Title
Cadiz vs. Court of Appeals
Case
G.R. No. 153784
Decision Date
Oct 25, 2005
Bank employees dismissed for diverting funds, forging documents, and breaching trust; Supreme Court upheld termination, citing just cause and due process compliance.

Case Summary (G.R. No. 153784)

Factual Background and Allegations

The petitioners were employed in different capacities at the main office branch (MOB) of Philippine Commercial International Bank (PCIB). The issue arose when Rosalina B. Alqueza filed a complaint related to the non-receipt of a $600 demand draft drawn against the bank. Investigations revealed that the demand draft was improperly deposited into a savings account held by Sonia Alfiscar. Evidence suggested a scheme of diverting funds meant for other accounts, leading to internal acknowledgment of the petitioners’ involvement in fraudulent activities. A subsequent audit corroborated these claims, revealing serious accounting improprieties including miscoding of checks and lack of proper validations.

Disciplinary Proceedings and Administrative Actions

Due to the findings from the audit, the bank issued show-cause memoranda to the petitioners, demanding explanations for their misconduct. After unsatisfactory responses, the bank dismissed the petitioners for violations of its Code of Discipline. In response, the petitioners filed a complaint for illegal dismissal with a labor arbiter who initially ruled in their favor, citing procedural inadequacies in the dismissal notices as grounds for reinstatement.

Appeals and Reversal

Upon appeal, the National Labor Relations Commission (NLRC) reversed the labor arbiter’s decision, concluding that the dismissal was justified based on substantial evidence of misconduct. The Court of Appeals upheld the NLRC's ruling, determining that the allegations against the petitioners established just cause for their termination, rejecting claims of insufficient evidence or improper procedure.

Legal Standards and Issues Presented

The case revolves around whether the Court of Appeals erred in its decisions and whether the petitioners were dismissed without just cause or due process. Respondent bank contended that the issues raised by the petitioners were factual in nature, typically not reviewable by the Supreme Court under Rule 45 of the Rules of Court. However, the Supreme Court acknowledged the appeal based on conflicting factual findings from the labor arbiter and the appellate bodies.

Analysis of Factual Findings

The Supreme Court undertook a thorough examination of the findings, siding with the conclusion reached by the NLRC and Court of Appeals that the petitioners had engaged in fraudulent activities. It was emphasized that the miscoding of deposit slips constituted a significant breach of trust. The labor arbiter’s characterization of these actions as mere procedural lapses was criticized, as such errors were intrinsic to the commission of fraud.

Procedural Due Process in Dismissal

The Court found that the bank adhered to the procedural requirements as dictated by Article 277(b) of the Labor Code. The process entailed providing notice of the investigation and the reasons for dismissal, which were sufficient for the petitioners to respond adequately. The issuance of both show-cause memoranda and subsequent dismissal notices followed the appropriate protocol, affirming that due process was indeed satisfied.

Conclusion on Just Cause for Termination

The determination of just cause

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