SECOND DIVISION
G.R. No. 212774, January 23, 2017
WESLEYAN UNIVERSITY-PHILIPPINES, Petitioner, v. GUILLERMO T. MAGLAYA, SR., Respondent.
D E C I S I O N
PERALTA, J.:
For this Court's resolution is a petition for review on certiorari filed by petitioner Wesleyan University-Philippines (WUP) assailing the Resolution1 dated January 20, 2014 of the Court of Appeals (CA) which denied its petition for certiorari.
The facts are as follows:chanRoblesvirtualLawlibrary
WUP is a non-stock, non-profit, non-sectarian educational corporation duly organized and existing under the Philippine laws on April 28, 1948.2
Respondent Atty. Guillenno T. Maglaya, Sr. (Maglaya) was appointed as a corporate member on January 1, 2004, and was elected as a member of the Board of Trustees (Board) on January 9, 2004 both for a period of five (5) years. On May 25, 2005, he was elected as President of the University for a five-year term. He was re-elected as a trustee on May 25, 2007.3
In a Memorandum dated November 28, 2008, the incumbent Bishops of the United Methodist Church (Bishops) apprised all the corporate members of the expiration of their terms on December 31, 2008, unless renewed by the former.4 The said members, including Maglaya, sought the renewal of their membership in the WUP's Board, and signified their willingness to serve the corporation.5
On January 10, 2009, Dr. Dominador Cabasal, Chairman of the Board, informed the Bishops of the cessation of corporate terms of some of the members and/or trustees since the by-laws provided that the vacancy shall only be filled by the Bishops upon the recommendation of the Board.6
On March 25, 2009, Maglaya learned that the Bishops created an Ad Hoc Committee to plan the efficient and orderly turnover of the administration of the WUP in view of the alleged "gentleman's agreement" reached in December 2008, and that the Bishops have appointed the incoming corporate members and trustees.7 He clarified that there was no agreement and any discussion of the turnover because the corporate members still have valid and existing corporate terms.8
On April 24, 2009, the Bishops, through a formal notice to all the officers, deans, staff, and employees of WUP, introduced the new corporate members, trustees, and officers. In the said notice, it was indicated that the new Board met, organized, and elected the new set of officers on April 20, 2009.9 Manuel Palomo (Palomo), the new Chairman of the Board, informed Maglaya of the termination of his services and authority as the President of the University on April 27, 2009.10
Thereafter, Maglaya and other fonner members of the Board (Plaintiffs) filed a Complaint for Injunction and Damages before the Regional Trial Court (RTC) of Cabanatuan City, Branch 28.11 In a Resolution12 dated August 19, 2009, the RTC dismissed the case declaring the same as a nuisance or harassment suit prohibited under Section 1(b),13 Rule 1 of the Interim Rules for Intra-Corporate Controversies.14 The RTC observed that it is clear from the by-laws of WUP that insofar as membership in the corporation is concerned, which can only be given by the College of Bishops of the United Methodist Church, it is a precondition to a seat in the WUP Board.15 Consequently, the expiration of the terms of the plaintiffs, including Maglaya, as corporate members carried with it their termination as members of the Board.16 Moreover, their continued stay in their office beyond their terms was only in hold-over capacities, which ceased when the Bishops appointed new members of the corporation and the Board.17
The CA, in a Decision18 dated March 15, 2011, affirmed the decision of the RTC, and dismissed the petition for certiorari filed by the plaintiffs for being the improper remedy. The CA held that their status as corporate members of WUP which expired on December 31, 2008 was undisputed. The CA agreed with the RTC that the plaintiffs had no legal standing to question the Bishops' alleged irregular appointment of the new members in their Complaint on May 18, 2009 as the termination of their membership in the corporation necessarily resulted in the conclusion of their positions as members of the Board pursuant to the WUP by-laws.19
Thereafter, Maglaya filed on March 22, 2011 the present illegal dismissal case against WUP, Palomo, Bishop Lito C. Tangonan (Tangonan), and Bishop Leo A. Soriano (Soriano).20 Maglaya claimed that he was unceremoniously dismissed in a wanton, reckless, oppressive and malevolent manner on the eve of April 27, 2009.21 Tangonan and Soriano acted in evident bad faith when they disregarded his five-year term of office and delegated their protege Palomo as the new university president.22 Maglaya alleged that he faithfully discharged his necessary and desirable functions as President, and received P175,000.00 as basic salary, P10,000.00 as cost of living allowance, and P10,000.00 as representation allowance. He was also entitled to other benefits such as: the use of university vehicles; the use of a post paid mobile cellular phone in his official transactions; the residence in the University Executive House located at Inday Street, Magsaysay Sur, Cabanatuan City, with free water, electricity, and services of a household helper; and receipt of 13th month pay, vacation leave pay, retirement pay, and shares in related learning experience.23 On May 31, 2006, his basic salary was increased to P95,000.00 due to his additional duty in overseeing the operations of the WUP Cardiovascular and Medical Center.
