Labor Conflict of Laws EDI-Staffbuilders International, Inc. vs. National Labor Relations Commission G.R. No. 145587. October 26, 2007. * Labor Law; Appeals; Due Process; Service of Pleadings; The failure of the appellant to furnish a copy of the appeal to the adverse party is not fatal to the appeal—it is merely a formal lapse, an excusable neglect, and hence, not a jurisdictional defect; The duty that is imposed on the National Labor Relations Commission (NLRC) is to require the appellant to comply with the rule that the opposing party should be provided with a copy of the appeal memorandum.—In a catena of cases, it was ruled that failure of appellant to furnish a copy of the appeal to the adverse party is not fatal to the appeal. In Estrada v. National Labor Relations Commission, 112 SCRA 688 (1982), this Court set aside the order of the NLRC which dismissed an appeal on the sole ground that the appellant did not furnish the appellee a memorandum of appeal contrary to the requirements of Article 223 of the New Labor Code and Section 9, Rule XIII of its Implementing Rules and Regulations. Also, in J.D. Magpayo Customs Brokerage Corp. v. NLRC, 118 SCRA 645 (1982), the order of dismissal of an appeal to the NLRC based on the ground that “there is no showing whatsoever that a copy of the appeal was served by the appellant on the appellee” was annulled. The Court ratiocinated as follows: The failure to give a copy of the appeal to the adverse party was a mere formal lapse, an excusable neglect. Time and again We have acted on petitions to review decisions of the Court of Appeals even in the absence of proof of service of a copy thereof to the Court of Appeals as required by Section 1 of Rule 45, Rules of Court. We act on the petitions and simply require the petitioners to comply with the rule. (Emphasis supplied.) The J.D. Magpayo ruling was reiterated in Carnation Philippines Employees Labor Union-FFW v. National Labor Relations Commission, 125 SCRA 42 (1983), Pagdonsalan v. NLRC, 127 SCRA 463 (1980), and in Sunrise Manning Agency, Inc. v. NLRC, 443 SCRA 35 (2004). Thus, the doctrine that evolved from these cases is that failure to furnish the adverse party with a copy of the appeal is treated only as a formal lapse, an excusable neglect, and hence, not a jurisdictional defect. Accordingly, in such a situation, the appeal should not be dismissed; however, it should not be given due course either.
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Labor Conflict of Laws
EDI-Staffbuilders International, Inc. vs. National Labor
Relations Commission
G.R. No. 145587. October 26, 2007.*
Labor Law; Appeals; Due Process; Service of Pleadings; The
failure of the appellant to furnish a copy of the appeal to the
adverse party is not fatal to the appeal—it is merely a formal
lapse, an excusable neglect, and hence, not a jurisdictional
defect; The duty that is imposed on the National Labor
Relations Commission (NLRC) is to require the appellant to
comply with the rule that the opposing party should be provided
with a copy of the appeal memorandum.—In a catena of cases,
it was ruled that failure of appellant to furnish a copy of the
appeal to the adverse party is not fatal to the appeal. In Estrada
v. National Labor Relations Commission, 112 SCRA 688 (1982),
this Court set aside the order of the NLRC which dismissed an
appeal on the sole ground that the appellant did not furnish
the appellee a memorandum of appeal contrary to the
requirements of Article 223 of the New Labor Code and Section
9, Rule XIII of its Implementing Rules and Regulations. Also,
in J.D. Magpayo Customs Brokerage Corp. v. NLRC, 118 SCRA
645 (1982), the order of dismissal of an appeal to the NLRC
based on the ground that “there is no showing whatsoever that
a copy of the appeal was served by the appellant on the appellee”
was annulled. The Court ratiocinated as follows: The failure to
give a copy of the appeal to the adverse party was a mere
formal lapse, an excusable neglect. Time and again We have
acted on petitions to review decisions of the Court of Appeals
even in the absence of proof of service of a copy thereof to the
Court of Appeals as required by Section 1 of Rule 45, Rules of
Court. We act on the petitions and simply require the
petitioners to comply with the rule. (Emphasis supplied.)
The J.D. Magpayo ruling was reiterated in Carnation
Philippines Employees Labor Union-FFW v. National Labor
Relations Commission, 125 SCRA 42 (1983), Pagdonsalan v.
NLRC, 127 SCRA 463 (1980), and in Sunrise Manning Agency,
Inc. v. NLRC, 443 SCRA 35 (2004). Thus, the doctrine that
evolved from these cases is that failure to furnish the adverse
party with a copy of the appeal is treated only as a formal
lapse, an excusable neglect, and hence, not a jurisdictional
defect. Accordingly, in such a situation, the appeal should not
be dismissed; however, it should not be given due course either.
As enunciated in J.D. Magpayo, the duty that is imposed on the
NLRC, in such a case, is to require the appellant to comply with
the rule that the opposing party should be provided with a copy
of the appeal memorandum.
