G.R. No. 120553 - PhilTranco Service Enterprises, Inc. vs. Court of Appeals

Balagtas Multi-Purpose Cooperative, Inc. (hereinafter “Balagtas”), a duly organized cooperative under Philippine law, employed Josefina G. Hipolito-Herrero (“Josefina”) as a part‑time manager in its Sulok, Balagtas, Bulacan office in April 1991.
Josefina’s initial assignment required her to work from 2:00 to 6:00 p.m., Monday to Friday, at a monthly salary of P4,000.00.

In September 1992, Balagtas established a branch office at Wawa, also in Balagtas, Bulacan. Josefina was required to report at the Wawa branch from 8:00 to 12:00 noon before proceeding to her Sulok office duties in the afternoon.
For the additional work at the Wawa branch, Josefina received a corresponding proportionate increase in her salary.

In early 1994, due to low membership and insufficient transaction volume, the board members of Balagtas contemplated closing the Wawa branch as its operation became financially burdensome.
On May 1, 1994, during their monthly meeting, the board approved Josefina’s leave of absence scheduled from May 9 to May 30, 1994.
Shortly after her approved leave ended on May 30, 1994, Josefina failed to report for work and subsequently tendered her resignation.

Almost nine months later, on February 25, 1995, Josefina filed a complaint with the Provincial Office of the Department of Labor in Malolos, Bulacan, charging illegal dismissal and non-payment of benefits including the 13th month pay (Christmas bonus).
She prayed for reinstatement, backwages, and moral damages.
The case was referred to a Labor Arbiter where, after submission of position papers by the parties, a trial was held.

Payment of P2,000.00 as 13th month pay covering the years 1995 to 1997.
Payment of P188,000.00 as backwages from the date of her dismissal up to the decision.
Payment of P28,000.00 as separation pay dating back to 1991.

Balagtas, aggrieved by the decision, appealed to the National Labor Relations Commission (NLRC).
Instead of posting the required cash or surety bond under Article 223 of the Labor Code, Balagtas filed a manifestation and motion contending an exemption based on Article 62(7) of Republic Act No. 6938 (Cooperative Code).

On July 20, 1998, the NLRC issued an order directing the posting of a cash or surety bond amounting to P218,000.00 within ten days, failing which the appeal would be deemed waived.
The NLRC later dismissed petitioners’ motion for reconsideration.
Subsequently, petitioners filed a petition for certiorari with the Court of Appeals (CA) alleging grave abuse of discretion on the part of the NLRC for imposing the bond requirement despite the Cooperative Code exemption.
The CA, after initially dismissing the petition for procedural deficiencies and then admitting it upon elevation, ultimately resolved to dismiss the petition in its decision dated September 27, 2002, reasoning that the exemption granted by the Cooperative Code applied exclusively to appeals from decisions of “inferior courts.”

Whether the provision in Article 62(7) of the Cooperative Code, which exempts cooperatives from putting up an appeal bond, applies to Balagtas in its appeal before the NLRC.
Whether the term “inferior courts” in the Cooperative Code should be construed to include quasi-judicial bodies like the NLRC.

Whether a certification issued by the Cooperative Development Authority, indicating that the net assets of the cooperative exceed the amount of the required bond, constitutes a substantial compliance with the bond posting requirement as an alternative form of security.