G.R. No.
108914 September 20, 1994
STAR ANGEL HANDICRAF vs.
NLRC (THIRD DIVISION) and Spouses HELEN AND
JOLITO FRIBALDOS
Highlighted ruling from book:
There is a distinction between the filing of an appeal
within the reglementary period and its perfection, and
that the appeal may be perfected after the said
reglementary period.
Star Angel held that the filing of a motion for reduction
of an appeal bond necessarily stays the reglementary
period for appeal.
appeal must be filed within ten (10) days but
may be perfected after that period.
FACTS:
On February 12, 1992, private respondents filed a
complaint against the Star Angel Handicraft owned by
Ildefonso and Estella Nuique,
Where: with the Regional Arbitration Branch, Region IV, of
the NLRC,
Case: for illegal dismissal, underpayment of wages,
overtime pay, premium pay for holidays, premium pay for
rest day, service incentive leave pay and thirteenth-month
pay (RAB-IV-2-4223-92-RI).
By agreement of the parties, private respondents
were allowed to report back for work, leaving only
the money claims for the determination of the Labor
Arbiter (Rollo, p. 2).
April 20 Respondents filed position paper;
Petitioner failed to submit despite
several directives to do so
June 24 Case set for hearing;
Petitioner’s counsel failed to
appear;
Case submitted for resolution
August 7 Petitioner filed a motion to admit
position paper
August 19 Petitioner received copy of Labor
Arbiter’s decision
Dated July 22,1992.
In the decision, the money claims were resolved in
favor of private respondents with Helen Fribaldos
receiving an award of P45,347.00 and Jolito Fribaldos an
award of P48,125.00, or a total sum of P93,472.00
Petitioner moved for the reconsideration of the
decision of the Labor Arbiter (Rollo, p. 42).
MR denied
Appeal made to NLRC with an Urgent Motion to
Reduce Bond, alleging as grounds grave abuse of
discretion committed by the Labor Arbiter in computing the
award of the claims based on an erroneous applicable,
daily-minimum wage for the handicraft establishment
(Rollo, p. 33).
On October 23, without resolving the Urgent Motion to
Reduce Bond, the NLRC (Third Division) dismissed the
appeal of petitioner for appellant's failure to put up a bond.
In Section 6 of Rule VI, it is provided that:
Bond. — In case the decision of a Labor Arbiter involves a
monetary award, an appeal by the employer shall be
perfected only upon the posting of a cash or surety bond
issued by a reputable bonding company duly accredited by
Thus, the NLRC stated:
On July 22, 1992, Labor Arbiter Ambrosio B. Sison
rendered a Decision in the instant case awarding
complainants Helen and Jolito Fribaldos wage
differential in the total amount of P93,472.00.
Respondents duly filed their Memorandum of
Appeal and paid appeal fee.
However, respondents filed an Urgent Motion to Reduce
Bond on the grounds that the Labor Arbiter committed
errors of judgment and that it cannot afford to post
bond equivalent to the amount awarded.
The posting of cash or supersedeas bond equivalent to
the award is mandated by law (Art. 223, Labor Code).
Without such bond, the appeal is not perfected.
And while the Commission in meritorious cases allows
reduction bond (sic), it must be for compelling reasons
and shown by evidence. The posting of bond is likewise
first required before the reduction thereof is allowed.
PREMISES CONSIDERED, respondents' appeal from the
Decision of July 22, 1992 is hereby DISMISSED for
failure to perfect appeal. (Rollo, pp. 40-41).
In its Resolution dated January 21, 1993, the NLRC
(Third Division) denied the motion for reconsideration
(Rollo, pp. 57-58).
ISSUE: Was it proper for the NLRC to dismiss the appeal
without acting on the motion to reduce appeal bond?
RULING: NO
There is no question about the timeliness of the filing
of the motion for reduction of the appeal bond, which
was annexed to the Memorandum on Appeal.
The motion averred that a big portion of the awards had
already prescribed, thus justifying the reduction of the bond
from P93,472.00 to only P19,890.00.
The appeal bond is required under Paragraph 2 of
Article 223 of the Labor Code, which provides:
In case of a judgment involving a monetary award, an
appeal by the employer may be perfected only upon the
posting of a cash or surety bond issued by a reputable
bonding company duly accredited by the Commission in the
amount equivalent to the monetary award in the judgment
appealed from.
Section 3(a), Article 223, Rule VI of the New Rules of
Procedure of the NLRC provides:
Requisites for Perfection of Appeals. — (a) The appeal
shall be filed within the reglementary period as
provided in Section 1 of this Rule; shall be under oath
with proof of payment of the required appeal fee and the
posting of a cash or surety bond as provided in Section 5 of
this Rule; . . . .
Under Section 5 of Rule VI, the appellant is required
1. to pay an appeal fee of P100.00 to the Regional
Arbitration Branch, Regional Office, and
2. to attach to the records of the case the official
receipt of such payment.
the Commission or the Supreme Court in an amount
equivalent to the monetary award.
The Commission may, meritorious cases and upon
Motion of the Appellant, reduce the amount of the
bond. (However, an appeal is deemed perfected upon the
posting of the bond equivalent to the monetary award
exclusive of moral and exemplary damages as well as
attorney's fees [Deleted, effective on January 14, 1992]).
Nothing herein however, shall be construed as extending
the period of appeal.
In dismissing the appeal, the NLRC said: "The posting
of bond is likwise first required before the reduction
thereof is allowed." In other words, the NLRC would not
act on a motion for the reduction of the bond unless
petitioner first files the bond, the amount of which he is
precisely contesting. This posture of the NLRC needs
