GODOY, JERICO U.

REN TRANSPORT CORP. AND/OR REYNALDO PAZCOGUIN III v. NATIONAL

LABOR RELATIONS COMMISSION (2ND DIVISION), SAMAHANG
MANGGAGAWA SA REN TRANSPORT-ASSOCIATION OF DEMOCRATIC LABOR
ASSOCIATIONS (SMART-ADLO) REPRESENTED BY ITS PRESIDENT NESTOR
FULMINAR

THE CASE:

There’s this respondent Union called as SMART (Samahang Manggagawa sa Ren-Transport-

Association) that their Collective Bargaining Agreement is due to expire. 2 of its members
expressed their intention to separate themselves together with majority of members of SMART
to form a new union organization in the company, hereinafter the petitioner in this case.
Accordingly, the Ren Transport Corporation stopped paying union dues to SMART because they
already recognized RTEA as the new organized union.

In lieu of this, SMART commenced an action for labor practice in the Labor Arbiter which
granted the petition. On appeal, the NLRC affirmed the decision. In the appellate court, the Court
of Appeals deleted the moral damages ruling that the petitioner is not entitled thereof.

Hence, this petition to the Supreme Court raises the question as to whether the petitioner shall
grant moral damages despite the fact that they are a corporation.

The Supreme Court ruled in the negative. The Supreme Court ruled that while it is true that a
corporation is not, as a general rule, entitled to moral damages. Being a mere artificial being, it is
incapable of experiencing physical suffering or sentiments like wounded feelings, serious
anxiety, mental anguish or moral shock. Absence of factual circumstance proven the damage
against the corporation shall fail to award moral damages.

In the case at bar, while there is a showing of bad faith on the part of the employer in the
commission of acts of unfair labor practice, there is no evidence establishing the factual basis of
the damage on the part of SMART.

In all foregoing, the Court DENIED the instant petition for absence of bad faith.