G.R. No. L-5694. May 12, 1954

The issue in this appeal is whether the jurisdiction of the Court of
Industrial Relations over certain controversies between employer and
employees is exclusive of the regular courts of justice.

In the Court of First Instance of Samar, on December 6, 1951, the
Pambujan Sur United Mine Workers, a registered labor union, filed
against the Samar Mining Company Inc. a complaint alleging breach of
their closed-shop agreement, the pertinent portion of which read:

“That the EMPLOYER (Samar Mining Co.) shall not
employ any worker or workers for its mine operation without first
consulting the UNION (Pambujan Sur United Mine Workers) through its
authorized representatives, as to whether it could furnish the
necessary workers that the employer may require from time to time for
the mine, and in this event the union shall be given (3) days within
which to produce the worker or workers needed by the employer, and if
after this period the said labor organization can not produce the
required worker or workers, the employer shall have the right to hire *
* *.”

The complaint, as amended, averred that, in violation of the
agreement, defendant had been hiring and continued to hire permanent
workers who were not members of the plaintiff union, without consulting
said union, nor giving it the three-day period for procuring laborers.
Then it said that as result of the breach, the plaintiff had suffered
damages amounting to P210,000. Wherefore it asked: that defendant be
required to desist from again violating their covenant; that plaintiff
be allowed to replace with its members those laborers already hired who
are not members of the union; that defendant be ordered to pay damages
in the sum of P210,000 and that other just and equitable remedies be
granted. Attached to the complaint were copies of the Collective
Bargaining Contract signed February 17, 1950 and its modification
signed August 6, 1951, by plaintiff and defendant.

Summoned to answer, the mining company submitted in due time a
motion to dismiss, on the ground that the court of Samar had no
jurisdiction over the subject-matter, i.e., “differences as regards
conditions of employment which is within the jurisdiction of the Court
of Industrial Relations.” The motion was supported by argument and
citation of authorities. The plaintiff replied, in a memorandum, that
in creating the Court of Industrial Relations, the law never meant “to
supersede the function of the regularly created judicial courts etc.”

The Hon. Emilio Benitez, judge, by order dated February 11, 1952,
upheld the motion, and dismissed the complaint. Hence this appeal.

The issue stated at the beginning of this decision involves in
reality two separate inquiries, to wit: (a) was the subject-matter of
the complaint a question cognizable by the Court of Industrial
Relations?; and (b) if so, is the jurisdiction of such court exclusive,
or merely concurrent?^[1]

The Court of Industrial Relations established by Commonwealth Act
No. 103 has jurisdiction “over the entire Philippines to consider,
investigate, decide and settle all questions, matters, controversies,
or disputes arising between and/or affecting employers and employees or
laborers, and landlords and tenants or farm-laborers, and regulate the
relations between them” subject to the provisions of the Act (Section
1). The Act enjoins the court to “take cognizance for purposes of
prevention, arbitration, decision and settlement of any industrial or
agricultural dispute causing or likely to cause a strike or lockout,
arising from differences as regards wages * * * dismissals or
suspension of employees * * * or conditions of tenancy or employment
between the employers and employees * * * provided that the number of
employees involved exceeds thirty, and such industrial or agricultural
dispute is submitted to the court by the Secretary of Labor or by any
or both of the parties to the controversy. (Section 4.)

In addition to the clause hereinbefore quoted, the Collective
Bargaining Contract, attached to plaintiff’s complaint, contains these
stipulations:

“2. Effective as of the enforcement of the Minimum
Wage Law on August 6, 1951, the wages of laborers shall be, at least P3
per day, * * *;

3. An additional compensation of thirty per cent (30%) over the basic daily wage should be paid for night work, * * *;

4.
“Tragedy compensation” or compensation according to the requirement of
the Compensation Act, as hereinafter computed by the Bureau of Labor
shall be paid by the Employer to the respective beneficiaries of the
deceased workers, * * *;

5. Wage payments shall be regularly made once every forthnight, * * *,

6.
Every worker who has heretofore rendered one year of continuous service
is entitled to 18 days vacation leave with pay, * * *;

7. Every worker who has heretofore rendered one year of continuous service is entitled to 15 days sick leave with pay, * * *;

8.
The employer does not tolerate any short-changing and will see to it
that no member of supervision shall short-change any worker, * * *;

10. Thirty minutes of meal time shall be allowed for each shift, * * *

It is apparent from the foregoing that said contract embodies terms
or conditions under which Samar Mining Company Inc. agreed to employ
the Pambujan Sur United Mine Workers, and the latter agreed to work for
said mining company. In the complaint it is alleged that the company
refused to abide by the terms of the contract “in spite of the repeated
written demands of the plaintiff” for compliance therewith. The matter
was therefore a dispute—industrial because mining is industry —between
employer and employees; and such dispute falls within the broad
jurisdiction of the Court of Industrial Relations (Sec. 1, Commonwealth
Act 103). And as the dispute arose from differences regarding
“conditions of employment” of 350 members of the plaintiff union,
actually in the employ of defendant, bitterness is likely to ensue,
leading probably to a strike, and the Court of Industrial Relations is
duty bound to assume cognizance of it at the request of any of the
parties to the controversy (Sec. 4, Commonwealth Act 103). In this case
the employer urges, and therefore requests, the intervention of the
Court of Industrial Relations. So that, whether section 1 of Act 103 or
section 4 is applied, the result is the same: the matter falls within
the power of the Court of Industrial Relations.

