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586 Phil. 19


[ G.R. NO. 151854, September 03, 2008 ]




This is a petition for review on certiorari under Rule 45 of the Rules of Procedure of the Decision dated January 11, 2002[1] of the Court of Appeals (CA) in CA-G.R. SP No. 62735 dismissing the petition for certiorari under Rule 65 filed by herein petitioners Philux, Inc. and Max Kienle. The petition for certiorari assailed the dismissal by the National Labor Relations Commission (NLRC) of the petitioners' appeal of the earlier Labor Arbiter's decision declaring herein private respondent Patricia Perjes to have been illegally dismissed and directing the petitioners to reinstate her and pay her backwages.

As culled from the Decision of the CA, the antecedent facts are as follows:
The records disclose that the petitioner, Philux, Inc., is a corporation engaged in the manufacture and sale of wood furnitures; while private respondent Patricia (Patria) Perjes was a daily-paid regular employee of the latter occupying the position of saleslady assigned to the petitioner's showroom at SM South mall, Zapote, Alabang Road, Las Piñas City.

On April 20, 1999, for failure of the petitioner-corporation to positively respond to the private respondent's demand incorporated in her letter dated October 20, 1998, the National Labor Union in behalf of the private respondent filed a Complaint before the Labor Arbiter docketed as NLRC Case No. 00-04-04757-99. The aforesaid Complaint prayed for the following reliefs:
(a) Payment of monthly commission from June 1998 until final settlement of the case;
(b) Payment of underpaid P50.00 from June 1998 up to November 20, 1998;
(c) Payment of 7 days sick leave and 7 days vacation leave for 1998 based on management practice;
(d) Payment of 13th month pay for the year 1997; and
(e) Payment of damages and attorney's fees.
On June 24, 1999, the private respondent filed a Manifestation and Motion to include Additional Complaint for illegal dismissal based on her transfer of work assignment from the petitioner's showroom in SM Las Piñas to SM Megamall, EDSA, Mandaluyong City. The private respondent demanded her reinstatement to her former position with full backwages from May 12, 1999 up to her actual reinstatement without loss of seniority rights and other privileges.

Upon order of the Labor Arbiter, the parties submitted their respective position papers.

In her position paper, the private respondent asserted her right for payment of commission, 13th month pay, and overtime pay, the same being based on existing laws. She also claimed that the deduction of P50.00 from her basic salary was likewise illegal, there being no written authorization therefore.

The private respondent insisted that she never abandoned her work. Her failure to report for work was with a valid reason, i.e., she had to look after her then sick brother who had suffered hypertensive intra-cerebral bleeding and pneumonia. Moreover, she allegedly needed to work near his place of abode. She lives in Bo. San Vicente, San Pedro, Laguna and it would take her 2 to 3 hours travel time, more or less, to and from her new post. Besides, petitioners' decision to transfer her to SM Megamall was purely harassment, especially so when it came to know that she has filed the aforementioned claims for payment.

On the other hand, the petitioners alleged that on June 8, 1998, the management suspected an anomaly in the reported sales of its showroom at SM South Mall then manned by Francis Otong and the private respondent. Petitioner Max Kienle reported the matter to the police of Almanza Uno, Las Piñas city. Thenceforth, an investigation was conducted where Francis Ong and the private respondent admitted in writing the following:
1. that Francis Otong had been manipulating the sales record of the petitioner with the knowledge and consent of the private respondent, enabling them to pocket the sum of P460,167.79;
2. That the management for humanitarian reason accepted the admission xxx and their offer of re-payment by payroll deductions.
3. That the private respondent authorized in writing the deductions from her payroll to be applied to the account of Mr. Otong with the petitioner. Mr. Otong promised to reimburse the private respondent whatever amount deducted from the latter.
4. That with their written consent, starting June 15, 1998, the petitioner deducted the amount of P50.00 from the private respondent's daily basic salary plus her commission.
Hence, according to the petitioners, the claims of the private respondent have no basis at all. The deductions made against her salary were authorized. She was not required to work continuously for 9 hours and the management had no control as regards the duration of her break time. Ergo, she was not entitled to overtime pay. Her 13th month pay for 1997 was already paid. As regards her claim of leave payments, she admitted in her position paper that the amount representing 5 days sick leave and 5 days vacation leave were already remitted to her; while her claim for additional 2 days each was without basis in law and in fact. Also, the private respondent's claim for damages and attorney's fees has no merit, her termination being an act of self-defense of the petitioner so as to avert unnecessary losses for unauthorized transaction.