Same; Same; Same; Same; The abject failure of the
National Labor Relations Commission (NLRC) to order the
appellant to furnish the appellee with the Appeal Memorandum
constitutes grave abuse of discretion.—While Gran’s failure to
furnish EDI with a copy of the Appeal Memorandum is
excusable, the abject failure of the NLRC to order Gran to
furnish EDI with the Appeal Memorandum constitutes grave
abuse of discretion. The records reveal that the NLRC
discovered that Gran failed to furnish EDI a copy of the Appeal
Memorandum. The NLRC then ordered Gran to present proof
of service. In compliance with the order, Gran submitted a copy
of Camp Crame Post Office’s list of mail/parcels sent on April 7,
1998. The post office’s list shows that private respondent Gran
sent two pieces of mail on the same date: one addressed to a
certain Dan O. de Guzman of Legaspi Village, Makati; and the
other appears to be addressed to Neil B. Garcia (or Gran), of
Ermita, Manila—both of whom are not connected with
petitioner. This mailing list, however, is not a conclusive proof
that EDI indeed received a copy of the Appeal Memorandum.
Same; Same; Same; Same; The glaring failure of the
National Labor Relations Commission (NLRC) to ensure that
the appellant should have furnished the appellee a copy of the
Appeal Memorandum before rendering judgment reversing the
dismissal of the complaint of the former constitutes an evasion
of the pertinent National Labor Relations Commission (NLRC)
Rules and established jurisprudence—worse, this failure
deprived the latter of procedural due process guaranteed by the
Constitution which can serve as basis for the nullification of
proceedings in the appeal before the National Labor Relations
Commission (NLRC).—After seeing that Gran failed to attach
the proof of service, the NLRC should not have simply accepted
the post office’s list of mail and parcels sent; but it should
have required Gran to properly furnish the opposing
parties with copies of his Appeal Memorandum as
prescribed in J.D. Magpayo and the other cases. The
NLRC should not have proceeded with the adjudication of the
case, as this constitutes grave abuse of discretion. The glaring
failure of NLRC to ensure that Gran should have furnished
petitioner EDI a copy of the Appeal Memorandum before
rendering judgment reversing the dismissal of Gran’s
complaint constitutes an evasion of the pertinent NLRC Rules
and established jurisprudence. Worse, this failure deprived
EDI of procedural due process guaranteed by the Constitution
which can serve as basis for the nullification of proceedings in
the appeal before the NLRC. One can only surmise the shock
and dismay that OAB, EDI, and ESI experienced when they
thought that the dismissal of Gran’s complaint became final,
only to receive a copy of Gran’s Motion for Execution of
Judgment which also informed them that Gran had obtained a
favorable NLRC Decision. This is not level playing field and
absolutely unfair and discriminatory against the employer and
the job recruiters. The rights of the employers to procedural
due process cannot be cavalierly disregarded for they too have
rights assured under the Constitution.
Labor Law; Overseas Filipino Workers (OFWs); In cases
involving Overseas Filipino Workers (OFWs), the rights and
obligations among and between the Overseas Filipino Worker
(OFW), the local recruiter/agent, and the foreign
employer/principal are governed by the employment contract.—
In cases involving OFWs, the rights and obligations among and
between the OFW, the local recruiter/agent, and the foreign
employer/principal are governed by the employment contract. A
contract freely entered into is considered law between the
parties; and hence, should be respected. In formulating the
contract, the parties may establish such stipulations, clauses,
terms and conditions as they may deem convenient, provided
they are not contrary to law, morals, good customs, public
order, or public policy. In the present case, the employment
contract signed by Gran specifically states that Saudi Labor
Laws will govern matters not provided for in the contract (e.g.
specific causes for termination, termination procedures, etc.).
Being the law intended by the parties (lex loci intentiones) to
apply to the contract, Saudi Labor Laws should govern all
matters relating to the termination of the employment of Gran.
Same; Same; Conflict of Laws; Doctrine of Processual
Presumption or Presumed Identity Approach; In international
law, the party who wants to have a foreign law applied to a
dispute or case has the burden of proving the foreign law; Where
a foreign law is not pleaded or, even if pleaded, is not proved,
the presumption is that foreign law is the same as Philippine
law.—In international law, the party who wants to have a
foreign law applied to a dispute or case has the burden of
proving the foreign law. The foreign law is treated as a
question of fact to be properly pleaded and proved as the judge
or labor arbiter cannot take judicial notice of a foreign law. He
is presumed to know only domestic or forum law.
Unfortunately for petitioner, it did not prove the pertinent
Saudi laws on the matter; thus, the International Law doctrine
ofpresumed-identity approach or processual presumption comes
into play. Where a foreign law is not pleaded or, even if
pleaded, is not proved, the presumption is that foreign law is
the same as ours. Thus, we apply Philippine labor laws in
determining the issues presented before us.
Same; Same; Termination of Employment; Illegal
Dismissals;Burden of Proof; In termination disputes or illegal
dismissal cases, the employer has the burden of proving that the
dismissal is for just and valid causes; and failure to do so
would necessarily mean that the dismissal was not justified and
therefore illegal—the employer is bound to adduce clear,
accurate, consistent, and convincing evidence to prove that the
dismissal is valid and legal.—It has been held that in
termination disputes or illegal dismissal cases, the employer
has the burden of proving that the dismissal is for just and
valid causes; and failure to do so would necessarily mean that
the dismissal was not justified and therefore illegal. Taking
into account the character of the charges and the penalty
meted to an employee, the employer is bound to adduce clear,
accurate, consistent, and convincing evidence to prove that the
dismissal is valid and legal. This is consistent with the
principle of security of tenure as guaranteed by the Constitution
and reinforced by Article 277 (b) of the Labor Code of the
Philippines.
