G.R. No. 80728 - Pearl S. Buck Foundation, Inc. vs. National Labor Relations Commission

William A. Grattage was employed by The Standard Fuel Company as a collector and was accustomed to receiving a monthly salary of P100.
On October 14, 1910, he tendered his resignation to depart for the United States aboard the transport Logan, scheduled to sail on October 15, 1910.

Upon resigning, Grattage demanded the balance of his due salary amounting to 79 centavos from the defendant.
Instead of settling his salary, the defendant allegedly took malicious steps, which included filing a criminal complaint against him.

The defendant charged Grattage with the crime of estafa, alleging that on October 13, 1910, he had illegally and fraudulently appropriated P22 from a transaction with “The Distilled Water Company” instead of remitting it to the company.
Based on this charge, Grattage was arrested on October 15, 1910, aboard the transport Logan, where his arrest occurred in full view of passengers and crew, and he was confined at the Luneta police station until he was released on October 17, 1910, after the municipal court hearing found no supporting evidence.

Grattage filed his complaint in the Court of First Instance alleging that the false charge caused him moral and pecuniary damages, including payment of attorney’s fees and enduring mental anguish from the humiliation and reputational injury.
The defendant, in response, filed a demurrer on December 1, 1910, claiming that the complaint was ambiguous, vague, and insufficient to state a cause of action.
On December 16, 1910, the lower court sustained the demurrer. Grattage took an exception and, despite his brief window to amend his complaint (granted on January 7, 1911), he decided not to amend and maintained his original complaint.
Consequently, on January 26, 1911, the court dismissed the action with costs in favor of the defendant, leading to Grattage’s appeal via bill of exceptions.

Whether the plaintiff’s action for indemnity due to alleged injury and damage from a false, malicious accusation can be maintained before the courts.
Whether the failure of the municipal judge to expressly certify that the accusation was false and libelous precluded the plaintiff’s claim.

Whether under Article 326 of the Penal Code and corresponding provisions in the Rules of Criminal Procedure, the absence of an express certification of falsehood and malice in the dismissal order bars any civil recovery for damages.
The implication of the rule that no criminal or civil proceeding for false accusation may be initiated unless the judge’s order explicitly mandates prosecuting the accusing party for false accusation.

Whether the decision in Gonzalez Quiros vs. Palanca Tan-Guinlay, which requires a judicial order to proceed against the accuser before recovering damages, applies to the present case.
The broader question of ensuring that judicial decisions align with the principles governing malicious prosecution, both from Philippine jurisprudence and analogous Spanish legal precedent.