Case Summary (G.R. No. 80039)
Procedural Posture
Petitioner filed a labor complaint with the NLRC seeking unpaid wages and benefits. The labor arbiter awarded petitioner P17,060.07. On appeal, the NLRC reversed and allowed the employer to apply that amount as set‑off against petitioner’s unpaid stock subscription, treating petitioner as a debtor to the corporation. Petitioner sought review by certiorari, arguing lack of jurisdiction and unlawful withholding of wages.
Jurisdictional Analysis
The Supreme Court held that the NLRC lacks jurisdiction to resolve intra‑corporate disputes such as unpaid stock subscriptions; such controversies fall within the exclusive competence of the Securities and Exchange Commission pursuant to Section 5 of PD No. 902‑A. Because the controversy concerning unpaid subscriptions is an internal corporate matter, the NLRC is not the proper forum to adjudicate that claimed corporate obligation.
Merits—Due Date of Unpaid Subscriptions
Even assuming, arguendo, that the NLRC could exercise jurisdiction in the circumstances of this case, the Court found that unpaid subscriptions are not due and payable until the corporation makes a formal call for payment under Section 67 of the Corporation Code. The record did not show (a) any board resolution calling for payment of unpaid subscriptions, nor (b) proof that a notice of such call was sent to petitioner. The only documentary showing was a corporate deduction by respondents from amounts payable to petitioner, which the Court held was not equivalent to a lawful call and notice.
Legality of the Set‑off Against Wages
The Court further held that, if there had been a proper call, the NLRC still could not validly offset the unpaid subscription against wages and benefits due the employee. Article 113 of the Labor Code limits wage deductions to three specific situations: insurance premium reimbursement with worker’s consent, authorized union dues checkoff, or deductions authorized by law or Secretary of Labor regulations. The attempted deduction/set‑off of unpaid stock subscription did not fall within these exceptions and therefore was unlawful. Consequently, the set‑off performed by respondents was premature and
...continue readingCase Syllabus (G.R. No. 80039)
Case Citation and Procedural Reference
- Reported at 254 Phil. 444, First Division, G.R. No. 80039, decided April 18, 1989.
- The case reached the Supreme Court by a petition for review of a decision of the National Labor Relations Commission (NLRC) dated September 18, 1987.
- The only remedy provided by law from an NLRC decision is a special civil action for certiorari under Rule 65 of the Rules of Court based on jurisdictional grounds or alleged grave abuse of discretion amounting to lack or excess of jurisdiction; not by way of appeal by certiorari.
- The Supreme Court, however, treated the petition in the interest of justice as a special civil action for certiorari.
Parties and Roles
- Petitioner: Ernesto M. Apodaca.
- Respondents: National Labor Relations Commission (public respondent), Jose M. Mirasol, and Intrans Phils., Inc. (private respondents).
- Private respondents included the corporation (Intrans Phils., Inc.) and an individual respondent (Jose M. Mirasol).
Facts
- On August 28, 1985, respondent Jose M. Mirasol persuaded petitioner to subscribe to 1,500 shares of respondent corporation at P100.00 per share, totaling P150,000.00.
- Petitioner made an initial payment of P37,500.00 toward the subscription.
- On September 1, 1975, petitioner was appointed President and General Manager of the respondent corporation.
- Petitioner resigned his position on January 2, 1986.
- On December 19, 1986, petitioner filed with the NLRC a complaint against private respondents for unpaid wages, cost of living allowance, balance of gasoline and representation expenses, and bonus compensation for 1986.
- Private respondents admitted owing petitioner P17,060.07 but applied that amount to the unpaid balance of his stock subscription, claimed to be P95,439.93.
- Records show the respondent corporation deducted the amount due to petitioner from the amount receivable from him for unpaid subscriptions; private respondents referenced a letter dated 8 February 1986 addressed to petitioner’s counsel (Untalan, Dula, Banares, Viernes and Associates) (pages 36–37, Rollo).
Issues Presented
- Does the National Labor Relations Commission have jurisdiction to resolve a claim for non-payment of stock subscriptions to a corporation?
- Assuming the NLRC has jurisdiction, can an obligation arising from unpaid stock subscriptions be offset against a money claim (wages and benefits) of an employee against the employer?
Labor Arbiter Proceedings and Ruling
- Petitioner and private respondents submitted position papers to the labor arbiter.
- The labor arbiter, in a decision dated April 28, 1987, sustained petitioner’s claim for P17,060.07.
- The labor arbiter’s ground: the employer has no right to withhold payment of wages already earned under Article 103 of the Labor Code (as cited in the labor arbiter’s decision).
NLRC Proceedings and Ruling
- Private respondents appealed the labor arbiter’s decision to the NLRC.
- The NLRC, in a decision dated September 18, 1987, reversed the labor arbiter and held:
- A stockholder who fails to pay h