rethinking.
What obviously misled the NLRC in imposing the
posting of a bond as a precondition before it can act
on the motion to reduce the bond is provision of
Article 223 (par. 2) of the Labor Code which requires
the posting of the bond before an appeal "may be
perfected."
Filing of an appeal within reglamentary period vs
perfection
Filing of an appeal Perfection of an
within reglamentary appeal
period
May transpire after the
end of the
reglamentary period
for filing appeal
Under Article 223 of the Labor Code, an appeal to the
NLRC from the decisions, awards or orders of the
Labor Arbiter must be made "within ten (10) calendar
days from receipt of such decisions, awards or
orders."
Under Section 3(a) of Rule VI of the New Rules of Procedure
of the NLRC, the appeal fees must be paid and the
memorandum of appeal must be filed within the ten-
day reglementary period.
Neither the Labor Code nor its implementing rules
specifically provide for a situation where the appellant
moves for a reduction of the appeal bond.
Inasmuch as in practice the NLRC allows the
reduction of the appeal bond upon motion of
appellant and on meritorious grounds, it follows that a
motion to that effect may be filed within the reglementary
period for appealing.
Such motion may be filed in lieu of a bond which amount is
being contested.
Lamsan Trading vs. Leogardo
Highlighted ruling in book:
Rules of procedure and practice of the Ministry of Labor
provide periods within which to do certain acts such as to
file a motion for reconsideration.
Such periods are imposed to prevent needless delays and to
ensure the orderly and speedy discharge of judicial
business. Strict compliance with such rule is both
mandatory and imperative.
Only strong consideration of equity will lead the Supreme
Court to allow an exception to the procedural rule in the
interest of substantial justice.
FACTS:
Private respondents Danilo Sarmiento, Isagani Acuril,
Roquito Reyes, and Rafael Talaver were rank-and-file
employees of petitioner company.
On December 12 and 13, 1978, Criminal Case Nos. 939
to 942 were filed against them and a number of
In the meantime, the appeal is not deemed perfected
and the Labor Arbiter retains jurisdiction over the
case until the NLRC has acted on the motion and
appellant has filed the bond as fixed by the NLRC.
An analogous procedure is the extension of time to file a
record on appeal, provided the motion for such extension is
filed before the expiration of the reglementary period for
filing said record on appeal (Vda. de Capulong v. Workmen's
Insurance Co., Inc., 178 SCRA 314 [1989]; Tuason v. Court
of Appeals, 43 SCRA 664 [1972]).
If the order of the trial court granting the motion is
issued only after the expiration of the original period,
the appeal may still be perfected within the period
extended (Singbengco v. Arellano, 99 Phil. 952 [1956]).
Likewise, the appeal is deemed perfected only after the
approval of the record on appeal and not upon the filing of
said record on appeal.
We have, heretofore, relaxed the requirement of the
posting of an appeal bond as a condition for
perfecting an appeal under Article 223 of the Labor
Code.
In Erectors, Incorporated v. National Labor Relations
Commission, 202 SCRA 597 (1991), we nullified an order of
the NLRC which required the appellant to post a bond of
P575,222.00 within ten days from receipt of the order or
suffer the dismissal of the appeal. The bond therein required
was based on the award which was erroneously computed
based on the salary which the employee was no longer
receiving at the time of his separation and "which even
included in the computation the award of P400,000.00 for
moral and exemplary damages.
In Blancaflor v. National Labor Relations Commission, 218
SCRA 366 (1993), Rada v. National Labor Relations
Commission, 205 SCRA 67 (1992), and Your Bus Line v.
National Labor Relations Commission, 190 SCRA 160
(1990), we cautioned the NLRC to give Article 223 of the
Labor Code, particularly the provisions on requiring a bond
on appeals involving monetary awards, a liberal
interpretation in line with the desired objective of resolving
controversies on the merits.
WHEREFORE, the Resolutions of the NLRC (Third Division)
dated October 23, 1992 and January 21, 1993 are SET
ASIDE. The NLRC (Third Divison) is DIRECTED to ACT
on the motion for the reduction of the appeal bond
and to ACCEPT the appeal of petitioner after the filing
of the appropriate appeal bond.
others before the Municipal Trial Court of Sultan
Kudarat, Maguindanao,
CASE: for qualified theft of steel drums belonging to
petitioner company committed around four months
earlier or sometime in October, 1977.
Apart from filing criminal charges, the petitioner also
sought clearance from the Ministry of Labor to
terminate the services of the respondent employees
on the ground of "dishonesty/stealing."
There was no opposition by the employees to the request
for clearance.
It was, therefore, granted on December 26, 1978. The
opposition to the clearance application was filed
several hours after the clearance had already been
granted.
On January 2, 1979, the respondent employees filed a
motion for reconsideration of the order granting clearance
to terminate their services.
The motion was set for hearing on February 5, 1979 but
nobody appeared for the employees on that date.
The Regional Director of the Ministry of Labor denied the
motion for reconsideration.
After receiving notice of the denial, the employees filed their
notice of appeal from said order.
APPEAL DISMISSED
On the ground that "oppositors had not presented a
memorandum on appeal or any pleading to pursue its
appeal filed on February 13, 1979,"
the Ministry of Labor and Employment (MOLE) in an order
dated January 6, 1983, dismissed the respondent
