PHILIPPINE NATIONAL RAILWAYS, PETITIONER, VS. NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER CEFERINA DIOSANA, AND RODOLFO CALDO, RESPONDENTS.

Article 1155 of the Civil Code provides that the ”prescription
of actions is interrupted” inter alia,
“when there is any written acknowledgment of the debt by the debtor.”
This simply means that the period of prescription, when interrupted by such a
written acknowledgment, begins to run anew; and whatever time of limitation
might have already elapsed from the accrual of the cause of action is thereby
negated and rendered inefficacious.   It
does not mean that prescription will not run any more.  But this was how the public respondents
construed and applied the cited provision in the case at bar.  They thus incurred in fundamental, grave
error justifying the issuance of the correcting writ of certiorari.

More than sixteen (16) years ago, on April 16, 1973 to be
precise, the Court of Industrial Relations promulgated judgment in an unfair
labor practice case instituted by Rodolfo Caldo and
two (2) others against the Philippine National Railways and its Personnel
Manager,1
declaring the respondents guilty as charged and ordering them “to
reinstate the individual complainants to their former work as permanent
employees pursuant to the same Budgets of respondent PNR, with full back wages
from the time of their dismissal until actual reinstatement is effected, without
loss of seniority and other benefits appertaining thereto.”2

The judgment became final and was ordered executed by Order dated
September 3, 1974.1
Pursuant to a Memorandum issued by the PNR’s Board of
directors dated December 26, 19742 — approving the reinstatement of
the complainants and payment to them of back wages in accordance with the CIR
decision — Caldo and the two (2) other complainants
were paid their back salaries in full, i.e., up to April 30, 1974.3
However, only Caldo’s co-complainants were
reinstated.  Caldo
was not.  According to him, over the next
twelve (12) years, he repeatedly demanded that he be re-employed, to no avail.4

On March 31, 1986,
Caldo filed with the Labor Arbiters’ Office (National
Capital Region) a motion for reconstitution and for an alias writ of execution.5
The motion averred, in substance, (1) that the records of his case were among
those destroyed during “the fire that razed the office of the National
Labor Relations Commission (NLRC) including its Records Office,” (2) that
he (Caldo) was entitled to additional back wages from
May 1, 1974 up to March 13, 1986 on which latter date he had allegedly made
known his “non-interest to be reinstated;” and (3) since in the
premises his reinstatement seemed impossible, he should be granted
“separation pay for one (1) month for every year of service from March 16,
1960 up to April 30,1974.”6 The motion was granted and, on the
basis of computations made by an NLRC analyst, a writ of execution issued on July 15, 1986.

Thereafter, various technical issues, as the NLRC was to
eventually point out in its Resolution of October 27, 19877 —

” ** were
raised by appellants which resulted in the referral of this case to the
NLRC-NCR for further deliberation and/or hearings.  While this case was pending thereat, appellee filed a Motion for an Alias Writ of Execution on December 23, 1986.  This Motion was granted by Labor Arbiter Diosana,
and the corresponding alias Writ of Execution was issued on January 5, 1987.

On January 27, 1987, appellant PNR filed an Urgent Motion to Quash
the alias Writ of Execution on the ground that the decision in this case is
more than ten (10) years old and therefore, could not and should not be
enforced by a simple motion, and that the Writ of Execution ordering payment of
P74,826,00 representing back wages from ten (10) years
ago up to the present is against the decision of the Supreme Court.  Appellee filed an
Opposition thereto arguing inter alia, that if there
was delay in the execution of judgment, it was because in December 1983, the
records of this case were among those burned in the fire that razed the NLRC
Offices.  PNR filed a Reply to this
Opposition.”

In a Decision rendered on May
20, 1987, the Labor Arbiter overruled PNR’s
motion to quash and ordered payment of back wages to Caldo,
but “limited to three (3) years without qualification or deductions and
without reinstatement.”1 She justified her rejection of PNR’s theory that Caldo’s motion
for execution was time-barred in the following manner:2

“Rule 39, Section 6 relied upon by respondent PNR in its
motion to quash writ of execution states that judgment may be executed on
motion within five (5) years from the date of entry or from the date it becomes
final (and) executory.  After the lapse of such time and before it is
barred by the statute of limitations, * * a judgment may be enforced by action.

The statute of limitations, Art. 1155 of
Civil Code, in the matter of prescription of action provides that the
prescription of actions is interrupted when they are filed before the Court,
when there is a written extra-judicial demand and when there is a written
acknowledgment.  The statute of
limitations which, according to Section 6, Rule 39, is said to bar the filing
of actions refers to Art. 1155 jut cited.  For while under Art. 1144 of the Civil Code,
the right of complainant Caldo to commence action to
enforce the decision of 1973 commenced five (5) years thereafter, that is on or
about April 16, 1978 prescription of the right of Rodolfo Caldo to enforce the decision by mere motion did not start
to run because of the written acknowledgment by PNR.

“ * * * * Thus, following Art. 1155 of the
Civil Code, when respondent PNR and the board of directors of PNR
acknowledged through the resolution of its debt and obligation to complainant Caldo, the prescription of the right of complainant Caldo to seek the execution of the April 16, 1973 decision
was stopped.  Hence, the position of
respondent PNR is not well taken.”

