Cabana, Adrian C.

Case Title : Dy-Dumalasa vs Fernandez et.al 593 SCRA 656

G.R. NO. 178760
July 23, 2009

Facts

Respondents – Fernandez and others were former employees of Helios Manufacturing

Corporation, a closed domestic corporation engaged in soap manufacturing which the
petitioner – Dy Dumalasa was a member of the Board of Directors. Respondents filed a case
for illegal dismissal or illegal closure of business against the company and impleaded its
members and Board of Directors, including the herein petitioner.

The decision of the labor arbiter attained finality and stated in the decision with the
execution of the writ “in case you fail to collect the amounts indicated, you are hereby
ordered to cause the satisfaction of the judgment out of the respondents’ goods or chattels,
or in the absence thereof, from the properties not exempt from execution

Pursuant to the above writ, the sheriff issued a notice of levy on real property under
the name of petitioner and her husband.

Petitioner moved to quash the writ contending that the company has separate and
distinct personality and that the Labor arbiter has no jurisdiction over him.

Issue

Whether or not petitioner’s personal property is solidary liable with the company?

Ruling

Yes. The Supreme Court held that solidary or joint and several obligation is one in which each
debtor is liable for the entire obligation, and each creditor is entitled to demand the whole obligation. In
a joint obligation each obligor answers only for a part of the whole liability and to each obligee belongs
only a part of the correlative right.
The Supreme Court ruled in the case of Carag vs NLRC to wit “to hold a director personally
liable for debts of the corporation, and thus pierce the veil of the corporation fiction, the bad faith or
wrongdoing of the director must be established clearly and convincingly.

The Supreme Court finds the presence of the Bad faith on the part of the petitioner when they
closed the company’s Muntinlupa plant 15 days before the scheduled cessation of operations, only to
reestablish a plant in Carmona, Cavite

Hence the Petitioner is hereby considered joint and solidary liable with the company.