SY,

ET AL. v. FAIRLAND KNITCRAFT CO., INC. YUPANGCO COTTON MILLS v. COURT OF APPEALS
FACTS: Fairland Knitcraft Co., Inc. is a domestic corporation FACTS: In this case, alleged properties of Yupangco Cotton Mills
engaged in garments business, while Susan de Leon is the located in the compound and buildings of Artex Development
owner/proprietress of Weesan Garments. Marialy Sy, et al., are the Corporation were levied by the Sheriff of the NLRC.
workers.
Such was the result of the issuance of a writ of execution issued by
Marialy Sy, et al., filed with the Arbitration Branch of the NLRC a LA Reyes in a labor dispute between Artex and Samar-Anglo.
complaint against Susan/Weesan for underpayment and non-
th rd
payment of wages, OT, HP 13 month and others. Susan/Weesan It filed a 3 party claim with the LA; an affidavit of adverse claim
filed before the DOLE-NCR a report on its temporary closure. As the with the NLRC, which was dismissed by the LA. on appeal to the
workers were not allowed to work anymore, they filed an amended NLRC, it was likewise dismissed for lack of merit. It filed a petcert
complaint for illegal dismissal and impleaded Fairland and its before the RTC, but was also dismissed for lack of merit.
manager Debbie Manduabas, as additional respondents.
It filed a complaint before the RTC for the recovery of the property
Weesan was sent a notice of hearing requiring it to appear before (reinvindicatoria). But it was also dismissed. On appeal to the CA, it
the LA. Atty. Geronimo appeared as counsel for Weesan and dismissed the same on the ground of forum shopping. Hence the
requested an extension of time to file his clients position paper. present petition.
Subsequently, he also entered his appearance for Fairland and
requested the same extension and filed for two separate position ISSUES:
papers. 1. Forum Shopping?
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2. May a 3 party be precluded the from availing himself of the
LA dismissed the complaint for lack of merit. Workers appealed to other alternative remedies in the event he failed in the remedy
st
NLRC. Granted, ordered to reinstate workers with full backwages. 1 availed of?

Atty. G filed MR. however, Fairland filed another MR through Atty. HELD:
Melina Tecson assailing the jurisdiction of the LA and NLRC over it, 1. NO. There is no forum-shopping where two different orders
claiming that it was never summoned to appear, attend or were questioned, two distinct causes of action and issues were
participate in all proceedings. Both were dismissed. raised, and two objectives were sought.

Thus, petcert. Before the CA. It held that in labor cases, both party In the case at bar, there was no identity of parties, rights and causes
and counsel must be duly served with separate copies of order, of action and reliefs sought. The case before the NLRC where LA
decision or resolution. And since Fairland and its counsel were not Reyes issued a writ of execution on the property of petitioner was
separately furnished with a copy of the NLRC Resolution denying a labor dispute between Artex and Samar-Anglo. Petitioner was not
the MR of its Decision, said Decision cannot be enforced against a party to the case. The only issue petitioner raised before the NLRC
Fairland. And that because of this, said Decision which held was whether or not the writ of execution issued by the labor arbiter
Susan/Weesan and Fairland solidarily liable to the workers, has not could be satisfied against the property of petitioner, not a party to
attained finality. the labor case. On the other hand, the accion reinvindicatoria filed
by petitioner in the trial court was to recover the property illegally
ISSUE: Whether or not the decision has attained finality and be levied upon and sold at auction. Hence, the causes of action in
enforced against Fairland. these cases were different.

HELD: YES. Article 224 contemplates the furnishing of copies of final 2. NO. A third party whose property has been levied upon by a
decisions, orders or awards both to the parties and their counsel in sheriff to enforce a decision against a judgment debtor is afforded
connection with the execution of such final decisions, orders or with several alternative remedies to protect its interests. The third
awards. However, for the purpose of computing the period for party may avail himself of alternative remedies cumulatively, and
filing an appeal from the NLRC to the CA, same shall be counted one will not preclude the third party from availing himself of the
from receipt of the decision, order or award by the counsel of other alternative remedies in the event he failed in the remedy first
record pursuant to the established rule that notice to counsel is availed of.
notice to party. And since the period for filing of an appeal is
reckoned from the counsels receipt of the decision, order or award, Thus, a third party may avail himself of the following alternative
it necessarily follows that the reckoning period for their finality is remedies: a) File a third party claim with the sheriff of the Labor
likewise the counsels date of receipt thereof, if a party is Arbiter; and b) If the third party claim is denied, the third party may
represented by counsel. appeal the denial to the NLRC.

