Zamboanga City Electric Cooperative, Inc. v. Buat
REITERATIONFacts
The Antecedents: Petitioner Zamboanga City Electric Cooperative, Inc. (ZAMCELCO) is an electric cooperative organized under Presidential Decree No. 269, as amended. Private respondent Engr. Patricio S. Dela Peña, Jr. was employed by ZAMCELCO in 1974 and rose through the ranks to become General Manager on November 14, 1984. In June 1986, ZAMCELCO's board of directors created a fact-finding committee to investigate charges of unlawful disbursement or misappropriation of funds, with the private respondent being among those charged. Three audit teams conducted inquiries; the first recommended dismissal if unliquidated cash advances were not settled, the second recommended stricter financial measures and streamlining, and the third recommended dismissal for mismanagement and disregard of NEA guidelines. On April 13, 1988, the NEA Administrator directed private respondent to explain why he should not be summarily dismissed and suspended him. Private respondent submitted his explanation on May 10, 1988. On July 15, 1988, ZAMCELCO's board passed Resolution No. 21A-88 terminating private respondent's services on grounds of mismanagement and loss of trust and confidence. Three days later, private respondent resigned, later claiming he was pressured to do so. Procedural History: On April 3, 1989, private respondent filed a complaint with the NLRC for illegal dismissal, alleging lack of due process and claiming back wages, leave credits, retirement pay, damages, and attorney's fees, but praying for separation pay in lieu of reinstatement. Labor Arbiter Harun B. Ismael upheld the dismissal in a decision dated October 27, 1989. Private respondent appealed to the NLRC Fifth Division, which reversed and set aside the Labor Arbiter's decision in a Resolution promulgated on March 21, 1991. ZAMCELCO filed a Motion for Reconsideration, which was denied by the NLRC in a Resolution promulgated on April 30, 1991. The Petition: ZAMCELCO filed a petition for certiorari under Rule 65 of the Revised Rules of Court to set aside the NLRC's Resolution dated March 21, 1991, and its subsequent Resolution denying the motion for reconsideration.
Issue(s)
Whether the NLRC had jurisdiction to entertain the petition of private respondent, considering that the power to discipline, suspend, or dismiss general managers of electric cooperatives rests with the cooperative's board, subject to NEA Administrator review and approval. Whether the dismissal of private respondent from service was legal.
Ruling
The petition is GRANTED. The decision of the NLRC is REVERSED. The decision of the Labor Arbiter in Case No. RAB-09-04-00080-89 is REINSTATED.
Ratio Decidendi
On the issue of NLRC jurisdiction: The Court held that the dismissal of private respondent arose from a labor dispute, which falls within the original and exclusive jurisdiction of the NLRC, as provided by Article 217 of the Labor Code. Furthermore, even assuming arguendo that the NLRC lacked jurisdiction, petitioner ZAMCELCO was estopped from raising this issue. The Court cited the principle of estoppel, emphasizing that ZAMCELCO participated in the proceedings from start to finish, filed its position paper, and only raised the issue of jurisdiction when the NLRC's resolution was adverse. The Supreme Court frowns upon the practice of submitting a case for decision and accepting the judgment only if favorable, while attacking it for lack of jurisdiction when adverse, as established in Soco vs. Merco. On the legality of the dismissal: The Court found that the dismissal of private respondent was legal. Petitioner ZAMCELCO contended that private respondent held a position of trust and confidence, and loss of trust and confidence is a just cause for termination. Before dismissal, ZAMCELCO created a committee to investigate the charges, and private respondent was given an opportunity to answer. The committee recommended dismissal. Additionally, three NEA audit teams unanimously found grounds for suspension and eventual dismissal. ZAMCELCO's board passed Resolution No. 21A-88 terminating private respondent based on mismanagement and loss of trust and confidence, which was approved by the NEA. The Court concluded that the dismissal had a basis and was not attended by bad faith. Consequently, private respondent was not entitled to moral damages, as these are recoverable only when dismissal is attended by bad faith, fraud, or is oppressive to labor, or contrary to morals, good customs, or public policy, citing Spartan Security Detective Agency, Inc. v. National Labor Relations Commission.
Main Doctrine
The NLRC has jurisdiction over termination disputes, and a party is estopped from questioning jurisdiction after participating in the proceedings. Dismissal based on loss of trust and confidence is a just cause for termination, provided procedural due process is observed.