PHILIPPINE SUGAR INSTITUTE, PETITIONER, VS. COURT OF INDUSTRIAL RELATIONS, ET AL., RESPONDENTS.

Above petitioner-institute (a semi-public corporation) purchased the
assets of the Insular Sugar Refining Corporation and the defunct
Insurefco and Paper Pulp Project Workers’ Union (now the National Sugar
Workers’ Union-PAFLU). Before the purchase, the employees of the
Insular Sugar Institute and the employees of the refinery through their
organization, the Insurefco and Paper Pulp Project Workers-Union, had
made demands for wage increases and other conditions of employment.
Appropriate proceedings were instituted before the Court of Industrial
Relations. To facilitate the immediate disposition of the dispute, the
parties effected an agreement dated June 11, 1949 which was approved by
the said Court on June 20, 1949. On the matter of wage increases, the
case was submitted for arbitration before the same Court. After
hearing, the Court granted an increase of fifty centavos to all daily
workers in its order of February 10, 1951. Petitioner complied with the
said awards for a period of more than three years.

On January 8, 1955, petitioner filed with the Court of Industrial
Relations a notice to terminate the partial agreement of June 20, 1949
and the award of February 10, 1951 with the prayer that the termination
shall be effective on the date of the notice.

Petitioner avers that under section 17 of Com. Act No. 103, the partial
agreement above-mentioned may be terminated by mere notice to the Court
of Industrial Relations, considering the fact that no period for its
effectivity was mentioned in the awards and the further fact that the
same had been complied with for three years.

Respondent union on the other hand contends that mere notice to
terminate does not automatically end the awards and that the union
could therefore properly contest the notice to terminate.

The issue involves the provisions of Section 17 of Com. Act No. 103 which says:

“Section 17—Limit of effectiveness of Award—An award, order or decision
of the Court shall be valid and effective during the time therein
specified. In the absence of such specification, any party or both
parties to a controversy may terminate the effectiveness of an award,
order or decision after three years have elapsed from the date of said
award, order or decision by giving notice to that effect to the Court:
Provided, however, that at any time during the effectiveness of an
award, order or decision, the Court may, on application of an
interested party, and after due hearing, alter, modify in whole or in
part, or set aside any such award, order or decision, or reopen any
question involved therein.”

The above
provision enumerates two kinds of awards, order or decision. The first
kind is that award with a specified period within which the same may be
enforced. The other kind is that without any specification as to its
duration. As regards this second kind, any party to the controversy may
terminate the effectiveness of the award, order or decision as long as
it had been enforced for a period of not less than three years from the
date of said award, order or decision and provided that notice has been
given to the Court.

It is true that with reference to this second kind, the law as stated
requires only, aside from the lapse of a three-year period, the giving
of “notice” to the Court of Industrial Relations. It is equally true
that the statute makes no mention of “due hearing” or other conditions
such as notice of termination to the opposing party. Nevertheless, the
necessity of “due hearing” is implicit in the very phrase “notice to
the Court”, for them, what would be the purpose of “notice to the
Court” other than that the Court should be given an opportunity to pass
upon the merits of the proposed termination.

This Court has opined in the case of Katipunan Labor Union vs.
Caltex (Phil.) Inc. and Court of Industrial Relations, L-10037, May 27,
1957) that because the agreement (like the award in the instant case)
sought to be terminated was the result of compromise arrived at by and
between the parties and approved by the court upon their submission, a
hearing is necessary to show supervening conditions that would justify
abandonment of the contract.

The Court a quo‘s findings that there existed no cause to justify the termination of the award shall likewise be conclusive on this Court.

Wherefore, the order appealed from is hereby affirmed in all parts and
respects, with no pronouncement as to costs. So ordered.

Bengzon, Montemayor, Bautista Angelo, Labrador, Concepcion, Barrera, and Gutierrez David, JJ., concur.