Hence, the date of receipt referred to in Sec. 14, Rule VII of the then The remedies above mentioned are cumulative and may be

in force New Rules of Procedure of the NLRC which provides that resorted to by a third-party claimant independent of or separately
decisions, resolutions or orders of the NLRC shall become from and without need of availing of the others. If a third-party
executory after 10 calendar days from receipt of the same, refers claimant opted to file a proper action to vindicate his claim of
to the date of receipt by counsel. ownership, he must institute an action, distinct and separate from
that in which the judgment is being enforced, with the court of
Thus contrary to the CAs conclusion, the said NLRC Decision competent jurisdiction even before or without need of filing a claim
became final, as to Fairland, 10 calendar days after Atty. Tecsons in the court which issued the writ, the latter not being a condition

receipt thereof. In sum, we hold that the LA had validly acquired sine qua non for the former. In such proper action, the validity and
jurisdiction over Fairland and its manager, Debbie, through the sufficiency of the title of the third-party claimant will be resolved
appearance of Atty. Geronimo as their counsel and likewise, and a writ of preliminary injunction against the sheriff may be
through the latters filing of pleadings on their behalf. issued.
ANDO v. CAMPO the courts, to execute its judgment extends only to properties
Andresito Campo, et al., were pilers/haulers of bags of sugars hired unquestionably belonging to the judgment debtor alone.
by Premier Allied and Contracting Services, Inc. (PACSI). When they
were dismissed from employment, they filed and illegal dismissal
case against PACSI and its president Paquito Ando. PAL v. BICHARA
FACTS: PAL hired Alexander Bichara as an FA. When PAL
The LA ruled in favor of the workers and ordered PACSI and Ando implemented a retrenchment program in 1971, Bichara voluntarily
to pay the workers separation pay and attorney’s fees. On appeal resigned. The following month, he was rehired.
to the NLRC, it affirmed the LA decision with modification of the
awards. To answer for the monetary award, the NLRC Acting He was included in PAL’s Purser Upragding Program, in which he
Sheriff, issued a Notice of Sale on Execution of Personal Property graduated. But after failing two check rides, he was demoted to the
over the property in the name of Ando and his wife Erlinda. position of flight steward. He appealed his demotion but to no
avail. Hence, a complaint for illegal demotion against PAL before
Ando, thus, filed an action for prohibition and damages with prayer the NLRC Regional Arbitration Board.
for TRO before the RTC, claiming that the property belonged to him
and his wife, not to PACSI, and, hence, cannot be subject to The LA Nora declared the demotion illegal and ordered PAL to
execution sale. And since PACSI was the judgment debtor, reinstate Bichara to flight purser. PAL appealed to the NLRC and
execution should be made on its properties. then to the CA.

