POMPOSA VDA. DE NATOR AND ALFREDO TALON, PETITIONERS VS. THE HON. COURT OF INDUSTRIAL RELATIONS, DIONISIO ABENAZA, GAUDENCIO CARDONA, QUINTIN BRIONES, ALFREDO COMPRA AND LUCIO C…

On August 6, 1953, Dionisio Abenaza, Gaudencio Cardona, Quintin
Briones, Alfredo Compra and Lucio Compra, filed with the Court of First
Instance of Cebu (Civil Case No. 3238), an action for the recovery of
various sums of money, due them as underpayment, overtime pay,
separation pay, as hotel boys of the “La Suerte Hotel”, Cebu City;
moral damages, and attorney’s fees against Pomposa Vda. de Nator and
Alfredo Talon, owners and/or operators of said hotel; which was amended
on January 4, 1954. After due hearing, the CFI, on May 20, 1955,
rendered judgment, in favor of the plaintiffs claimants and against
Nator and Talon, who appealed to the Court of Appeals, on July 30, 1955
(CA-G. R. No. 16861-R). Pending appeal, on November 30, 1957, the Court
of Appeals was informed about the loss of the stenographic notes due to
fire and on February 24, 1958, remanded the case to the court a quo for
re-trial.

Under date of August 30, 1958, the lower court handed down the following order—

“After hearing the arguments of the plaintiffs and
it appearing that the demands of the plaintiffs involve the application
of the Minimum Wage Law; x x x considering that under the ruling,. of
the Supreme Court laid down in the case of ‘PAFLU vs. Hon. Tan, Judge
of the Court of First Instance of Manila, et al., G. R. No. 9115/ any
case involving the application of the Minimum Wage Law falls within the
exclusive jurisdiction of the Court of Industrial Relations; and
considering by analogy the rule laid down by the Supreme Court in the
case of Castro vs. The Collector of Internal Revenue, et al., Off.
Gaz., July 15, 1957, to the effect that a case occurring before the
effectivity of the Act which gives jurisdiction to the new Court should
be decided by the latter under whose jurisdiction it falls.

“HEREBY RESOLVES:

“To
declare itself without jurisdiction to retry this case and dismisses it
without prejudice and without special pronouncement as to costs.”

The above order was the subject of a petition filed on September 29,
1958, for Mandamus and Prohibition in this Court (G. R. No. L-14568),
to compel the judge of the court a quo to retry the case and restrain
him from making any decision on the evidence taken anew, but transmit
the evidence to the Court of Appeals. The petition was dismissed on
October 23, 1958, this Court saying “appeal in due time being the
proper remedy This Court also denied the motion for reconsideration
filed thereto on November 14, 1958.

Under these circumstances, Abenaza and others, the plaintiffs in
Civil Case No. 3238, presented their claim with the CIR on December 5,
1958 against Nator and Talon (Case No. 22-V Cebu), under five (5)
causes of action, to wit: (1) Underpayment or wage differentials under
the Minimum Wage Law; (2) overtime pay for services rendered beyond the
eight-hour period; (3) separation pay for having been dismissed without
due notice and justifiable cause; (4) actual and moral damages and (5)
for attorney’s fees.

Respondents Nator and Talon filed separate Answers. Nator after
specifically denying the material allegations of the complaint,
interposed the following special defenses, to wit: (a) no cause of
action for causes of action 3, 4 & 5; (b) prescription of action
for causes of action 1, 2 & 4; (c) and as special defense for all
the causes of action, that same is barred by prior judgment, since the
subject matter of the instant proceedings is the same as that of Civil
Case No. R-3238, CFI Cebu, which has been disposed of by said court and
by this Court (G. R. No. L-14568) (Mandamus & Prohibition). Talon
adopted the Special defenses invoked by Nator and interposed a
Counter-claim for P2,500.00 for moral damages and attorney’s fees. Both
respondents prayed for the dismissal of the complaint.

After hearing, Judge Jose S. Bautista of the CIR rendered judgment
finding that there is sufficient legal cause of action, and that the
action has not prescribed. The dispositive portion of the decision
recites—

“x x x x x x x x

“IN VIEW WHEREOF, the respondents are hereby ordered
jointly and severally to pay petitioners Dionisio Abenaza, Gaudencio
Cardona, Alfredo Compra and Lucio Compra the sums of Pl,312.22,
Pl,312.22, P1,400.28 and P1,15.16, respectively, plus interest thereon,
at the rate of 6% annually from the time of the filing of this case on
December 5, 1958 and until the above amounts are fully paid to the
satisfaction of said petitioners.”

