NATION MULTI SERVICE LABOR UNION, PAULINA H. DE LOS REYES, EULALIA LISING, CRISOSTOMO D. SASIS, ALFREDO BAES, SEGUNDO DOMINGUEZ, ISMAEL ROYOL, JR., JESUS RAMOS, VIRGILIO LAUREAN…

Nation Multi Service Labor Union versus Ambassador Hotel

The Case

This is a special civil action for certiorari and prohibition brought before the Supreme Court by the Nation Multi Service Labor Union and twenty-two individual employees against Ambassador Hotel, Incorporated and its officer Simeon Nicolas Chan, impleading the presiding judge of the Court of First Instance of Manila. The petitioners ask the Court to annul the restraining order issued by the trial judge and to stop him from proceeding with a prohibition suit filed by the private respondents, which sought to nullify a decision of the Secretary of Labor that had already become final. The case matters because it fixes the boundaries of judicial intervention in labor disputes decided under Presidential Decree Number 21, and because it teaches that a due process objection raised at the wrong stage, after a party has already been fully heard, cannot be used to frustrate a final labor award.

Procedural History

The controversy began with three unfair labor practice cases filed with the National Labor Relations Commission created under Presidential Decree Number 21. A compulsory arbitrator, Francisco Jose, heard the cases and ruled in favor of the petitioners. The private respondents appealed to the National Labor Relations Commission, which modified the arbitrator's decision and declared that an employer-employee relationship existed between the individual petitioners and the private respondents. The private respondents then elevated the matter to the Secretary of Labor, who affirmed the Commission in full. Instead of appealing to the President, the private respondents filed a petition for certiorari with prayer for preliminary injunction before the Court of First Instance of Manila, presided over by the respondent judge. The trial judge entertained the suit and, without notice and hearing, issued a temporary restraining order. The petitioners then came to the Supreme Court by certiorari and prohibition, contending that the trial judge acted with grave abuse of discretion in assuming jurisdiction over a matter that had already reached finality.

Facts

The individual petitioners were employees who claimed to have been dismissed by the private respondents because of their union affiliations and activities. They filed unfair labor practice complaints, and the compulsory arbitrator heard the parties, received testimonial evidence from witnesses presented by the private respondents, including Eustacio Maloles and George Crame, and admitted documentary evidence. On March 25, 1974, the arbitrator rendered a decision finding the private respondents guilty of unfair labor practice, although he did not find an employer-employee relationship between the individual petitioners and the private respondents.

The private respondents appealed to the National Labor Relations Commission. On July 19, 1974, the Commission modified the appealed decision and held that the private respondents were indeed the employers of the individual petitioners. The private respondents then appealed to the Secretary of Labor. The petitioners objected on the ground that the appeal was not under oath and was filed beyond the reglementary period, but the Secretary took up the appeal on its merits, reviewed the evidence, and on October 23, 1974 issued a resolution affirming the Commission in full and ordering the private respondents to reinstate the complainants with backwages.

Despite the finality of the Secretary's decision, the private respondents filed a petition for certiorari with prayer for preliminary injunction before the Court of First Instance of Manila to nullify that decision. The respondent judge, without notice and hearing, issued a temporary restraining order dated November 8, 1974. The petitioners then filed this special civil action, stressing that the Secretary's order had already attained finality and that only the President could overrule it under the decree.

Issues

• Whether or not the respondent judge acted with grave abuse of discretion in assuming jurisdiction over the prohibition suit filed by the private respondents and in issuing a restraining order against the final decision of the Secretary of Labor.
• Whether or not the private respondents were denied procedural due process, given that they were not notified at the stage of appeal to the National Labor Relations Commission, such that judicial intervention was warranted.
• Whether or not the private respondents were bound to exhaust the remedy of appeal to the President before seeking judicial relief.

Applicable Provisions

The first paragraph of Section 5 of Presidential Decree Number 21 provides:

The decision of the Commission shall be immediately executory unless appealed to the Secretary of Labor who shall act on all cases within five (5) days from filing. The latter's decision is appealable to the President.

This provision establishes that the Secretary of Labor's decision is final and may be reviewed only by the President, which is why the private respondents' resort to the trial court was improper.

