G.R. No. 54996. November 27, 1981
RICARDO M. REYES, PETITIONER, VS. PHILIPPINE DUPLICATORS, INC. AND THE NATIONAL LABOR RELATIONS COMMISSION, RESPONDENTS.
DE CASTRO, J.:
Petition for certiorari praying that the decision dated
October 25, 1979 of respondent Commission be set aside and another one entered
affirming the decision dated January 26, 1978 of the Labor Arbiter.
In 1953, petitioner was employed by Gestetner Limited,
Philippines. In 1962, private respondent
Philippine Duplicators, Inc. took over the business and operation of Gestetner
Limited Philippines.
A Collective Bargaining Agreement was entered into which provided
for the retention of petitioner’s services with full recognition of petitioner’s
ten (10) years of service with Gestetner Ltd. Philippines. Said CBA likewise established a retirement
scheme pursuant to which an “employee, who has reached the age of
fifty-five (55) or completed twenty (20) years of continuous service has an
option to retire in accordance with the PDI Plan.
On January 25, 1977, after a total of 24 years of continuous
service to both Gestetner Ltd. Philippines and Philippine Duplicators, Inc.,
petitioner opted to retire and notified private respondent of his option
effective February 28, 1977.[1]
On February 18, 1977, private respondent after admitting to have
received the notice of petitioner to retire notified him that his services were
terminated on grounds of lack of confidence and conflict of interest.[2]
The reason behind private respondent’s refusal to grant petitioner’s
retirement benefits, and its termination of petitioner’s services is the
alleged fact that the latter appears as one of the incorporators of another
corporation, MOSECOR (Modern System and Equipment Corporation) and that MOSECOR
is engaged in the selling of stencils and duplicating machines, the very same
equipment and supplies which Philippine Duplicators, Inc. sells. Private respondent concluded that petitioner
committed acts which were totally unexpected and detrimental to the business
interest of Philippine Duplicators, Inc.
Thus, the rationale behind petitioner’s termination.
This case was referred for compulsory arbitration. On January 26, 1978, Labor Arbiter Porfirio
E. Villanueva, rendered a decision ordering respondent Philippine Duplicators
Inc. to pay petitioner P84,000.00 plus P8,400.00 attorney’s fees.
In ruling in favor of petitioner, the arbiter a quo
held that the records show that as far back as June 1975, the stockholdings and
board membership in MOSECOR of petitioner became known to respondent; that
despite this knowledge, respondent retained petitioner in its employ though it
was then in a position to confront the latter with the issue of conflict of
interest; that after a lapse of two years, respondent can not now claim and is
now estopped from claiming that such relation of petitioner with MOSECOR is in
conflict with its interest; that during the period petitioner was employed with
respondent, the latter reached its record growth in sales and net income; and
this growth in sales could not have been realized if petitioner had committed
acts detrimental to respondent.[3]
On appeal by the Company, the Commission reversed the arbiter’s
decision, ruling that petitioner and his other companions took over MOSECOR for
the purpose of competing with respondent company; that there is nothing in the
transcript of stenographic notes that indicate respondent’s knowledge of
petitioner’s business interest as early as June 1975; and that respondent came
to know about MOSECOR when it was able to obtain from the Securities and
Exchange Commission the pertinent papers relating thereto.[4]
In the instant petition, it was alleged that:
(1) Respondent did not conduct any investigation
as to the existence of the alleged cause of petitioner’s dismissal nor did it
confront petitioner of the charges against him from the time the alleged cause
existed up to the date of the latter’s termination.
(2) Entitlement to retirement benefits becomes
vested right on the employee upon his exercise of his option to retire by
giving notice to the company, and it becomes the duty of the company to
recognize said right and give what is due to the employee.
(3) A close examination of the records however,
would readily show that except for the bare allegation that MOSECOR has for its
principal purpose similar with that of private respondent, nothing therein can
be found that private respondent indeed has a similar principal purpose of
creation. In fact not even the Articles
of Incorporation of Private Respondent was offered in evidence to show that
both MOSECOR and private respondent was created under one and the same
principal purpose. Nonetheless, the
respondent Commission assumed it as an established fact based solely
upon the bare allegation of private respondent
that it is so.
(4) On the contrary, the records will show that
during the period 1975 to 1976 when petitioner and “others” were
declared to have competed with private respondent, the latter reached the highest
growth in terms of net sales and income with an increase of no less than 61% in
sales and income.