employees’ appeal, affirming the grant of clearance to
terminate employment in favor of petitioner.
On February 8, 1983, the respondent employees filed
a motion for reconsideration of said order explaining
that their counsel, Atty. Lanang S. Ali, a trial lawyer of the
Citizens Legal Assistance Office (CLAO) of the Ministry of
Justice, had, as early as February 13, 1979, transmitted the
records of the case to the Special Appealed Cases Division
of the CLAO Manila, which division handles all appealed
cases.
Due to oversight, negligence, or inaction on the part of the
CLAO Division in Manila, no memorandum on appeal was
prepared or submitted.
The petitioner filed an opposition to the motion for
reconsideration.
On December 7, 1984, the Ministry of Labor and
Employment through the Deputy Minister, issued
another order reconsidering the order dated January
6, 1983
The MOLE rendered a new judgment denying the
applicant company’s application for clearance to
terminate and ordering the respondent employees’
reinstatement with backwages.
The petitioner filed a motion for reconsideration,
which motion was denied for having been filed out of
time.
It is this action of the respondent Ministry that is now raised
in this petition for certiorari.
Meanwhile, Criminal Case No. 939 against respondent
Roquito Reyes was dismissed on January 12, 1981 for
failure to prosecute. Criminal Case Nos. 940 to 942 against
the other respondent employees and other persons were
dismissed on July 12, 1982 for the same reason.
The court, in dismissing the cases for qualified theft, noted
the reasons cited by the accused in their ex-parte joint
motion to dismiss. Among them — (1) No evidence was
presented by the prosecution since the cases were filed in
1978 or almost four years earlier; (2) There was no attempt
to set the cases for hearing, with a setting one year earlier
having been postponed due to non-availability of
prosecution witnesses; (3) The complainant, now the
petitioner, filed a manifestation-motion to have the cases
"written off the record;" and (4) The complainant employer
was willing to "give its former employees a certificate of
proper discharge" provided no further claims and
counterclaims would be filed. The only method whereby the
employer could get any form of evidence on who committed
the theft was to have the respondents testify against each
other. No such testimony could be secured.chanrobles
virtual lawlibrary
The petitioner assails the MOLE order which
denounces as illegal a dismissal it had once ordered
approved, as well as its denial of petitioner’s motion
for reconsideration, filed one day late, while having
given due course to respondent employees’
memorandum on appeal, filed nearly four (4) years
after the appeal was taken.
In its order dated December 7, 1984, the Deputy Labor
Minister held that:
"Viewed in the light of the foregoing facts and evidence
which remain unrebutted in the records, the application
for clearance to terminate oppositors employment
must perforce fail for lack of substantial evidence to
sustain the same . . ."
ISSUE: whether or not it was proper for the deputy of
ministry of labor to reconsider and reverse his order
granting petitioner company the clearance to terminate the
services of the private respondents and ordered the latter’s
reinstatement with three years backwages.
RULING: YES
We do not find the reconsideration by the MOLE of its
previous order as arbitrary.
The circumstances surrounding its issuance may be rather
unusual but it is neither correct nor fair to portray the public
respondent’s order as the result of a capricious or mercurial
mind.
It was upon his cognizance of an erroneous ruling that a re-
examination of the earlier findings and conclusions became
not only necessary but just.
Reference to our ruling in International Hardwood and
Veneer Co. of the Philippines v. Leogardo (117 SCRA 967),
and to other cases on valid dismissals due to dishonesty or
stealing is erroneous.
The supposed dishonesty in this petition is not substantiated
by any evidence whatsoever. If the private respondents are
cashiers, managers, supervisors, salesmen, or other
personnel occupying positions of responsibility, the
requirement that an employee should enjoy the trust and
confidence of his employer may justify their termination.
However, the private respondents are ordinary rank and file
workers. They are electricians and operators of equipment.
There has to be some kind of proof that the respondents
were involved in the loss of company property. Mere
accusations by the employer, especially in the light of what
happened in the criminal prosecutions, will not suffice.
The records of this case indicate that the application
to terminate the employees was grounded solely on
the criminal charges filed against them.
Since the cases were kept pending for almost four years
inspite of the failure to present even a single witness in
support of the criminal complaints, the application for
clearance should have been denied for lack of merit instead
of being granted on the ground that the respondent
employees failed to timely enter any opposition.
The MOLE is not estopped to correct its initial error in
the light of subsequent events brought to its
attention.
It is precisely for this purpose that motions for
reconsideration are made available to bring such lapses to
the attention of the adjudicating body for rectification .
It was upon such a motion for reconsideration that the
respondent Deputy Minister took to task the proper
administration of justice, while exercising its prerogative to
revise, reverse, or revoke a previous order or ruling. There
being no abuse of discretion such privilege must remain Commission in Manila, The CLAO Special and Appealed
undisturbed. Cases Division is exclusively tasked to handle all such cases.