Section 1 of Rule 65 of the Rules of Court provides:

When any tribunal, board or officer exercising judicial functions, has acted without or in excess of its or his jurisdiction, or with grave abuse of discretion and there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court alleging the facts with certainty and praying that judgment be rendered annulling or modifying the proceedings, as the law requires, of such tribunal, board or officer. The petition shall be accompanied by a certified true copy of the judgment or order subject thereof, together with copies of all pleadings and documents relevant and pertinent thereto.

This provision supplies the remedy of certiorari and prohibition, which the Court held available to the petitioners because the respondent judge acted with grave abuse of discretion.

Article II, Section 9 of the Constitution provides:

The State shall afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race, or creed, and regulate the relations-between workers and employers. The State shall assure the rights of workers to self-organization, collective bargaining, security of tenure, and just and humane conditions of work. The State may provide for compulsory arbitration.

This provision anchors the Court's observation that keeping the labor award in litigation instead of executing it does not protect labor as the Constitution requires.

Article II, Section 6 of the Constitution provides:

The State shall promote social justice to ensure the dignity, welfare, and security of all the people. Towards this end, the State shall regulate the acquisition, ownership, use, enjoyment, and disposition of private property, and equitably diffuse property ownership and profits.

This provision is cited to show that the delay in enforcing the award in favor of the workers offends the social justice principle.

Ruling

On the first issue, the Court held that even if the Court of First Instance may be conceded jurisdiction, the respondent judge committed grave abuse of discretion. The Secretary of Labor's order of October 23, 1974 had attained finality under Presidential Decree Number 21, and the appropriate step for a dissatisfied party was to appeal to the President, which the private respondents did not do. By entertaining the prohibition suit and issuing a restraining order, the trial judge frustrated the implementation of an order that had reached the stage of finality, and the fruits of victory were in effect denied to the petitioners.

On the second issue, the Court held that there was no denial of procedural due process. The private respondents were heard by the compulsory arbitrator and by the Secretary of Labor. The failure to notify them at the stage of appeal to the National Labor Relations Commission was an oversight that could not be visited with fatal consequences, because at that stage no additional factual evidence could have been introduced; the Commission reversed the arbitrator on a question of law. The Court quoted its recent ruling in Maglasang versus Ople:

It is thus apparent that even granting the absence of any hearing at the stage of mediation and factfinding, petitioner was afforded the occasion to explain matters fully and present its side of the controversy twice, the first time in his appeal with respondent Commission and thereafter in the review conducted by respondent Secretary of Labor. It would follow that the objection premised on lack of respect for the due process guarantee lacks support in the record.

Since the private respondents had a full and unimpeded opportunity to cure any due process deficiency, their reliance on that objection was vain and futile.

On the third issue, the Court held that the private respondents should have exhausted the remedy of appeal to the President, which the decree explicitly provided and which was both adequate and appropriate. That remedy was in line with the policy of leaving the solution of labor disputes as much as possible to administrative agencies and limiting judicial participation. The Court also noted that prohibition is available even for grave abuse of discretion only if there is no remedy by appeal, and such was not the case here. The suit for prohibition was therefore bereft of support in law.

Doctrine

A Bar candidate should retain these rules. First, under Presidential Decree Number 21, the decision of the Secretary of Labor is final and appealable only to the President; a party dissatisfied with it must exhaust that remedy and cannot go directly to the courts. Second, the failure to notify a party at an intermediate stage of an administrative labor proceeding does not amount to a denial of procedural due process where that party was heard at other stages and had a full opportunity to present its side, because any deficiency may be cured. Third, prohibition lies only where there is no appeal or other plain, speedy, and adequate remedy, and the availability of an appeal to the President forecloses that remedy. Fourth, courts must defer to the policy of expeditious disposition of labor cases and must not entertain suits that evade the remedies ordained by the decree, for to do so defeats the constitutional protection of labor and the social justice principle.

Disposition

The Supreme Court granted the writ of certiorari, nullified and set aside the restraining order of November 8, 1974 and the order of November 18, 1974, granted the writ of prohibition restraining the judge from taking further action on the prohibition suit except to dismiss it, and imposed costs against the private respondents.

Remember This

The single line worth memorizing is that the Secretary of Labor's decision under Presidential Decree Number 21 is final and appealable only to the President, so a party who skips that appeal cannot obtain judicial relief. Examiners like to use this case on the doctrine of exhaustion of administrative remedies in labor cases and on the rule that a due process objection is unavailing where the party was in fact heard at other stages of the proceedings.