EMILIO VENEGAS (DOING BUSINESS UNDER THE NAME AND STYLE OF) D’BEER PLAZA, PETITIONER, VS. SECOND DIVISION, NATIONAL LABOR RELATIONS COMMISSION, EDUARDO G. MAGNO, AND MELANIO DIA…

By Resolution dated April 25, 1990, this Court^[1]
initially dismissed the petition in the case at bar “no grave abuse of
discretion being thereby shown on the part of the NLRC in denying, in the light
of the established facts on record, the petitioner’s petition for relief under
Rule 38 of the Rules of Court and affirming the decision of the Labor Arbiter
dated March 13, 1987.”^[2] Under
date of May 18, 1990, the petitioner filed a motion for reconsideration of this
Resolution, and a supplement thereto dated May 25, 1990. By direction of this Court, comment on the
motions was filed in behalf of the respondents, and a reply thereto submitted
by the petitioner. The Court thereafter
gave due course to the petition and required memoranda of the parties,
principally so that it would have an opportunity to rule on the issue involving
the loss of adjudicatory power of the Commission en banc occasioned by Republic Act No. 6715.

The present proceeding in this Court had its origin in a case in
the Office of the Labor Arbiter at Manila, commenced by complaint of respondent
Melanio Diaz against Emilio Venegas (doing business under the name and style of
“D’Beer Plaza”), alleging that the latter had illegally dismissed him from
employment. The case resulted, after
appropriate proceedings, in a judgment by Labor Arbiter Eduardo Magno dated
March 13, 1987 finding that Melanio’s employment had indeed been illegally
terminated and sentencing Venegas to pay him two (2) years’ back wages only,
“considering** (Venegas’) financial
difficulties;” separation pay equivalent to one-half (1/2) monthly salary for
every year of service; and 10% of the total amount due as attorney’s fees.

No appeal was taken from this decision; and the reason, according
to Venegas, was that his counsel misunderstood the decision; he took it to mean
that Venegas was being made to pay only separation pay for two (2) years, a
verdict which he found acceptable. They
allegedly discovered their error only when they received notice of the
execution of the judgment. Venegas’
attorney thereupon filed with the National Labor Relations Commission a
petition for relief from judgment in accordance with Rule 38 of the Rules of
Court.

The National Labor Relations Commission en banc,
which took cognizance of the petition for relief, originally denied the same in
a resolution dated August 27, 1987. However, on Venegas’ motion for reconsideration, the Commission en
banc set aside that resolution of dismissal, reinstated the petition
which it declared to be sufficient in form and substance, and issued a writ of
preliminary injunction upon a bond of P10,000.00 enjoining enforcement of the
arbiter’s decision.

Two years later, or on August 8, 1989, the petition for relief
was denied for lack of merit by the Second Division of the NLRC which
also lifted the writ of preliminary injunction issued as aforestated by the
Commission en banc. Said
Second Division also denied Venegas’
motion for reconsideration by Resolution dated Feburary 20, 1990. In the latter resolution, the Second
Division drew attention to certain facts on record, including the following:

1. About a month after rendition by the Arbiter
of his decision of March 13, 1987, or on April 19, 1987, the Research and
Information Unit of the NLRC computed the total monetary award granted by said
decision. A copy thereof was furnished
the petitioner on May 18, 1987 and the Labor Arbiter scheduled hearings thereon
on May 22 and June 15, 1987 in neither of which was there an appearance by
petitioner or his counsel, despite notice.

2.           
Venegas’
petition for relief was not filed until August 5, 1987. An answer thereto was presented, and a reply
to said answer submitted. Thereafter
hearings were had on January 19, 1988, December 7, and 27, 1988 and August 8,
1989.

The resolution further declared that the claimed failure of
Venegas’ counsel to understand the terms of the Labor Arbiter’s decision
despite its being “couched in simple English” constituted inexcusable
negligence warranting no relief, and Venegas was bound by his attorney’s error
or neglect.

