REGAL MANUFACTURING EMPLOYEES ASSOCIATION AND CELESTINO BAYLON, PETITIONERS, VS. HON. ANDRES REYES AND PHILIPPINE METAL FOUN­DRIES, INC., (FORMERLY REGAL MANUFACTURING CO., INC.…

This is a petition
for certiorari with prohibition by the Regal Manufacturing Employees Association
(hereinafter referred to as the Union) and Celestino Baylon against Judge
Andres Reyes of the Court of First Instance of Rizal
and the Philippine Metal Foundries, Inc. (hereinafter referred to as the
Company).

Imputed to the respondent court is excess of jurisdiction and/ or
grave abuse of discretion
consisting in rendering judgment on September 28, 1964 in civil case 7863, and issuing the orders of January
12 and February 18, 1965, denying their
pe­tition for relief of from said judgment and their subsequent motion
for reconsideration, despite the protestation of the Union that the subject
matter or cause of action in the said civil
case is clearly a labor
dispute, as to which the law (R.A. 875) vests ju­risdiction
exclusively in the Court of Industrial Relations.

The Company, with offices and factory at 304
Jose Rizal St., Mandaluyong, Rizal, and
the Union, an affiliate of the Free Trade. Union of the
Philippines (hereinafter referred to as
the FTUP), entered into a
collective bargaining agreement on
February 29, 1960, with a life of, two years, which was later extended
to December 31, 1963.  This agreement contains “no strike”
and “no lockout” provisions^[1] as well as stipulations on the hand­ling of
grievances.^[2]

Thru its general manager Leopoldo Relunia, the Compa­ny on
October 3, 1963
dismissed BayIon, president of the Union, from his job as a foundry worker. 
This dismissal caused the Union to declare a strike on October 5 and to
picket the factory and offices of the Company.

On October 7 the Company
filed a petition for injunction with the respondent CPI against Baylon and the Union,
claiming that the strike was declared “without
previous notice,” in viola­tion of the collective bargaining agreement; that the strikers have blocked and
are blocking all ingress and egress of the Company’s personnel,
equipment, supply, materials and other properties needed in its business
operations, resulting in the interruption of
work and business; that the strikers have resorted, and conti­nue to
resort, to threats of bodily injury not only to its employees who have refused to join or participate in the strike,
but also to the members of their
families; that these threats and violence have prevented and discouraged the
employees and laborers from the normal performance of their duties; and that
the Company stands to suffer
substantial and irreparable injury to its rights and pro­perties by reason of
the strike and the picketing.

On October 8 the
respondent CFI ordered the Union and Baylon “to
desist from blocking, obstructing and in any manner interfering with the
ingress and egress of employees, vehicles, materials, supplies, equipment, and
the general public to and from petitioner’s offices, premises and factories at
304 Jose Ri­zal Street, Mandaluyong, Rizal;
to desist from illegal acts of co­ercing
or causing violence upon the person or property of the em­ployees of
petitioner, the latter’s customers and the general pu­blic; and to
desist from intimidating, coercing and otherwise dis­couraging petitioner’s employees and laborers who desire to re­turn to work from doing so, until
further orders from the Court.”

On October 8 also, the Union and Baylon filed
with the CIR an unfair
labor practice complaint against the Company and its general manager, charging them with dismissing Baylon from his employment “without just cause and
proper investigation” and by
reason of his union activities from 1958 to 1963.  On the basis of this charge, a formal
complaint (case 3932-ULP) was filed against the Company and its general manager
The complainants prayed that the respondents therein be declared guilty of
unfair labor practice, and ordered to reinstate Baylon
to his former po­sition, with back wages from the time of his dismissal and all
the rights and privileges appertaining thereto.

On October 14 the Company
in turn filed with the CIR an unfair labor practice charge against the Union, its president Celestino
Baylon, and some 23 of its members, imputing to them collective and individual violations of the
collective bargaining agreement. According to the formal complaint filed
against the Union, et al. (case 3941-ULP), a grievance conference was scheduled
for October 3, 1963; that at the appointed time and place, the representatives
and counsel of the Company were present but the representatives of the Union
did not appear; that without filing a notice of strike, the Union and its
president and members declared a strike on October 5 and thereafter picketed
the offices and factory of the Company. 
The CIR was asked (1) to declare all the respondents therein guilty of
unfair labor practice; (2) to order them to cease and desist from committing
such unfair labor practice, to bargain in good faith and to comply strictly
with the provisions of the collective bargaining agreement; and (3) to declare the strike illegal and the
individual participants therein as having lost their status, rights and privileges as employees of the company.