But plaintiff-appellant argues that its purpose is to compel the
defendant “to employ as its laborers only members of the union”; and
therefore until those members are actually employed there is no
employer-employee relationship to call for the Industrial Court’s
intervention. The argument forgets that the Union counts with 350
employees of the defendant, and the controversy is between such
employees and the employer. Incidentally it may be noted that, as
plaintiff seeks the dismissal of those workers hired in violation of
the Collective Bargaining Contract, the differences further relate to
“dismissals” of employees within the meaning of section 4 of
Commonwealth Act No. 103.

That the controversy concerns more than 30 employees is clear. The
Union has 350 member-employees and all are suing to enforce the
Collective Bargaining Contract. It is inaccurate to state that “the
present action does not involve employees/laborers of the defendant
company who are members of the plaintiff union, but its remaining
unemployed members who should have been employed if not for the
violation of the bargaining contract by the defendant.” The action is
by the Union; therefore all its members—whether actual employees or
would-be employees—are affected.^[2] The Members of the
Union, who are actual employees have a vital interest in the
fulfillment of the obligation resulting from the bargaining contract,
specially the clause allegedly broken by defendant. Otherwise it would
not have been inserted in the said contract.

Perhaps it is unnecessary to dwell at this time upon the
significance and usefulness of collective bargaining agreements and
closed-shop stipulations. Nevertheless it may be pointed out that “it
lies at the very heart of ‘labor-management’ relations” and “the
institution seems certain to grow, at least as long as there survives
the political democracy whose achievement it has followed.^[3] Indeed one of the four major policies of the Industrial Peace Act^[4] recently approved, is to “advance the settlement of issues between employers and employees thru collective bargaining.”^[5]

Several controversies involving collective bargaining have been submitted for adjudication to the Court of Industrial Relations.^[6]

Contrary to appellant’s contention, the demand for damages is no
obstacle to the Industrial Court’s jurisdiction, such damages being
evidently the wages lost to members of the Union, who should have been
employed— but were not employed—by the defendant. It is undeniable that
the Court of Industrial Relations has authority to require payment of
such wages should it find the claim to be just or equitable.^[7] For as appellee has emphasized in its brief, the court may include in its award any matter or determination which may be deemed necessary or expedient for the purpose of settling the dispute. (Sec. 13, Com. Act 103)

Therefore this court’s opinion is that the issues tendered in the
plaintiff’s amended complaint fall within the alloted jurisdiction of
the Industrial Court. This is not to say that every dispute
between employer and employees or between landlord and tenant must be
brought to the Industrial Court. Some do not fall within its
jurisdiction. For instance, where the number of employees affected does
not exceed thirty.

There remains the question whether such jurisdiction is exclusive of Courts of First Instance.

The jurisdiction of a court is exclusive either by express
declaration of the statute, or by clear implication from the provisions
thereof.^[8]

Commonwealth Act No. 103 with its amendments does not explicitly confer exclusive jurisdiction on the Industrial Court.

Unquestionably, Congress could have so directed, because it has,
under the Constitution, power to apportion and diminish the
jurisdiction of courts inferior to the Supreme Court. It has
furthermore specific constitutional authority to regulate the relations
between capital and labor^[9] which naturally includes the
power to establish an agency exclusively to handle labor controversies,
subject, of course, to the revisory power of the Supreme Court.
Congress did not in so many words declare the jurisdiction to be
exclusive. Did it intend to make it exclusive?

For the settlement of labor disputes Commonwealth Act No. 103 gave
the Industrial Court special powers, not ordinarily granted to courts
of first instance, powers particularly adapted to the speedy and
equitable settlement of the industrial or agricultural dispute.^[10] For example:

(a) The power to delegate investigation of the controversy to any board or person (Section 6);

(b) The power to enforce its order by contempt proceedings (Section 6);

(c)
The power to hear in any suitable place, to refer the matter to an
expert and accept his report as evidence (Section 7). Reference may
also be made to a provincial fiscal, justice of the peace etc. (Section
10);

(d) The power to require the services of any Government official or employee, without additional compensation (Section 11);

(e) The power to act without regard to technicalities or legal forms or rules of legal evidence (Section 20);

(f)
And the authority to include in its decision or award any matter or
determination which may be deemed necessary or expedient for the
purpose of settling the dispute or preventing further disputes (Section
13).

And foreseeing the probability that the dispute will produce unrest,
paralization of industrial production and economic hardship of the
community, Commonwealth Act No. 103 has imposed on the disputants
certain duties to be observed pro bono publico during the
pendency of the matter before the Industrial Court: For instance, the
duty of the employee not to strike or walk out of his employment, and
the corresponding obligation of the employer to refrain from employing
others and from discharging the employees engaged in fighting his acts
or policies. These correlative obligations do not obtain where the
debate is staged before ordinary courts.