The above decision is now before Us on review, petitioners raising two legal issues, to wit:—

(1)	Whether or not the action (CIR No. 22-V Cebu, has already prescribed; and
(2)	Whether or not said action has been barred by previous judgment.

Petitioners contend that the first cause of action, which comes
under the Minimum Wage Law, accrued from August 4, 1951 to February 17,
1953, and the complaint for their recovery with the CIR having been
filed only on December 5, 1958, or after the 3-year period, the action
of respondents has prescribed. Section 17, of the Minimum Wage Act 602,
as amended by R. A. No. 812, provides—

“Sec. 17. Statute of Limitation.—Any action
commenced on or after the effective date of this Act to enforce any
cause of action under this Act may be commenced within thi»ee years
after the cause of action accrued, and every such action shall be
forever barred unless commenced within three years after the cause of
action accrued.” (R. A. No. 602, as amended by R. A. No. 812).

As to the second cause of action, which is for overtime pay, and
which allegedly cover the same period (Aug. 4, 1951 to February 17,
1953) said claim has also prescribed, since the complaint was only
made on December 5, 1958. Section 7-A of Comm. Act No. 444, as amended
by R.A. No. 1993, approved on June 22, 1957, states—

“Sec. 7-A. Any action to enforce any cause of action
under this Act shall be commenced within three years after the cause of
action accrued, otherwise such action shall be forever barred.”

Petitioners also point out the fact that the filing of Civil Case
No. R-3238, on August 6, 1953, with the CFI for the same causes of
action, did not suspend the period of prescription, because as found by
the CFI, it had no jurisdiction over the subject matter and dismissed
the same. The case of Conspecto vs. Fruto, 34 Phil., 144f was cited
wherein it was held that, “while the commencement of the action would
of course stop the running of the statute of limitations, its dismissal
or voluntary abandonment by plaintiff would leave the parties in
exactly in the same position, as if no action had been commenced at
all. Said action by reason of its dismissal or abandonment took no time
out of the prescription.” And furthermore, “the bringing of an action
in a court without jurisdiction does not interrupt the running of the
statute of limitations” (Sec. 271, 54 CJ.S. p. 303).

Petitioners further contend that the case of respondents is barred
by former judgment. Basis of this claim is the fact that when the court
a quo dismissed the claim on the ground of lack of jurisdiction,
the matter was brought before this Court on a Petition for Mandamus and
Prohibition and which was dismissed for the reason that “appeal in due
time being the proper remedy.” And said dismissal having become final,
same constitutes res judicata to the present case.

Respondents-claimants alleged that the petition at bar is premature
and, therefore, constitutes no cause of action; that their causes of
action is not barred by the statute of limitations nor by a former
judgment. Respondents maintain that since the decision, subject of the
present appeal, was only a decision of one judge, an appeal therefrom
should have been made to the Court en banc, through a motion for
reconsideration (Broce, et al. vs. CIR, et al., G.R. No. L-12367, Oct.
28, 1959).

After a careful consideration of the circumstances surrounding the
controversy, We find that the causes of action of respondents have not
prescribed or barred by a former judgment.

It cannot be seriously controverted that the respondents claimants
were militant and alert in the ventilation of their case and had
pursued the procedure then available to them as sanctioned by existing
jurisprudence. Within the prescriptive period of three years, they
caused the filing of a complaint with the CIR, which refused to take
cognizance thereof for lack of the numerical requirement of the
employees involved; within the same period they presented their claim
with the only court (CFI) which was then authorized to hear their case
and which had found for them. The petitioners even appealed from the
CFI decision to the Court of Appeals, which is an indication that they
themselves were convinced of the trial court’s jurisdiction at that
time.

