FIRST DIVISION
G.R. No. 194944, September 18, 2017
PHILIPPINE NATIONAL BANK, Petitioner, v. TERESITA FE A. GREGORIO, Respondent.
D E C I S I O N
JARDELEZA, J.:
Petitioner Philippine National Bank (PNB) filed this petition for review on certiorari1 under Rule 45 of the Rules of Court challenging the Decision2 of the Court of Appeals (CA) dated July 15, 2010 in CA-G.R. SP No. 110045 and its Resolution3 dated December 21, 2010 which denied PNB's motion for reconsideration. The CA found that the National Labor Relations Commission (NLRC) committed grave abuse of discretion when it reversed the Labor Arbiter (LA) and ruled that PNB illegally dismissed respondent Teresita Fe A. Gregorio (Gregorio).4
Gregorio was initially hired by PNB as an apprentice teller in 1978. She rose through the ranks and eventually became the Branch Manager, with a level of Senior Manager, of PNB's Sucat, Parañaque Branch (PNB Sucat).5
Sometime in December 2002, a depositor requested confirmation that PNB Sucat offers a unique kind of high-return investment, as promised by branch officers and personnel.6 Thus, from January 8 to 24, 2003, PNB's Internal Audit Group (IAG) conducted a credit review at PNB Sucat regarding its activities connected with loan against deposit hold-out transactions.7
On February 3, 2003, a certain Benita C. Rebello (Rebello) also executed an affidavit detailing her transactions with Gregorio.8
On February 18, 2003, the IAG submitted its evaluation, findings, and recommendation in a Memorandum9 (IAG Memorandum) which essentially detailed how Gregorio authorized the conduct of irregular transactions in PNB Sucat. From its investigation and Rebollo's affidavit, the IAG discovered Gregorio's purported irregular lending activities: Gregorio, along with Gloria Miranda (Miranda), a customer relation specialist of PNB Sucat, allegedly convinced depositors to invest in a PNB product that had an above-market interest income yield. To avail of this product, Gregorio required depositors to avail of a loan secured by their deposits with PNB Sucat. The loan proceeds are thereafter loaned to other borrowers who undertook to pay a 5% monthly interest. Of the 5%, 3% will be paid to them as income interest yield while the remaining 2% will go to PNB Sucat as commission. Parenthetically, the IAG found no records showing that PNB Sucat received any commission arising from these loan activities. To facilitate the loans, Gregorio required the depositors to accomplish loan documents such as the Application/Approval Form on Loans Against Deposit Hold-out, Promissory Notes, and Deposit Hold-out Agreements. The proceeds of the loans are then released through manager's checks. These checks, in turn, are credited to the savings accounts of persons other than the borrowers.10
The IAG Memorandum identified other irregular transactions within PNB Sucat to prove Gregorio's supposed modus operandi: Gregorio approved the application of loan proceeds of 25 borrowers to settle the outstanding loans covered by 44 promissory notes and bank charges of other borrowers.11 Sampled bank transactions from the period of February 15 to August 29, 2001 show that Gregorio approved 21 manager's checks representing the proceeds of loans against deposit hold-outs. These were loan proceeds of 15 borrowers credited to the accounts of persons other than the borrowers. There were no documents showing the borrowers' written consent to the crediting of their loan proceeds to other people's accounts. Dollar loans against hold-out were granted to three borrowers which proceeds, however, were credited without written consent to the account of a third person.12
The IAG's investigation also revealed that there were two deposit hold-out borrowers who received the monthly 3% interest income yield through their savings accounts. This was paid either in cash or fund transfer from the account of a certain Grace de Guia Brozas (Brozas). The IAG asserted that this is the dummy account of Miranda, who worked with Gregorio in the conduct of these irregular lending activities,13 on the basis of bank records showing several fund transfers of large amounts from Miranda's account to Brozas' account.
