Case Digest (G.R. No. 110827)
Facts:
Calabash Garments, Inc. was the subject of a complaint for illegal lockout filed by Calabash Workers Union-Associated Labor Union-TUCP before the NLRC on 19 June 1991, later amended on 2 September 1991 to include G.G. Sportswear Manufacturing Corporation as co-respondent. After clarificatory questions and submission for resolution, the Labor Arbiter ruled on 1 September 1992 that Calabash Garments, Inc. and G.G. Sportswear were solidarily liable, including monetary awards.
On 31 May 1993, the NLRC denied Calabash Garments, Inc. and co-respondent’s motions for reduction of appeal bond and required a joint bond of P8,053,500.00 within ten days, warning that failure would dismiss the appeal. The NLRC denied their motions for reconsideration on 29 June 1993, prompting Calabash Garments, Inc. to file a Rule 65 petition, arguing grave abuse of discretion in refusing to reduce the bond.
Issues:
- Whether the NLRC gravely abused its discretion in denying Calabash Garments, Inc.’s motion for reduction of the appeal bond.
- Whether the bond amount required was excessive such that reduction was warranted in a meritorious case.
Ruling:
The Court dismissed the petition for lack of merit, finding no grave abuse of discretion by the NLRC.
The Court held that the NLRC properly applied the rule requiring an employer’s cash or surety bond to perfect an appeal in monetary award cases and that the authority to reduce the bond under its rules is discretionary and applies only in meritorious cases.
Ratio:
The Court explained that Article 223 of the Labor Code requires an employer appealing a decision involving a monetary award to post a cash or surety bond to protect the workers and discourage dilatory or evasive appeals. Consistent with this, the NLRC’s Section 6, Rule VI allows bond reduction only in meritorious cases upon motion.
It further found petitioners’ insistence that the bond was unduly onerous to be unsupported. The NLRC determined—after checking with an accredited surety—that the required bond was P8,053,500.00 and that the premium and related charges were far less than petitioners portrayed; collateral used by the surety (e.g., time deposits) would not constitute an expense in the way claimed. Because petitioners failed to show that their case was meritorious or that the NLRC’s ruling was arbitrary, no reduction was warranted.
Doctrine:
- In cases involving a monetary award, an employer’s appeal may be perfected only upon posting a cash or surety bond equivalent to the monetary judgment.
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