Same; Same; Same; Incompetence; An allegation of
incompetence should have a factual foundation—incompetence
may be shown by weighing it against a standard, benchmark, or
criterion.—Petitioner’s imputation of incompetence on private
respondent due to his “insufficient knowledge in programming
and zero knowledge of the ACAD system” based only on the
above mentioned letters, without any other evidence, cannot be
given credence. An allegation of incompetence should have a
factual foundation. Incompetence may be shown by weighing it
against a standard, benchmark, or criterion. However, EDI
failed to establish any such bases to show how petitioner found
Gran incompetent.
Same; Same; Same; Willful Disobedience; Requisites.— The
elements that must concur for the charge of insubordination or
willful disobedience to prosper were not present. In Micro Sales
Operation Network v. NLRC, 472 SCRA 328 (2005), we held
that: For willful disobedience to be a valid cause for dismissal,
the following twin elements must concur: (1) the employee’s
assailed conduct must have been willful, that is, characterized
by a wrongful and perverse attitude; and (2) the order violated
must have been reasonable, lawful, made known to the
employee and must pertain to the duties which he had been
engaged to discharge.
Same; Same; Same; Burden of Proof; The burden of proving
that an Overseas Filipino Workers (OFWs) employment was
validly and legally terminated devolves not only upon the
foreign-based employer but also on the employment or
recruitment agency for the latter is not only an agent of the
former, but is also solidarily liable with the foreign principal for
any claims or liabilities arising from the dismissal of the
worker.—Even though EDI and/or ESI were merely the local
employment or recruitment agencies and not the foreign
employer, they should have adduced additional evidence to
convincingly show that Gran’s employment was validly and
legally terminated. The burden devolves not only upon the
foreign-based employer but also on the employment or
recruitment agency for the latter is not only an agent of the
former, but is also solidarily liable with the foreign principal
for any claims or liabilities arising from the dismissal of the
worker.
Same; Same; Same; Trade Tests; It is presumed that before
the deployment of Overseas Filipino Worker’s (OFW’s), they were
subjected to trade tests required by law to be conducted by the
recruiting agency to insure employment of only technically
qualified workers for the foreign principal; The purpose of the
trade test is to weed out incompetent applicants from the pool of
available workers.—In Prieto, this Court ruled that “[i]t is
presumed that before their deployment, the petitioners were
subjected to trade tests required by law to be conducted by the
recruiting agency to insure employment of only technically
qualified workers for the foreign principal.” The CA, using the
ruling in the said case, ruled that Gran must have passed the
test; otherwise, he would not have been hired. Therefore, EDI
was at fault when it deployed Gran who was allegedly
“incompetent” for the job. According to petitioner,
thePrieto ruling is not applicable because in the case at hand,
Gran misrepresented himself in his curriculum vitae as a
Computer Specialist; thus, he was not qualified for the job for
which he was hired. We disagree. The CA is correct in
applying Prieto. The purpose of the required trade test is to
weed out incompetent applicants from the pool of available
workers. It is supposed to reveal applicants with false
educational backgrounds, and expose bogus qualifications.
Since EDI deployed Gran to Riyadh, it can be presumed that
Gran had passed the required trade test and that Gran is
qualified for the job. Even if there was no objective trade test
done by EDI, it was still EDI’s responsibility to subject Gran to
a trade test; and its failure to do so only weakened its position
but should not in any way prejudice Gran. In any case, the
issue is rendered moot and academic because Gran’s
incompetency is unproved.
Termination of Employment; Due Process; Under the twin
notice requirement, the employees must be given two (2) notices
before their employment could be terminated—(1) a first notice
to apprise the employees of their fault, and (2) a second notice to
communicate to the employees that their employment is being
terminated, and in between the first and second notice, the
employees should be given a hearing or opportunity to defend
themselves personally or by counsel of their choice.—In Agabon
v. NLRC, 442 SCRA 573 (2004), this Court held that:
Procedurally, (1) if the dismissal is based on a just cause under
Article 282, the employer must give the employee two written
notices and a hearing or opportunity to be heard if requested by
the employee before terminating the employment: a notice
specifying the grounds for which dismissal is sought a hearing
or an opportunity to be heard and after hearing or opportunity
to be heard, a notice of the decision to dismiss; and (2) if the
dismissal is based on authorized causes under Articles 283 and
284, the employer must give the employee and the Department
of Labor and Employment written notices 30 days prior to the
effectivity of his separation. Under the twin notice
requirement, the employees must be given two (2) notices
before their employment could be terminated: (1) a first notice
to apprise the employees of their fault, and (2) a second notice
to communicate to the employees that their employment is
being terminated. In between the first and second notice, the
employees should be given a hearing or opportunity to defend
themselves personally or by counsel of their choice.
Same; Migrant Workers and Overseas Filipinos Act (R.A.
