People v. Laogo, G.R. No.

176264, January 10, 2011

[DIGEST]
Facts:

Susan Navarro invited Teodulo dela Cruz, Billy dela Cruz, Jr., Dante Lopez, Edwin
Enriquez, Rogelio Enriquez, and Gary Bustillos and several individuals to her house in
Bulacan, Bulacan to celebrate the town fiesta. Teresita “Tessie” Laogo, the proprietor and
manager of Laogo Travel Consultancy, was among the several guests in Susan’s house
during the said occasion.

During the fiesta, Gary introduced Teodulo to Susan as somebody who could help him find
work abroad. Since Susan was Gary’s aunt, Teodulo immediately trusted Susan. Susan told
him he can apply as assistant cook and can work in Guam, USA. Upon Susan’s instruction,
Teodulo filled out an application form and gave her P3,000.00 after the latter promised to
process his application to work abroad. After several months, Susan accompanied Teodulo
to Tessie’s travel agency office in Ermita where he paid an additional P15,000.00 for his
placement fee. A receipt bearing the logo and name of Laogo Travel Consultancy was
issued to him signed by Susan. Months later, when Susan’s promise to send him abroad
remained unfulfilled, Teodulo, along with several other applicants, went to Tessie’s office
and to Susan’s house to follow up their application, but the two always told them that their
visas have yet to be released.

Similarly, Billy also met Susan through Gary, who himself was seeking help from Susan to
work in Guam. At Susan’s house, Billy saw Dante, Edwin, and Rogelio. Like him, the three
were also seeking Susan’s help to work abroad. Susan introduced Billy to Tessie, who
promised him that she will send them abroad within three months. After the meeting, Billy
issued to Susan two Metrobank checks, dated March 11 and May 10, 2000, bearing the
amounts P23,000.00 and P44,000.00, respectively, as partial payment for his placement
fee. Billy also went to Tessie’s travel agency in Ermita and personally handed an additional
cash of P6,000.00 to Susan, who thereafter gave the money to Tessie. Tessie issued a
corresponding receipt for the P6,000.00 cash bearing her signature and the name and logo
of Laogo Travel Consultancy. After several months, no word was heard from either Susan
or Tessie. Sensing that something was wrong, Billy decided to report the matter to the
authorities in Bulacan, Bulacan and filed a complaint against Susan and Tessie.

Dante was also introduced by Gary Bustillos to Tessie and Susan. Susan identified herself
as an employee of Tessie’s travel agency. The two told him that they can send him and his
companions to Guam within the span of three months. Dante paid both Susan and Tessie
P6,000.00 to process his papers, covered by a receipt dated May 19, 2000 showing
Tessie’s signature. Tessie’s promise, however, turned sour after three months. When he
confronted Tessie, the latter told him that he would be sent to a different country. Left
without a choice, Dante waited. Again, the promise remained unfulfilled.

Rogelio also met Tessie during the town fiesta when Susan invited him to cook for her
guests. Susan introduced Tessie as someone who could send him to work abroad. Eager
about the prospect, Rogelio immediately gave his P3,000.00 cash to Susan for the
processing of his visa and employment documents. He saw Susan hand the money to
Tessie. A week later, Rogelio gave an additional P900.00 to Susan. No receipts were
issued on both payments since Rogelio failed to complete the required P6,000.00
placement fee. Months passed but Rogelio heard nothing from either Susan or Tessie.
Apprehensive, Rogelio verified the status of the Laogo Travel Consultancy with the
Philippine Overseas Employment Administration (POEA). From the POEA, Rogelio learned
that Susan, Tessie, and Laogo Travel Consultancy did not have any license to recruit
workers for employment abroad. Aggrieved, Rogelio, together with his six companions, filed
a complaint against Susan and Tessie.

Edwin also paid P12,000.00 to Susan as processing fee for his application to work in Guam.
Tessie and Susan’s husband were present when he gave the money to Susan during the
town fiesta. Susan issued a receipt dated May 16, 2000 to Edwin. The receipt contained the
logo of Laogo Travel Consultancy and was signed by Susan with a description which says
“Payment was for Placement Fee.”

