Januaria Rivera vs.

UNILAB
GR No. 155639 | April 22, 2009

Facts:

Rivera commenced employment with respondent United Laboratories, Inc. (UNILAB) on April 7, 1958 as
senior manufacturing pharmacist. She later became Director of UNILAB's Manufacturing Division.

In a letter dated January 7, 1995 to UNILAB, Rivera asked that her retirement benefits be increased in
accordance with the amended retirement program based on her December 31, 1992 terminal basic
salary, multiplied by her thirty-four (34) years of service with the company. UNILAB did not reply to this
letter and Rivera made two follow-up letters, one dated December 18, 1995 and the other, February 12,
1996, reiterating her demand for additional retirement benefits.

UNILAB denied Rivera's request in a letter dated February 26, 1996. The company explained that since
the upgrade of the retirement benefit formula occurred in December 1992, the upgraded formula does
not apply to her; what applied to her case is the formula that governed in 1988, the year she compulsory
retired from the plan.

Rivera sought legal assistance and, in a letter, dated July 24, 1996,16 lawyer Katz N. Tierra demanded a
recomputation of Rivera's retirement pay under the plan and under the retirement law. UNILAB again
rejected the demand in its letter dated August 5, 1996.

On August 9, 1996, Rivera sought relief from the NLRC in an action against UNILAB for recovery of unpaid
retirement pay differential. In defense, UNILAB argued that the complaint was filed out of time as it was
filed only on August 9, 1996.

Labor Arbiter Manuel R. Caday dismissed the complaint for lack of merit in an order dated November 7,
1997. The Labor Arbiter found that Rivera's cause of action did not accrue only on February 26, 1996
when her third letter was answered by UNILAB; it accrued on January 15, 1993 when she received the
company's check in payment of her retirement benefits after she was retired on December 31, 1992.

Rivera appealed to the NLRC. In a decision promulgated on August 18, 1998, the NLRC denied the appeal
for lack of merit, thereby affirming the Labor Arbiter's order of November 7, 1997. Rivera moved for the
reconsideration of the decision, but the NLRC denied the motion in a resolution promulgated on January
29,1997.

Rivera elevated the case to the CA by way of a petition for certiorari under Rule 65 of the Rules of Court.
The CA however avoided ruling on the merits of the case by reason of what it recognized as "an existing
controversy as to the crucial fact of when precisely petitioner retired from respondent company for
purposes of determining whether or not she is covered by respondent's amended retirement plan so as
to fix the amount of retirement benefits."

On October 16, 2002, the CA promulgated its resolution denying both motions for lack of merit. 28
Hence, the present petition.

Issues:

Whether the doctrine of piercing the corporate veil is applicable. (NO)

Ruling:

The doctrine piercing the veil of corporate fiction applies only when such corporate fiction is used to
defeat public convenience, justify wrong, protect fraud, or defend crime, or when it is made as a shield
to confuse the legitimate issues, or where a corporation is the mere alter ego or business conduit of a
person, or where the corporation is so organized and controlled and its affairs are so conducted as to
make it merely an instrumentality, agency, conduit or adjunct of another corporation.

To disregard the separate juridical personality of a corporation, the wrongdoing must be established
clearly and convincingly.

In the case at bar, Rivera has entered a new employment contract with UNILAB which she has signed and
agreed on. There is also no clear evidence that could support Rivera's claim that she is entitled to receive
retirement benefits on her second employment with UNILAB and/or it is just a continuation of her
employment. Rivera cannot then posit that UNILAB had acted in a devious manner when it applied the
previous policy on giving her the retirement benefits. Same with her consultancy contract with ARMCO
and FIL-ASIA, it cannot be said that it has been used by UNILAB as an alter ego to commit fraud against
Rivera as the same has been accepted by Rivera fully knowing the terms of her employment.