MANUEL L. FERNANDEZ, PETITIONER, VS. GROLIER INTERNATIONAL, INC., THE MINISTER OF LABOR, AND THE NATIONAL LABOR RELATIONS COMMISSION, RESPONDENTS.

Before us are the petitioner’s motion for reconsideration and the
supplement to said motion of the decision of this Court in Manuel L. Fernandez v. Grolier International,
Inc., et al. (146 SCRA 269).

In the above-mentioned case, we affirmed the decisions of the
public respondents which dismissed the petitioner’s complaint on the grounds of
prescription and lack of jurisdiction.

The grounds relied upon
in the motion for reconsideration filed on January 6, 1987 are:

“I. THE PETITIONER’S VERSION OF
FACTS IS THE ONLY VERSION OF FACTS; AND,

“II. THE
DISMISSAL OF THE INSTANT CASE ON THE GROUND OF PRESCRIPTION IS A CORRUPTION OF
JUDICIAL PROCESS  AS
IT IS AS BASELESS AS IT WAS UNLAWFUL.  (Rollo, p. 151)

On January 21, 1987,
petitioner then filed a Supplement to the Motion for Reconsideration “to
elucidate on the following vital legal issues, to wit:”

“1.  The issue of prescription, which was never
raised in the pleadings of the private respondent much less proved in the
trial, unceremoniously, became the sole
ground for dismissal of this case;

“2.  The issue that petitioner worked in Sydney,
Australia, under the same employment contract he had with the Philippine branch
of Grolier International was sidetracked conveniently, despite the fact that the evidence of the petitioner regarding this
matter stood unchallenged in the records of the proceedings;

“3.  The ruling that under the circumstances of the
case, the merits of the petitioner’s claims against private respondent was unnecessary, is absurd and devoid of basis in law;

“4.  The citation of Article 281 of the Labor Code
of the Philippines
has absolutely no relevance to the case at bar.”

(Rollo, pp. 161-162)

The petitioner alleges that the failure of private respondent to
specifically plead prescription in its position paper constitutes a waiver of
the defense of prescription.

In the case of Director of Lands v. Dano, (96 SCRA 161,165), this Court held that
“inasmuch as petitioner had never pleaded the statute of limitations, he
is deemed to have waived the same.”

It is true that there are exceptions to the rule that an action
will not be declared to have prescribed if prescription is not expressly
invoked.  (Garcia v. Mathis, 100 SCRA
250).  However, where considerations of
substantial justice come in, it is better to resolve the issues on the basic
merits of the case instead of applying the rule on prescription which the
private respondent waived when it was not pleaded.

Moreover, the finding of prescription of the Labor Arbiter is not
indubitable.  It cannot be said that the
petitioner was “dismissed” from employment on February 3, 1975 when he flew back to Manila
from Australia.  Both petitioner and private respondent
treated the return to Manila as a
condition precedent to the approval of Fernandez’ immigration papers.  He remained a Grolier’s employee.  As late as September, 1975 the respondent’s
Mr. William Murphy was still following up the petitioner’s immigration papers
with the Australian Embassy in Manila.  It was only in May, 1976, three months before
the instant case was filed with the Ministry of Labor and Employment, that
Fernandez was dismissed by the private respondent after a final decision by
Australian authorities that he could not enter Australia
as an immigrant.

A careful review of the records in relation to the motion for
reconsideration constrains us to grant the motion.

Petitioner Fernandez stresses that the private respondent chose
to base its case solely on jurisdiction and lately on prescription.  The respondent’s version of the facts is
based on an affidavit of Ronald Besaw but the affiant
was never presented as a witness.

The petitioner cited the
pertinent portion of the proceedings to support its contention that the proof
upon which we earlier based our assessment of the facts is not evidence but
consists of unsubstantiated allegations. 
The record states:

“ATTORNEY ALCANTARA

“Due to illness,
I was not able to prepare a written motion to dismiss as I undertook some weeks
ago, your Honor.

“However, if I
may be allowed to file now or make an oral motion to dismiss in order not to
prolong the proceedings, I would like to ask for the dismissal of the case on
the ground that this Honorable Commission
does not have any jurisdiction over the instant case.

“From the
testimony of the complainant, it appears that he accepted work for the Grolier
Society of Australia
which is a corporation or an entity which is separate and distinct from the
respondent in this case, the Grolier International, Inc., your Honor.

“Grolier International,
Incorporated is a Philippine Corporation doing business in the Philippines.

“The action or
the complaint of the complainant should be addressed and filed against the
Grolier Society of Australia
and should be filed not in the Philippines but in Australia, your Honor.

“The complainant
worked in Australia
and from his testimony it appears that he received his pay from the Grolier
Society of Australia.

“His complaint,
we reiterate should therefore be filed against the instant respondent, your Honor.

“That is all, your Honor.

“ATTORNEY PLANCO

“Yes, your Honor.

“We would like to
register our opposition to the motion to dismiss this case on the ground of
lack of jurisdiction on the part of this Honorable Office.

“It must be
understood that Grolier International, Inc. is an international corporation by
the very name it suggests, your Honor.

“By its very
name, it transacts business in different parts of the world, your Honor, and
many cases have been decided already like the case of Zulueta
versus Cathay Pacific, the case of Ortigas versus Air
France, which
are all international corporations, your Honor.

“The complaint
did not happen here but charges were filed here, your Honor.

“In this
particular case, in the absence of any definite evidence to be presented here
and challenged in the records of the defense is the fact that while the
plaintiff performed functions in Australia and received pay there, all these
were done under his employment contract with the Philippine Branch, unless
defendant can present or show that there was an employment contract in Sydney
whereby it would prove termination of relationship employment, rather,
employment relationship with the Philippine Branch, the ground of lack of
jurisdiction is without basis and entirely absurd, your Honor.”