ISSUE: Do regular courts have jurisdiction over the enforcement of During the pendency of the illegal demotion case, PAL
DOA rendered in labor cases? implemented another retrenchment program resulting in the
termination of Bichara. Thus, together with 1,400 FAs, represented
HELD: NO. The SC has long recognized that regular courts have no by FASAP, they filed for ULP and illegal retrenchment against PAL.
jurisdiction to hear and decide questions which arise from and are PAL lost.
incidental to the enforcement of decisions, orders, or awards
rendered in labor cases by appropriate officers and tribunals of the During the pendency of the cases, on July 9, 2005, Bichara reached
DOLE. To hold otherwise is to sanction splitting of jurisdiction which 60 years old (compulsory retirement age under the CBA).
is obnoxious to the orderly administration of justice. Thus, it is, first
and foremost, the NLRC Manual on the Execution of Judgment that On January 31, 2008, Bichara filed a motion for execution of LA
governs any question on the execution of a judgment of that body. Nora’s decision. PAL opposed arguing that the illegal demotion case
Petitioner need not look further than that. was overtaken by supervening events, Bichara’s retrenchment and
reaching compulsory retirement age.
The NLRC Manual on the Execution of Judgment deals specifically
with third-party claims in cases brought before that body. It defines LA Macam: ordered separation pay in lieu of reinstatement. The
a third-party claim as one where a person, not a party to the case, reason was PAL disregarded the LA ruling of reinstatement and
asserts title to or right to the possession of the property levied illegal retrenchment (immediately executory). NLRC: reversed.
upon. It also sets out the procedure for the filing of a third-party Moot and academic for reaching 60. CA: reversed the NLRC, agreed
claim. There is no doubt in our mind that Ando’s complaint is a with LA but shall receive backwages up to date of retirement only.
third-party claim within the cognizance of the NLRC. Ando may
indeed be considered a "third party" in relation to the property ISSUE: Monetary award proper?
subject of the execution vis-à-vis the LA’s decision. There is no
question that the property belongs to Ando and his wife, and not HELD: NO. a judgment should be implemented according to the
to PACSI. It can be said that the property belongs to the conjugal terms of its dispositive portion. As such, where the writ of exection
partnership, not to Ando alone. Thus, the property belongs to a is not in harmony with and exceeds the judgment which gives it life,
third party, i.e., the conjugal partnership. At the very least, the SC the writ has pro tanto no validty.
can consider that Erlinda is a third party within contemplation of
the law. A companion to this rule is the principle of immutability of final
judgments, which states that a final judgment may no longer be
The broad powers granted to the LA and to the NLRC by Arts. 217, altered, amended or modified, even if the alteration, amendment
218 and 224 of the Labor Code can only be interpreted as vesting or modification is meant to correct what is perceived to be
in them jurisdiction over incidents arising from, in connection with erroneous conclusion of fact or law and regardless of what court
or relating to labor disputes, as the controversy under renders it. Any attempt to insert, change or add matters not clearly
consideration, to the exclusion of the regular courts. There is no contemplated in the dispositive portion violates the rule on
denying that the present controversy arose from the complaint for immutability of judgments. But like any other rule, this principle has
illegal dismissal. The subject matter of Ando’s complaint is the exceptions, namely: 1) correction of clerical errors; 2) nunc pro tunc
execution of the NLRC decision. Execution is an essential part of the entries which cause no prejudice to any party; 3) void judgments;
proceedings before the NLRC. Jurisdiction, once acquired, and 4) whenever circumstances transpire after the finality of the
continues until the case is finally terminated, and there can be no decision rendering its execution unjust and inequitable.
end to the controversy without the full and proper implementation
of the commission’s directives. In this case, the final judgment sought to be executed is LA Nora’s
decision, which was confined to the directive that PAL reinstate
Ando claims that the property sought to be levied does not belong Bichara as a flight purser in view of his illegal demotion.
to PACSI, the judgment debtor, but to him and his wife. Since he
was sued in a representative capacity, and not in his personal LA Macam went beyond the terms of said decision when he
capacity, the property could not be made to answer for the directed the issuance of a writ of execution ordering the payment
judgment obligation of PACSI. Moreover, the power of the NLRC, or of separation pay in lieu of reinstatement.
GUILLERMO v. USON DUTCH MOVERS, INC. v. LEQUIN
FACTS: Crisanto Uson was an accounting clerk of Royal Class FACTS: Edilberto Lequin, et al., filed a complaint for illegal dismissal
Venture (Royal). Eventually, he was promoted to accounting against Dutch Movers, Inc. (DMI), and/or spouses Cesar and
supervisor until he was allegedly dismissed. Yolanda Lee, alleged President/Owner and Manager respectively.