On October 18 the Company
filed with the CFI a motion to admit an amended petition for injunction, naming
as additional respondent the FTUP,
as “mother and parent
union” of the Union, stating that Baylon
is being sued in his capacity as president of the Union and as an officer of
FTUP, and alleging that Baylon’s services were
terminated due to his frequent and repeated absen­ces from work, namely, 7 days
in April, 14 in May, 16 in June, and 17 in July, all in 1963.  In addition to the allegations in its ori­ginal
petition, the company further alleged

“That petitioner’s business operations consist of the manufacture of, among other
things, sewing machines, water pumps, water heaters, pressure tanks another appliances and equipment, from
which petitioner makes gross sales
amount­ing to P10, 000.00 per day, more or less; and by reason of the unlawful
acts of respondents herein described, petitioner has consequently been de­prived
of, as it is continues to be
deprived, of the right and opportunity to make such sales, from October 5,
1963, and profit or net income from which petitioner shall in due time prove
and es­tablish;

“That the bad faith and malice of respondents in abruptly
declaring and in abetting and instigating the walk-out or strike by
petitioner’s employees, without notice and in gross, wilful,
mali­cious violation of the provisions of the Collective Bargaining Agreement,
as above-alleged, entitle petitioner to a recovery for special damages under
the New Civil Code; while special damages petitio­ner believes may be fixed at
P50,000;

“That respondents, representing as they do to a great extent,
the labor or working force in general, have by their unlawful actuations here­in
described, created or caused to be created, the impression that labor has all
the rights, to the exclusion of management, including the right to violate with
impunity any and all formal contractual com­mitments.  And for the public good, the respondents
should be consequently adjudged liable for exemplary or corrective damages of
not less than P10,000;

“That respondents are liable jointly and se­verally to
petitioner for the above-mentioned items of compensatory, special and exemplary
damages, in addition to which, considering that petitioner has been compelled
to file this action due to said illegal acts of respondents, said respondents
should further be adjudged to pay P5,000, as
attorney’s fees.”

The Company prayed that judgment be
rendered declaring the preliminary restraining order permanent, declaring the
strike illegal with loss of employee status of all the participants, add
judging the respondents therein as having lost all their rights and privileges
under R.A. 875, and holding them jointly
and severally liable for actual damages in such sum as may be proved, P50, 000 in special damages, P10,000 in exemplary
or corrective damages, and r 5,000 as attorney’s fees.

The Union and Baylon, represented by Atty. Rufino B. Risma, on May 18, 1964 filed their answer to the complaint,
ad­mitting the principal allegations thereof but denying the illegal acts imputed to them.  They further alleged that the strikers have
maintained absolute peace and order within the strike zone; that the Company
violated the security of tenure of employment of Baylon
with impunity by dismissing him without cause and proper investigation; and
that the Company interfered with the rights of the employees and laborers to
self-organization by threatening them if they did not return to work and by requiring some of them to sign blank forms stating that they were
prevented from, going to work by some of the strikers. The answering
respondents therein also deny the necessity of a restraining order since the
Company had readmitted into its employ during the last week of October, 1963
all the employees and laborers who went on strike, except Baylon
who was refused employment. As special and af­firmative defenses, they further
asserted that the respondent CFI has no jurisdiction over the subject-matter
the case in view of the pending unfair labor practice case (case 3932-ULP)
before the that no damages can be awarded to the Company because by admitting
all of the strikers, except Baylon, back to work, the
Company had thereby condoned the acts complained of:

The Union and the FTUP, represented by
Atty. A. E. Pacis, filed ‘their answer to the amended
petition, alleging, inter alia, that the
respondent Baylon has ceased to be president of the Union and
an officer of the FTUP and that both unions never autho­rized the acts imputed
to Baylon.  The
said unions admit that some members, “upon the instruction of respondent Baylon, walk­ed out of their jobs and picketed the premises
[of the Company but have no knowledge as to whether threats and intimidation
were employed by some employees’.”

Pre-trial in civil case 7863 was calendared for February 20, 1964, postponed to March
20, and finally set for August 10.  On
this date, the herein petitioners and their counsel failed to appear.  So by order of August 10, the Company was
allowed to present its evidence before ‘a senior deputy clerk of court.

Atty. Risma, on August 25, moved that
he be dropped as counsel for the Union and Baylon, on the ground that he is “no longer their counsel.” This motion was denied on August 31, for
“lack of proof of service upon the respondent employees associa­tion and
respondent Celestino Baylon.”