ISSUE (THIS ONE): Whether the denial of the petitioner’s
MR of the Minstry’s order revoking clearance to terminate
respondent employees was proper?
RULING:
NO
We note that the same was admittedly filed out of time. The
order sought to be reconsidered had become both final and
executory.
Rules of procedure and practice of the Ministry of
Labor provide periods within which to do certain acts
such as to file a motion for reconsideration. Such
periods are imposed with a view to prevent needless delays
and to ensure the orderly and speedy discharge of judicial
business. Strict compliance with such rule is both
mandatory and imperative (FJR Garments Industries v.
Court of Appeals, 130 SCRA 216).
Only strong considerations of equity, which are missing in
this case, will lead this Court to allow an exception to the
procedural rule in the interest of substantial justice.
IN THIS CASE
Thus, as early as February 13, 1979, the counsel for private
respondents had immediately transmitted the records of the
case to said Division, but for some reason, the CLAO office
in Manila failed to file the necessary memorandum on
appeal, delaying the case for a considering period.
However, upon discovery of such omission, the original
counsel for respondent employees immediately sought to
rectify the same by preparing and himself filing the
memorandum on appeal.cralawnad
As a general rule, negligence of counsel may not be
condoned and should bind the client. Under the special
circumstances of this case, however, we find the delay
excusable. It cannot be attributed to private respondents or
their Maguindanao counsel who had every right to presume
that official duty would be regularly performed by the CLAO
in Manila. Considering, the circumstances in which Atty. Ali
found the respondents’ appeal, his display of diligence in the
pursuit of the appeal for his clients should be commended
instead of deplored. We find for the private respondents.
WHEREFORE, IN VIEW OF THE FOREGOING, the petition is
hereby DISMISSED for lack of merit.

