LUZON GLASS FACTORY, PETITIONER, VS. COURT OF INDUSTRIAL RELATIONS, FAR EASTERN-LUZON GLASS WORKERS UNION, RESPONDENTS.

This appeal by certiorari
was interposed by the Luzon Glass Factory (hereinafter referred to as the
Factory) from the majority resolution en banc, dated May 9, 1964,
of the Court of Industrial Relations (CIR), reversing the decision of the trial
court and ins­tead finding the Factory guilty of unfair labor practices in
violation of section 4(a), paragraphs (1) and (4) of the Industrial Peace Act
(Rep. Act 875), and consequently ordering the Factory to cease and desist from
engaging in the said unfair labor practices and to reins­tate the complaining
employees to their former positions or equiva­lent jobs, with backpay from the date of lay-off to the date of actual
reinstatement, minus the total amount of salaries or incomes which the
complaining workers had respectively earned in the interim.

On February 9, 1960
some employees of the Factory organized the Far Eastern-Luzon Glass Workers
Union-CLP (hereinaf­ter referred to as the Union).  Four days later, or on February 13, 1960, Chu Tek Chen, the manager of the
Factory and its sister com­pany, the Far Eastern Manufacturing Company, Inc.
(hereinafter referred to as the FEMCO), was furnished a letter officially in­forming
the Factory of the establishment of the Union and intro­ducing the officers and
members thereof.  Chu
Tek Chen lost no time in expressing his vehement
opposition to and utter disenchanment over the
formation of the Union and the affiliation with it of
some employees.  He forthwith threatened
the officers and mem­bers of the new union with dismissal if they did not
disaffiliate from the Union.  On the same day, the employees concerned were
notified, either of their
lay-off, or transfer effective February
15, 1960 to the FEMCO.  Of
the five complaining employees, Francisco Regullano
and Mariano Regullano, both Union members, were laid
off from the Factory, while Lauro Crisologo,
Eduardo Gozon and Mariano Badoy, vice-president,
secretary and member of the Union, respectively, were transferred to the FEMCO
where they were gi­ven work on a rotation basis until their lay-off on April
18, 1960.

In view of the foregoing developments, the Union charged the
Factory, the FEMCO and Chu Tek
Chen in CIR Case 2410-ULP with unfair labor practices under section 4(a),
paragraphs (1) and (4) of the Industrial Peace Act.  The Union alleged that
the respon­dents, motivated by anti-union
sentiments, interfered in the exer­cise of their right to self-organization and discriminatorily laid off the Union members, five of whom are the complaining
witnesses.

In their joint answer, the three respondents squarely tra­versed
the allegations of the Union, particularly the charge of
illegal transfer and lay-off of Union members. 
By way of special and affirmative defenses, they averred, inter alia, that

1.  The Union has no
personality to represent the workers involved in the ULP case;

2.  There is no tie-up between the Factory and the
FEMCO as each has a separate corporate iden­tity and operates under an
independent management, and, moreover, Chu Tek Chen is not
the manager of either company;

3.  The dismissals were made in faithful implemen­tation
of the closed-shop arrangements entered into between the Factory and the Luzon
Glass Factory Labor Union, and between
the FEMCO and the FEMCO Labor Organization; and

4.  Before seeking judicial intervention, the
Union never attempted to negotiate honestly and fairly its grievances with the
respective manage­ments of the companies, and their inordinate haste in going
to court subverts the philosophy underlying the Magna Carta
of Labor that calls for a maximum use of the machinery of fair and honest negotiation, with resort to the
court as a last avenue of action.

On January 17, 1964
the Hon. Amando C. Bugayong,
the trial judge, rendered judgment
dismissing “the complaint for lack of substantial evidence in support of
the charges therein alleged.” The trial judge also took cognizance of and
accorded full credence to the separate petitions filed by Crisologo,
Badoy and Gozon, to
withdraw and desist from pursuing the case against the respondents on the
proffered grounds that the case was instituted due to a mis­apprehension of the
actual facts, that the differences have been amicably settled, and that the
respondents were not actually guilty of any unfair labor practice.