On September 28, 1964
the respondent CFI rendered judgment, as follows:

“WREREFORE, judgment is hereby rendered ordering the
respondents, jointly and severally, to
pay the petitioner the sum of P58, 000.00 and P7.35 as actual and compensatory damages,
P1,000.00 as exemplary damages, and P5,030.00
as attorney’s fees.  Respondent Celestino Baylon as well as the
following union officers and members namely: Abraham Duran, ‘Valentin Banaga, Miguel Nodado, Edgardo Jestre, Rafael Culo, Renato Jestre, Ananias Rivera, Renato Barcelon, Jose Requilla, and
others who have participated in said strike are declared to have lost employee
status from the date of the strike for so participating in an illegal strike
and the petitioner is hereby authorized to dismiss them from their respective
positions.  With costs against the
respondents.”

Thereafter, the FTUP,
through V.E. del Rosario & Asso­ciate, filed a motion for reconsideration
of the said decision, insofar as it affects the said union, praying that it be
permitted to present its evidence to show that while it was the mother union of
the petitioner Union, it did not authorize the strike or condone the illegal
acts complained of; that the FTUP’s non-appearance at the pre-trial held on
August 10, 1964 “was On account of the disaffiliation of the respondent
Regal Manufacturing Employees Asso­ciation on June 15, 1964 from the FTUP and the disauthorization
of undersigned counsel’s; that FTUP’s inclusion in
the case was by virtue of the fact that it was the mother union, “without,
in any manner imputing liability upon movant
Federation’s; that V. E. del Rosario, as FTUP’s
president, was abroad at the time the strike was declared and could not have
authorized the same; that at a ge­neral meeting of the members of the Union had
after his (del Ro­sario’s) arrival from abroad, he, as president of the FTUP,
then and there disauthorized the strike and scolded
the general mem­bership “for having been unwittingly made ready tools for
a few unscrupulous local
leaders”; that this generated, and ultimately,’ led to the disaffiliation
of the Union from the FTUP; that the strike was staged without the knowledge of
the executive officers of the FTUP, who, upon, being informed thereof, disauthorized the same; and that the inclusion of the FTUP
in the decision would create grave injustice and cause irreparable injury to
said union, it not having been a party to the illegal acts complained of.

The Company opposed the
motion for reconsideration and moved that the same be stricken off the record,
on the ground that it is “in fact a motion for new trial and as such is
defective both in form and
substance,” for the motion not Only does not point out, pursuant to
section 1 of Rule 37 of the Rules of Court, any fraud, accident, mistake or
excusable negligence which ordinary prudence could not have guarded against to
warrant a new trial but as well is not accompanied by an affidavit of merits
showing, any valid defense, as required
by section 2 of the same Rule.

By order of November 14, the case was ordered reopened
as far as the FTUP was concerned, and was tentatively scheduled for December 14
for presentation of its evidence. 
The Company filed a motion for
reconsideration, reiterating the grounds stated in its opposition to the FTUP’s motion for reconsideration.  By order of January 19, 1965, the order of November 14, 1964 was set aside and the scheduled hearing was
cancelled.

The Union and Baylon, on
their part, filed a petition for relief from judgment.  Their counsel, Atty. Risma,
alleged there­in that his services as counsel were availed of by them only
during the time when they were in trouble; that Atty. Pacts, upon becom­ing
counsel, moved for the issuance of an alias summons and filed an answer
to the amended petition; that when
his (Risma’s) motion for withdrawal as counsel was
denied, the ex parte
hearing had al­ready been finished, and
for this, reason his clients “were not represented by any counsel” during the said pre-trial, due to the confusion brought
about by the change of counsel; that his failure to ap­pear at the said
hearing, which is excusable, deprived his clients of their day in court;
and that they have a very good defense
which they can prove if given a day in court.

The Company filed an opposition
to the petition for relief from
judgment and at the same time moved that it be stricken off the record,
alleging that it is not a proper, remedy because when the same was filed on November
12, 1964, the decision had not yet become final and executory
as the movants‘ counsel received a copy thereof only on October 14, 1964; that
the petition is defec­tive in form as it is not verified and is not accompanied by an af­fidavit of merits;
and that the respondents and their counsel of record are guilty of inexcusable
negligence because the manifestation of
withdrawal of the latter was made only after the Company had presented
all its evidence and, therefore, the motion for withdrawal was an attempt on
Atty. Risma’s part to “avoid the ef­fects of his
non-appearance at the trial of this case”.

