Title
Associated Labor Union vs. Borromeo
Case
G.R. No. L-26461
Decision Date
Nov 27, 1968
ALU's picketing at SUGECO and related sites was deemed lawful; CFI lacked jurisdiction, and injunctions violated labor law requirements.
labor dispute
jurisdiction
preliminary injunctions

Case Summary (G.R. No. 16318)

Factual Background and Labor Dispute

The collective bargaining contract between ALU and SUGECO lapsed on January 1, 1966. During renewal negotiations, twelve (12) SUGECO employees resigned from ALU in late February 1966. After the resignations, the negotiations ceased. On March 1, 1966, ALU requested SUGECO to bar those twelve (12) resigned employees from reporting for work unless they produced clearance from ALU. SUGECO rejected the request, citing irreparable injury, the alleged lapse of the bargaining contract, and the asserted inability to demand such clearance from employees after the contract period.

ALU then accused SUGECO of bargaining in bad faith and of having supervisors who campaigned for the resignations of ALU members. ALU also threatened a strike and picketing, stating that picket lines would be established “in any place where your business may be found.” Counsel for SUGECO replied on March 3, 1966 that, because of the resignations, ALU no longer represented the majority of SUGECO employees for negotiation and recognition purposes.

ALU proceeded to strike and picket the SUGECO plant on March 4, 1966. The following day, March 5, 1966, SUGECO filed Civil Case No. R-9221 to restrain ALU from picketing the plant, the SUGECO offices at Cebu City, and other locations in the Philippines. An ex parte writ of preliminary injunction was issued forthwith by Judge Amador E. Gomez, as Judge of the CFI of Cebu, Branch II.

Concurrently, ALU filed unfair labor practice charges before the Court of Industrial Relations (CIR), alleging coercion and pressure by SUGECO and its general manager, Concepcion Y. Lua, and its supervisors, resulting in the employees’ resignations from ALU. The CIR acting prosecutor filed the corresponding complaint on April 29, 1966.

ALU contested the CFI injunction. Its motion for reconsideration was denied, and ALU then instituted Case No. L-25999 before the Supreme Court on May 9, 1966, seeking certiorari and prohibition, with preliminary injunction. The Supreme Court granted preliminary injunction on May 16, 1966, and later decided L-25999 in ALU’s favor by annulling the CFI writ of preliminary injunction and declaring permanent the Supreme Court injunction issued on February 9, 1967.

Events After the Supreme Court Injunction and Filing of Civil Case No. 9414

After the Supreme Court writ became effective, ALU resumed picketing at the SUGECO plant in Mandaue. ALU also began picketing additional sites associated with SUGECO’s management, including the house of Mrs. Lua, SUGECO’s general manager, and her husband Antonio Lua, and the store of Cebu Home and Industrial Supply. The store was managed by Mr. Lua and dealt in general merchandise including oxygen, acetylene, and cooking gas produced by SUGECO.

On June 21, 1966, respondents Cebu Home and Antonio Lua filed a complaint in the CFI of Cebu, docketed as Civil Case No. 9414, seeking to restrain ALU from picketing the store and the residence and to recover damages. Judge Borromeo issued an order requiring ALU to show cause why a writ of preliminary injunction should not be issued.

ALU challenged the court’s jurisdiction through a memorandum and a motion to dismiss, arguing that the case had grown out of a labor dispute, was intimately connected with an unfair labor practice case pending before the CIR, and involved a strike the injunction against which had been lifted by the Supreme Court in L-25999. Despite ALU’s challenge, on June 30, 1966, Judge Borromeo issued a writ of preliminary injunction upon bond of P3,000.00, restraining ALU from (1) picketing the store and the residence, (2) preventing employees from entering or leaving those premises, (3) stopping vehicles entering or leaving the premises, (4) preventing sale and distribution of merchandise connected with the business, and (5) performing acts disturbing privacy and tranquility of the petitioner and his family.

Respondents sought to amend the order on July 4, 1966. ALU sought reconsideration and the lifting of the writ on July 6, 1966. Acting on respondents’ motion, Judge Borromeo issued on July 22, 1966 another order, reasoning that the petition was justified and that the complained acts, if not restrained, would render the writ ineffective. This second order further restrained ALU from preventing respondents from unloading and hauling merchandise and delivering/loading empty tanks and supplies to transportation for Manila or other places, and from preventing, obstructing, or molesting respondents and their employees in connection with their business.

