MABUHAY VINYL CORPORATION, PETITIONER, VS. NATIONAL LABOR RELATIONS COMMISSION (FIFTH DIVISION) CAGAYAN DE ORO CITY AND ANTONIO V. CAÑETE, RESPONDENTS.

This is a petition for certiorari under Rule 65 of the
Rules of Court with a prayer for the issuance of a writ of preliminary
injunction or restraining order to annul and set aside the Resolution
promulgated on September 13, 1990 of the National Labor Relations Commission
(NLRC) of Cagayan de Oro City^[1]
affirming the decision promulgated on March 13, 1987 of the NLRC of Manila^[2] in declaring the dismissal of private respondent Antonio V. Canete
illegal and in ordering
petitioner Mabuhay Vinyl Corporation to pay private respondent backwages,
separation pay and attorney’s fees.

It appears on record that private respondent Antonio V. Cañete
was employed as a supervisor of petitioner Mabuhay Vinyl Corporation’s Shop
Steel Fabrication Division. At around
1:50 p.m. of June 28, 1984, a truck with Plate No. MAD-135 driven by Cecilio
Tagalog and owned by private respondent entered the premises of petitioner at
Assumption Heights, Barangay Buru-un, Iligan City to haul cargoes from
petitioner’s bodega to Vinatex. Said truck did not contain any cargo when it
was being inspected by the petitioner’s security guards nor did the driver of said truck declare any
cargo to said security guards.

At around 4 p.m. of that same day, the driver of said truck,
before leaving the premises of the petitioner, presented a gate pass for the
items loaded inside the truck. However,
during the routine inspection, the security guards discovered that aside from
the items specified in the gate pass, some other items which were hidden at the
back of the driver’s seat comprising 113 pieces of welding rods and 37 pieces
of stainless steel rings which were wrapped in a plastic cellophane and covered
by a rug as shown by the
pictures taken by the safety
inspector of petitioner immediately after said discovery.

When said security guards confronted and questioned the driver,
the latter pointed to the private respondent as the one who personally loaded
said stolen items inside the truck.

After a verification from petitioner’s inventory control clerk
that said welding rods and steel rings came from its stock room, private
respondent was placed on preventive suspension pending investigation of said case by the petitioner.

On July 5, 1984, an administrative investigation was conducted
but, aside from claiming ownership over said stolen goods without presenting
any documentary evidence, private respondent refused to answer the questions
propounded to him during said investigation.

Upon private respondent’s refusal to respond to petitioner’s
letter dated July 9, 1984 requiring the former to explain his participation in
the commission of the criminal offense and after evaluating the evidences,
petitioner terminated the services of private respondent on August 9, 1984 for
gross insubordination and for loss of
trust and confidence as a managerial employee based on said theft incident.

On July 11, 1984, petitioner filed a criminal complaint for
Qualified Theft and Theft against private respondent and his driver,
respectively, with the City Fiscal of Iligan City which was, however, dismissed
by the investigating fiscal On August 24, 1984 on the claim of ownership made by the private respondent over the stolen
items as supported by Sales Invoice No. 048 dated April 17, 1984 issued by Asia Meco Mercantile for the said welding rods and the Official Receipt No. 1547 dated
June 25, 1984 issued by Lactao and Sons Engineering Auto Repair and Machine
Shop for said steel rings.

On Novembers 16,
1984, private respondent filed a
complaint against petitioner for
illegal dismissal with the NLRC of Cagayan de Oro City. Said complaint
was referred to Hearing Officer Acaina D. Bagul who subsequently recommended the
reinstatement of private respondent without loss of seniority rights and the payment of backwages in her Progress
Report dated July 18, 1985.

On August 6, 1985,
petitioner filed again a criminal charge
for Qualified Theft and Theft
against private respondent and
his driver, respectively, as well as another criminal complaint for Falsification and Use of Falsified
Documents against private respondent with the Fiscal’s Office of Iligan City
alleging newly discovered evidence showing that the documents presented to the investigating fiscal by the private
respondent on the latter’s claim of ownership over the stolen items were
falsified.

On August 28, 1985, a decision was rendered by the NLRC of
Cagayan de Oro City dismissing private respondent’s complaint for illegal
dismissal with prejudice for lack of merit.^[3]
Thereafter, private respondent filed an appeal with the public respondent NLRC
of Manila.

