Case Summary (G.R. No. 201787)
Employment History, Salary Adjustments, and the 13th Month Pay Dispute
The record showed that Quimpo worked as Assistant Building Administrator for Finance and Administration and received successive promotions with corresponding salary increases. She advanced as senior Assistant Building Administrator in 1984, Building Administrator in 1985, and General Manager in 1986. In 1987, Quimpo received another salary increase granted by the corporation’s president. On 29 November 1988, she received her 13th month pay computed using her basic salary. She protested that company policy had included other fringe benefits in the computation of the 13th month pay.
After her protest, the corporation reverted her salary to P8,107.50, which she had been receiving in November 1987, explaining that the salary increase granted by the president in December 1986 had not been confirmed by the Board of Directors. Quimpo therefore filed a complaint for underpayment, withholding of salary, and diminution of her 13th month pay.
Labor Arbiter’s Ruling
In a decision dated 20 June 1990, Labor Arbiter Manuel P. Asuncion ruled in favor of Quimpo and ordered petitioners to pay: (1) the full amount of her salary at P22,311.24 per month from December 1988, with legal interest; (2) 13th month pay for 1987 in the amount of P6,200.00; and (3) moral and exemplary damages in the amount of P250,000.00. The Labor Arbiter also required petitioners to pay an attorney’s fee equivalent to ten percent (ten percent) of the benefits awarded.
NLRC Resolutions and Petition for Certiorari
Petitioners appealed to the NLRC. On 24 September 1991, the NLRC issued its first questioned resolution, affirming the Labor Arbiter and dismissing the appeal for lack of merit. Petitioners then filed a motion for reconsideration. On 27 December 1991, the NLRC issued its second questioned resolution, dismissing the motion for lack of merit and stating that no further motion of a similar nature would be entertained.
On 07 February 1992, Quimpo’s petition for certiorari, dated 27 January 1992, was filed with the Supreme Court, asserting that the NLRC acted without or beyond jurisdiction or with grave abuse of discretion in: sustaining the Labor Arbiter’s conclusion that the salary increases were valid; sustaining the award of moral damages; and sustaining the award of attorney’s fees. Petitioners likewise prayed for interim relief. The Supreme Court issued a temporary restraining order on 02 March 1992, requiring petitioners to post a cash or surety bond effective during the pendency of the case until full execution of judgment. The Court later lifted the temporary restraining order on 22 July 1992 because petitioners failed to post another bond pursuant to the Court’s 18 May 1992 interim resolution.
On 23 September 1992, the Supreme Court resolved to give due course to the petition and required memoranda. A year later, on 15 February 1994, the parties filed a Joint Motion to Render Decision Based on the Compromise Agreement, reflecting their decision to terminate the litigation amicably.
The Compromise Agreement and the Request for Adoption as Judgment
The Joint Motion reported that on 29 January 1994, both First Intramuros BF Condominium Corporation and Nancy Dingayan-Quimpo executed a compromise agreement for amicable settlement. The compromise agreement stated that Quimpo had filed two labor cases against the corporation: one for Withholding of wages and underpayment of 13th month pay and the other for Illegal Suspension and Illegal Dismissal, both of which had been decided by the NLRC in Quimpo’s favor and were pending before the Supreme Court. The compromise agreement then set a payment scheme under which the first party would pay Quimpo a total of P1,200,000.00, payable in six installments scheduled for February 1, 1994, March 1, 1994, April 1, 1994, May 1, 1994, June 1, 1994, and July 1, 1994, in the amounts of P300,000.00, P300,000.00, P150,000.00, P150,000.00, P150,000.00, and P150,000.00, respectively.
The agreement declared that the total payment would constitute a full settlement of Quimpo’s claims against the corporation for backwages, separation pay, damages, and attorney’s fees. It further provided that both parties waived any and all claims, whether civil, criminal, or otherwise, arising from incidents involving the labor cases. The compromise was represented as signed in Kalookan City in January 1994 and contained the signatures of the parties and the corporation’s officers. In their joint motion, the parties prayed that the Supreme Court adopt the compromise agreement as its Decision in the case.
Supreme Court’s Evaluation and Disposition
The Supreme Court recognized that the law not only authorizes but also encourages amicable settlements of disputes between parties under Art. 2029 of the Civil Code. The Court held that the freedom to compromise extended beyond cases about to be filed and could also cover cases already pending in court. It
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Case Syllabus (G.R. No. 201787)
- The case involved a Petition for Certiorari with a prayer for writ of preliminary injunction assailing an NLRC resolution.
- The petitioners sought reversal and setting aside of the National Labor Relations Commission resolutions dated 24 September 1991 and 27 December 1991.
- The Supreme Court ultimately approved and enjoined compliance with a subsequently executed compromise agreement.
Parties and Procedural Posture
- Petitioners were First Intramuros BF Condominium Corporation and Maxy Abad.
- Respondents were the National Labor Relations Commission and Nancy Dingayan Quimpo.
- The petitioners challenged the NLRC’s affirmance of the Labor Arbiter decision issued on 20 June 1990.
- The petition for certiorari was filed on 27 January 1992 and later acted upon by the Supreme Court.
- The Supreme Court issued a temporary restraining order on 02 March 1992 upon petitioners’ posting of a bond.
- The temporary restraining order was later lifted on 22 July 1992 due to petitioners’ failure to post another bond.
- The Supreme Court gave due course to the petition on 23 September 1992 and required memoranda.
- The parties later filed a joint motion on 15 February 1994 to render decision based on the compromise agreement.
Employment History and Salary Adjustments
- The private respondent, Nancy Dingayan Quimpo, was employed on 01 February 1980 as Assistant Building Administrator for Finance and Administration.
- She received various promotions with corresponding increases in salary.
- Her promotions included becoming Senior Assistant Building Administrator in 1984, Building Administrator in 1985, and General Manager in 1986.
- In 1987, she received another salary increase granted by the petitioners’ president.
- On 29 November 1988, she received her 13th month pay computed based on her basic salary.
- She protested the computation, asserting company policy to include other fringe benefits in the computation of the 13th month pay.
- The corporation later reverted her salary to P8,107.50, the amount she was receiving in November 1987, because the increase granted in December 1986 was allegedly not confirmed by the Board of Directors.
Labor Complaint and Labor Arbiter Ruling
- The private respondent filed a complaint for underpayment, withholding of salary, and diminution of her 13th month pay.
- The Labor Arbiter, Manuel P. Asuncion, rendered a decision on 20 June 1990.
- The Labor Arbiter ordered payment of the complainant’s full salary at P22,311.24 per month, from December 1988, plus legal interest.
- The Labor Arbiter ordered payment of 13th month pay for 1987 in the amount of P6,200.00.
- The Labor Arbiter further awarded moral and exemplary damages of P250,000.00.
- The Labor Arbiter ordered payment of attorney’s fees equivalent to 10% of the benefits awarded.
NLRC Proceedings and Questioned Resolutions
- The petitioners appealed the Labor Arbiter’s decision to the NLRC.
- On 24 September 1991, the NLRC issued a resolution that affirmed the Labor Arbiter’s decision and dismissed the appeal for lack of merit.
- On 27 December 1991, the NLRC denied the petitioners’ motion for reconsideration and dismissed it for lack of merit.
- The NLRC’s second resolution stated that no further motion of similar nature would be entertained.
Grounds Raised in the Petition
- The petition for certiorari asserted that the NLRC acted without or beyond jurisdiction and with grave abuse of discretion.
- The petitioners claimed grave abuse in the NLRC’s ruling that the private respondent’s salary increases were valid.
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