No. 8042); In cases arising before the effectivity of the Migrant
Workers and Overseas Filipinos Act on 25 August 1995, where
the contract is for a fixed term and the employees are dismissed
without just cause, they are entitled to the payment of their
salaries corresponding to the unexpired portion of their contract,
but for cases arising after the effectivity of the law, when the
termination of employment is without just, valid or authorized
cause as defined by law or contract, the worker shall be entitled
to the full reimbursement of his placement fee with interest of
twelve percent (12%) per annum, plus his salaries for the
unexpired portion of his employment contract or for three (3)
months for every year of the unexpired term whichever is less.—
We reiterate the rule that with regard to employees hired for a
fixed period of employment, in cases arising before the
effectivity of R.A. No. 8042 (Migrant Workers and Overseas
Filipinos Act) on August 25, 1995, that when the contract is for
a fixed term and the employees are dismissed without just
cause, they are entitled to the payment of their salaries
corresponding to the unexpired portion of their contract. On the
other hand, for cases arising after the effectivity of R.A. No.
8042, when the termination of employment is without just,
valid or authorized cause as defined by law or contract, the
worker shall be entitled to the full reimbursement of his
placement fee with interest of twelve percent (12%) per annum,
plus his salaries for the unexpired portion of his employment
contract or for three (3) months for every year of the unexpired
term whichever is less.
Quitclaims; Courts must undertake a meticulous and
rigorous review of quitclaims or waivers, more particularly
those executed by employees—they should be carefully
examined, in regard not only to the words and terms used, but
also the factual circumstances under which they have been
executed.—Courts must undertake a meticulous and rigorous
review of quitclaims or waivers, more particularly those
executed by employees. This requirement was clearly
articulated by Chief Justice Artemio V. Panganiban in Land
and Housing Development Corporation v. Esquillo, 471 SCRA
488 (2005), Quitclaims, releases and other waivers of benefits
granted by laws or contracts in favor of workers should be
strictly scrutinized to protect the weak and the
disadvantaged. The waivers should be carefully
examined, in regard not only to the words and terms
used, but also the factual circumstances under which
they have been executed. (Emphasis supplied.) This Court
had also outlined in Land and Housing Development
Corporation, citingPeriquet v. NLRC, 186 SCRA 724 (1990), the
parameters for valid compromise agreements, waivers, and
quitclaims: Not all waivers and quitclaims are invalid as
against public policy. If the agreement was voluntarily entered
into and represents a reasonable settlement, it is binding on
the parties and may not later be disowned simply because of a
change of mind. It is only where there is clear proof that the
waiver was wangled from an unsuspecting or gullible person,
or the terms of settlement are unconscionable on its face, that
the law will step in to annul the questionable transaction. But
where it is shown that the person making the waiver did so
voluntarily, with full understanding of what he was
doing, and the consideration for the quitclaim is
credible and reasonable, the transaction must be recognized
as a valid and binding undertaking. (Emphasis supplied.)
Same; Guidelines for a Valid and Enforceable Quitclaim.—
In order to prevent disputes on the validity and enforceability
of quitclaims and waivers of employees under Philippine laws,
said agreements should contain the following: 1. A fixed
amount as full and final compromise settlement; 2. The
benefits of the employees if possible with the corresponding
amounts, which the employees are giving up in consideration of
the fixed compromise amount; 3. A statement that the
employer has clearly explained to the employee in English,
Filipino, or in the dialect known to the employees—that by
signing the waiver or quitclaim, they are forfeiting or
relinquishing their right to receive the benefits which are due
them under the law; and 4. A statement that the employees
signed and executed the document voluntarily, and had fully
understood the contents of the document and that their consent
was freely given without any threat, violence, duress,
intimidation, or undue influence exerted on their person. It is
advisable that the stipulations be made in English and Tagalog
or in the dialect known to the employee. There should be two (2)
witnesses to the execution of the quitclaim who must also sign
the quitclaim. The document should be subscribed and sworn to
under oath preferably before any administering official of the
Department of Labor and Employment or its regional office, the
Bureau of Labor Relations, the NLRC or a labor attaché in a
foreign country. Such official shall assist the parties regarding
the execution of the quitclaim and waiver. This compromise
settlement becomes final and binding under Article 227 of the
Labor Code.
Same; Conflict of Laws; The foregoing rules on quitclaim or
waiver shall apply only to labor contracts of Overseas Filipino
Workers (OFWs) in the absence of proof of the laws of the foreign
country agreed upon to govern said contracts.—It is made clear
that the foregoing rules on quitclaim or waiver shall apply only
to labor contracts of OFWs in the absence of proof of the laws of
the foreign country agreed upon to govern said contracts.
Otherwise, the foreign laws shall apply.
Pioneer Concrete Philippines, Inc. vs. Todaro
G.R. No. 154830. June 8, 2007.*
Actions; Cause of Action; Elements.—Section 2, Rule 2 of
the Rules of Court, as amended, defines a cause of action as the
act or omission by which a party violates a right of another. A
cause of action exists if the following elements are present: (1)
a right in favor of the plaintiff by whatever means and under
whatever law it arises or is created; (2) an obligation on the
part of the named defendant to respect or not to violate such
right; and, (3) an act or omission on the part of such defendant
violative of the right of the plaintiff or constituting a breach of
the obligation of the defendant to the plaintiff for which the
latter may maintain an action for recovery of damages.