On March 6, 1986, Fiscal Amer R. Ibrahim of Iligan City rendered
a Resolution finding the criminal charge against private respondent and his
driver to be fully supported by evidence and recommended the filing of the
corresponding criminal information against the latter which was approved by the
City Fiscal Dominador L. Padilla.

On March 13, 1987, public respondent NLRC rendered a decision
reversing the decision of the NLRC of Cagayan de Oro City, the dispositive
portion of which reads as follows:

“WHEREFORE, premises considered, the appealed Decision is as
it is hereby REVERSED and another one issued:

“1. Declaring
complainant-appellant’s termination illegal;

“2. Ordering
respondent-appellee to pay complainant-appellant backwages from the time of
illegal dismissal and up to the time of the rendition of this Decision;

“3. Ordering
respondent-appellee to pay complainant-appellant separation pay equivalent to
one-half (1/2) month pay for every year of service, a fraction of at least six
(6) months considered as one year; and

“4. To pay complainant-appellant attorney’s fees
equivalent to ten (10%) percent of the total award.

“All other claims are dismissed for evident lack of
merit.”^[4]

On June 16, 1987, NLRC Manila denied petitioner’s Motion for
Reconsideration.

On August 13, 1987, the City Fiscal Ulysses V. Lagcao dismissed
the criminal charges against private respondent and his driver for
insufficiency of evidence.^[5]
Thereafter or on September 12, 1987, petitioner
filed a petition for review with the Secretary of Justice for said dismissal.

On December 2, 1987, this Court denied petitioner’s Petition for
Review on Certiorari of the public respondent NLRC decision for having
been filed out of time and said decision became final and executory after this
Court, likewise, denied petitioner’s Motion for Reconsideration.

Subsequently, private respondent filed a Motion for Execution of
said decision and the resolution of which was suspended by an exchange of
pleadings filed by the contending parties relative to the correct computation
of the monetary award of the private respondent.

On December 14, 1988, the Secretary of Justice Sedfrey A. Ordonez
reversed the Resolution of the City Fiscal of Iligan ordering the dismissal of
the complaint against private respondent and his driver, the dispositive
portion of which reads:

“WHEREFORE, you are hereby directed to file the corresponding
information for qualified theft against Antonio Cañete and Cecilio Tagalog and
to report to this Office the action taken hereon within five (5) days from
receipt hereof. Returned herewith are
the complete records of the case.”^[6]

Thereafter, or on January 20, 1989, Fiscal Lagcao filed an information for qualified theft
against private respondent and his driver with the Regional Trial Court of
Iligan City, Branch 2, docketed as Criminal Case No. 2265.

On January 29, 1989, petitioner filed an Opposition to Execution
and/or Motion to Quash Execution due to the supervening event that the finding
of the Secretary of Justice directly contradicted the decision of the public
respondent NLRC thereby rendering said decision unenforceable.

Acting on said Motion, the Labor Arbiter issued an Order on March
8, 1989 denying said Motion, the dispositive portion of which reads:

“WHEREFORE, in view of the foregoing premises and considerations
the respondent – Mabuhay Vinyl
Corporation is hereby ORDERED to pay the complainant-Antonio Cañete the total
amount of ONE HUNDRED TWENTY NINE THOUSAND THREE HUNDRED NINETY FOUR PESOS and
07/100 (P129,394.07) within fifteen (15) days from receipt of this Order,
otherwise a WRIT OF EXECUTION shall immediately issue for the said
amount.”^[7]

Thereafter, petitioner filed with the public respondent NLRC a
Memorandum on Appeal with Urgent Prayer for Injunction and Restraining Order.

On March 20, 1990, a decision was rendered by the Regional Trial
Court of Iligan City, in the Qualified Theft case, acquitting private
respondent Antonio Cañete but convicting his driver, Cecilio Tagalog of simple
theft, the dispositive portion
of which reads as follows:

“WHEREFORE, finding accused CECILIO TAGALOG guilty beyond
reasonable doubt of the crime of THEFT, he is hereby sentenced to suffer an
indeterminate penalty of THREE (3) MONTHS and ELEVEN (11) DAYS of arresto mayor
as minimum to ONE (1) YEAR, EIGHT (8)
MONTHS and TWENTY-ONE (21) DAYS of prision correccional as maximum and to pay
costs.

