G.R. No. 1523 - People vs Sosa

Respondent Cezar Durumpili David, Jr. was employed as Service Manager by petitioner Buenaflor Car Services, Inc. (doing business as “Pronto! Auto Services”).
In his role, he was responsible for the overall day-to-day operations, including authority to sign checks, check vouchers, and purchase orders.

The Purchasing Officer (Sonny D. De Guzman) prepared the purchase order.
The order was then submitted to the respondent for review and approval.
Upon approval, a duplicate copy was sent to the supplier.
The Accounting Assistant (Marilyn A. Del Rosario) prepared the request for payment after the goods’ delivery.
The check voucher and check were subsequently signed by one of the authorized officers: respondent, Finance Manager/Chief Finance Officer (Ruby Anne B. Vasay), or Vice President for Operations (Oliver S. Buenaflor).

It was company policy that checks should be issued in the supplier’s name, not in “cash,” and were to be picked up at the company office.

On August 8, 2013, Chief Finance Officer Cristina S. David of the affiliate company, Diamond IGB, Inc., received a call from ChinaBank regarding cleared checks bearing the words “OR CASH” after the payee’s name.
An immediate investigation ensued upon verification of the bank’s report.
On August 22, 2013, petitioner’s President (Exequiel T. Lampa) and Human Resource Manager (Helen Lee) confronted Del Rosario.

Del Rosario admitted, in two separate extrajudicial written confessions, that she had inserted the words “OR CASH” on the checks after their approval, upon instruction from respondent.
She implicated De Guzman for preparing spurious purchase orders and also involved the messenger/driver Jayson G. Caranto, who encashed some of these checks.

As a consequence of the investigation, respondent along with Del Rosario, De Guzman, and Caranto were placed under preventive suspension for thirty (30) days and were asked to submit written explanations.
The investigation revealed a total of twenty-seven (27) altered checks amounting to P1,021,561.72.
On September 20, 2013, respondent and his co-workers were served notices of termination for violations relating to serious misconduct and willful breach of trust in violation of the company’s Code of Conduct and Behavior.
Separate legal actions ensued:

Respondent, De Guzman, and Caranto filed a complaint for illegal dismissal before the NLRC.
On a parallel track, petitioner (through Lee) instituted criminal charges for twenty-seven counts of Qualified Theft through Falsification of Commercial Documents against the involved employees.

The LA ruled on September 29, 2014, that respondent, De Guzman, and Caranto were illegally dismissed.
Backwages, separation pay, and attorney’s fees were awarded.
The LA noted the lack of evidence establishing conspiracy linking respondent with the alterations.

The NLRC based its ruling on the involvement of the respondent in approving the purchase orders, despite Del Rosario’s extrajudicial confession against him being deemed insufficient.

The CA Decision dated November 3, 2015, upheld the NLRC ruling, finding no grave abuse of discretion in determining respondent’s illegal dismissal.
The CA considered Del Rosario’s confession as hearsay against respondent under the res inter alios acta rule.
The CA absolved petitioner’s corporate officer, Buenaflor, and also Diamond IGB, Inc. (a subsidiary with separate juridical personality), from monetary liability.

Petitioner moved for partial reconsideration before both the NLRC (denied on February 9, 2015) and the CA (denied on February 9, 2016), prompting the instant petition for review on certiorari before the Supreme Court.

Whether the Court of Appeals committed reversible error in upholding the NLRC’s ruling that respondent was illegally dismissed.

Was there sufficient evidence to establish respondent’s participation in the alleged scheme to alter checks and defraud the company?
Did the CA err in treating Del Rosario’s extrajudicial confession as inadmissible hearsay against respondent under the res inter alios acta rule?

Whether the employer’s failure to strictly adhere to company procedures in the issuance and alteration of checks exonerates respondent of the charges leveled against him.
Whether substantial evidence exists to justify respondent’s termination on the grounds of serious misconduct and/or willful breach of trust.