The IAG also noted in its Memorandum that tellers of PNB Sucat accepted for encashment eight managers' checks representing loan proceeds without the proper endorsement of the loan borrowers.14 In other instances, the tellers paid managers' checks in cash even when it was not clear if the proper bank officer approved the checks for encashment or deposit.15
Further, the IAG found that the 3% interest was paid to the depositors who availed of the loan against hold-out transactions either: (1) to their savings or checking accounts with PNB Sucat or (2) by Gregorio in cash.16
Later on, two other depositors executed affidavits narrating their transactions with Gregorio. Specifically, Maxima Villar (Villar) and Virginia Pollard (Pollard) executed affidavits on May 19, 2003 and October 14, 2003, respectively, depicting essentially the same transaction that Rebollo stated in her affidavit. In sum, these depositors claimed in their affidavits that Gregorio convinced them to invest in a PNB product that had a high interest income yield. They were required to sign withdrawal slips and other loan documents. Later on, they claimed that, upon inquiry with PNB Sucat, they were surprised to learn that they have outstanding loans with the bank and that their deposits were subject of a hold-out agreement. They were presented with bank documents concerning their loans and holdout agreements. They insisted in their affidavits that they never agreed to contract a loan with the bank.17
On May 30, 2003, the PNB Administrative Adjudication Panel (Panel) charged Gregorio with gross misconduct and dishonesty based on Villar's affidavit.18 On February 4, 2004, Gregorio was again charged with gross dishonesty and/or willful breach of trust and gross misconduct and/or negligence.19 Gregorio filed separate answers to these charges on June 12, 200320 and February 16, 2004,21 respectively. In her answer to the first charge, Gregorio submitted Villar's affidavit of retraction which she received on June 11, 2003. According to Villar's affidavit of retraction: (1) the loan against deposit hold-out transaction was a matter between PNB Sucat's depositors and their respective borrowers; (2) these loans "are [the depositors-borrowers'] private concern. Employees of the [b]ranch do not have to do anything with them (sic) and their business concerns;"22 (3) Villar executed the earlier affidavit "out of [her] sincere fear and anxiety that [she] may not be able to get [her] money from PNB Sucat with interest, for reasons which [she] was (sic) not able to verify the facts first before executing the affidavit;"23 (4) Gregorio never induced Villar to enter into any illegal activity or to sign any blank bank documents; (5) the hold-out of Villar's deposit was made upon her instructions.24 Notably, Rebollo also executed an affidavit of retraction of her earlier affidavit.25
In her answer to the second charge, Gregorio denied Pollard's claim that she made the latter sign blank bank documents. Instead, according to Gregorio, Pollard was made to sign "documents with blank spaces on them that [Pollard], like other depositors, have (sic) to fill out."26 Gregorio also stated that she never borrowed money from Pollard nor induced her to invest money in high interest-yielding ventures. Rather, Pollard's loan activities were between her and her borrowers. Gregorio asserts that Pollard only complained because her borrower had failed to pay her. Nevertheless, whatever losses she may have incurred is her concern. Gregorio, as well as the staff of PNB Sucat, has nothing to do with this.27
On March 22, 2004, the Panel conducted a meeting on the charges which Gregorio attended.28 On March 29, 2004, the Panel recommended Gregorio's dismissal29 after taking into consideration the affidavits executed by Rebollo, Villar, and Pollard, as well as the results of the IAG investigation. Although the Panel noted the affidavits of retraction from Villar and Rebollo, it did not give credence to these later affidavits. As to Villar's affidavit of retraction, the decision stated that the original of the affidavit was never presented before the Panel and thus its authenticity was never established. It also cited jurisprudence stating that affidavits of retraction are generally unreliable. As to Rebollo's affidavit of retraction, the decision emphasized that this second affidavit even revealed Gregorio's active participation in the supposed irregular lending activities when Rebollo stated that:
[N]a ang mga pangyayari ay alam ko, at ang ginawa lamang ni Mrs. Gregorio ay tinulangan ako kung papaano kumita ang pera ko ng mas mataas kay sa binibigay na tubo ng bangko sa aking "time deposit"; na ang kanyang ginawa lamang ay ipinakilala ako kay Mrs. Realina Ty na siya raw ay "supplier" ng City Hall ng Parañaque at siya ang gagamit ng aking pera. x x x30 (Emphasis and underscoring in the original.)On May 4, 2004, PNB issued a memorandum dismissing Gregorio from service based on the Panel's recommendation. This prompted Gregorio to file before the NLRC an action for illegal dismissal, damages and attorney's fees, with prayer for reinstatement with full backwages against PNB. The LA found that Gregorio was illegally dismissed, rooting his finding on the insufficiency ofPNB's bases in dismissing Gregorio. The LA asserted that as to the first charge, PNB based its decision solely on Villar's first affidavit which has since been successfully rebutted by Gregorio when she presented Villar's affidavit of retraction. There was thus no basis for holding Gregorio guilty on the first charge.31
WHEREFORE, all foregoing premises considered, judgment is hereby rendered:PNB appealed to the NLRC which reversed the LA's Decision in a Decision35 promulgated on September 26, 2008. The dispositive portion of the NLRC Decision reads:
1. Declaring complainant TERESITA FE A. GREGORIO to have been illegally dismissed from her employment and ordering respondent PHILIPPINE NATIONAL BANK to immediately reinstate her to her former or substantially equivalent position without loss of seniority rights and other privileges; and
2. Further ordering respondent PHILIPPINE NATIONAL BANK to pay complainant TERESITA FE A. GREGORIO the amount of P1,554,247.75 representing the monetary awards granted the latter as initially computed above.
For being a mere nominal party, Mr. Lorenzo V. Tan is hereby ordered dropped as party-respondent in this case.