The Union and Baylon, in reply, stated that, the petition for relief was properly filed a, for pursuant
to section 3 of Rule 38 of the Rules of Court, the same-was filed within 60
days from re­ceipt by their counsel of a copy of the decision; that the
petition is duly verified “because be (Risma)
was the one who did not ap­pear due to his assumption that he was
relieved” as their counsel, and that “the verification constitutes
the affidavit of merits re­quired”; that the “allegation in the petition x x
x that this Hono­rable Court has no
jurisdiction in the subject of this
proceedings, it being a labor dispute and well within the exclusive jurisdiction of the CIR where respondent has filed the action” (for unfair
labor practice) is a substantial defense; and that the said ULP case
“constitutes the pendency of another
action” which is also a va­lid and legal ground for a motion to dismiss
under section 1, sub­section (c), of Rule 16 of the Rules of Court.

By order of January 12,
1965, the petition for relief from, judgment was denied “for
lack of merit.” Also denied in the same order was the Company’s motion for execution of said judgment as
it had “not yet become final and executory.”
The Union and Baylon filed a motion for reconsideration, contending that
the said order “is contrary
to law” and is “unfair, unjust and discrimina­tory.” By order of
February 18, this motion for reconsideration was denied “for lack of merit.” On March 15, 1965 the Company moved for
execution of the judgment on the ground that it “has al­ready become final
and executory, the respondents not having filed an
appeal to the Decision of this Hon. Court
and its subsequent Orders.”

Hence the present recourse by
the Union and Baylon.

The primary issue is whether the respondent CFI acted without or
in excess of its jurisdiction and with grave abuse of discretion in rendering
the decision and issuing the orders complained of.

We note that the respondent CFI took cognizance of civil case
7863 because in its view (1) the original petition for injunction was primarily
aimed at preventing the herein petitioners who went on strike from committing
acts of violence within the strike zone, and (2) the amended petition seeks the
recovery of actual, special, exemplary or corrective damages and attorney’s
fees, on account of the alleged “bad faith and malice of respondents in
abruptly declaring and in abetting and instigating the walkout or strike by
petitioner’s employees, without notice and in gross, wil­ful,
malicious violation of the Collective Bargaining Agreement.”

With respect to the first reason given, it is sufficient to
-state that the respondent court correctly ruled that the matter of injunctive
relief “has become moot due to the return to work of the striking
employees.”^[3]

A searching scrutiny of
the second reason given is vital to the resolution of the issue at hand.

The original petition for
injunction in civil case 7863 prayed that the CFI of Rizal
issue an order restraining the strik­ers from committing and continuing to
commit the allegedly un­lawful acts imputed to them, declaring the strike
illegal, and ad­judging the strikers as having lost their employee status as
well as all their rights and privileges under LA. 875.  The petition, therefore, on its very face,
presented for resolution an unfair labor practice charge which falls within the
exclusive competence of the Court of Industrial Relations.  The respondent Court of First Instance
therefore should have refused to take cognizance “of the petition and
instead dismissed it outright, as it had no ju­risdiction thereon. This is the
teaching in Leduna, et al. vs. Enriquez, et al.,
L-13965, May 23, 1960,
articulated in the fol­lowing words: “the Court of Industrial Relations
had, accordingly, the ‘exclusive’ authority to determine whether or not the
company was guilty of unfair labor practices and whether the strike called by
reason thereof was justified or not, as well as whether the em­ployees who took
part in the strike have lost their jobs in conse­quence thereof or are entitled
to retain such jobs, or if they have been dismissed, to be reinstated, ‘with or
without backpay‘; and that, owing to the ‘exclusive’
nature of this authority of the Court
of Industrial Relations, its
decision thereon in proper cases, would be binding upon the ordinary courts of
justice, and would prevail over the orders and determinations of the latter on
the same matter.”^[4]

The amended petition for
injunction of October 18, 1963 can fare no better, and should suffer the
same fate as the origi­nal petition, because this amended petition reproduces in
toto all the allegations and prayers contained
in the original petition.

But this is not all.  The answer to the amended petition squarely
challenged the jurisdiction of the respondent CFI over the subject-matter of the amended
petition and pointedly called the attention of the said CFI to the pendency in the CIR of ULP case 3932 which was filed by the
Union and Baylon long before the promulgation of the
order of August 10, 1964 of the respondent court which allowed the Company to
present its evidence before the senior deputy clerk thereof, and much longer
before the decision of September 28, 1964, hereinbefore adverted to, was rendered
by the said CFI.

The events that ensued
after the filing of the amended petition for injunction – even the declaration
in default of the Union and BayIon
– could not and did not alter the picture nor invest the CFI with jurisdiction
to proceed with civil case 7863.  The res­pondent
court’s actions, orders and decision issued and promul­gated in connection with
the original as well as the amended peti­tions were therefore null and void and
of no effect.