Same; Same; Pleadings and Practice; Motions to
Dismiss; To sustain a motion to dismiss for lack of cause of
action, the complaint must show that the claim for relief does
not exist, rather than that a claim has been defectively stated, or
is ambiguous, indefinite or uncertain.—In Hongkong and
Shanghai Banking Corporation Limited v. Catalan, 440 SCRA
498 (2004), this Court held: The elementary test for failure to
state a cause of action is whether the complaint alleges facts
which if true would justify the relief demanded. Stated
otherwise, may the court render a valid judgment upon the
facts alleged therein? The inquiry is into the sufficiency, not
the veracity of the material allegations. If the allegations in the
complaint furnish sufficient basis on which it can be
maintained, it should not be dismissed regardless of the
defense that may be presented by the defendants. Moreover,
the complaint does not have to establish or allege facts proving
the existence of a cause of action at the outset; this will have to
be done at the trial on the merits of the case. To sustain a
motion to dismiss for lack of cause of action, the complaint
must show that the claim for relief does not exist, rather than
that a claim has been defectively stated, or is ambiguous,
indefinite or uncertain.
Labor Law; Jurisdictions; Employer-Employee
Relationship; Where no employer-employee relationship exists
between the parties and no issue is involved which may be
resolved by reference to the Labor Code, other labor statutes or
any collective bargaining agreement, it is the Regional Trial
Court that has jurisdiction; It is settled that an action for
breach of contractual obligation is intrinsically a civil
dispute.—As to the question of jurisdiction, this Court has
consistently held that where no employer-employee
relationship exists between the parties and no issue is involved
which may be resolved by reference to the Labor Code, other
labor statutes or any collective bargaining agreement, it is the
Regional Trial Court that has jurisdiction. In the present case,
no employer-employee relationship exists between petitioners
and respondent. In fact, in his complaint, private respondent is
not seeking any relief under the Labor Code, but seeks
payment of damages on account of petitioners’ alleged breach of
their obligation under their agreement to employ him. It is
settled that an action for breach of contractual obligation is
intrinsically a civil dispute. In the alternative, respondent
seeks redress on the basis of the provisions of Articles 19 and
21 of the Civil Code. Hence, it is clear that the present action is
within the realm of civil law, and jurisdiction over it belongs to
the regular courts.
Conflict of Laws; Forum Non-Conveniens; Words and
Phrases; The doctrine of forum non conveniens, literally
meaning “the forum is inconvenient,” emerged in private
international law to deter the practice of global forum shopping,
that is to prevent non-resident litigants from choosing the forum
or place wherein to bring their suit for malicious reasons, such
as to secure procedural advantages, to annoy and harass the
defendant, to avoid overcrowded dockets, or to select a more
friendly venue.—With respect to the applicability of the
principle of forum non conveniens in the present case, this
Court’s ruling in Bank of America NT & SA v. Court of Appeals,
400 SCRA 156 (2003), is instructive, to wit: The doctrine
of forum non-conveniens, literally meaning ‘the forum is
inconvenient,’ emerged in private international law to deter the
practice of global forum shopping, that is to prevent non-
resident litigants from choosing the forum or place wherein to
bring their suit for malicious reasons, such as to secure
procedural advantages, to annoy and harass the defendant, to
avoid overcrowded dockets, or to select a more friendly venue.
Under this doctrine, a court, in conflicts of law cases, may
refuse impositions on its jurisdiction where it is not the most
“convenient” or available forum and the parties are not
precluded from seeking remedies elsewhere. Whether a suit
should be entertained or dismissed on the basis of said doctrine
depends largely upon the facts of the particular case and is
addressed to the sound discretion of the trial court. In the case
of Communication Materials and Design, Inc. vs. Court of
Appeals, this Court held that “x x x [a] Philippine Court may
assume jurisdiction over the case if it chooses to do so;
provided, that the following requisites are met: (1) that the
Philippine Court is one to which the parties may conveniently
resort to; (2) that the Philippine Court is in a position to make
an intelligent decision as to the law and the facts; and, (3) that
the Philippine Court has or is likely to have power to enforce
its decision.” Moreover, this Court enunciated in Philsec.
Investment Corporation vs. Court of Appeals, that the doctrine
of forum non conveniens should not be used as a ground for a
motion to dismiss because Sec. 1, Rule 16 of the Rules of Court
does not include said doctrine as a ground. This Court further
ruled that while it is within the discretion of the trial court to
abstain from assuming jurisdiction on this ground, it should do
so only after vital facts are established, to determine whether
special circumstances require the court’s desistance; and that
the propriety of dismissing a case based on this principle
of forum non conveniensrequires a factual determination, hence
it is more properly considered a matter of defense.
Cadalin vs. POEA's Administrator
G.R. No. 104776. December 5, 1994.*
Conflict of Laws; As a general rule, a foreign procedural
law will not be applied in the forum.—As a general rule, a
foreign procedural law will not be applied in the forum.
Procedural matters, such as service of process, joinder of
actions, period and requisites for appeal, and so forth, are
governed by the laws of the forum. This is true even if the
action is based upon a foreign substantive law (Restatement of
the Conflict of Laws, Sec. 685; Salonga, Private International
Law, 131 [1979]).
Same; Prescription; A law on prescription of actions is sui
generis in Conflict of Laws.—A law on prescription of actions
issui generis in Conflict of Laws in the sense that it may be
viewed either as procedural or substantive, depending on the
characterization given such a law. Thus in Bournias v. Atlantic
Maritime Company, supra, the American court applied the
statute of limitations of New York, instead of the Panamanian
law, after finding that there was no showing that the
Panamanian law on prescription was intended to be
substantive. Being considered merely a procedural law even in
Panama, it has to give way to the law of the forum on
prescription of actions.
