Matling Industrial v. Coros
ABANDONMENTFacts
The Antecedents: Ricardo R. Coros was dismissed by Matling Industrial and Commercial Corporation (Matling) from his position as Vice President for Finance and Administration. Following his dismissal, Coros filed a complaint for illegal suspension and illegal dismissal against Matling and certain corporate officers with the National Labor Relations Commission (NLRC). The petitioners moved to dismiss the complaint, arguing that the dispute was intra-corporate and thus fell under the jurisdiction of the Securities and Exchange Commission (SEC) because Coros was allegedly a member of Matling's Board of Directors and its Vice President. Coros opposed the motion, asserting that his directorship was doubtful and that his termination was as Vice President, not as a Director. Procedural History: The Labor Arbiter (LA) initially granted the motion to dismiss, ruling that Coros was a corporate officer and that the controversy was under the SEC's jurisdiction. Coros appealed to the NLRC, which set aside the LA's order, concluding that Coros was not a corporate officer as his position was not listed in Matling's By-Laws. The NLRC remanded the case to the LA for further proceedings. The petitioners sought reconsideration, but the NLRC denied it. Subsequently, the petitioners filed a petition for certiorari with the Court of Appeals (CA), challenging the NLRC's ruling. The CA dismissed the petition, affirming that Coros' position was not a corporate office and that the LA had jurisdiction. The Petition: The petitioners are now before the Supreme Court via a petition for review on certiorari, challenging the CA's decision and resolution. They contend that Coros was a stockholder and member of Matling's Board of Directors, as well as its Vice President for Finance and Administration, and that the CA erred in holding that the Labor Arbiter had jurisdiction. The core issue presented to the Supreme Court is whether Coros was a corporate officer of Matling, which would determine whether his dismissal constituted an intra-corporate dispute cognizable by the RTC (formerly SEC) or a termination dispute within the LA's jurisdiction.
Issue(s)
Whether the respondent's position as Vice President for Finance and Administration was a corporate office. Whether the respondent's status as a Director and stockholder automatically converted his dismissal into an intra-corporate dispute. Whether the Labor Arbiter or the Regional Trial Court has jurisdiction over the respondent's complaint for illegal dismissal.
Ruling
The appeal fails. The Supreme Court affirmed the decision of the Court of Appeals, holding that the Labor Arbiter has jurisdiction over the respondent's complaint for illegal dismissal because his position as Vice President for Finance and Administration was not a corporate office. The Court ruled that for a position to be considered a corporate office, it must be expressly mentioned in the corporation's By-Laws, or created by the Board of Directors and filled by election or appointment by the Board or stockholders. The Court further clarified that the status of director or stockholder does not automatically make a dismissal an intra-corporate dispute if the position itself is not a corporate office.
Ratio Decidendi
On the issue of whether the respondent's position as Vice President for Finance and Administration was a corporate office: The Court held that the respondent's position was not a corporate office. Section 25 of the Corporation Code provides that corporate officers are those expressly mentioned in the By-Laws, or elected by the Board of Directors. Matling's By-Laws listed only the President, Executive Vice President, Secretary, and Treasurer as corporate officers. While By-Law No. V granted the President the power to create new offices and appoint officers, this power was limited to creating non-corporate offices for ordinary employees. The Court reiterated that an office is created by the charter or by-laws and the officer is elected by the directors or stockholders, whereas an employee is employed by a managing officer. Therefore, the position of Vice President for Finance and Administration, created by the President and not expressly listed in the By-Laws, was an ordinary office, not a corporate office. On the issue of whether the respondent's status as Director and stockholder automatically converted his dismissal into an intra-corporate dispute: The Court ruled that this status does not automatically convert the dismissal into an intra-corporate dispute. The determination of jurisdiction depends on both the status of the parties and the nature of the controversy. In this case, the respondent's appointment to Vice President for Finance and Administration was based on his long tenure and service as an employee, not on his status as a director or stockholder. His dismissal from this position did not affect his status as a director or stockholder. Therefore, the dispute was primarily a termination dispute cognizable by the Labor Arbiter. On the issue of jurisdiction: The Court reiterated that the Labor Arbiter has original and exclusive jurisdiction over termination disputes. Jurisdiction shifts to the SEC (now RTC) only when the dispute involves an intra-corporate matter, specifically concerning corporate officers. Since the respondent was found to be an ordinary employee holding an ordinary office, his dismissal constituted a termination dispute falling under the jurisdiction of the Labor Arbiter. The Court emphasized that the nature of the position, not merely the title or the parties' relationship, determines jurisdiction.
Main Doctrine
The determination of whether a complaint for illegal dismissal is cognizable by the Labor Arbiter or the Regional Trial Court hinges on whether the dismissed individual was a regular employee or a corporate officer. A position must be expressly mentioned in the By-Laws to be considered a corporate office; otherwise, it is an ordinary office cognizable by the Labor Arbiter.