Uson filed with NLRC Sub-RAB a complaint for illegal dismissal. DMI, a corporation engaged in the hauling LPG, employed Lequin
Royal did not make an appearance despite receipt of summons. as drivers, et al., as helpers. Cesar informed them that DMI would
Uson filed position paper. LA De Vera rendered decision in favor of cease operations for no reason. They requested to issue a formal
Uson ordering Royal to reinstate him to his former position with notice regarding the matter but to no avail.
th
backwages and 13 month plust damages.
Upon request the DOLE-NCR issued a certification that DMI did not
Royal did not appeal the decision. Consequently, upon motion of file any notice of business closure.
Uson, a writ of execution was issued, but the judgment still
unsatisfied. A Second Alias Writ of Execution was issued but again LA dismissed the case for lack of cause of action. NLRC reversed,
it remained unsatisfied. Lequin, et al., illegally dismissed. NLRC decision became final and
executory on December 30, 2007. Entry of judgment on February
Uson then filed a Motion for Alias Writ of Execution and to Hold 14, 2008.
Directors and Officers of Royal Liable for Satisfaction of the
Decision. When the sheriff went to the address of Royal, it was Lequin filed Motion for Writ of Execution. When discovered DMI no
found out that the establishment erected there was in the name of longer operates, they filed a Motion to Implead the spouses Lees.
JOEL and SONS CORP. a family owned corporation of the
Guillermos, with Jose Guillermo as GM. The latter informed the And seeks to include Edgar and Millicent Smith (Officers in AOI of
sheriff that Royal has been dissolved. DMI) be impleaded and held solidarily liable. Smiths say they just
lent their name to assist in incorporating DMI.
LA Rimando then issued an order granted the motion of Uson and
held the Officers of JSC for the obligations of Royal to the ISSUE: May the Lees be held personally liable?
employees jointly and severally liable. LA pierced the veil of
corporate fiction and held Guillermo personally liable. Guillermo HELD: YES. The principle of immutability of judgment, or the rule
MRd by special appearance/set aside the order but it was denied. that once a judgment has become final and executory, the same
MR of the order denied. can no longer be altered or modified and the court’s duty is only to
order its execution, is not absolute. One of its exception is when
ISSUE: May Guillermo as and Officer of JSC be held liable for the there is a supervening event occurring after the judgment becomes
obligations of Royal? final and executory, which renders the decision unenforceable.

HELD: YES. The SC explained that A corporation is still an artificial Supervening event refers to facts that transpired after a judgment
being invested by law with a personality separate and distinct from has become final and executory, or to a new situation that
that of its stockholders and from that of other corporations to developed after the same attained finality. Supervening events
which it may be connected. It is not in every instance of inability to include matters that the parties were unaware of before or during
collect from a corporation that the veil of corporate fiction is trial as they were not yet existing during that time.
pierced, and the officials are made liable.
The supervening events transpired in this case (closure of DMI)
Personal liability attaches only when there is a wilfull and knowing after the NLRC decision became final and executory, rendered its
assent to patently unlawful acts of the corporation, there is gross execution impossible and unjust.
negligence or bad faith in directing the affairs of the corporation,
or there is conflict of interest resulting in damages to the Further, while a corporation has a separate and distinct personality
corporation. from its stockholders, and and other corporations it may be
connected with, such personality may be disregarded, or the veil or
Doctrine of piercing the corporate veil is held to apply when; the corporate fiction may be pierced attaching personal liability against
corporate fiction is used as a vehicle for the evasion of an existing responsible person if the corporation’s personality “is used to
obligation; fraud cases, when used to justify a wrong, protect fraud defeat public convenience, justify wrong, protect fraud or defend
or defend a crime; or alter ego cases, where a corporation is merely crime, or is used as a device to defeat the labor laws.” By
a farce since it is a mere alter ego or business conduit of a person. responsible person, we refer to an individual or entity responsible
for, and who acted in bad faith in committing illegal dismissal or in
In cases where personal liability attaches, not even all officers are violation of the Labor Code; or one who actively participated in the
made accountable. Rather, only the “responsible officer” is held management of the Coroporation.
personally liable in committing illegal dismissal or any act violative
of the Labor Code. Solidariliy liable when corporate veil is pierced. Here, the veil of corporate fiction must be pierced and accordingly,
Corporate tort. The person “actively engaged” in the management the spouses Lee should be held personally liable for judgment
of the corporation who is held liable. awards, because the peculiarity of the situation shows that they
controlled DMI.
Verified position paper of Uson revealed he was illegally dismissed
by Guillermo, President/GM Royal when the former exposed the
latters dictating and undervaluing of shares of stock. G is
responsible for running the company, dismissed Uson, and refused
to receive the summons.