indiscriminately used as a shield by the employer against a
claim that the dismissal of an employee was arbitrary. And, in
order to constitute a just cause for dismissal, the act
complained of must be work-related and shows that the
employee concerned is unfit to continue working for the
employer. In addition, loss of confidence as a just cause for
termination of employment is premised on the fact that
the

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12  Tirazona v. Court of Appeals, G.R. No. 169712, March 14, 2008, 548 SCRA
560.
13 G.R. No. 148544, July 12, 2006, 494 SCRA 643.

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Lopez vs. Alturas Group of Companies

employee concerned holds a position of responsibility,

trust and confidence or that the employee concerned is entrusted
with confidence with respect to delicate matters, such as the
handling or care and protection of the property and assets
of the employer. The betrayal of this trust is the essence of the
offense for which an employee is penalized.” (emphasis and
underscoring supplied)

Petitioner, a driver assigned with a specific vehicle, was

entrusted with the transportation of respondent company’s
goods and property, and consequently with its handling
and protection, hence, even if he did not occupy a
managerial position, he can be said to be holding a position
of responsibility. As to his act—principal ground for his
dismissal—his attempt to smuggle out the scrap iron
belonging to respondent company, the same is undoubtedly
work-related.
Respondent company’s charge against petitioner was
amply proven by substantial evidence consisting of the
affidavits of various employees of respondent. Contrary to
the NLRC’s observation, the security guard who
apprehended petitioner, Gerardo Luega, actually executed
a statement14 relative to the smuggling out of scrap iron,
which was attached to, and served as basis for the filing of,
the corresponding complaint for Qualified Theft.
Petitioner’s claim that he was framed up after he allegedly
lost his pay slip to draw respondent company to suspect
that he might file a labor complaint for underpayment does
not inspire credence.
It is, however, with respect to the appellate court’s
finding that petitioner was not afforded procedural due
process that the Court deviates from. Procedural due
process has been defined as giving an opportunity to be
heard before judgment is rendered.15 In termination cases,
Perez v. Philippine Tele-

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14  Philtread Tire and Rubber Corp. v.Vicente, G.R. No. 142759, 10
November 2004, 441 SCRA 574, 581.
15  Cruz v. Coca-Cola Bottlers Phils., Inc., G.R. No. 165586, 15 June
2005, 460 SCRA 340, 351.

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graph and Telephone Company,16 illuminates on the correct

proceedings to be followed therein in order to comply with
the due process requirement:

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“The above rulings are a clear recognition that the employer

may provide an employee with ample opportunity to be heard and
defend himself with the assistance of a representative or counsel
in ways other than a formal hearing. The employee can be fully
afforded a chance to respond to the charges against him, adduce
his evidence or rebut the evidence against him through a wide
array of methods, verbal or written.
After receiving the first notice apprising him of the
charges against him, the employee may submit a written
explanation (which may be in the form of a letter, memorandum,
affidavit or position paper) and offer evidence in support
thereof, like relevant company records (such as his 201 file and
daily time records) and the sworn statements of his
witnesses. For this purpose, he may prepare his
explanation personally or with the assistance of a
representative or counsel. He may also ask the employer to
provide him copy of records material to his defense. His
written explanation may also include a request that a
formal hearing or conference be held. In such a case, the
conduct of a formal hearing or conference becomes
mandatory, just as it is where there exist substantial
evidentiary disputes or where company rules or practice
requires an actual hearing as part of employment
pretermination procedure.” (emphasis and underscoring
supplied)

Petitioner was given the opportunity to explain his side

when he was informed of the charge against him and
required to submit his written explanation with which he
complied. That there might have been no hearing is of no
moment, for as Autobus Workers’ Union v. NLRC17 holds:

“This Court has held that there is no violation of due pro­-

cess even if no hearing was conducted, where the party
was

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16 G.R. No. 152048, April 7, 2009, 584 SCRA 110.

17 353 Phil. 419; 291 SCRA 219 (1998).

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Lopez vs. Alturas Group of Companies

given a chance to explain his side of the controversy. What

is frowned upon is the denial of the opportunity to be heard.”
(emphasis supplied)

Parenthetically, the Court finds that it was error for the

NLRC to opine that petitioner should have been afforded
counsel or advised of the right to counsel. The right to
counsel and the assistance of one in investigations
involving termination cases is neither indispensable nor
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mandatory, except when the employee himself requests for

one or that he manifests that he wants a formal hearing on
the charges against him. In petitioner’s case, there is no
showing that he requested for a formal hearing to be
conducted or that he be assisted by counsel. Verily, since he
was furnished a second notice informing him of his
dismissal and the grounds therefor, the twin-notice
requirement had been complied with to call for a deletion of
the appellate court’s award of nominal damages to
petitioner.
As for the subsequent dismissal of the criminal cases18
filed against petitioner, criminal and labor proceedings are
distinct and separate from each other. Each requires a
different quantum of proof, arising though they are from
the same set of facts or circumstances. As Vergara v.
NLRC19 holds:

“An employee’s acquittal in a criminal case does not

automatically preclude a determination that he has been guilty of
acts inimical to the employer’s interest resulting in loss of trust
and confidence. Corollarily, the ground for the dismissal of an
employee does not require proof beyond reasonable doubt; as
noted earlier, the quantum of proof required is merely substantial
evidence. More importantly, the trial court acquitted petitioner
not because he did not commit the offense, but merely because of
the failure of the prosecution to prove his guilt beyond reasonable
doubt. In other words, while the evidence presented
against petitioner did

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18 Vide Resolution dated June 12, 2008 re I.S. Case No. 2008-97 for Qualified
Theft of the Cartons, records, pp. 149-152.
19 G.R. No. 117196, December 5, 1997, 282 SCRA 486.

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not satisfy the quantum of proof required for conviction in

a criminal case, it substantially proved his culpability
which warranted his dismissal from employment.”
(emphasis supplied)

WHEREFORE, the petition is DENIED. The Report

dated December 18, 2009 of the Court of Appeals
dismissing petitioner’s complaint is AFFIRMED with
MODIFICATION in that the award of nominal damages in
the amount of P30,000 is DELETED.
Costs against petitioner.
SO ORDERED.

Brion, Bersamin, Villarama, Jr. and Sereno, JJ.,

concur.
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Petition denied, judgment affirmed with modification.

Note.—In termination proceedings of employees,

procedural due process consists of the twin requirements of
notice and hearing. The employer must furnish the
employee with two written notices before the termination
of employment can be effected: (1) the first apprises the
employee of the particular acts or omissions for which his
dismissal is sought; and (2) the second informs the
employee of the employer’s decision to dismiss him. The
requirement of a hearing is complied with as long as there
was an opportunity to be heard, and not necessarily that an
actual hearing was conducted. (New Puerto Commercial vs.
Lopez, 625 SCRA 422 [2010])
——o0o—— 

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