SO ORDERED.34 (Emphasis in the original.)
WHEREFORE, premises considered, the appeal of respondent Philippine National Bank is GRANTED. The Decision of Labor Arbiter Napoleon M. Menese dated December 8, 2005 is REVERSED and SET ASIDE, and a new one is hereby rendered DISMISSING the above-entitled [complaint] for lack of merit.The NLRC held that PNB met the required burden of proof. According to the NLRC, PNB used the affidavits of Rebollo, Villar, and Pollard as well as the result of the IAG's investigation as bases for its findings. It agreed with PNB that Rebollo and Villar's affidavits of retraction did not necessarily make their earlier statements false as recantations are generally looked upon with disfavor as they can be easily fabricated. It added that the LA erred in holding that Gregorio should have been given the opportunity to confront Pollard. According to the NLRC, the confrontation of a witness is not required in company investigations for administrative liability of the employee. Further, the NLRC highlighted that Gregorio's supposed evidence consisted of nothing more than mere denials. Finally, it held that Gregorio's previous commendations did not necessarily mean that she could not have committed the charges against her.37
SO ORDERED.36 (Emphasis in the original.)
[A] petition for certiorari does not normally include an inquiry into the correctness of its evaluation of the evidence. Errors of judgment, as distinguished from errors of jurisdiction, are not within the province of a special civil action for certiorari, which is merely confined to issues of jurisdiction or grave abuse of discretion. It is, thus, incumbent upon petitioners to satisfactorily establish that the NLRC acted capriciously and whimsically in order that the extraordinary writ of certiorari will lie. By grave abuse of discretion is meant such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction, and it must be shown that the discretion was exercised arbitrarily or despotically.53These parameters of the review powers of the courts in decisions coming from the NLRC find more meaning when seen in the context of the authority of quasi-judicial bodies and the binding effect of their rulings. In Hagonoy Rural Bank, Inc. v. NLRC,54 we explained that quasi-judicial agencies, like the NLRC, have acquired expertise in the specific matters entrusted to their jurisdiction. Thus, their findings of facts are accorded not only respect but even finality if they are supported by substantial evidence.55
In a Rule 45 review, we consider the correctness of the assailed CA decision, in contrast with the review for jurisdictional error that we undertake under Rule 65. Furthermore, Rule 45 limits us to the review of questions of law raised against the assailed CA decision. In ruling for legal correctness, we have to view the CA decision in the same context that the petition for certiorari it ruled upon was presented to it; we have to examine the CA decision from the prism of whether it correctly determined the presence or absence of grave abuse of discretion in the NLRC decision before it, not on the basis of whether the NLRC decision on the merits of the case was correct. In other words, we have to be keenly aware that the CA undertook a Rule 65 review, not a review on appeal, of the NLRC decision challenged before it.59 (Citation omitted; emphasis and underscoring supplied.)To summarize, an appeal is a statutory right. This means that there is no remedy of appeal unless there is a law expressly granting it. In the case of the decisions of the NLRC, there is no law stating that the aggrieved party may appeal the decision before the court. Our ruling in St. Martin, however, explained that while there is no appeal from an NLRC decision, this does not mean that NLRC decisions are absolutely beyond the powers of review of the court. In fact, NLRC decisions may be reviewed by the CA through a petition for certiorari under Rule 65. Pertinent here is the use of the word "review" and not "appeal." Also relevant is the use of the remedy of a petition under Rule 65, which is a special civil action for certiorari on the basis of grave abuse of discretion. The implication of this is that an NLRC decision is final and not subject to appeal or review by the courts. There is an exception to this, which is a review by the CA only in cases where there is grave abuse of discretion. When the CA reviews an NLRC decision, it is necessarily limited to the question of whether the NLRC acted arbitrarily, whimsically, or capriciously, in the sense that grave abuse of discretion is understood under the law, the rules, and jurisprudence. It does not entail looking into the correctness of the judgment of the NLRC on the merits.
A). PRIVATE RESPONDENT HAS MISERABLY FAILED TO ESTABLISH A VALID GROUND FOR THE DISMISSAL OF HEREIN PETITIONER.None of these allegations shows that the NLRC was capnctous, whimsical or arbitrary in issuing its Decision. The tenor of Gregorio's pleading, in truth, seeks a review of the merits of the case. This can only be properly done in an appeal which, as we have constantly repeated, is not available to challenge the decision of the NLRC. It is only in special cases where there is grave, and not mere abuse of discretion, when the CA may interfere in the exercise of its review power.
B). THE CHARGE OF GROSS MISCONDUCT AND WILLFUL BREACH OF TRUST AND CONFIDENCE HAS NO FACTUAL AND LEGAL BASIS.
C). THERE WAS NO SINGLE INCIDENT THAT HAS GIVEN RISE TO THE ALLEGED WILLFUL BREACH OF TRUST AND CONFIDENCE AS WELL AS [THE] ALLEGED GROSS MISCONDUCT.