(Rollo,
pp. 11-13)

and

“Attorney Planco

“Am I to
understand that the respondent is relying entirely on the question of jurisdiction and there
is no more intention on their part to present evidence in case of denial?

“Attorney Alcantara

“Not necessarily,
since this is a question of jurisdiction, I don’t think we could be precluded later from
presenting evidence if the resolution on our motion to dismiss is
adverse to us since this is a question of jurisdiction.

“Labor Arbiter

“So, the case is
deemed submitted.  (TSN, pp. 16-17,
February 11, 1977) (Underscoring by the petitioner)” (Rollo,
p. 152)

It may be recalled that Mr. Fernandez started working with
Grolier International, Inc., Philippines
on July 1, 1964 working his
way to Comptroller and Executive Administrator. 
On June 27, 1974 he
left for Sydney, Australia
where he worked with Grolier Society, Ltd. of Australia
from July 1, 1974 to February 3, 1975 with an annual salary
of 8,000 Australian dollars.  He had to return to the Philippines to follow up his immigration papers but on February
19, 1975, his bid
for immigration status was not approved. 
In May, 1976, the denial became final.

The basic factual issue may be stated thus – Did Mr. Fernandez resign from his employment when he left for Australia
or may his employment abroad be considered a continuation of his Philippine
employment to entitle him to reinstatement and/or separation benefits?

A second and hard look at the case shows that even if we accept
the private respondent’s statement of facts in his pleadings and memorandum
before us, when this statement is weighed against the petitioner’s evidence
submitted during the proceedings below, the balance would tilt in favor of the
petitioner.

The records show that Grolier International is a company based in
New York.  The Philippine and Australian offices are
both managed by the same person – Managing Director Ronald Besaw.  It was Mr. Besaw
who transferred Fernandez to Sydney
to take the place of Janette Williams, accountant of the Australian office, who
had resigned.  To facilitate the travel
and exit permit, Mr. Besaw made it appear that
Fernandez would attend a series of conferences in Australia
when there were no such conferences.  It
just so happened that the services of Fernandez were needed in Sydney
at the time.

The private respondent contends that the petitioner voluntarily
resigned so he could migrate to Australia.  It is highly unlikely that the petitioner who
was already Comptroller and Executive Administrator of Grolier’s Philippine
operations would voluntarily resign and take his chances, at his age, in a
foreign country if he had not been assured of continued employment at a higher
income in Grolier’s Australian operations. 
No resignation papers were signed and absolutely no reason for termination of employment is
apparent from the records.  Fernandez held the highest position open to a
Filipino in his company.

The petitioner did not go to Australia
as immigrant or prospective immigrant. 
His employer sent him abroad ostensibly for a series of seminars but
actually to secure his services as an accountant or financial officer in Sydney.  Considering the brighter prospects of
employment with the Sydney office,
the petitioner may have been very interested in being transferred there,
applying for immigration papers, and working permanently in Australia.  To interpret that desire and the acceptance
of Mr. Besaw’s order to go to Australia
as tantamount to resignation would, however, be stretching the facts too thinly.

It is true that the Manila office and the Sydney
office are different juridical entities separately incorporated in each of the
two countries.  However, the separate
incorporation is dictated by requirements of law and convenience.  As far as the mother multinational
corporation is concerned, the Manila
and Sydney offices are merely
marketing arms of the same employer, distributing the same line of goods, and
obeying unified management and operating rules. 
It is significant that there was never a contract of employment between
the petitioner and Grolier’s of Australia.  The employment contract in the Philippines
sufficed to cover Fernandez’ seven months work in the Sydney
office.  Mr. Fernandez traveled to Sydney
on a visitor’s visa clearly stamped by Australian authorities with
“Employment Prohibited”.

There are other factual
considerations.

The June 5, 1974
letter of Mr. Ronald Besaw asked petitioner Fernandez
to attend “a series of conferences of finance executives of the company to
be held in our Sydney Office starting June
27, 1974.” (Rollo, p.9) He,
therefore, went abroad on company business. 
His expenses were shared by the Manila
and Sydney offices.  Significantly, while Fernandez’ fare to
Sydney was shouldered by Grolier’s International, the expenses for his return
flight were deducted from his last salaries after the company decided not to
give him back his position in the Philippine office.

Even when the petitioner had already returned to Manila on
February 3, 1975, Mr. Besaw was still urging the Department of Immigration to
facilitate Fernandez’ immigration to Sydney with his family.  (Rollo,
p. 22).  The same letter refers to
Mr. Manuel L. Fernandez as “one of
our executives in the Philippines“, not as a former or resigned executive.

We, therefore, rule that the petitioner did not resign from his
employment with the private respondent when he left for Sydney
or when he returned to Manila.  His services were terminated when it became
final that the Australian authorities would not approve his transfer to the respondent’s Sydney office as an immigrant worker.

WHEREFORE, the motion for reconsideration is hereby
GRANTED.  The questioned order and
resolution of the public respondents
are REVERSED and SET ASIDE.  The private respondent is ordered to reinstate
the petitioner with full backwages from February 3, 1975 but not to exceed three (3) years, without
qualification or deduction.  Should
reinstatement be no longer possible, the private respondent is ordered to pay
the petitioner separation pay based on the applicable law or company practise, whichever is higher, effective as of the end of the above three (3) year period.  The private respondent is further ordered to
reimburse the petitioner the amount of P6,646.65 as
return fare from Sydney to Manila.

SO ORDERED.

Fernan (Chairman), Paras, Padilla, Bidin, and Cortes, JJ., concur.