Case Summary (G.R. No. 201073)
Factual Background
PESALA is a non-stock corporation established to encourage savings among its members and provide loans. In compliance with Republic Act No. 3779, PESALA sought and received authorization from the Bangko Sentral ng Pilipinas to operate as a savings and loan association. A certification from Philippine Airlines confirmed its support for PESALA, including provisions for payroll deductions from employees for loan repayments, capital contributions, and deposits. The arrangement persisted until 1997 when PAL implemented a new maximum salary deduction policy.
Events Leading to Dispute
On July 11, 1997, Atty. Blanco informed PESALA that PAL would impose a maximum 40% salary deduction effective August 1, 1997. This change was expected to reduce significantly the funds remitted to PESALA, leading to projected financial deficits. PESALA filed a complaint for specific performance and damages in the Regional Trial Court of Pasay City, seeking to prevent PAL from implementing the salary deduction changes.
Initial Court Proceedings
The RTC granted a Temporary Restraining Order (TRO) on August 11, 1997, prohibiting PAL from enforcing the 40% salary deduction. After PAL failed to comply with this order, the RTC issued a Writ of Preliminary Injunction on September 3, 1997. Despite this, PAL persisted in under-remitting the amounts due to PESALA.
Court Orders and Non-Compliance
The RTC found that PAL's actions led to an uncollected amount of approximately P44,488,716.41. By March 11, 1998, the RTC ordered PAL to remit this amount to PESALA. Following continued non-compliance and PAL's eventual receivership in June 1998, PESALA sought indirect contempt charges against senior PAL officials, consolidating its claims in ongoing litigation proceedings.
Judgment of the RTC
On November 6, 2002, the RTC ruled in favor of PESALA, making the preliminary injunction permanent, requiring PAL to comply with the payroll deductions, and declaring PAL officials guilty of indirect contempt. The judgment ordered PAL to remit the unpaid amounts promptly.
Appeals and Court of Appeals Decision
PAL appealed the RTC’s decision to the Court of Appeals, which dismissed one appeal but granted others, affirming most of the RTC's orders while reversing the finding of contempt against PAL officials. The Court of Appeals upheld the remittance order to PESALA but did not find PAL officials guilty of indirect contempt, concluding the case on September 13, 2011.
Legal Issues Raised
PAL contested the appeals on two grounds: alleged violations of due process and claims of unfairness in awarding PESALA amounts not specified in the original complaint. PAL argued that it was denied due process as it was ordered to remit amounts not explicitly requested, asserting that its only financial liability was for a different amount.
Supreme Court Ruling
...continue readingCase Syllabus (G.R. No. 201073)
Case Overview
- The case is a Petition for Review on Certiorari concerning the Decision dated September 13, 2011, and the Resolution dated March 13, 2012, issued by the Court of Appeals (CA).
- The CA's decision modified and affirmed the Consolidated Decision dated November 6, 2002, from the Regional Trial Court (RTC), Branch 118, Pasay City in Civil Case Nos. 97-1026 and 00-0016.
Parties Involved
- Petitioner: Philippine Airlines, Inc. (PAL)
- Respondent: PAL Employees Savings and Loan Association, Inc. (PESALA)
Factual Background
- PESALA is a private non-stock corporation aimed at promoting thrift and saving among its members by receiving deposits and providing loans.
- PESALA sought authorization from the Bangko Sentral ng Pilipinas (BSP) to operate as a savings and loan association under Republic Act No. 3779.
- PAL issued a certification supporting PESALA's operations, allowing payroll deductions for loan repayments and deposits.
Events Leading to Controversy
- On July 11, 1997, PAL informed PESALA about a new policy limiting salary deductions to a maximum of 40% to prevent "zero net pay" situations.
- PESALA estimated that this limitation would drastically reduce the funds collected, potentially leading to a monthly shortfall of approximately P38,400,000.00 and a loss of interest income of around P3,840,000.00.
Initial Legal Action
- PESALA filed a Complaint for Specific Performance, Damages, or Declaratory Relief on August 6, 1997, seeking a Temporary Restraining Order (TRO) against PAL's new deduction policy.
- The RTC issued a TRO on August 11, 199