Same; Same; Actions; Words and Phrases; “Borrowing
Statute,” Explained; One form of “borrowing statutes” provides
that an action barred by the laws of the place where it accrued,
will not be enforced in the forum even though the local statute
has not run against it.—However, the characterization of a
statute into a procedural or substantive law becomes irrelevant
when the country of the forum has a “borrowing statute.” Said
statute has the practical effect of treating the foreign statute of
limitation as one of substance (Goodrich, Conflict of Laws 152-
153 [1938]). A “borrowing statute” directs the state of the forum
to apply the foreign statute of limitations to the pending claims
based on a foreign law (Siegel, Conflicts 183 [1975]). While
there are several kinds of “borrowing statutes,” one form
provides that an action barred by the laws of the place where it
accrued, will not be enforced in the forum even though the local
statute has not run against it (Goodrich and Scoles, Conflict of
Laws, 152-153 [1938]). Section 48 of our Code of Civil
Procedure is of this kind. Said Section provides: “If by the laws
of the state or country where the cause of action arose, the
action is barred, it is also barred in the Philippine Islands.”
Same; Same; Same; Section 48 of the Code of Civil
Procedure has not been repealed or amended by the Civil
Code.—Section 48 has not been repealed or amended by the
Civil Code of the Philippines. Article 2270 of said Code
repealed only those provisions of the Code of Civil Procedure as
to which were inconsistent with it. There is no provision in the
Civil Code of the Philippines, which is inconsistent with or
contradictory to Section 48 of the Code of Civil Procedure
(Paras, Philippine Conflict of Laws, 104 [7th ed.]).
Same; Same; Labor Law; The courts of the forum will not
enforce any foreign claim obnoxious to the forum’s public
policy.—In the light of the 1987 Constitution, however, Section
48 cannot be enforced ex proprio vigore insofar as it ordains the
application in this jurisdiction of Section 156 of the Amiri
Decree No. 23 of 1976. The courts of the forum will not enforce
any foreign claim obnoxious to the forum’s public policy
(Canadian Northern Railway Co. v. Eggen, 252 U.S. 553, 40 S.
Ct. 402, 64 L. ed. 713 [1920]). To enforce the one-year
prescriptive period of the Amiri Decree No. 23 of 1976 as
regards the claims in question would contravene the public
policy on the protection to labor.
Labor Law; Overseas Contract
Workers; Prescription; Article 291 of the Labor Code applies to
money claims arising from employer-employee relations,
including those arising from application of foreign laws
providing for greater employee benefits.—Section 7-a of the
Eight-Hour Labor Law provides the prescriptive period for
filing “actions to enforce any cause of action under said law.”
On the other hand, Article 291 of the Labor Code of the
Philippines provides the prescriptive period for filing “money
claims arising from employer-employee relations.” The claims
in the cases at bench all arose from the employer-employee
relations, which is broader in scope than claims arising from a
specific law or from the collective bargaining agreement. The
contention of the POEA Administrator, that the three-year
prescriptive period under Article 291 of the Labor Code of the
Philippines applies only to money claims specifically
recoverable under said Code, does not find support in the plain
language of the provision. Neither is the contention of the
claimants in G.R. No. 104911-14 that said Article refers only to
claims “arising from the employer’s violation of the employee’s
right,” as provided by the Labor Code supported by the facial
reading of the provision.
Same; Same; Right to Speedy Disposition of Cases; “Speedy
disposition of cases” is a relative term, a flexible concept
consistent with delays and depends upon the circumstances of
each case.—It is true that the constitutional right to “a speedy
disposition of cases” is not limited to the accused in criminal
proceedings but extends to all parties in all cases, including
civil and administrative cases, and in all proceedings, including
judicial and quasi-judicial hearings. Hence, under the
Constitution, any party to a case may demand expeditious
action on all officials who are tasked with the administration of
justice. However, as held inCaballero v. Alfonso, Jr., 153 SCRA
153 (1987), “speedy disposition of cases” is a relative term. Just
like the constitutional guarantee of “speedy trial” accorded to
the accused in all criminal proceedings, “speedy disposition of
cases” is a flexible concept. It is consistent with delays and
depends upon the circumstances of each case. What the
Constitution prohibits are unreasonable, arbitrary and
oppressive delays which render rights nugatory.
Same; Same; Same; Even if the cases took seven years to be
disposed of in the administrative level there is no violation of
the constitutional right to speedy disposition of cases where the
cases are not of the run-of-the-mill variety, involve a total of
1,767 claimants hired on various dates, with claims totalling
more than US$65 million.—The cases at bench are not of the
run-of-the-mill variety, such that their final disposition in the
administrative level after seven years from their inception,
cannot be said to be attended by unreasonable, arbitrary and
oppressive delays as to violate the constitutional rights to a
speedy disposition of the cases of complainants. The amended
complaint filed on June 6, 1984 involved a total of 1,767
claimants. Said complaint had undergone several amendments,
the first being on April 3, 1985. The claimants were hired on
various dates from 1975 to 1983. They were deployed in
different areas, one group in and the other groups outside of,
Bahrain. The monetary claims totalled more than US$65
million.