“For failure of the prosecution to prove the guilt of accused
ANTONIO CAÑETE beyond reasonable doubt, he is hereby acquitted of the crime
charged in the information. The bond
put up by said accused for his provisional liberty is hereby discharged.”^[8]

On April 4, 1990, private respondent
filed an Urgent Motion to Dismiss the Memorandum on Appeal on the ground
of his acquittal in the criminal case.

On September 13, 1990, a Resolution was issued by the public
respondent NLRC, the dispositive portion of which reads as follows:

“WHEREFORE, the questioned order of March 8, 1989 is hereby
AFFIRMED and the appeal therefrom is DISMISSED.

“Accordingly, the petition for the issuance of a writ of preliminary
prohibitory injunction is Denied for being moot and academic.

“Let the records of this case be immediately remanded to the
Arbitration Branch of origin for execution of judgment.”^[9]

Hence, this petition alleging grave abuse of discretion on the part
of the public respondent NLRC in affirming the Labor Arbiter’s Order which
refused to declare unenforceable its Resolution dated March 13, 1987 by reason of the supervening event,
which is the consequent filing of the criminal information against private
respondent, that has made its execution unjust and inequitable.

This petition is meritorious.

While it is true that once a judgment has become final and
executory said judgment can no longer be amended or corrected by the court
since the only jurisdiction left with the court is to order its execution,
however, said rule admits of certain exceptions, as in the instant case, where
the execution of a final and executory judgment may be stayed “when facts
and events transpire after a judgment
has become executory which on equitable grounds render its execution impossible
or unjust.”^[10]

In this case, the filing of the criminal information for
qualified theft against private respondent is a supervening fact and event
which should render impossible and unjust the execution of the decision of the
public respondent NLRC in declaring the termination of private respondent’s
services as illegal since said decision based its conclusions solely on the
dismissal of the criminal charges against the latter. The fact that private respondent was subsequently acquitted of
qualified theft is of no moment because his acquittal was not based on his
innocence but rather on the failure on the part of the prosecution to prove his
guilt beyond reasonable doubt. “Loss of confidence is established as a
valid ground for the dismissal of an employee. The law does not require proof beyond reasonable doubt of the employees’
misconduct to invoke such a justification. It is sufficient that there is some basis for the loss of trust or that
the employer has reasonable grounds to believe that the employee is responsible
for the misconduct and his participation therein renders him unworthy of the
trust and confidence demanded of his position.”^[11]

Indeed, it is unfair and unreasonable to require petitioner to
accept back private respondent in whom it has already lost confidence because
of the latter’s act of dishonesty in spite of his having been acquitted in the
course of a criminal prosecution.

Furthermore, “it is well-settled that when after a judgment has
become final and executory, facts and circumstances transpire which render its
execution impossible or unjust, the interested party may ask a competent court
to stay its execution or to prevent its enforcement.”^[12]

WHEREFORE, this petition for certiorari is granted
and the questioned Resolution of the public respondent NLRC is hereby annulled
and set aside thereby dismissing the complaint against petitioner.

SO ORDERED.

Narvasa, C.J., (Chairman), Regalado, and Campos, Jr., JJ., concur.

Padilla, J., see dissenting
opinion.

^[1]
Rollo, pp. 38-46. Penned by
Commissioner G. Gonzaga, Jr., with the concurrence of Presiding
Commissioner Musib M. Buat and Commissioner Oscar N. Abella.

^[2]
Id., at pp. 103-109. Penned by Commissioner Domingo H. Zapanta with the concurrence
of Presiding Commissioner Daniel M. Lucas, Jr. and Commissioner Oscar N. Abella.

^[3]
Decision, NLRC, Cagayan de Oro City; Rollo, pp. 48-85.

^[4]
Ibid., at p. 109.

^[5]
Id., at p. 110.

^[6]
Id., at p. 114.

^[7]
Id., at p. 136.

^[8]
Id., at p. 162.

^[9]
Id., at p. 45.

^[10]
Baclayan vs. Court of Appeals, 182 SCRA 761 (1990).

^[11]
Ocean Terminal Services, Inc. vs. NLRC, 197 SCRA 491 (1991).

^[12]
Lee vs. De Guzman, Jr., 187 SCRA 276 (1990).

200

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6 pt
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3