Maglaya presented the following pieces of evidence: copies of his appointment as President, his Identification Card, the WUP Administration and Personnel Policy Manual which specified the retirement of the university president, and the check disbursement in his favor evidencing his salary, to substantiate his claim that he was a mere employee.24
WUP, on the other hand, asseverated that the dismissal or removal of Maglaya, being a corporate officer and not a regular employee, is a corporate act or intra-corporate controversy under the jurisdiction of the RTC.25 WUP also maintained that since Maglaya's appointment was not renewed, he ceased to be a member of the corporation and of the Board; thus, his term for presidency has also been terminated.26
Meanwhile, this Court, in a Resolution dated June 13, 2011, denied the petition for review on certiorari filed by Maglaya and the other former members of the Board for failure to show any reversible error in the decision of the CA. The same became final and executory on August 24, 2011.27
In a Decision28 dated September 20, 2011, the Labor Arbiter (LA) ruled in favor of WUP. The LA held that the action between employers and employees where the employer-employee relationship is merely incidental is within the exclusive and original jurisdiction of the regular courts.29 Since he was appointed as President of the University by the Board, Maglaya was a corporate officer and not a mere employee. The instant case involves intra-corporate dispute which was definitely beyond the jurisdiction of the labor tribunal.30 The dispositive portion of the decision reads:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, the instant complaint is hereby dismissed for lack of jurisdiction.
SO ORDERED.31
WHEREFORE, premises considered, the appealed decision is hereby REVERSED and SET ASIDE, declaring:chanRoblesvirtualLawlibrary
(a) jurisdiction over this case by virtue of the employer-employee relation of the parties (b) the illegality of the dismissal of [respondent] by [petitioner] [Petitioner] therefore [is] hereby ordered to pay [respondent]: 1. separation pay - [P] 375,000.00 2. full backwages - 1,252,462.50 3. retirement pay - 500,000.00 4. moral damages - 100,000.00 5. exemplary damages - 50,000.00 6. 10% of the above as attorney's fees - 227,746.25TOTAL AWARDS - [P]2,505,208.75
based on the attached computation of this Commission's Computation Unit.
SO ORDERED.35
WHEREFORE, the petition is DENIED for lack of merit.
SO ORDERED.41
The Court of Appeals committed an error of law when it summarily dismissed the special civil action for certiorari raising lack of jurisdiction of the NLRC filed by [WUP] where it was very clear that the NLRC had no jurisdiction over the case involving a corporate officer and where the nature of the controversy is an intra-corporate dispute.
