Title
Diaz vs. Encanto
Case
G.R. No. 171303
Decision Date
Jan 20, 2016
A professor’s sabbatical leave was denied due to staffing needs; her withheld salaries were deemed lawful for non-compliance with university procedures, but she was entitled to unpaid wages upon submission of required documents.
university professor
sabbatical leave
privilege

Case Summary (G.R. No. 171303)

Factual Background

Elizabeth L. Diaz had been a faculty member of the University of the Philippines since 1963 and was an associate professor in the College of Mass Communication in 1987. She taught a full 12-unit load in the second semester of Academic Year 1987-1988, then took sick leave effective November 23, 1987 until March 1, 1988 and returned to duty on March 2, 1988. On May 3, 1988, she applied directly to the Office of the President for a one-year sabbatical leave with pay effective June 1988 to May 1989 for "rest, renewal and study." The Department Chair, Cecilia Lazaro, initially recommended approval but later, on May 10, 1988, recommended that Diaz be granted any leave of which she might be qualified. Lazaro removed Diaz's name from the final teaching schedule for the first semester of AY 1988-89, apparently to avoid a mid-semester dropping of classes based on prior experience. Diaz received her salary for June 1988, suggesting a possible approval of the sabbatical; thereafter the Dean, Georgina R. Encanto, referred the application to the University Secretary and recommended denial. Payroll actions followed: Encanto instructed a hold on Diaz's salary effective July 1, 1988; Diaz's name disappeared from the payroll from September 1988 to January 1989. Various administrators including Ernesto G. Tabujara and Gemino H. Abad commented on the application, with Tabujara recommending a leave without pay to allow hiring of a substitute and Abad requesting Diaz to furnish a written background for the denial. The Academic Policy Coordinating Committee reviewed the case on July 21, 1988. University officials instructed that until Diaz formally filed a Report for Duty and confirmed her actual date of return she would be considered AWOL. Diaz taught during the second semester of AY 1988-89 but did not claim salaries because she refused to submit the Report for Duty form; she received salaries through July 15, 1989 but not thereafter until she submitted a Report for Duty in July 1990 after compulsory summer leave.

Administrative and Early Judicial Proceedings

On January 3, 1989, Diaz filed a complaint with the Ombudsman against Abad, Tabujara, and Encanto for alleged violation of Section 3(e) of R.A. 3019 concerning the legality of the Report for Duty form as prerequisite to salary. The Ombudsman dismissed the complaint on May 4, 1989, finding that Diaz was rightfully considered on leave without pay for the first semester of AY 1988-89 and advising that she accomplish the Report for Duty form to establish the date of her return; the Ombudsman also suggested that University authorities could, if possible, dispense with the requirement and pay her salaries for actual services rendered from November 3, 1988. Diaz sought relief by two special civil actions for certiorari to the Supreme Court (G.R. No. 88834 and G.R. No. 89207), both of which were dismissed or resolved against her, the Supreme Court noting absence of manifest partiality, evident bad faith, or gross inexcusable negligence by the respondents.

Trial Court Proceedings and Judgment

On July 18, 1989, Diaz filed a civil action against the University of the Philippines, Jose V. Abueva, Encanto, Tabujara, and Abad, alleging conspiracy and joint tortfeasance in denying her sabbatical and withholding salaries and praying for recovery of unpaid salaries, moral and exemplary damages, and attorney's fees. The Regional Trial Court, Branch 71, Pasig City, rendered judgment on April 17, 1996 in favor of Diaz and ordered defendants, except Abueva, to pay unpaid salaries and, except the University and Abueva, to pay moral and exemplary damages and attorney's fees. On September 17, 1996, the RTC denied respondents' motions for reconsideration but amended its decision to absolve Encanto from liability on the ground that her role had been purely recommendatory and that she transmitted her recommendation within eighteen days.

Court of Appeals Disposition

All parties appealed to the Court of Appeals. The CA limited the issue to whether the respondents acted negligently or in bad faith in denying Diaz's sabbatical application and withholding her salaries. In a decision promulgated April 28, 2005, the Court of Appeals reversed and set aside the RTC judgment. It directed the University to pay Diaz PHP 21,879.64 as unpaid salaries and deleted the awards of moral and exemplary damages and attorney's fees. The CA found no negligence or bad faith in the denial of the sabbatical because sabbatical leave is a privilege, not a right, and because any delay was attributable to Diaz's own failure to observe usual procedures and to her refusal to comply with documentary requirements such as the Report for Duty form.

Assignments of Error Presented to the Supreme Court

In her Rule 45 petition, Diaz presented six assignments of error contending that the Court of Appeals disregarded the RTC's factual findings and erred in concluding that respondents acted without negligence or bad faith, erred in treating withholding of salaries as lawful, erred in computing unpaid salaries, and erred in refusing to find Encanto, Tabujara, and Abad jointly and severally liable for actual, moral and exemplary damages and attorney's fees.

Issues Framed by the Supreme Court

The Supreme Court framed the decisive issue as whether the respondents acted in bad faith in denying Diaz's sabbatical leave application and in withholding her salaries. The Court observed that bad faith is a question of fact and generally not within the scope of a Rule 45 petition, but made an exception because the RTC and the Court of Appeals had reached differing conclusions upon the same factual findings.

Legal Standard on Bad Faith and Abuse of Rights

The Court recited the standard under Article 19 of the Civil Code that abuse of right exists when a legal right or duty is exercised in bad faith for the sole intent of prejudicing another. The Court explained that malice or bad faith is at the core of Article 19, that good faith is presumed, and that the party alleging bad faith bears the burden of proof. Bad faith implies a dishonest purpose or conscious wrongdoing and not mere bad judgment or simple negligence.

Supreme Court's Factual and Legal Analysis on Sabbatical Denial

The Court found that the respondents had a duty to resolve the sabbatical application but that the record did not show an intent to prejudice Diaz. The Court reiterated that a sabbatical is a privilege, not an entitlement, and accorded weight to prior determinations by the Ombudsman, this Court in earlier certiorari proceedings, and the Court of Appeals, all of which found no manifest partiality, bad faith, or gross negligence. The Court noted that the application was processed according to usual procedures, that Diaz was given opportunity to submit background information, and that the denial rested on service exigencies such as shortage of teaching staff as reported by administrators in the best position to know. The Court thus held that Diaz failed to prove bad faith in the denial or in the delay of resolution.

Supreme Court's Ruling on Withheld Salaries

The Court distinguished three salary-related periods. It held that Diaz was entitled to compensation for the period from July 1, 1988 to October 31, 1988 because her name was removed from the class schedule for the first semester of AY 1988-89 without her knowledge or consent, and she had a reasonable expectation that her sabbatical would be approved as evidenced by the June 1988 salary. The Court found that the Department Chair, Cecilia Lazaro, acted in good faith when she removed Diaz's name to prevent mid-semester dropping of classes. For the periods November 1, 1988 to May 31, 1989 and July 16, 1989 to May 31, 1990, the Court held that the University lawfully withheld salaries because Diaz refused to comply with the standard documentary requirement of the Report for Duty form; the RTC and the Ombudsman had previously upheld the propriety of th

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