Same; Same; Actions; Class Suits; Where the claims are for
benefits granted under the Bahrain law, only the claimants who
worked in Bahrain shall be entitled to file their claims in a
class suit, excluding those who worked elsewhere.—A class suit
is proper where the subject matter of the controversy is one of
common or general interest to many and the parties are so
numerous that it is impracticable to bring them all before the
court (Revised Rules of Court, Rule 3, Sec. 12). While all the
claims are for benefits granted under the Bahrain law, many of
the claimants worked outside Bahrain. Some of the claimants
were deployed in Indonesia and Malaysia under different terms
and conditions of employment. NLRC and the POEA
Administrator are correct in their stance that inasmuch as the
first requirement of a class suit is not present (common or
general interest based on the Amiri Decree of the State of
Bahrain), it is only logical that only those who worked in
Bahrain shall be entitled to file their claims in a class suit.
Same; Same; Same; Same; A principle basic to the concept
of “class suit” is that plaintiffs brought on the record must fairly
represent and protect the interests of the others, such that if it
appears that each claimant is only interested in collecting his
own claims and has no concern in protecting the interests of the
others, the most that can be accorded to them is to be allowed to
join as plaintiffs in one complaint.—It appears that each
claimant is only interested in collecting his own claims. A
claimant has no concern in protecting the interests of the other
claimants as shown by the fact, that hundreds of them have
abandoned their co-claimants and have entered into separate
compro-mise settlements of their respective claims. A principle
basic to the concept of “class suit” is that plaintiffs brought on
the record must fairly represent and protect the interests of the
others (Dimayuga v. Court of Industrial Relations, 101 Phil.
590 [1957]). For this matter, the claimants who worked in
Bahrain can not be allowed to sue in a class suit in a judicial
proceeding. The most that can be accorded to them under the
Rules of Court is to be allowed to join as plaintiffs in one
complaint (Revised Rules of Court, Rule 3, Sec. 6).
Same; Same; Same; Same; The Supreme Court is extra-
cautious in allowing class suits because they are the exceptions
to the condition sine qua non, requiring the joinder of all
indispensable parties.—The Court is extra-cautious in allowing
class suits because they are the exceptions to the condition sine
qua non, requiring the joinder of all indispensable parties. In
an improperly instituted class suit, there would be no problem
if the decision secured is favorable to the plaintiffs. The
problem arises when the decision is adverse to them, in which
case the others who were impleaded by their self-appointed
representatives, would surely claim denial of due process.
Actions; Forum Shopping; Before Administrative Circular
No. 04-94, the Anti-Forum Shopping Rule (Revised Circular No.
28-91) applied only to petitions filed with the Supreme Court
and the Court of Appeals.—The Anti-Forum Shopping Rule
(Revised Circular No. 28-91) is intended to put a stop to the
practice of some parties of filing multiple petitions and
complaints involving the same issues, with the result that the
courts or agencies have to resolve the same issues. Said Rule,
however, applies only to petitions filed with the Supreme Court
and the Court of Appeals. It is entitled “Additional
Requirements For Petitions Filed with the Supreme Court and
the Court of Appeals To Prevent Forum Shopping or Multiple
Filing of Petitioners and Complainants.” The first sentence of
the circular expressly states that said circular applies to and
governs the filing of petitions in the Supreme Court and the
Court of Appeals. While Administrative Circular No. 04-94
extended the application of the anti-forum shopping rule to the
lower courts and administrative agencies, said circular took
effect only on April 1, 1994.
Jurisdiction; Legal Ethics; Attorneys; The NLRC and the
POEA have no jurisdiction to investigate charges of unethical
conduct of lawyers.—POEA and NLRC could not have
entertained the complaint for unethical conduct against Atty.
De Castro because NLRC and POEA have no jurisdiction to
investigate charges of unethical conduct of lawyers.
Same; Same; Same; Complaints for violation of the Code of
Professional Responsibility should be filed in a separate and
appropriate proceeding.—The complaint of Atty. Gerardo A. Del
Mundo to cite Atty. Florante De Castro and Atty. Katz Tierra
for violation of the Code of Professional Responsibility should
be filed in a separate and appropriate proceeding.
Same; Attorney’s Liens; A statement of a claim for a
charging lien should be filed with the court or administrative
agency which renders and executes the money judgment.—A
statement of a claim for a charging lien shall be filed with the
court or administrative agency which renders and executes the
money judgment secured by the lawyer for his clients. The
lawyer shall cause written notice thereof to be delivered to his
clients and to the adverse party (Revised Rules of Court, Rule
138, Sec. 37). The statement of the claim for the charging lien
of Atty. Del Mundo should have been filed with the
administrative agency that rendered and executed the
judgment.
Evidence; Conflict of Laws; Administrative Law; An official
document from a foreign government can be admitted in
evidence in proceedings before an administrative body even
without observing the rule provided in Section 24, Rule 132 of
the 1989 Revised Rules on Evidence.—Claimants presented a
Memorandum of the Ministry of Labor of Bahrain dated April
16, 1983. While said document was presented to the POEA
without observing the rule on presenting official documents of a
foreign government as provided in Section 24, Rule 132 of the
1989 Revised Rules on Evidence, it can be admitted in evidence
in proceedings before an administrative body. The opposing
parties have a copy of the said memorandum, and they could
easily verify its authenticity and accuracy.