Therefore, it would seem that public convenience will best be served
by requiring the Industrial Court’s intervention in labor-management
controversies likely to cause strikes or lockouts. A unified policy and
centralized administration is thereby insured, the more effectively to
cope with probably explosive contingencies.

On the other hand, objectionable consequences are apt to flow from a
ruling that reserves co-ordinate jurisdiction to the regular courts.
The employees who desire to keep, aloft and threatening, labor’s
peculiar weapon (strike), or who contemplate the eventual use thereof,
will elect recourse to the judiciary—not to the Industrial Court. The
same choice will be made by the employer who plans dismissal of some
employees in the heat of the contest. And to complicate the situation,
one party^[11] might invoke the intervention of the
Industrial Court to forestall the “strategic” move or hidden motives of
the adversary. Even the Secretary of Labor could bring the issues to
the Industrial Court.

Two plain propositions are thus made manifest: Congress had power to
give exclusive jurisdiction to the Industrial Court; it is convenient
that such jurisdiction be exclusive. And the resultant inference,
rational and sound, is that Congress meant it to be exclusive, since
the lawmaking body is presumed to have intended to do the right thing
(article 10 New Civil Code).^[12]

We have heretofore reached the same conclusion in a parallel situation. In Ojo et al. vs. Jamito et al.^[13]
we ruled that Act 461 granting to the Department of Justice
jurisdiction to determine cases in which a tenant may be dispossessed
by the landlord, must be construed to have taken those cases out of the general jurisdiction of the courts of first instance.

Indeed there are authorities to the effect that “where jurisdiction
is conferred in express terms upon one court, and not upon another, it
has been held that it is the intention that the jurisdiction conferred
shall be exclusive.”^[14]

To be sure, as plaintiff discloses, several prominent American
courts follow the opposite line of thought. But judicial wisdom in this
particular matter would seem to favor adherence to the exclusion
theory, what with the litigant’s ordinary duty to exhaust
administrative remedies and the “doctrine of primary administrative
jurisdiction” sense-making and expedient,

“That the courts cannot or will not determine a controversy
involving a question which is within the jurisdiction of an
administrative tribunal prior to the decision of that question by the
administrative tribunal, where the question demands the exercise of
sound administrative discretion requiring the special knowledge,
experience, and services of the administrative tribunal to determine
technical and intricate matters of fact, and a uniformity of ruling is
essential to comply with the purposes of the regulatory statute
administered.” (42 Am. Jur., 698.)

Our construction of the legislative will to confer exclusive
jurisdiction—particularly as to collective bargaining contracts—is
confirmed by Republic Act No. 875 effective June 17, 1953. Entitled “An
Act to Promote Industrial Peace” and designed partly to advance the
settlement of issues between employers and employees thru collective
bargaining, it expressly provides that the jurisdiction of the Court of
Industrial Relations “shall be exclusive” to prevent “unfair labor
practices,” which term embraces a refusal to bargain collectively.
(Section 4, paragraph 6) and termination or modification of the
collective bargaining agreement (Section 13) including, inferentially,
any breach or disregard of such agreement.

Wherefore, premises considered, the appealed order is hereby affirmed, with costs.

Paras, C. J., Pablo, Montemayor, Reyes, Jugo, Bautista Angelo, Labrador, and Concepcion, JJ., concur.

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^[1] Appellant says the issue was the jurisdiction of the
lower court to entertain its complaint. Correct. But that issue
depended upon the two points which this decision will examine and
settle, with the aid of carefully prepared briefs and memoranda on both
sides.

^[2] Commonwealth Act 213, section 2.

^[3] Francisco Labor Laws, p. 142 citing an article on Labor Management Relations in LXI Harvard Law Review;

^[4] Republic Act No. 875 effective June 17, 1953.

^[5] Sec. 1(c) Republic Act No. 875.

^[6] Manila Oriental Sawmill vs. National Labor Union, 91 Phil., 28; Liberal Labor Union vs. Philippine Can Company, 91 Phil., 72.

^[7] Cf. Bardwill Bros vs. Phil. Labor Union 40 Off. Gaz.
No. 13, p. 185; Union of Phil. Education Employees vs. Phil. Education
Co. 91 Phil., 93; Francisco Labor Laws p. 277.

^[8] 21 C J. S., 730.

^[9] Article XIV section 6, Constitution.

^[10] It is “more an administrative board” whose function
is “more active, affirmative and dynamic” than a court of justice. (Ang
Tibay vs. Court of Industrial Relations, 69 Phil., 635).

^[11] Note that any party to the dispute may request the Court’s Aid.

^[12] Decisive argument, years ago, in a famous theological debate: Potuit, decuit, ergo fecit. He could do it, it was proper to do it, therefore he did it.

^[13] Suppl. No. 11, Vol. 46 Off. Gaz., p. 219; See also Pena vs. Arellano, same suppl. p. 228.

^[14] 21 C. J. S., p. 730.