Venegas then instituted the special civil action of certiorari at bar, questioning the authority of the Second Division
to overturn the acts of the Commission en banc of giving due course to
the petition for relief from the Labor Arbiter’s judgment and restraining
execution thereof. Venegas also insists
that there was excusable negligence justifying extension of relief to him in
accordance with Rule 38.

The authority of the Second Division to take cognizance of
the petition for relief, which had earlier been acted on by the NLRC en
banc, emanates from Republic Act No. 6715,^[3] which
took effect on March 21, 1989.^[4] The
law amended Article 213 of the Labor Code, among others, by divesting the
National Labor Relations Commission en banc of adjudicatory powers which
thenceforth could be exercised only through the Commission’s divisions, five
(5) having been created for the purpose. Upon effectivity of the law, the Commission en banc could sit
only for purposes of (a) promulgating rules and regulations governing the
hearing and disposition of cases before any of its divisions and regional
branches, and (b) formulating policies affecting its administration and
operations;^[5]
but no longer for purposes of hearing and deciding cases.

In virtue of this amendment, the Commission en banc lost
jurisdiction to act on Venegas’ petition for relief. The matter had perforce to be referred to the proper Division
having jurisdiction under the new statute; and this was the Second Division, to
which the law has assigned cases coming from the National Capitol Region.

As regards the matter of counsel’s claimed negligence as
warranting relief under Rule 38, the Second Division’s analysis and rejection
of that thesis is riot only free of any grave abuse of discretion but in truth
appears to be entirely consistent with law and logic. The Division adverted to the very statements of Venegas’ counsel,
viz.:

“3)   That even if there was yet time to appeal, I
did not consider advicing (sic) my client to take the said step considering
that in my understanding of the dispositive part of the decision, Mr. EMILIO N.
VENEGAS was no longer liable to pay Mr. MELANIO DIAZ any backwages but only the
separation pay for two (2) years at the rate of one-half (1/2) month salary per
year;

“4) That it was only
when the writ of execution was issued when I realized my mistake in which I had
to explain my erroneous advice to my client of not making an appeal from the
judgment. x x x” (Underscoring supplied.),

and in light thereof, declared it to be
“indubitably clear” that –

“ * * counsel’s negligence
is not at all excusable in nature as to warrant a re-opening of Melanio Diaz’s
case. The dispositive portion of the
decision in question is couched in simple English and admits no interpretation
other than what it purports to be. Hence, for counsel to admit of having erroneously read the same, points
to his gross negligence which ultimately binds his client. Well settled is the rule that clients are
bound by the action of their counsels in the conduct of a case, for as the
Supreme Court puts it, in the case of Cabalis vs. Nery (L­-31988, 21 November
1979) ‘if the lawyer’s mistake and negligence were admitted as reasons for
reopening cases, there would never be an end to a suit so long as counsel had
not been sufficiently diligent or experienced or learned.’“

WHEREFORE, in reiteration of earlier action, the petition
is DENIED for lack of merit, with costs against petitioner.

SO ORDERED.

Padilla, Regalado, Nocon, and
Melo, JJ., concur.

^[1]
First Division

^[2]
Rollo, p. 83

^[3]
Introducing important amendments to the Labor Code; SEE footnote 3, infra

^[4]
After publication in two newspapers of general circulation.

^[5]
SEE (Joint) Decision prom. March 5, 1991 in G.R. No. 87211 (JOVENCIO L. MAYOR v.
HON. CATALINO MACARAIG, et al.); G.R. No. 90044 (PASCUAL V. REYES v.
HON. FRANKLIN DRILON); G.R. NO. 91547 (CEFERINO E. DULAY, et al. v. HON.
CATALINO MACARAIG, JR., etc., et al.); G.R. No. 917301 (CONRADO B. MAGLAYA v.
HON. CATALINO MACARAEG, et al.); G.R. No. 94518 (ROLANDO D. GAMBITO v.
THE SECRETARY OF LABOR AND EMPLOYMENT, et al.).