DE LA SALLE UNIVERSITY AND DR. CARMELITA I. QUEBENGCO PETITIONERS, VS.DE LA SALLE UNIVERSITY EMPLOYEES ASSOCIATION (DLSUEA-NAFTEU), RESPONDENT.

De La Salle University versus De La Salle University Employees Association

The Case

This is a petition for review on certiorari brought by De La Salle University and its Executive Vice President, Dr. Carmelita Quebengco, against the De La Salle University Employees Association, the union representing its rank-and-file employees. The University challenges the decision of the First Division of the Court of Appeals which set aside the orders of the Second Division of the National Labor Relations Commission affirming the dismissal of the union's complaint for unfair labor practice, and which directed that the records of that complaint be transmitted to the Third Division of the Commission. The case matters for two reasons. First, it teaches the procedural rule that a final and executory judgment can no longer be disturbed, even by a co-equal division of the same appellate court. Second, and more importantly for labor law, it teaches that an employer who unilaterally withholds union dues and suspends normal relations with a union during an intra-union dispute commits unfair labor practice.

Procedural History

The union filed a complaint for unfair labor practice against the University before the Labor Arbiter, who dismissed it. The union appealed to the National Labor Relations Commission, and the appeal was lodged with the Commission's Second Division, which affirmed the dismissal. The union then went up to the Court of Appeals by petition for certiorari, and the case was raffled to the appellate court's First Division.

In the meantime, a separate controversy was brewing. The union had asked the Commission's Third Division, which was handling a certified case arising from a notice of strike, to absorb or subsume its other cases, including the unfair labor practice complaint then pending appeal before the Second Division. The Third Division granted the motion. The University challenged that order before the Court of Appeals, and the petition was raffled to the Tenth Division. The Tenth Division reversed the Third Division, holding that the unfair labor practice complaint had already been disposed of by the Labor Arbiter and was already on appeal, so it could no longer be subsumed. That Tenth Division decision became final and executory.

The First Division, apparently unaware of the Tenth Division's ruling, thereafter granted the union's petition and ordered the Second Division to transmit the records of the unfair labor practice complaint to the Third Division. Hence, the University's petition for review on certiorari before the Supreme Court.

Facts

In 2001, a splinter group within the union led by Belen Aliazas filed a petition for the conduct of elections with the Department of Labor and Employment, alleging that the incumbent officers had failed to call a regular election since 1985. The union disputed this, claiming that an election was held in 1987 and that the officers' terms were extended by law, with a hold-over tenure affirmed by the general assembly until the conclusion of collective bargaining negotiations. A collective bargaining agreement was in fact executed only on March 30, 2000.

The Department of Labor and Employment, through its National Capital Region office, ruled that the hold-over authority of the incumbent officers had been extinguished by the execution of the collective bargaining agreement, and ordered that elections be conducted under its supervision. Despite these conditions, the union called for a regular election on July 9, 2001, without prior notice to the Department and without a pre-election conference. The Aliazas group sought intervention before the Bureau of Labor Relations, which issued a cease and desist order stopping the election.

The Aliazas group then wrote the University President, requesting that union dues and agency fees be placed in escrow until new officers were elected. The University obliged. By letter of August 16, 2001, it informed the union that, by virtue of the Department and Bureau orders, a void in the union leadership existed, and that it would establish a savings account where all collected union dues and agency fees would be deposited and held in trust, and would discontinue normal relations with any group within the union, including the incumbent officers, to maintain neutrality. This prompted the union to file the complaint for unfair labor practice, claiming that the University unduly interfered with its internal affairs and discriminated against its members.

Issues

• Whether or not the First Division of the Court of Appeals erred in ordering the Second Division of the National Labor Relations Commission to transmit the records of the unfair labor practice complaint to the Third Division, despite the final and executory decision of the Tenth Division setting aside the order of consolidation.
• Whether or not the University committed unfair labor practice when it withheld union dues and agency fees and suspended normal relations with the union's incumbent officers during the intra-union dispute.
• Whether or not the union is entitled to exemplary damages, nominal damages, and attorney's fees.

Applicable Provisions

Article 2221 of the Civil Code provides:

Nominal damages are adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.

This provision supports the award of nominal damages to the union, whose right was invaded by the University's acts of interference.

Article 2208 of the Civil Code provides:

When the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest.

This provision, numbered as paragraph 8 in the decision, supports the award of attorney's fees to the union, which was compelled to litigate to protect its interests.

Ruling

On the first issue, the Court held that the petition had become moot. The Tenth Division's decision setting aside the consolidation order became final and executory on July 11, 2004, while the challenged First Division decision was promulgated only on September 16, 2005. The Court reasoned that to still transmit to the Third Division the unfair labor practice complaint which had already been resolved by the Second Division would lead to absurd consequences.

On the second issue, however, the Court ruled for the union. Pending the final resolution of the intra-union dispute, the union's officers remained duly authorized to conduct union affairs. The Court relied on the clarification letter of the Bureau of Labor Relations Director, which stated that there was no void in the union leadership, and that the incumbent officers, as duly elected officers, continue their functions in a hold-over capacity until their successors shall have been elected and qualified. The Court also stressed that a valid and existing collective bargaining agreement had been entered into between the parties, and it behooved the University to observe its terms and conditions bearing on union dues and representation. It held that a collective bargaining agreement becomes the law between the parties, compliance with which is mandated by express policy of the law.

On the third issue, the Court held that while exemplary damages need not be proved as to amount, the union must first show proof of entitlement to moral, temperate, or compensatory damages, and since no such damages were prayed for, there was no basis to grant exemplary damages. Nonetheless, the grant of nominal damages and attorney's fees was in order.

Doctrine

A decision that has become final and executory can no longer be disturbed, and a co-equal division of the same appellate court cannot revive a matter already laid to rest by a final judgment. An employer commits unfair labor practice when, during an intra-union dispute, it unilaterally withholds union dues and agency fees and suspends normal relations with the union's incumbent officers, for those officers remain duly authorized to conduct union affairs in a hold-over capacity until their successors are elected and qualified. A collective bargaining agreement entered into by a legitimate labor organization and an employer becomes the law between the parties, and compliance with it is mandated by express policy of the law. Nominal damages under Article 2221 of the Civil Code are adjudicated to vindicate a right that has been violated, and attorney's fees under Article 2208 of the Civil Code may be awarded when the defendant's act compelled the plaintiff to litigate to protect its interest.

Disposition

The petition was partly granted. The challenge to the transmittal of records was declared moot, but the decision of the Second Division of the National Labor Relations Commission was reversed, and a new one was entered finding the University liable for unfair labor practice and ordering it to pay the union nominal damages of 250,000 pesos and attorney's fees of 50,000 pesos.

Remember This

The single line worth memorizing is that an employer's unilateral withholding of union dues and suspension of relations with incumbent officers during an intra-union dispute is unfair labor practice, because those officers remain authorized in a hold-over capacity. Examiners like to use this case to test the finality of judgments and the rule that a collective bargaining agreement is the law between the parties.