As stated in the order of respondent Deputy Minister

Leogardo, the petitioner had only until March 15, 1985
to file its motion for reconsideration.

However, it was only on March 16, 1985 that applicant

sent by registered mail its present motion for
reconsideration.

Consequently, the respondent ruled that the same was filed

out of time and it had no jurisdiction to review or disturb its
final order (Order, Rollo, pp. 53-54).

That the application of such rule appears to the petitioner as

discriminatory, is understandable considering the four (4)
year delay in the filing of the respondents’ memorandum on
appeal as compared to the petitioner’s delay. The petitioner
emphasizes that its motion for reconsideration was only one
day late.

However, there is considerable difference between a

motion for reconsideration and a memorandum on
appeal.

No period for the filing of a memorandum on appeal is

provided by the Rules as in the case of a motion for
reconsideration. It is not mandatory for an appeal to be
perfected that a memorandum must also be
submitted within the period to appeal. (Arrastre
Security Association — TUPAS v. Ople, 127 SCRA 580) In
fact an appeal can be decided without a party’s
memorandum.

The absence of a rule on the filing of an appellant’s

memorandum is not the principal reason for our affirmance
of the respondent Deputy Minister’s order allowing
respondent employees’ appeal.

More compelling is the policy that rules of technicality

must yield to the broader interests of substantial
justice. The dismissal of an appeal on purely technical
grounds is frowned upon by this Court, especially
considering in the case at bar, the merit of respondent
employees’ clarification of the delay for which they should
not be faulted.

The private respondents were represented before the then

MOL Regional Office No. XII in Cotabato City by CLAO Trial
Attorney Lanang S. Ali. Under the rules of CLAO, a trial
lawyer in a regional office is not allowed to appear in cases
appealed to the ministry or the National Labor Relations