Case Summary (G.R. No. 161003)
Issues Presented
- Can final and executory Supreme Court judgments be compromised?
- Is a waiver executed without counsel or arbiter assistance valid?
- Did the CA’s ignorance of jurisprudence and miscount of reconsideration period deny due process?
Legal Principles on Compromise Agreements
- A compromise is a contract of reciprocal concessions to resolve disputes (Art. 2028, Civil Code).
- It must be free, intelligent, lawful, moral, and not contrary to public policy (Arts. 1318; 2037–2038).
- A judicially approved compromise has the force of a judgment and is immediately executory, barring vices of consent or forgery.
Analysis on Compromise after Final Judgment
- Civil Code Article 2040 provides that a compromise entered in ignorance of an existing final judgment may be rescinded; it does not render post‐judgment compromises void or prohibited.
- Petitioners had full knowledge of the finality of their award when they signed waivers. No lack of knowledge exists to invoke rescission.
- The law does not prohibit parties from settling or novating final obligations by mutual agreement.
Supporting Jurisprudence
- Jesalva v. Bautista recognized compromises even with pending or final judgments.
- Palanca v. Court of Industrial Relations upheld post‐judgment settlement of back‐wage amounts in the absence of fraud or public policy violation.
- Gatchalian v. Arlegui confirmed novation through compromise before execution of final judgment.
- Northern Lines, Inc. v. Court of Tax Appeals and Dormitorio v. Fernandez affirmed the right to novate and compromise final liabilities.
- Rovero v. Amparo distinguishes public‐agency limitations from private‐party autonomy, irrelevant here as respondent acted as a private party under agreement.
Requirements for Valid Post‐Judgment Compromise
- Consent of parties, certainty of object, lawful cause (Art. 1318).
- No allegations or proof of vitiated consent, fraud, or unconscionable consideration appear.
- Petitioners voluntarily executed manifestations and joint affidavits waiving claims. Estoppel prevents belated challenge.
Waiver Execution and Validity
- No legal requirement for counsel or arbiter presence at execution of waivers; validity hinges on voluntary, intelligent consent and reasonable consideration.
- NLRC Rules mandate that any settlement be reduced to writing, explained by the arbiter, and approved after confirming voluntariness.
- Despite initial waiver execution outside arbiter presence, subsequent pre‐execution conference complied w
Case Syllabus (G.R. No. 161003)
Facts of the Case
- The Supreme Court rendered a final and executory decision in Rizalino P. Uy v. National Labor Relations Commission (GR No. 117983, September 6, 1996), affirming with modification the NLRC award for wage differentials.
- Eight complainants (now petitioners) were awarded ₱1,487,312.69 in wage differentials.
- On February 3, 1997, the petitioners moved for issuance of a writ of execution.
- On May 19, 1997, respondent filed a Manifestation stating that petitioners were satisfied with payment; the document was signed by all eight petitioners.
- Attached to the Manifestation was a Joint Affidavit (May 5, 1997) in which petitioners attested receipt of payment and waived all other benefits.
- On June 3, 1997, petitioners filed an Urgent Motion for Issuance of Writ of Execution, confirming that each received ₱40,000 on May 2, 1997.
- On June 9, 1997, respondent opposed, claiming full satisfaction; petitioners replied they had received only partial payment.
- On October 20, 1997, six of the eight petitioners filed another Manifestation and Joint Affidavit (in the local dialect) abandoning any further claims.
- On February 27, 1998, the Labor Arbiter denied the writ of execution motion and considered the cases closed and terminated.
- On appeal, the NLRC reversed and ordered immediate issuance of the writ, holding that final judgments cannot be altered and quitclaims are contrary to public policy.
Procedural History
- Petitioners filed a Petition for Review under Rule 45 of the Rules of Court (G.R. No. 161003).
- The Court of Appeals (CA) in CA-GR SP No. 53581, through its May 31, 2000 Decision, found NLRC’s actions a grave abuse of discretion, set aside the NLRC resolutions, and reinstated the Labor Arbiter’s February 27, 1998 order.
- The C