The decision of the
respondent judge of September 28, 1964 declared the strike illegal, adjudged the
union officers and mem­bers who participated in the strike as having lost
employee status, authorized the Company to dismiss them from their respective
positions, and awarded actual, compensatory and exemplary damages and
attorney’s fees.  To the extent that the
decision de­clared the strike illegal, adjudged loss of employee status of the
strikers, and authorized their dismissal, the same is void, for the reason that
these adjudications fall within the exclusive competence of the CIR.

To elaborate, the facts
and circumstances which gave rise to the two ULP cases (3941 and 3932 filed
with the CIR are the same facts and circumstances that constitute the basis of
the ori­ginal petition as well as the amended petition for injunction with the
CFI. The acts complained of by the Company in the CFI are therefore directly
interwoven with the ULP cases filed with the CAME Box Factory Workers
Union, et al. vs. Victoriano, et al.,^[5] this Court, looking to National Garment
& Textile Workers Union vs. Caluag,^[6] emphasized that when the “issue
involved in the main case is interwoven with the unfair labor case pending in
the Court of Industrial Relations as to which, its jurisdiction is exclusive,
the main case does not come under the jurisdiction of the trial court even if it involves violence, intimidation and co­ercion
as averred in the complaint.”

Because the strikers have
returned to work, the respon­dent CFI, in its decision of September 28, 1964,
stated that the petition for injunction “has, in effect, been converted
into one for the enforcement of a collective bargaining contract and to seek redress
for a violation thereof,” and therefore is within the jurisdiction and competence of the regular
courts and not of the Court of Industrial Relations, ” citing Dee Cho Lumber Workers Union-NLU vs. Dee Cho
Lumber Company, L-10080, April 30, 1957, and Philippine Sugar Institute vs.
CIR, L-13098, October 29, 1959.  The
doctrine laid down in those cases is, however, inapplicable in the case at bar
because those actions were for the enforcement of collective bargaining
contracts and involved, not unfair labor practices, but solely, the
construction and interpretation of the stipulations embodied in the agreements.

At all events, the power
of the CIR to hear and decide the ULP cases is not affected by the conclusion
reached by the res­pondent CFI that the petition for injunction seeks redress
for vio­lations of the collective bargaining agreement, for the reason that
whether or not for such violations damages are recoverable, and to what extent,
will still have to depend on the evidence to be adduced in the ULP cases
pending between the parties and their final outcome.  As this Court very aptly stated in Associated
La­bor Union vs. Gomez,^[7] the
averment of the company therein that it suffered damages by reason of the strike cannot “work to de­feat the CIR’s jurisdiction” for the
right to damages “would still have to depend on the evidence in the unfair
labor practice case in the CIR,” and to hold otherwise “is to
sanction split jurisdic­tion which is obnoxious to the orderly administration
of justice.”

Under the environmental
circumstances obtaining, the res­pondent court should have dismissed the
original petition for in­junction outright, or, later, dismissed the amended
petition for injunction, without prejudice, or, in the very least, suspended
action thereon in so far as the question of damages is concerned, until
the CIR shall have finally decided the two labor disputes pending before it.

ACCORDINGLY, the decision rendered by the respondent CFI
on September 28, 1964 and the orders promulgated by it on January 12 and February
18, 1965, are hereby
annulled and set aside. The court a quo is hereby ordered to
refrain from proceeding with case
7863, on the question of
damages, until final judgment in ULP cases 3932′ and 3941 shall have been
rendered.  Costs against the respondent
Philippine Metal Foundries, Inc.

Concepcion, C.J., Reyes, JBL, Dizon, Makalintal, Zaldivar, Sanchez, Angeles, and
Fernando, JJ., concur.

^[1]
Art. I, par. 2(a) and (c) of the collective bargaining
agreement.

^[2]
Art. IX, id.

^[3]
Progressive Labor Association, et al. vs. Hon. Judge Guillermo Villasor, et al., L-26383, April 3, 1968; Meralco Workers
Union vs: Yatco, et
al., L-19785, Jan. 30, 1967,
1967A PHILD 149, 19 SCRA 177

^[4]
See also Philippine Communications, Electronics & Electricity Workers
Federation, et al. vs. Nolasco, et al.,
L-24984, July, 1968, and cases therein cited; Security Bank Emplo­yees, et al. vs.
Security Bank & Trust Co., et al., 28536, April 30, 1968, and cases therein
cited.

^[5]
102 Phil. 646.

^[6]
99 Phil. 1067.

^[7]
L-25999, Feb. 9, 1965,1957A
PHILD 40, 19 SCRA 04.