The power of the Court of Appeals to review NLRC decisions via Rule 65 or Petition for Certiorari has been settled as early as in our decision in St. Martin Funeral Home v. National Labor Relations Commission. This Court held that the proper vehicle for such review was a Special Civil Action for Certiorari under Rule 65 of the Rules of Court, and that this action should be filed in the Court of Appeals in strict observance of the doctrine of the hierarchy of courts. Moreover, it is already settled that under Section 9 of Batas Pambansa Blg. 129, as amended by Republic Act No. 7902[10] (An Act Expanding the Jurisdiction of the Court of Appeals, amending for the purpose of Section Nine of Batas Pambansa Blg. 129 as amended, known as the Judiciary Reorganization Act of 1980), the Court of Appeals — pursuant to the exercise of its original jurisdiction over Petitions for Certiorari - is specifically given the power to pass upon the evidence, if and when necessary, to resolve factual issues.44
"Corporate officers" in the context of Presidential Decree No. 902-A are those officers of the corporation who are given that character by the Corporation Code or by the corporation's by-laws. There are three specific officers whom a corporation must have under Section 25 of the Corporation Code. These are the president, secretary and the treasurer. The number of officers is not limited to these three. A corporation may have such other officers as may be provided for by its by-laws like, but not limited to, the vice-president, cashier, auditor or general manager. The number of corporate officers is thus limited by law and by the corporation's by-laws.52
ARTICLE VI. BOARD OF TRUSTEES
x x x x
Section 2. Membership – (a) The Board of Trustees shall be composed of Ten (10) members of the corporation from among themselves provided, that six (6) shall come from the Ministry and Laity of the United Methodist [C]hurch in the Philippines, three (3) shall be non-Methodist, friends and sympathizers of the Wesleyan University-Philippines and of the United Methodist Church, and one (1) representative of the Wesleyan Alumni Association, as provided in section 1 (c), Article IV hereof, and (b) provided further that the incumbent area bishop and the President of the Wesleyan University-Philippines shall be honorary members of the Board.
x x x x56ARTICLE VIII. OFFICERS
Section 1. Officers – The officers of the Board of Trustees shall be:chanRoblesvirtualLawlibrary(a) Chairman
(b) Vice-Chairman
(c) Secretary
(d) Treasurer
x x x x
Section 6. The President of Wesleyan University-Philippines – The President of the University, who must be an active member of the United Methodist Church in the Philippines at the time of his election shall be in-charge of and be responsible for the administration of the University and other institutions of learning that [m]ay hereafter be established by the corporation, and(a) May, with the Board of Trustees;chanrobleslaw(1) Organize and/or reorganize the administrative set up of the Wesleyan University-Philippines to effect efficiency and upgrade institutional administration and supervision;chanrobleslaw
(2) Employ, suspend, dismiss, transfer or replace personnel and prescribe and enforce rules and regulations for their proper conduct in the discharge of their duties;chanrobleslaw
(3) Shall make reports during the different rumual conference of the United Methodist Church ru1d to such agencies as may be deemed necessary on the operations of the university and related matters;chanrobleslaw
(4) Shall prescribe and enforce rules and regulations for the promotion and maintenance of discipline in the proper conduct and discharge of the functions and duties of subordinate administrative officers, professors, teachers, employees and students and other personnel.
(b) Shall make reports and recommendations to the Board of Trustees or to the Chairman of the Board of Trustees on matters pertaining to the institution as he may find necessary;chanrobleslaw
(c) Shall countersign all checks drawn by the Treasurer from the depository of the University, and
(d) Shall exercise, perform and discharge all such other powers, functions and duties as are interest in the office of the President.
x x x57
Endnotes:
* Designated Additional Member per Special Order No. 2416, dated January 4, 2017.
1 Penned by Associate Justice Normandie B. Pizarro, with Presiding Justice Andres B. Reyes, Jr. and Associate Justice Manuel M. Barrios, concurring; rollo, pp. 30-32.
2Id. at 53.
3Id. at 56.
4 CA rollo, p. 227.
5Id. at 228.
6Rollo, p. 57.
7Id.
8Id. at 57-58.
9Id. at 58.
10Id. at 104.
11Id. at 52-67.