Upon motion for
reconsideration filed by the Union, the
CIR, in a majority resolution en banc, overturned the decision of
the trial judge.  The majority of the
court found that the Factory was guilty as charged.  With respect to the Regullano
brothers, the court found that at the time of their dismissal they were
employees of the Factory and that they were laid off due to their union activi­ties,
and not on the feigned reason of lack of work. 
Anent Crisolo­go, Gozon
and Badoy, the majority held that these employees
were transferred to the FEMCO and then laid off because they steadfast­ly
refused to disaffiliate from the Union.  The transfer of the said employees to the
FEMCO was a mere subterfuge to oust them eventually from employment since any
transfer to the FEMCO, a sister company of the Factory, would inevitably result
in lay-off because there were no more operations in the said company.  Finally, the resolution appealed from,
contrary to the disposition of the trial judge, denied credence to the
aforementioned individual petitions to withdraw filed by Crisologo,
Badoy and Gozon.  The majority stressed that

“It is a fundamental rule that pleadings of this nature could
not just be given due credence.  Extra
caution should be taken before the same are given credit.  And so when they themselves testified in open court and explained why they
filed these pleadings of withdrawal, the trial Court should have considered the
testimony as prevailing over the allegations of the pleading.  There is really no necessity of acting on the
notice of dismissal filed by Eduardo Gozon, because
the records beyond doubt show that it was filed long after the case was
submitted for decision. . . Said pleading should have been disregarded as a
mere scrap of paper and dismissed outright. . .”

In the appeal by certiorari
at bar, the Factory challenges the abovementioned majority, resolution en
banc on the following grounds:

1.  There exists no employer-employee relationship
between the Factory and the complaining workers who were actually employees of
the FEMCO, and, consequently, the CIR erred in finding that the said workers
were illegally laid off by the Factory and in ordering the lat­ter to reinstate
them with backwages;

2.  The CIR erred in refusing to dismiss the ULP
case despite the explicit motions to withdraw filed by three of the complaining
workers; and

3.  Even assuming that the CIR may order the
Factory to reinstate the complaining employees, the court erred in ordering the
payment of backpay to them from the date of their
lay-off to the date of their actual reinstatement, a period of more than four
and a half years, such decree being contrary to the ruling in Sta. Cecilia
Sawmill, Inc. vs. CIR (L-19273 & L-19274, February 29, 1964) which
limits the award of backpay to an amount equivalent
to three months’ salary.

On November 14, 1964
the respondent Union filed its answer, contending that

1.  The CIR’s finding
that the herein complainants are employees of the Factory, being supported by
substantial evidence, cannot be reviewed by this Court;

2.  The CIR acted within the bounds of law, equity
and justice in refusing to accord credence to the separate petitions to
withdraw filed by three of the complaining employees; and

3.  The environmental circumstances obtaining in
case at bar are materially different from those in Sta. Cecilia Sawmill,
hence the doctrine enunciated in the said case cannot justifiably be applied in
the controversy at bar.

Pending resolution of the instant appeal by certiorari, the parties, assisted by their
respective counsels, filed on September
18, 1968 a “joint motion to dismiss” anchored on the
principal ground that the Factory and the Union have
arrived at an amicable settlement.  The
said motion, which was likewise signed by all the five complaining employees,
recites that

1.  The parties have amicably settled the
subject-matter of the instant controversy to their full and complete
satisfaction;

2.  On account of the foregoing settlement the respondent
Union (complainant in CIR case
2410- ULP) and all of the complaining workers “confess that they have no
cause of action” against the petitioner
Factory or against any of the
respondents in the said CIR case, and, moreover, they “waive any claim or
right of whatever nature they may have” against the latter;

3.  The petitioner Factory “confesses that it
has no more cause of action” against the respondent Union and complaining employees, and that “it likewise waives whatever claim or
right it may have” against the latter; and

4.  The parties “know and are fully aware
that the dismissal herein sought is not only the dismissal of the appeal by certiorari filed
by here­in petitioner, but an outright dismissal of the entire case on
account of full, comprehensive and
total settlement of the subject-matter of the complaint originally
instituted” by the Union in the
CIR and the counterclaim filed by the Factory.

Verily, the amicable settlement reached by the parties has
rendered the case at bar moot and academic.

ACCORDINGLY, the instant appeal by certiorari is hereby dismissed, without pronouncement as to costs.

Concepcion, C.J., Reyes, J.B.L., Makalintal, Sanchez, Angeles, Fernando, and Capistrano, JJ., concur.

Dizon and Zaldivar, JJ., on leave.