The management likewise decided to transfer the private respondent to its Megamall showroom so that she could be supervised by other Philux employees, unlike in the South Mall where most of the time she was alone. The move by the petitioner was purposely made to avert recurrence of losses. Moreover, her transfer was sought because of her propensity to be absent for flimsy reasons which resulted in not opening the store on time and/or leaving the store manned only by one person. Such was allegedly against the contract of employment of the private respondent with the petitioner. Thus, the questioned transfer is not without basis. On the contrary, the private respondent's willful disobedience constitutes a valid ground for termination of her employment.[2]
In a decision dated June 30, 2000,[3] the Labor Arbiter rendered judgment in private respondent's favor. In part, the decision states:
It appears that complainant and co-employee Francis Otong were involved in a violation of company policy. However, management admittedly condoned their offense and the parties agreed to a schedule of salary deductions so that complainant and Otong will be able to pay their financial liabilities to the company.

Complainant having been totally condoned, management is estopped from doing further acts which are deemed prejudicial to her interest, thus her transfer to another branch which will cause inconvenience to her and against her will and consent amount to constructive illegal dismissal.

Thus, complainant is entitled to reinstatement to her former position and station and full backwages until her actual reinstatement, computed below as follows:
May 12, 1999 to June 30, 2000 = 13.633 months
Basic salary: P 250.00

Salaries and Wages

P 250.00 x 26 days x 13.633 months

13th Month Pay

P 88,614.50/12

Service Incentive Leave Pay

P 250.00 x 5 days x 13.633/12

P 97,419.14

As for the money claims, respondent have explained that they were the result of the schedule of salary deductions agreed upon by both parties pursuant to the condonation of offense as discussed above.

WHEREFORE, premises considered, complainant is hereby declared to have been illegally dismissed and respondent corporation is hereby directed to reinstate her and pay her backwages as computed above.

A copy of the aforesaid Labor Arbiter's decision was received on July 14, 2000 by the petitioners. The latter filed a Motion for Reconsideration[4] on July 24, 2000 and private respondent filed an Opposition[5] thereto. In its Resolution dated August 31, 2000[6], the NLRC treated the motion for reconsideration as an appeal from the Labor Arbiter's decision but dismissed the same for failure of the petitioners to post a bond as mandated by law.

The petitioners then filed a Motion to Reinstate Appeal dated September 25, 2000[7] alleging that this failure to post an appeal bond was due to the absence of the officers of the corporation in the country at the time the appeal was filed. Attached to the motion was a supersedeas bond[8] of the same date.

On October 24, 2000, the NLRC denied by Resolution[9] the petitioners' motion to reinstate appeal which it treated as a motion for reconsideration of the dismissal of their appeal on the ground that while a surety bond was posted, the same was filed beyond the reglementary period to appeal.

Thereafter, the petitioners filed a petition for certiorari[10] under Rule 65 of the Rules of Court with the CA which was docketed as CA-G.R. SP No. 62735.

In its herein assailed Decision dated January 11, 2002,[11] the CA dismissed the aforementioned petition for lack of merit, in effect affirming the impugned resolutions of the NLRC.

Hence, the petitioners are now before this Court via the instant petition for review under Rule 45. They contend that the CA committed serious error by inflexibly applying a stringent interpretation of a mere procedural rule such as the posting of an appeal bond within the ten (10)-day period provided by law.

On April 15, 2002, we resolved to require the private respondent, through the labor union representative, to comment on the petition.[12] A copy of the Resolution having been returned unserved, the Court subsequently required service thereof to the private respondent herself. Upon private respondent's failure to file a comment, the latter, by Resolution,[13] was required to show cause why she should not be disciplinarily dealt with or be held in contempt. Subsequently, by Resolution dated April 23, 2003,[14] the Court imposed on the private respondent a fine or a penalty of imprisonment if the fine is not paid, and to comply with the earlier Resolution requiring explanation and comment, within ten days from notice. Still failing to comply with the aforementioned resolution, the Court, on September 17, 2003, resolved to inform the private respondent that she is deemed to have waived the filing of the comment and that the case shall forthwith be resolved on the basis of the pleadings submitted by the petitioners.[15]

The petition has no merit.

It is settled that the right to appeal is not a natural right or a part of due process, but merely a statutory privilege that may be exercised only in the manner and in accordance with the provisions of the applicable law.[16] Hence, a party who seeks to avail of the same must comply with the requirements of the rules, failing which the right to appeal is invariably lost.