D). ON THE CONTRARY, AS BRANCH MANAGER, PETITIONER PERFORMED HER DUTIES AND FUNCTIONS EXEMPLARILY:
- NOT ONLY AS EVIDENCED BY THE "COMMENDATIONS" SHE RECEIVED, AND "OUTSTANDING" RATINGS ACCORDED IN HER PERFORMANCE APPRAISAL;
- MORE IMPORTANTLY - BEING IN THE WORLD OF BUSINESS - PETITIONER HAS BROUGHT SUBSTANTIAL INCOME TO HEREIN PRIVATE RESPONDENT BANK.
- THE BANK INCURRED NO LOSS IN ITS OPERATIONS PARTICULARLY INVOLVED IN THE TRANSACTIONS IN QUESTION, BUT ON THE CONTRARY, HUGELY [PROFITED THEREFROM].64 (Emphasis in the original; citations omitted.)
Art. 297 [282]. Termination by Employer - An employer may terminate an employment for any of the following causes:In this case, PNB charged Gregorio with gross dishonesty, gross misconduct, and willful breach of trust. All these qualify as just causes for termination. Hence, the next logical question is whether PNB presented sufficient evidence to prove that Gregorio indeed committed these acts.
(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 following.
Endnotes:
** Designated Acting Chairperson per Special Order No. 2484 dated September 14, 2017.
1Rollo, pp. 9.26
2Id. at 9-26. Penned by Associate Justice Ruben C. Ayson and concurred in by Associate Justices Normandie B. Pizarro and Priscilla J. Baltazar-Padilla.
3Id. at 27-32.
4Id. at 25-26.
5Id. at 11-12.
6Id. at 99-A.
7Id. at 13.
8Id. at 104.
9Id. at 97-109.
10Id. at 99-100.
11Id. at 98.
12Id. at 100-101.
13Id. at 101.
14Id. at 102.
15Id. at 103.
16Id. at 99-A.
17Id. at 141-143, 144-146.
18Id. at 141-143.
19Id. at 144-146.
20Id. at 147-149.
21Id. at 150-152.
22Id. at 148.
23Id.
24Id.
25Rollo, pp. 427-428.
26Id. at 150.
27Id. at 151.
28Id. at 156.
29Id. at 153-161.
30Id. at 159-160.
31Id. at 241-243.
32Id. at 244-245.
33Id. at 247-248.
34Id. at 252-253.
35Id. at 313-328.
36Id. at 327-328.
37Id. at 323-324.
38Id. at 329-359.
39Id. at 360-361.
40Id. at 362-399.
41Id. at 82-83.
42Id. at 86.
43Id. at 49, 57.
44Id. at 64.
45Id. at 87.
46Id. at 438-439.
47Id. at 454-455.
48Id. at 456.
49 G.R. No. 130866, September 16, 1998, 295 SCRA 494.
50Bernardo v. Court of Appeals (Special Sixth Division), G.R. No. 106153, July 14, 1997, 275 SCRA 413, 426. Citation omitted.
51Heirs of Spouses Teojilo M. Reterta and Elisa Reterta v. Spouses Lorenzo Mores and Virginia Lopez, G.R. No. 159941, August 17, 2011, 655 SCRA 580, 590.
52 G.R. No. 179169, March 3, 2010, 614 SCRA 182.
53Id. at 192.
54 G.R. No. 122075, January 28, 1998, 285 SCRA 297.
55Id. at 308.
56 RULES OF COURT, Rule 45, Sec. 1.
57Fuji Television Network Inc. v. Espiritu, G.R. Nos. 204944-45, December 3, 2014, 744 SCRA 31, 63; Career Philippines Shipmanagement, Inc. v. Serna, G.R. No. 172086, December 3, 2012, 686 SCRA 676, 684.
58Supra.
59Id. at 684.
60Triplex Enterprise, Inc. v. PNB-Republic Bank, G.R. No. 151007, July 17, 2006, 495 SCRA 362, 365.
61Id. Citation omitted.
62Rollo, p. 20.
63Id.
64 CA rollo, p. 9.
65 RULES OF COURT, Rule 133, Sec. 5.
66Rollo, p. 159.
67Id. at 455.
68Muaje-Tuazon v. Wenphil Corporation, G.R. No. 162447, December 27, 2006, 511 SCRA 521, 531.
69Samalio v. Court of Appeals, G.R. No. 140079, March 31, 2005, 454 SCRA 462, 472-473.
70Rollo, p. 324.
71Solid Development Corporation Workers Association (SDCWA-UWP) v. Solid Development Corporation, G.R. No. 165995, August 14, 2007, 530 SCRA 132, 139. Citation omitted.
72Rollo, pp. 323-324.