ISSUE:

Was large scale illegal recruitment committed?

RULING:

Recruitment and placement refers to the act of canvassing, enlisting, contracting,

transporting, utilizing, hiring or procuring workers, and includes referrals, contract services,
promising or advertising for employment, locally or abroad, whether for profit or not. When a
person or entity, in any manner, offers or promises for a fee employment to two or more
persons, that person or entity shall be deemed engaged in recruitment and placement.

Article 38(a) of the Labor Code, as amended, specifies that recruitment activities
undertaken by non-licensees or non-holders of authority are deemed illegal and punishable
by law. And when the illegal recruitment is committed against three or more persons,
individually or as a group, then it is deemed committed in large scale and carries with it
stiffer penalties as the same is deemed a form of economic sabotage.

But to prove illegal recruitment, it must be shown that the accused, without being duly
authorized by law, gave complainants the distinct impression that he had the power or
ability to send them abroad for work, such that the latter were convinced to part with their
money in order to be employed. It is important that there must at least be a promise or offer
of an employment from the person posing as a recruiter, whether locally or abroad.

In this case, Teodulo, Billy, Dante, Edwin, and Rogelio were promised to be sent abroad by
Susan and Tessie as cooks and assistant cooks. The follow up transactions between
Tessie and the five persons were done inside the said travel agency. Moreover, all four
receipts issued to the said persons bear the name and logo of Laogo Travel Consultancy,
with two of the said receipts personally signed by Tessie herself. Tessie and Susan could
thus be said to have acted together in making them believe that they were transacting with
a legitimate recruitment agency and that Laogo Travel Consultancy had the authority to
recruit them and send them abroad for work when in truth and in fact it had none as certified
by the POEA.
The Supreme Court here ruled in the affirmative. Large scale illegal recruitment was thus
committed.
Prince Transport Inc v. Garcia, G.R. No. 167291, January
12 2011 [DIGEST]
Facts:

Herein respondents were employees of Prince Transport, Inc. (PTI), a company engaged in
the business of transporting passengers by land. They were hired either as drivers,
conductors, mechanics or inspectors, except for respondent Diosdado Garcia (Garcia), who
was assigned as Operations Manager.

Respondents decided to form a union for their mutual aid and protection. However, they
were transferred to one of its sub-companies, Lubas Transport (Lubas) before they were
able to continue the formation of the said union.

Despite such transfer, the schedule of the respondents, as well as their company
identification cards, were issued by PTI. Their daily time records, tickets and reports were
also filed at the PTI office. Likewise, all their claims for salaries were transacted at the same
office.

Later, the business of Lubas deteriorated because of the refusal of PTI to maintain and
repair the units being used therein, which resulted in the virtual stoppage of its operations
and respondents' loss of employment.

Respondents consequently filed a complaint charging petitioners with illegal dismissal,

unfair labor practice and illegal deductions and praying for the award of premium pay for
holiday and rest day, holiday pay, service leave pay, 13th month pay, moral and exemplary
damages and attorney's fees.

Petitioners, on the other hand, contended that respondents were no longer their employees,
since they all transferred to Lubas at their own request. Petitioners had nothing to do with
the management and operations of Lubas as well as the control and supervision of the
latter's employees. Petitioners were not aware of the existence of any union in their
company and came to know of the same only in June 1998 when they were served a copy
of the summons in the petition for certification election filed by the union. That before the
union was registered, the complaint was already filed. The real motive in the filing of the
complaints was because PTI asked respondents to vacate the bunkhouse where the
respondents and their respective families were staying because PTI wanted to renovate the
same.

The Labor Arbiter ruled that petitioners were not guilty of unfair labor practice in the
absence of evidence to show that they violated respondents’ right to self-organization. The
Labor Arbiter also held that Lubas is the respondents’ employer and that it (Lubas) is an
entity which is separate, distinct and independent from PTI. Nonetheless, the Labor Arbiter
found that Lubas is guilty of illegally dismissing respondents from their employment.

Respondents filed an appeal with the National Labor Relations Commission (NLRC)
praying, among others, that PTI should also be held equally liable as Lubas.

