G.R. No. L-38613 - Pacific Timber Export Corp. vs. Court of Appeals

On April 5, 1994, Numeriano Mallen, Jr. was hired as a waiter at VIPS Coffee Shop and Restaurant, a fine dining establishment located in the Harrison Plaza Commercial Complex in Manila.
His employment involved duties typical of a waiter, and he was subject to the management and policies set by VIPS Coffee Shop and Restaurant.

Beginning in January 1998, respondent availed himself of several types of leaves:

Respondent initially applied for a three-day sick leave from April 18 to April 20, 1998.
Instead of a three-day leave, he was issued a memorandum on April 28, 1998, granting him an extended leave of two and a half months (without pay) to recuperate.

The memorandum detailed a restorative program requiring him to rest, refrain from loitering on the premises, undergo health exercise and medical check-ups, and present a certificate of fitness upon his return.

On May 5, 1998, respondent filed a complaint before the Department of Labor and Employment-National Capital Region (DOLE-NCR) for underpayment of wages and non-payment of holiday pay.
In June 1998, after reporting back to work with a medical certificate, he was refused reinstatement by the management.
On June 22, 1998, the DOLE-NCR recognized issues of constructive dismissal and endorsed his complaint to the NLRC.
On July 23, 1998, respondent filed an additional complaint for illegal dismissal before the NLRC-NCR, and again, on August 3, 1998, his attempt to report back to work was denied.

Labor Arbiter Madjayran H. Ajan found respondent’s dismissal illegal, linking it to both his filing of a complaint and his pattern of absences.
The decision ordered his reinstatement without loss of seniority and awarded him backwages of P88,000.00 (as of August 31, 1999), paternity pay, attorney’s fees, moral damages (P50,000.00), and exemplary damages (P20,000.00).

The NLRC ruled that the complaint for illegal dismissal was premature because the respondent’s cause of action had not yet accrued when he filed on May 5, 1998.
However, considering the closure of the restaurant effective August 26, 1999, the NLRC modified the Labor Arbiter’s decision and instead directed the payment of separation pay (P13,750.00) plus his paternity leave pay (P1,519.00), dismissing the awards for moral and exemplary damages.

The CA upheld that respondent was constructively dismissed due to being granted an extended three-month leave in lieu of the three-day sick leave he applied for.
It set aside the NLRC decision and reinstated the Labor Arbiter’s ruling in favor of respondent.

Whether petitioner, as a corporate officer (specifically the Vice-President of VIPS Coffee Shop and Restaurant), could be held personally liable for the monetary awards granted in favor of respondent arising from his alleged illegal dismissal.

Whether the allegations of constructive dismissal and the actions leading to respondent’s leave (i.e., the granting of a three-month leave instead of a three-day leave) were sufficient to impute personal malice or bad faith to petitioner.

Whether the evidence presented meets the twin requisites required to pierce the corporate veil and hold a corporate officer personally liable, namely:

An expressed allegation that the officer assented to patently unlawful acts or acted with gross negligence or bad faith; and
Clear and convincing proof of such unlawful conduct or bad faith.