Same; Offer to Compromise; In civil cases, an offer to settle
a claim is not an admission that anything is due and is not
admissible in evidence against the offeror.—The admissibility of
the offer of compromise made by BRII as contained in the
memorandum is another matter. Under Section 27, Rule 130 of
the 1989 Revised Rules on Evidence, an offer to settle a claim is
not an admission that anything is due. Said Rule provides:
“Offer of compromise not admissible.—In civil cases, an offer of
compromise is not an admission of any liability, and is not
admissible in evidence against the offeror.” This Rule is not
only a rule of procedure to avoid the cluttering of the record
with unwanted evidence but a statement of public policy. There
is great public interest in having the protagonists settle their
differences amicably before these ripen into litigation. Every
effort must be taken to encourage them to arrive at a
settlement. The submission of offers and counter-offers in the
negotiation table is a step in the right direction. But to bind a
party to his offers, as what claimants would make this Court
do, would defeat the salutary purpose of the Rule.
Contracts; Overseas Contract Workers; Any ambiguity in
the overseas-employment contracts should be interpreted
against the parties who drafted them.—The overseas-
employment contracts could have been drafted more
felicitously. While a part thereof provides that the
compensation to the employee may be “adjusted downward so
that the total computation (thereunder) plus the non-waivable
benefits shall be equivalent to the compensation” therein
agreed, another part of the same provision categorically states
“that total remuneration and benefits do not fall below that of
the host country regulation and custom.” Any ambiguity in the
overseas-employment contracts should be interpreted against
AIBC and BRII, the parties that drafted it (Eastern Shipping
Lines, Inc. v. Margarine-Verkaufs-Union, 93 SCRA 257 [1979]).
Same; Conflict of Laws; Parties to a contract may select the
law by which it is to be governed, and instead of adopting the
entire mass of the foreign law, the parties may just agree that
specific provisions of a foreign statute shall be deemed
incorporated into their contract “as a set of terms.”—The parties
to a contract may select the law by which it is to be governed
(Cheshire, Private International Law, 187 [7th ed.]). In such a
case, the foreign law is adopted as a “system” to regulate the
relations of the parties, including questions of their capacity to
enter into the contract, the formalities to be observed by them,
matters of performance, and so forth (16 Am Jur 2d, 150-161).
Instead of adopting the entire mass of the foreign law, the
parties may just agree that specific provisions of a foreign
statute shall be deemed incorporated into their contract “as a
set of terms.” By such reference to the provisions of the foreign
law, the contract does not become a foreign contract to be
governed by the foreign law. The said law does not operate as a
statute but as a set of contractual terms deemed written in the
contract (Anton, Private International Law, 197 [1967]; Dicey
and Morris, The Conflict of Laws, 702-703, [8th ed.]).
Same; Same; The choice of law must, however, bear some
relationship to the parties or their transaction.—A basic policy
of contract is to protect the expectation of the parties (Reese,
Choice of Law in Torts and Contracts, 16 Columbia Journal of
Transnational Law 1, 21 [1977]). Such party expectation is
protected by giving effect to the parties’ own choice of the
applicable law (Fricke v. Isbrandtsen Co. Inc., 151 F. Supp.
465, 467 [1957]). The choice of law must, however, bear some
relationship to the parties or their transaction (Scoles and
Hayes, Conflict of Law, 644-647 [1982]). There is no question
that the contracts sought to be enforced by claimants have a
direct connection with the Bahrain law because the services
were rendered in that country.
Administrative Law; Due Process; There is no denial of due
process even if the respondents had no opportunity to refute the
evidence of the claimants before the POEA where they had all
the opportunity to rebut said evidence and to present their
counter-evidence before the NLRC.—NLRC noted that so many
pieces of evidentiary matters were submitted to the POEA
Administrator by the claimants after the cases were deemed
submitted for resolution and which were taken cognizance of by
the POEA Administrator in resolving the cases. While AIBC
and BRII had no opportunity to refute said evidence of the
claimants before the POEA Administrator, they had all the
opportunity to rebut said evidence and to present their counter-
evidence before NLRC. As a matter of fact, AIBC and BRII
themselves were able to present before NLRC additional
evidence which they failed to present before the POEA
Administrator. Under Article 221 of the Labor Code of the
Philippines, NLRC is enjoined to “use every and all reasonable
means to ascertain the facts in each case speedily and
objectively and without regard to technicalities of law or
procedure, all in the interest of due process.”
Same; Same; While technical rules of procedure and
evidence do not apply to the proceedings conducted by
administrative agencies, there are cardinal rules which must be
observed by the hearing officers in order to comply with the due
process requirements of the Constitution.—A principle well
embedded in Administrative Law is that the technical rules of
procedure and evidence do not apply to the proceedings
conducted by administrative agencies (First Asian Transport &
Shipping Agency Inc. v. Ople, 142 SCRA 542 [1986]; Asiaworld
Publishing House, Inc. v. Ople, 152 SCRA 219 [1987]). This
principle is enshrined in Article 221 of the Labor Code of the
Philippines and is now the bedrock of proceedings before
NLRC. Notwithstanding the non-applicability of technical rules
of procedure and evidence in administrative proceedings, there
are cardinal rules which must be observed by the hearing
officers in order to comply with the due process requirements of
the Constitution. These cardinal rules are collated in Ang
Tibay v. Court of Industrial Relations, 69 Phil. 635 (1940).