Here, the NLRC sustained the Decision of the Labor Arbiter.

Respondents then filed a petition for certiorari with the CA assailing the Decision and
Resolution of the NLRC.

The CA ruled that petitioners were guilty of unfair labor practice; that Lubas is a mere
instrumentality, agent conduit or adjunct of PTI; and that petitioners’ act of transferring
respondents’ employment to Lubas is indicative of their intent to frustrate the efforts of
respondents to organize themselves into a union. 

Petitioners went to the Supreme Court (SC) and filed a petition for review on certiorari. They
argued that the CA should have respected the findings of the Labor Arbiter and the NLRC;
that it should not have given due course to the petition for certiorari with respect to several
respondents who failed to file an appeal to the NLRC and considering that only one of the
respondents executed and verified the said petition; that Petitioners Prince Transport, Inc.
and Mr. Renato Claros, and Lubas Transport are separate and distinct entities; and that
reinstatement should not have been awarded as it was not one of the issues raised in their
petition for certiorari.

Issues:

1. Does the CA have the power to resolve factual issues?

2. Does it have the power to conduct its own evaluation of the evidence on record despite
the factual findings of the Labor Arbiter and the NLRC?

3. Did the petition for certiorari suffer from a fatal defect considering that its verification and
certification against forum shopping was signed only by respondent Garcia?

4. Did the CA err in applying the doctrine of piercing the corporate veil with respect to
Lubas?

5. Did the CA err in awarding reinstatement to respondents?

6. Did petitioners commit unfair labor practice?

Ruling:

1. The CA has the power to resolve factual issues. Under Section 9 of Batas Pambansa
Blg. 129, as amended by Republic Act No. 7902, the CA — pursuant to the exercise of its
original jurisdiction over petitions for certiorari — is specifically given the power to pass
upon the evidence, if and when necessary, to resolve factual issues.

2. The CA has the power to conduct its own evaluation of evidence despite the factual
findings of the Labor Arbiter and the NLRC. When there is a showing that the findings were
arrived at arbitrarily or in disregard of the evidence on record, they may be examined by the
CA. The CA can grant the petition for certiorari if it finds that the NLRC, in its assailed
decision or resolution, made a factual finding not supported by substantial evidence. It is
within the jurisdiction of the CA, whose jurisdiction over labor cases has been expanded to
review the findings of the NLRC. In this case, the SC ruled that the CA did not err in arriving
at the following factual findings and conclusions.

3. Firstly, respondents' petition did not suffer from a fatal defect when its verification and
certification against forum shopping was signed only by respondent Garcia.

While the general rule is that the certificate of non-forum shopping must be signed by all the
plaintiffs in a case and the signature of only one of them is insufficient, the rules on forum
shopping, which were designed to promote and facilitate the orderly administration of
justice, should not be interpreted with such absolute literalness as to subvert its own
ultimate and legitimate objective. Strict compliance with the provision regarding the
certificate of non-forum shopping underscores its mandatory nature in that the certification
cannot be altogether dispensed with or its requirements completely disregarded. It does not,
however, prohibit substantial compliance therewith under justifiable circumstances,
considering especially that although it is obligatory, it is not jurisdictional. In a number of
cases, it has been consistently held that when all the petitioners share a common interest
and invoke a common cause of action or defense, the signature of only one of them in the
certification against forum shopping substantially complies with the rules. In the present
case, there is no question that respondents share a common interest and invoke a common
cause of action. Hence, the signature of respondent Garcia is a sufficient compliance with
the rule governing certificates of non-forum shopping. In the first place, some of the
respondents actually executed a Special Power of Attorney authorizing Garcia as their
attorney-in-fact in filing a petition for certiorari with the CA.