(5) Petitioner, however, believes that the
procedure adopted by the Commission in passing upon the case has deprived
petitioner of his day in the proceedings — a deprivation of right without
due process of law. Regretfully, when
the case was pending before the respondent Commission, Second Division, the
same was still under conciliation upon the initiative of Commissioner Cecilio
T. Seno. Its abrupt transfer therefore
to the Third Division and thus resulting as a sequel, to the termination of the
conciliation was unfair to the petitioner who was all along vouching on the
integrity of the commission which turned out to be otherwise.
The decisive issue in this case is whether or not petitioner is
entitled to the retirement benefits pursuant to the Collective Bargaining
Agreement.
It was the contention of respondent that there were sufficient
grounds to dismiss petitioner since the latter was engaged in a business
endeavor which runs in conflict with the former’s business interests. Respondent, to strengthen its stand,
submitted in evidence newspaper clipping and award of contract to MOSECOR[5]
to confirm its true intention of competing with respondent.
In brief, a perusal of the records shows:
(1) Respondent’s lone witness admitted during
the hearing before the arbiter, that the company came to know of the
stockholdings of petitioner even before June 14, 1977, the date of the
newspaper clipping.
(2) Respondent averred that it received
information from a reliable source that petitioner has already acquired
interest in MOSECOR on June 2, 1975 but it was only on February 14, 1977 when
it was able to obtain a certification from the Securities and Exchange Commission.
(3) The newspaper announcements which were
relied upon by the Commission in reversing the Arbiter’s decision were
published on April 24 and April 15, 1977 and the award of contract to MOSECOR
as a result of the bidding dated July 7, 1977, or a few months after
petitioner’s dismissal on February 18, 1977.
(4) Petitioner was summarily dismissed. He was not given the opportunity to defend
himself, hence, a denial of due process.
He was not confronted with the charges before his actual dismissal.
Based on the foregoing, the Court finds no compelling reasons to
disturb the Arbiter’s findings of fact and conclusion. The company acted in bad faith in denying
petitioner his retirement benefits. The
alleged grounds of loss of confidence and conflict of interest can not hold
water. Respondent company is now
estopped from questioning the involvement of petitioner in another
corporation, for by its own omission, it failed to apprise petitioner of his
supposed detrimental acts immediately upon knowledge thereof, considering
petitioner’s length of service, having been in the company’s employ for twenty
(20) years. Estoppel which has its roots
in equity and based on good faith and moral right, which are apparently lacking
in the case at bar, therefore, operates against respondent Corporation. Respondent should have exercised caution and
care in dealing with its employees to prevent suspicion that its dismissal of
petitioner is only a scheme to evade its responsibility of granting retirement
benefits. Thus, it should not have
waited until petitioner applied for retirement to have taken adverse action
against him for a cause it had already knowledge of.
It is very clear that the newspaper announcements came after
petitioner’s dismissal. It is absurd to
think that petitioner who is a family man, would just stand by and await the
outcome of this case without looking for some other means of livelihood. An investment in a corporation is a
prerogative of every one as a preparation for any eventuality in the future. In the competitive world of business like
ours, man should learn how to survive in the best way he could for the desire
to survive is akin to the principle of self-preservation.
It is undisputed that MOSECOR was formed wayback in 1975, but the
records are bereft of any showing that petitioner during his employment with
respondent, transacted any business prejudicial to the latter. It was also not disputed that the company
even reached the highest growth in terms of net sales and income during the
period of 1975 to 1976. That during all
this time respondent took no adverse action against petitioner for acts in
conflict with its interest is evidence that petitioner committed no act
inimical to respondent’s business, but continued to be an asset to it.
As adverted to earlier, petitioner’s dismissal is not justified
for being arbitrary since he was denied due process and therefore, he is
entitled to the benefits provided for in the collective bargaining
agreement. Time and again, the court has
ruled that without any showing that the findings of the Arbiter are not
supported by substantial evidence, such findings are conclusive with this
Court.[6]
In view of the above conclusion, there is no further need to
discuss the other issues raised by petitioner.
WHEREFORE, the decision of the Commission dated October
25, 1979 is hereby set aside and the decision of the Labor Arbiter dated
January 26, 1978 is affirmed in toto, without costs.
SO ORDERED.
Barredo, Concepcion, Jr., Guerrero, and Abad Santos, JJ., concur.
Aquino, J., no part.
[1]
Exh. I, p. 53, Original NLRC Records.
[2]
Exh. II, pp. 54-55, Ibid.
[3]
Decision, pp. 38-45, rollo.
[4]
Decision, pp. 45-A-53, rollo.
[5]
pp. 151-152, Original NLRC Records.
[6]
Genconsu Free Workers Union, vs. Inciong, 91 SCRA 311.