National Waterworks and Sewerage Authority v. Court of Industrial Relations
REITERATIONFacts
The Antecedents: On February 14, 1957, seventy-two employees of the former Metropolitan Water District (MWD) filed a motion with the Court of Industrial Relations (CIR) seeking the execution of an award issued on November 25, 1950. This award granted a P0.50 daily salary increase to all MWD employees. The employees alleged that the MWD had paid this increase but stopped in November 1953, thus praying for an order to compel payment from the cessation date and for a computation of the amounts due. Procedural History: The National Waterworks and Sewerage Authority (NAWASA), successor to the MWD, opposed the motion on March 11, 1957. NAWASA contended that the award was terminated pursuant to Section 17 of Commonwealth Act No. 103, as amended, because it did not specify a duration. NAWASA claimed to have given notice of termination on December 29, 1953. On July 19, 1957, the CIR issued an order denying NAWASA's claim, stating that the award could not be terminated by mere notice without court approval. NAWASA's motion for reconsideration was denied, leading to the present petition for review. The Petition: NAWASA filed a petition for review with the Supreme Court, arguing that it could terminate the award by giving notice to the court after three years had elapsed from the date of the award, as provided by Section 17 of Commonwealth Act No. 103, since the award did not specify its duration and was not a compromise. NAWASA contended that the notice given was in accordance with law, and the CIR's requirement for judicial sanction was erroneous.
Issue(s)
Whether the National Waterworks and Sewerage Authority (NAWASA) can unilaterally terminate the award of the Court of Industrial Relations by merely giving notice thereof, pursuant to Section 17 of Commonwealth Act No. 103, as amended. Whether judicial approval is necessary for the termination of an award made by the Court of Industrial Relations, especially when the award does not specify its duration and is not a compromise.
Ruling
The petition is dismissed. The award of the Court of Industrial Relations remains valid and effective. NAWASA cannot unilaterally terminate the award by mere notice; judicial approval is required.
Ratio Decidendi
On Issue 1: The Supreme Court held that NAWASA cannot unilaterally terminate the award by merely giving notice. Section 17 of Commonwealth Act No. 103, while allowing termination by notice after three years if no duration is specified, requires this notice to be given to the Court. This requirement is not merely pro forma but grants the court the right to intervene. The Court's interpretation is that judicial sanction is necessary to ensure that the termination is not arbitrary and does not jeopardize the interests of labor. The award in question was not a compromise but was fixed by the Court after a mature study of the evidence, making it binding upon the parties. On Issue 2: The Court affirmed that judicial approval is necessary for the termination of an award made by the Court of Industrial Relations. Since an award is made as a result of a controversy and is binding upon both parties, its effectivity cannot be terminated ex parte without the court's sanction. The reason is that the award is made in favor of the employee, and it is only fair and just that the employee be heard before their right thereto is terminated. The requirement of notice to the court serves to give the court the opportunity to intervene and protect the interests of labor, preventing arbitrary actions by the employer.
Main Doctrine
The Court of Industrial Relations (CIR) has the authority to approve or deny the termination of its awards. An employer cannot unilaterally terminate an award by merely giving notice, especially if the award was not a compromise and did not specify a duration. The CIR's intervention is necessary to ensure that the termination is not arbitrary and does not prejudice the rights of the laborers.