G.R. No. 198357 - Building Care Corp. vs. Macaraeg

Case Summary (G.R. No. 198357)

Factual Background

The respondent was employed by petitioners as a security guard beginning August 25, 1996 and was posted at Genato Building in Caloocan City. On March 9, 2008 petitioners relieved her of that post and temporarily assigned her to Bayview Park Hotel from March 9 to 13, 2008. After that temporary posting respondent alleged that petitioners ceased to give her further assignments for more than nine months. She maintained that the prolonged absence of assignment amounted to constructive dismissal, which compelled her to file a complaint for illegal dismissal and other claims.

Petitioners’ Allegations of Misconduct

Petitioners asserted that the client requested respondent’s relief due to habitual tardiness, persistent borrowing of money from employees and tenants of the client, and sleeping on the job. Petitioners averred that they asked respondent to explain the alleged infractions but she failed to do so. Petitioners alleged that they temporarily posted respondent at Bayview Park Hotel but thereafter did not extend her posting because she failed to meet the client’s standards.

Administrative Proceedings Before the PNP Division

The respondent filed an administrative complaint for illegal dismissal with the PNP Security Agencies and Guard Supervision Division on June 18, 2008, but she failed to attend the conference hearings in that administrative proceeding. Petitioners presented at the conference a new assignment order detailing respondent’s posting at Ateneo de Manila University, but because respondent was absent they did not personally serve her with that order. Petitioners then sent respondent a letter directing her to report to headquarters for work assignment; respondent did not comply and instead pursued her complaint with the Labor Arbiter.

Labor Arbiter Proceedings and Decision

Respondent filed a complaint for illegal dismissal and other monetary claims with the Labor Arbiter. The Labor Arbiter rendered a decision on May 13, 2009 dismissing the charge of illegal dismissal for lack of merit but awarding respondent PHP 5,000 as financial assistance. The Labor Arbiter dismissed respondent’s other claims for lack of merit. The Labor Arbiter thus ruled in favor of petitioners on the principal charge of illegal dismissal.

NLRC Proceedings

Respondent filed a notice of appeal with the National Labor Relations Commission. The NLRC, however, dismissed the appeal as filed out of time in a decision dated October 23, 2009, thereby declaring that the Labor Arbiter’s decision had become final and executory on June 16, 2009. Petitioners relied on the NLRC’s dismissal to assert that the Labor Arbiter’s decision had attained finality and immutability.

Court of Appeals Proceedings and Ruling

The respondent elevated the case to the Court of Appeals by filing a petition for certiorari. On March 24, 2011 the Court of Appeals granted the petition for certiorari, reversed and set aside the NLRC’s October 23, 2009 decision and its March 2, 2010 resolution, and entered judgment declaring that respondent was illegally dismissed. The CA directed private respondents to reinstate respondent without loss of seniority rights, benefits and privileges and to pay backwages and other monetary benefits from the period of illegal dismissal until actual reinstatement. The CA remanded the case to the NLRC solely to determine the amount of monetary liabilities. The CA denied petitioners’ motion for reconsideration by resolution dated August 19, 2011.

Issue Presented

The central issue before the Supreme Court was whether the Court of Appeals erred in liberally applying procedural rules to allow respondent’s belated appeal to be considered on the merits despite its having been filed out of time before the NLRC.

Parties’ Contentions Before the Supreme Court

Petitioners contended that the Labor Arbiter’s decision had become final and executory due to respondent’s failure to file a timely appeal and that the CA erred by excusing the procedural lapse without valid and compelling reasons. Respondent contended that the CA correctly afforded liberality to secure a just determination of her claim of illegal dismissal and that the belated filing of the appeal was attributable to her former counsel.

Supreme Court’s Analysis of Procedural Liberality

The Court recognized that relaxation of procedural rules is permitted only as an exception and that such liberality requires valid and compelling reasons. The Court reviewed controlling jurisprudence, including Marohomsalic v. Cole (G.R. No. 169918, February 27, 2008) and Daikoku Electronics Phils., Inc. v. Raza (G.R. No. 181688, June 5, 2009), which hold that invocation of liberality cannot be made absent justifiable causes and circumstance and that a bare invocation of the interest of substantial justice is insufficient. The Court reiterated the principle that negligence of counsel binds the client and that departure from that rule is warranted only where counsel’s gross negligence deprived the client of due process. The Court found that respondent or her former counsel did not provide any explanation of extraordinary circumstances that justified the belated appeal and that respondent had not been deprived of the opportunity to be heard since she fully presented and argued her case before the Labor Arbiter. The Court cited Heirs of Teofilo Gaudiano v. Benemerito for the principle that perfect

Case Syllabus (G.R. No. 198357)

Parties and Procedural Posture

Petitioners are Building Care Corporation, Leopard Security & Investigation Agency and/or Ruperto Protacio, employers in the security-services business.
Respondent is Myrna Macaraeg, a security guard who commenced employment on August 25, 1996.
The petition is a Petition for Review on Certiorari under Rule 45, Rules of Court challenging the Court of Appeals Decision dated March 24, 2011 and Resolution dated August 19, 2011.
The central procedural question is whether the Court of Appeals properly exercised liberal application of procedural rules to consider a belated appeal to the NLRC.

Key Factual Allegations

Respondent was assigned to Genato Building in Caloocan City and was relieved from that post on March 9, 2008.
Respondent was temporarily assigned to Bayview Park Hotel from March 9 to March 13, 2008, and thereafter allegedly received no further assignment from petitioners.
Respondent alleged constructive dismissal by reason of being given no assignment for over nine months.
Petitioners alleged that respondent was relieved for habitual tardiness, persistent borrowing from employees and tenants, and sleeping on duty, and that respondent failed to explain those infractions when directed.
Respondent filed an administrative complaint with the PNP-Security Agencies and Guard Supervision Division on June 18, 2008, but did not attend hearing conferences in that forum.
Petitioners attempted to serve a new assignment order (for Ateneo de Manila University) and a letter ordering respondent to report to headquarters, but respondent did not comply and instead filed a complaint with the Labor Arbiter.

Procedural History

Respondent filed a complaint with the Labor Arbiter on September 9, 2008 for illegal dismissal, underpayment of salaries, non-payment of separation pay, and refund of cash bond.
The Labor Arbiter rendered a Decision on May 13, 2009 dismissing the illegal dismissal charge but awarding PHP 5,000 as financial assistance.
Respondent filed a notice of appeal to the NLRC, which the NLRC dismissed as filed out of time in its Decision dated October 23, 2009, and declared the Labor Arbiter's Decision final and executory as of June 16, 2009.
Respondent filed a petition for certiorari with the Court of Appeals, which on March 24, 2011 reversed the NLRC and declared respondent illegally dismissed with an order for reinstatement and backwages, and remanded to the NLRC to determine monetary liabilities.
The Court of Appeals denied petitioners' motion for reconsideration by Resolution dated August 19, 2011.
Petitioners brought the present petition under Rule 45, Rules of Court to the Supreme Court.

Issues Presented

Whether the Court of Appeals correctly applied liberal interpretation to consider respondent's belated appeal and resolve the case on the merits.
Whether the negligence of respondent's counsel justified relief from the consequences of failure to take timely appeal.
Whether respondent was deprived of due process such that equitable relief from procedural default was warranted.

Parties' Contentions

Petitioners contended that the NLRC correctly dismissed the appeal as tardy and that the Labor Arbiter's Decision became final and executory, thus entitling them to