On July 25, 1966, Judge Borromeo denied ALU’s motion to dismiss and to reconsider, and ALU commenced the present action on August 26, 1966.

The Parties’ Contentions

ALU asserted that the CFI had no jurisdiction over Civil Case No. 9414 because the controversy had grown out of a labor dispute, was intimately connected with CIR proceedings for unfair labor practice, and involved strike-related picketing previously addressed by the Supreme Court in L-25999. It also contended that even if jurisdiction existed, the writs were null and void because Judge Borromeo failed to comply with Section 9(f) of Republic Act No. 875, and with Section 9(d)(5), both of which require specific factual findings for the issuance of injunctions in labor disputes.

Respondents countered that the issue did not fall within CIR jurisdiction because there was no employer-employee relationship and no labor dispute between ALU’s members and Cebu Home. They also argued that SUGECO products sold and distributed by Cebu Home came from other parts of the Philippines, not from the SUGECO plant in Mandaue. They denied that the residence of Mr. Lua was being used to store and refill SUGECO gas for resale.

Legal Basis and Reasoning of the Court

The Court rejected respondents’ jurisdictional theory and held that Section 5(a) of Republic Act No. 875 vested the CIR with exclusive jurisdiction over the prevention of unfair labor practices. It further held that a “labor dispute” under the statute did not require a strict proximate employer-employee relationship between the parties in the injunction case. It emphasized that for Section 9 to apply—governing restraining orders or temporary or permanent injunctions in cases involving or growing out of a labor dispute—there was no indispensable requirement that the persons involved be employees of the same employer, although that was typically the case.

The Court explained that Section 9 governed disputes involving persons engaged in the same industry, trade, craft, or occupation, and persons with direct or indirect interests therein, including members or officers of employer or employee associations participating in the labor dispute. It also recognized that a person or association could be treated as participating in or interested in a labor dispute if relief was sought against it and it was engaged in the relevant industry or had a direct or indirect interest in the occurrence of the labor dispute.

Applying these principles, the Court found no dispute regarding the existence of a labor dispute between ALU and SUGECO. It also found that Mrs. Lua, SUGECO’s general manager, was the wife of Antonio Lua, and that Cebu Home was engaged in marketing SUGECO products. The Court further reasoned that because of the conjugal relationship, Mr. Lua had an interest in the management by Mrs. Lua of SUGECO and in the success or failure of her controversy with ALU, because it could affect the conjugal partnership’s interests. Additionally, as a distributor of SUGECO products, Cebu Home had at least an indirect interest in the labor dispute between SUGECO and ALU and in Civil Case No. R-9221.

On that basis, the Court held that respondents fell within the class of persons for whom Section 9 of Republic Act No. 875 applied to Civil Case No. 9414. The Court also relied on the cited teaching in Goldfinger v. Feintuch, explaining that peaceful picketing could extend beyond the manufacturer’s plant to a nonunion product sold through retailers when there existed unity of interest between the manufacturer and the retailers, because otherwise the union would be deprived of a fair means of bringing its grievance to the public.

The Court also treated ALU’s evidentiary allegations as sufficient for jurisdictional purposes. It noted that ALU introduced evidence that SUGECO products were being distributed through Cebu Home as a means to circumvent or offset the adverse effects of ALU’s picketing at the SUGECO plant and offices. It stated that respondents’ denials—that Cebu Home purchased SUGECO products before the strike or received some products from other parts of the country—did not remove the dispute from Section 9 because Cebu Home, as a distributor, was engaged in the same trade as SUGECO. The Court further reasoned that ALU had struck against SUGECO and had announced that picketing would occur “any place where your business may be found,” and that SUGECO in Cebu was described as a sister company of SUGECO elsewhere in the Philippines. The Court supported this approach by analogy to American Brake Shoe Co. v. District Lodge 9 of International Association of Machinists, and it quoted American Jurisprudence to the effect that the constitutional guarantee of free speech could be infringed by a policy prohibiting peaceful picketing merely because it is conducted by persons not employed at the particular place, when the picketing is still directed at a labor dispute and there is unity of interest between the entities involved.

Finally, the Court addressed a procedural point critical to jurisdiction. It rejected Judge Borromeo’s app

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