The efforts displayed by the respondents-claimants in filing their
claim before the court which had jurisdiction -over the claim in
accordance with the law and jurisprudence existing then, negate the
claim for prescription of action, since the basis of prescription is
the unwarranted failure to bring the matter to the attention of those
who are by law authorized to take cognizance thereof. The claim that
the CFI did not have jurisdiction at the time it took cognizance of
the case, is patently untenable. At that time the CFI was the proper
Court. The filing of the case with the CFI arrested the period of
prescription (Art. 1155 NCC), and the interruption of said period
lasted until the time that the dismissal for lack of jurisdiction
became final. “When prescription is interrupted by a judicial demand,
the full time for the prescription must be reckoned from the cessation
of the interruption” (cited in Florendo vs. Organo, 90 Phil., 483). The
whole period during which the case had been pending cannot be counted
for arriving at the prescriptive period. In other words, the running of
the period of prescription in this particular case was interrupted on
August 6, 1953, when the case in the CFI was filed and began to run
again on August 30, 1958, when the same Court had dismissed the case.
As the complaint was filed with the CIR on December 5, 1958, the action
has not yet prescribed.

It is true that Comm. Act 444 and R. A. 603 provide for a 3-year
period within which to bring the actions (Sees. 7-a and 17,
respectively), but even Sec. 7-a of Comm. Act 444, as amended by Rep.
Act No. 1993, grants an exception when it stated: “x x x Provided,
however, the actions already commenced before the effective date of
this Act shall not be affected by the period herein prescribed”, which
counsel wittingly or unwittingly omitted.

The dismissal by this Court of the Mandamus and Prohibition case was
not on the merits. This is clear from our Resolution which said:
“appeal in due time being the proper remedy.” Before a judgment can be
a bar to a subsequent action, said judgment must be on the merits. The
elements of a bar by prior judgment (res judicata) are: (1) it must be
final; (2) rendered by a court of competent jurisdiction; (3) one on
the merits; and (4) identity of parties, subject-matter and causes of
action (San Diego vs. Cardona, 70 Phil., 281; Aguirre, et al. w.
Atienza, et a.1., 104 Phil., 477). When the CFI dismissed the case for
lack of jurisdiction and this Court denied the Mandamus and Prohibition
instituted against the CFI for its action (dismissal), there was no
hearing on the merits as yet.

Under the above set of facts, therefore, it is clear that
respondents causes of action are legally maintainable. However, during
the pendency of the case, this Court has made pronouncements which
affect the present controversy. Thus, in the case of Naric Workers
Union vs. The CIR and NARIC, G. R. No. Ir-14999, Dec. 30, 1961. We said:

“Under the law and jurisprudence the Court of
Industrial Relations’ jurisdiction extends only to cases involving (a)
labor disputes affecting an industry which is indispensable to the
national interest and is so certified by the President to the Court
(Sec. 10, Rep. Act No. 875); (b) controversy about the minimum wage
under the Minimum Wage Law, (Rep. Act No. 602); (c) hours of
employment, under the Eight Hour Labor Law, Comm. Act No. 444;. and (d)
Unfair Labor Practice (Sec. 5[a], Rep. Act No. 875). And such disputes,
to fall under the jurisdiction of the CIR, must arise while the
employer-employee relationship between the parties exists or the
employee seeks reinstatement. When such relationship is over and the
employee does not seek reinstatement, all claims become money claims
that fall under the jurisdiction of the regular Courts (Sy Haun vs.
Judge Bautista, et al., 112 Phil., 914; 61 Off. GazM [20] 2942) and
cases cited therein.”

“x x x. In the recent case of National
Labor Union vs. Insular Yebana Tobacco Corporation, (58 Off. Gaz., [40]
6447) it was ruled that in the absence of unfair labor practice, the
CIR has no power to grant remedy under its general powers of mediation
and conciliation, such as reinstatement or back wages. x x x (G. R. No.
L-16031, C. Cagalawan vs. Customs Canteen, et al., Oct. 31, 1961.”)

Respondents in this case never asked for reinstatement, nor was
there any allegation of unfair labor practice committed by the
petitioners. Their case, therefore, is properly cognizable by the Court
of First Instance of Cebu, which Court has already rendered judgment in
their favor, but for circumstances heretofore mentioned,, it had
declared itself without jurisdiction. To affirm the judgment of the CIR
would in effect be legalizing an act which, under existing
jurisprudence, said court has no right to exercise.

Because of the conclusions reached, We deem it unnecessary to discuss the question of whether the appeal taken is premature.

WE hereby return the case, and direct, to the CFI of Cebu, to
conduct a hearing as ordered by the Court of Appeals in its Resolution
dated February 24, 1958, in case CA-G. R. No. 16861-R, for the purpose
of retaking the portions of the testimonies in the case which were
lost, after which to forward the same to the Court of Appeals for
decision. Without special pronouncement as. to costs.

Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Barrera, Dizon, and De Leon, JJ., concur.