Facts:

On May 3, 1988, the Philippine Amusement and Gaming Corporation (PAGCOR) terminated the employment of Joel Montoya, who served as a Table Supervisor at Casino Filipino, citing loss of confidence as the reason for his dismissal. Montoya was formally notified of his termination on May 5, 1988. Claiming that his dismissal was executed without due process, Montoya filed a complaint for damages and attorney's fees against PAGCOR in the Regional Trial Court of Angeles City on June 7, 1988. In response, PAGCOR filed a motion to dismiss, arguing that the court lacked jurisdiction over the case, as it was a money claim arising from an alleged illegal dismissal, which should be addressed by a labor arbiter and the National Labor Relations Commission (NLRC). Montoya countered that PAGCOR, being a government-controlled corporation established under Presidential Decree No. 1869, was not subject to the Labor Code. The trial court, presided over by Judge Eliodoro B. Guinto, denied PAGCO...

Facts:

• Termination of Employment: On May 3, 1988, the Philippine Amusement and Gaming Corporation (PAGCOR) terminated Joel Montoya, a Table Supervisor at Casino Filipino, on the grounds of loss of confidence. He was formally notified on May 5, 1988.
• Complaint Filed: Montoya filed a complaint for damages and attorney’s fees with the Regional Trial Court (RTC) of Angeles City on June 7, 1988, alleging that his dismissal was without due process.
• Jurisdictional Dispute: PAGCOR filed a motion to dismiss, arguing that the complaint, being a money claim arising from alleged illegal dismissal, fell under the jurisdiction of the labor arbiter and the National Labor Relations Commission (NLRC). Montoya countered that PAGCOR, as a government-controlled corporation under PD 1869, was not covered by the Labor Code.
• Trial Court Decision: The RTC denied PAGCOR’s motion to dismiss, citing the case of National Housing Authority v. Juico, which held that PAGCOR, as a government-owned corporation, belonged to the Civil Service. However, the court also ruled that PD 807 did not vest exclusive jurisdiction in the Civil Service Commission (CSC), allowing the RTC to hear the case under BP 129.
• Court of Appeals Decision: The Court of Appeals affirmed the RTC’s decision, stating that the issue was not a labor dispute but concerned the manner of dismissal, which fell under the jurisdiction of regular courts.

Issue:

• (Unlock)

Ruling:

• (Unlock)

Ratio:

1. Jurisdiction of Civil Service Authorities: Government-owned or controlled corporations with original charters, like PAGCOR, are part of the Civil Service under Article IX-B, Section 2(1) of the 1987 Constitution. Disputes involving their employees fall under the jurisdiction of the MSPB and CSC.
2. Labor-Related vs. Civil Claims: While regular courts have jurisdiction over civil claims not involving labor disputes, claims arising from employment relationships, even if framed as civil actions, must be resolved by the appropriate labor or civil service authorities.
3. Exhaustion of Administrative Remedies: Before resorting to judicial action, employees of government-owned corporations must exhaust administrative remedies through the MSPB and CSC.
4. Confidential Appointees: Employees of PAGCOR, classified as confidential appointees, serve at the pleasure of their superiors. Loss of confidence is a valid ground for termination, and such matters should be resolved by the Civil Service authorities.