With respect to the absence of some of the workers’ signatures in the verification, the
verification requirement is deemed substantially complied with when some of the parties
who undoubtedly have sufficient knowledge and belief to swear to the truth of the
allegations in the petition had signed the same. Such verification is deemed a sufficient
assurance that the matters alleged in the petition have been made in good faith or are true
and correct, and not merely speculative. Moreover, respondents' Partial Appeal shows that
the appeal stipulated as complainants-appellants, meaning that there were more than one
appellant who were all workers of petitioners. In any case, the settled rule is that a pleading
which is required by the Rules of Court to be verified, may be given due course even
without a verification if the circumstances warrant the suspension of the rules in the interest
of justice. Indeed, the absence of a verification is not jurisdictional, but only a formal defect,
which does not of itself justify a court in refusing to allow and act on a case. Hence, the
failure of some of the respondents to sign the verification attached to their Memorandum of
Appeal filed with the NLRC is not fatal to their cause of action.

4. Secondly, the CA did not err in applying the doctrine of piercing the corporate veil with
respect to Lubas.

Lubas is a mere agent, conduit or adjunct of PTI. A settled formulation of the doctrine of
piercing the corporate veil is that when two business enterprises are owned, conducted and
controlled by the same parties, both law and equity will, when necessary to protect the
rights of third parties, disregard the legal fiction that these two entities are distinct and treat
them as identical or as one and the same. It may be true that Lubas is a single
proprietorship and not a corporation. However, petitioners’ attempt to isolate themselves
from and hide behind the supposed separate and distinct personality of Lubas so as to
evade their liabilities is precisely what the classical doctrine of piercing the veil of corporate
entity seeks to prevent and remedy. In the present case it was Prince Transport who made
the decision to transfer its employees to Lubas. Prince Transport never regarded Lubas
Transport as a separate entity, as it admits to having referred to said entity as “Lubas
operations.” Moreover, it admits that it did not transfer the employees for it “assigned” the
respondents. Lastly, the existing funds and 201 file of the employees were turned over not
to a new company but a “new management.” PTI even exercised the decision as to which
employees shall work in Lubas. What is telling is the fact that PTI admitted that Lubas is
one of its sub-companies. In addition, PTI, in its letters to its employees who were
transferred to Lubas, referred to the latter as its “New City Operations Bus.” Moreover,
petitioners failed to refute the contention of respondents that despite the latter’s transfer to
Lubas of their daily time records, reports, daily income remittances of conductors, schedule
of drivers and conductors were all made, performed, filed and kept at the office of PTI. In
fact, respondents’ identification cards bear the name of PTI.

5. Thirdly, the CA did not err in awarding reinstatement to respondents.

It is clear from the amended complaints filed by respondents that they are seeking
reinstatement. In any case, Section 2 (c), Rule 7 of the Rules of Court provides that a
pleading shall specify the relief sought, but may add a general prayer for such further or
other reliefs as may be deemed just and equitable. Under this rule, a court can grant the
relief warranted by the allegation and the proof even if it is not specifically sought by the
injured party; the inclusion of a general prayer may justify the grant of a remedy different
from or together with the specific remedy sought, if the facts alleged in the complaint and
the evidence introduced so warrant. Moreover, the general prayer is broad enough “to
justify extension of a remedy different from or together with the specific remedy sought.”
Even without the prayer for a specific remedy, proper relief may be granted by the court if
the facts alleged in the complaint and the evidence introduced so warrant. The court shall
grant relief warranted by the allegations and the proof even if no such relief is prayed
for.The prayer in the complaint for other reliefs equitable and just in the premises justifies
the grant of a relief not otherwise specifically prayed for. In the instant case, aside from their
specific prayer for reinstatement, respondents, in their separate complaints, prayed for such
reliefs which are deemed just and equitable.

6. Lastly, petitioners in this case have committed unfair labor practice.

Respondents’ transfer of work assignments to Lubas was designed by petitioners as a

subterfuge to foil the former’s right to organize themselves into a union. Under Article 248
(a) and (e) of the Labor Code, an employer is guilty of unfair labor practice if it interferes
with, restrains or coerces its employees in the exercise of their right to self-organization or if
it discriminates in regard to wages, hours of work and other terms and conditions of
employment in order to encourage or discourage membership in any labor organization. In
this case, after respondents' transfer to Lubas, petitioners left them high and dry insofar as
the operations of Lubas was concerned. Petitioners “withheld the necessary financial and
logistic support such as spare parts, and repair and maintenance of the transferred buses
until only two units remained in running condition.” This left respondents virtually jobless.