12 Penned by Presiding Judge Tomas B. Talavera, id. at 68-74.
13 (b) Prohibition against nuisance and harassment suits. – Nuisance and harassment suits are prohibited. In determining whether a suit is a nuisance or harassment suit, the court shall consider, among others, the following:ChanRoblesVirtualawlibrary
(1) The extent of the shareholding or interest of the initiating stockholder or member,
(2) Subject matter of the suit;
(3) Legal and factual basis of the complaint;
(4) Availability of appraisal rights for the act or acts complained of; and
(5) Prejudice or damage to the corporation, partnership, or association in relation to the relief sought.
In case of nuisance or harassment suits, the court may, motu proprio or upon motion, forthwith dismiss the case.
14Rollo, p. 74.
15Id. at 73.
16Id.
17Id. at 72 -73.
18 Penned by Associate Justice Michael P. Elbinias, with Associate Justices Noel G. Tijam and Celia C. Librea-Leagogo, concurring; id. at 77-86.
19Rollo, pp. 83-84.
20Id. at 105.
21Id. at 93-94.
22Id. at 94.
23Id. at 93.
24Id. at 119.
25Id. at 107.
26Id. at 96.
27Id. at 87.
28 Penned by Labor Arbiter Leandro M. Jose; id. at 90-100.
29Rollo, p. 99.
30Id. at 100.
31Id.
32 Penned by Commissioner Teresita D. Castillon-Lora, with Presiding Commissioner Raul T. Aquino, concurring; id. at 102-125.
33 Article 297. [282] Termination by Employer. – An employer may terminate an employment for any of the following causes:chanRoblesvirtualLawlibrary(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative;
(d) Commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or his duly authorized representatives; and
(e) Other causes analogous to the foregoing.
34Rollo, p. 116.
35Id. at 124-125.
36Id. at 118.
37Id. at 118-119.
38 Penned by Commissioner Teresita D. Castillon-Lora, with Presiding Commissioner Joseph Gerard E. Mabilog, concurring, and Commissioner Dolores M. Peralta-Beley, dissenting; id. at 128-136.
39 NLRC Entry of Judgment, CA rollo, p. 433.
40Rollo, pp. 31-32.
41Id. at 32.
42 Article 229. [223] Appeal.- Decisions, awards, or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt of such decisions, awards, or orders. Such appeal may be entertained only on any of the following grounds:chanRoblesvirtualLawlibrary(a) If there is prima facie evidence of abuse of discretion on the part of the Labor Arbiter;
(b) If the decision, order or award was secured through fraud or coercion, including graft and corruption;
(c) If made purely on questions of law; and
(d) If serious errors in the findings of facts are raised which would cause grave or irreparable damage or injury to the appellant.
x x x x
The decision of the Commission shall be final and executory after ten (10) calendar days from receipt thereof by the parties.
x x x x
43Panuncillo v. CAP Philippines, Inc., 544 Phil. 256 (2007).
44PICOP Resources, Incorporated (PRI) v. Tañeca, G.R. No. 160828, August 9, 2010, 627 SCRA 56, 65-66. (Citation omitted).
45St. Martin Funeral Home v. National Labor Relations Commission, 356 Phil. 811 (1998). (Emphasis supplied).
46 CA rollo, p. 383.
47Id. at 4.
48Id. at 3.
49St. Martin Funeral Home v. National Labor Relations Commission, supra note 45.
50Id.
51Id.
52Garcia v. Eastern Telecommunications Phils., Inc., 603 Phil. 438 (2009). (Citation omitted).
53Tabang v. NLRC, 334 Phil. 424 (1997). (Emphasis supplied).
54Cosare v. Broadcom Asia, Inc., 726 Phil. 316 (2014).
55Rollo, pp. 43-51.
56Id. at 45. (Underscoring supplied).
57Id. at 47-48.
58Garcia v. Eastern Telecommunications Phils., Inc., supra note 52.
59Tabang v. NLRC, supra note 53.
60Okol v. Slimmers World International, 623 Phil. 13 (2009).
61Union Motors Corp. v. National Labor Relations Commission, 373 Phil. 310 (1999).
62Okol v. Slimmers World International, supra note 60.
63Id.
64 326 Phil. 74 (1996)
65Leonor v. Court of Appeals, supra. (Emphasis supplied).