The Arbiter’s decision was affirmed by the NLRC in its own
Resolution promulgated on October 27,1989.3 It declared, citing “a
well-known and respected commentator,” that “acknowledgment of a debt
that suspends the prescriptive period need not be express so long as it is in
writing,” and PNR’s failure “to seasonably
invoke the issue of prescription, although it had sufficient opportunity to do
so, constitutes a waiver of the same.” The Commission subsequently denied PNR’s motion for reconsideration dated November 26, 1987.

Article 1144 of the Civil Code provides that an action “upon
a judgment,” i.e., to execute a final and executory
judgment, “must be brought within ten years from the time the right of
action accrues.” However, by virtue of the Rules of Court, the enforcement
of a judgment does not entail an action, in the sense of an ordinary suit in a
court of justice (Sec. 1, Rule 2), a motion being sufficient if execution is
sought within the first five years.  This
is made clear by Section 6, Rule 39:

“Sec. 6.  Execution by motion or
by independent action. — A judgment may be executed on motion
within five (5) years from the date of its entry or from the date it becomes
final and executory. 
After the lapse of such time, and before it is barred by the statute of
limitations, a judgment may be enforced by action.”

 In this case, it is clear
that the judgment of the Court of Industrial Relations had become final and executory at least as of September 3, 1974.1 It could have been executed by
motion within five (5) years.  It was
not.  It could have been enforced by an
independent action within the next five (5) years (or within ten (10) years
from the time it became final).  It was
not.  Therefore, the right of action to
enforce the judgment had prescribed by the time that Caldo
filed his “Motion for Reconstitution of the Record of the Case and
Issuance of Alias Writ of Execution” on April 7, 1986.2 Indeed, even if the motion had been
filed within the second five-year period, it would still have been
inefficacious since execution by motion was no longer possible then, an
independent action being needful for the purpose.  And even if the ten-year period of limitation
were to be reckoned from December 26, 1974, the day when the PNR Board of
Directors, acknowledging the company’s obligation under the CIR judgment,
ordered reinstatement and payment of back salaries to Caldo
and his two (2) co-complainants, the prescriptive period would still have to be
regarded as expired.

The theory advocated by the respondents, that the resolution of
the PNR Board of Directors of December 26, 1974, considered as a “written
acknowledgment of the debt by the debtor” within the meaning of Article
1155 of the Civil Code, did not merely interrupt and renew the prescription of
the right to execute the judgment but caused it to stop completely, placing it,
as it were, in an indefinite state of suspended animation, is fallacious.  The effect of the interruption spoken of in
Article 1155 is to renew the obligation, to make prescription run again from
the date of the interruption and not, to repeat, to cause it to stop running
altogether.3

The destruction by fire of the records of CIR Case No. 5414-ULP,
which allegedly occurred in December, 1983, cannot be regarded as having
interrupted said period, for it obviously did not prevent Caldo
from attempting to reconstitute the records and instituting the action before
the expiry of the period of ten years from finality of the judgment rendered
therein.  Hence, Article 1154, declaring
that the “period during which the obligee was
prevented by a fortuitous event from enforcing his right is not reckoned
against him,” is inapplicable.

The Court is thus constrained to pronounce Rodolfo Caldo’s attempt to execute the judgment in CIR Case No.
5414-ULP, by the filing of a motion to this effect (after reconstitution of the
records), to be ineffectual not only because it was time-barred but also
because, even assuming the contrary, execution could not longer be had by
motion but by independent action.

WHEREFORE, the petition for certiorari is GRANTED,
and the Resolution of the respondent Commission dated October 27, 1987 and the Decision of Labor
Arbiter Ceferina Diosana
dated May 20, 1987 thereby
affirmed, are NULLIFIED AND SET ASIDE. 
No pronouncement as to costs.

Cruz, Gancayco, Griño-Aquino,
and Medialdea,
JJ., concur.

1
Docketed as Case No. 5414-ULP

2
Rollo, pp. 17-18.  The decision was written by Hon. Alberto S. Veloso, Associate Judge

1
Id., p. 19

2
Id., p. 20; Annex D,
Petition

3
Id., p. 4

4
Id., p. 73

5
The motion was drawn up and presented by the Chief, Legal Service and a Senior
Legal Officer of the “LEGALSERVICE, Legal Assistance & Counselling division, MOLE.”

6
Id., pp. 21-22

7
Id., pp. 42 et seq.

1 Id.,
 pp. 27-35

2 Id.,
pp. 32-33; emphasis supplied

3 Id.,
pp. 42-48 (see footnote 8, supra)

1 See footnote 1, p. 2, supra

2 Rollo, p. 21

3 SEE Overseas Bank of Manila v. Geraldez, 94 SCRA 937, cited in Caguioa,
Comments and Cases on Civil Law, 2d Rev. Ed., Vol. IV, pp. 38, 41-42; also, Tolentino, Civil Code of the Philippines, 1985 ed., Vol.
IV, p. 50, citing Buard v. Lemee,
12 Rob. 243