By explicit provision of law, an appeal from rulings of the Labor Arbiter to the NLRC must be perfected within ten (10) calendar days from receipt thereof, otherwise the same shall become final and executory.[17] In case of a judgment involving a monetary award, the appeal shall be perfected only upon (1) payment of the required appeal fee, (2) posting of a cash or surety bond issued by a reputable bonding company and (3) filing of a memorandum of appeal.[18] The mere filing of a notice of appeal without complying with the other requisites mentioned shall not stop the running of the period for perfection of appeal.[19]

In this case, the petitioners, through their former counsel, who received a copy of the decision of the Labor Arbiter on July 14, 2000, filed a Motion for Reconsideration on July 24, 2000 which was the last day to perfect an appeal. No cash or surety bond, however, was posted by the petitioners. The motion having been treated as an appeal by the NLRC, the lack of a bond is fatal to the said appeal. The judgment in question involves a monetary award and an appeal therefrom by the employer may be perfected only upon the posting of a cash or surety bond in the amount equivalent to the monetary award in the judgment appealed from.

Clearly then, the CA acted in accordance with law in dismissing the petition for certiorari assailing the dismissal by the NLRC of the petitioners' appeal for failure of the latter to post the required appeal bond.

The petitioners, however, argue that they should not suffer the consequences of their former counsel's negligence and/or gross ignorance of the rules of procedure because gross injustice would result. While the general rule is that any act performed by a lawyer within the scope of his general or implied authority is regarded as an act of the client, the petitioners invoke exceptions thereto, i.e., where the reckless or gross negligence of counsel would deprive the client of due process of law, or where it would result in the outright deprivation of the client's property through a technicality.

Unfortunately, petitioners' case does not fall under the exception but rather is squarely within the ambit of the general rule. The general rule is that a client is bound by the acts, even mistakes, of his counsel in the realm of procedural technique.[20] The exception to this rule is when the negligence of counsel is so gross, reckless and inexcusable that the client is deprived of his day in court, in which case the remedy then is to reopen the case and allow the party who was denied his day in court to adduce his evidence.[21]

Through their present counsel, the petitioners want us to nullify the decision of the CA and, in effect, the resolutions of the NLRC dismissing their appeal on the ground that their former counsel was grossly negligent and ignorant of the NLRC rules of procedure. This ground cannot be lightly invoked. Otherwise, there would never be an end to a suit so long as new counsel would be employed who could allege and show that prior counsel had not been sufficiently diligent, or experienced, or learned.[22]

In Salonga v. Court of Appeals[23] cited by petitioners, we found therein petitioner's former counsel only guilty of simple negligence and not gross negligence as would amount to a deprivation of petitioner's right to due process, although said counsel's failure to file a timely answer has led to a judgment by default against his client.

The decision in Legarda v. Court of Appeals[24] also invoked by petitioners, that the alleged reckless, inexcusable and gross negligence of counsel resulted in the deprivation of the client's property without due process of law, was modified on reconsideration in our en banc Resolution dated October 16, 1997.[25] The Court held:
xxx as long as a party was given the opportunity to defend her interests in due course, she cannot be said to have been denied due process of law, for this opportunity to be heard is the very essence of due process. The chronology of events shows that the case took its regular course in the trial and appellate courts but Legarda's counsel failed to act as any ordinary counsel should have acted, his negligence every step of the way amounting to "abandonment, " in the words of the Gancayco decision. Yet, it cannot be denied that the proceedings which led to the filing of this case were not attended by any irregularity. The judgment by default was valid, so was the ensuing sale at public auction. If Cabrera was adjudged highest bidder in said auction sale, it was not through any machination on his part. All of his actuations that led to the final registration of the title in his name were aboveboard, untainted by any irregularity.


The Gancayco decision makes much of the fact that Legarda is now "consigned to penury" and, therefore, this Court "must come to the aid of the distraught client." It must be remembered that this Court renders decisions, not on the basis of emotions but on its sound judgment, applying the relevant, appropriate law. Much as it may pity Legarda, or any losing litigant for that matter, it cannot play the role of a "knight in shining armor" coming to the aid of someone, who through her weakness, ignorance or misjudgment may have been bested in a legal joust which complied with all the rules of legal proceedings.[26]
In Escudero v. Dulay,[27] the Court sustained therein petitioners' contention that the general rule should not be applied automatically to their case as their trial counsel's blunder in procedure and gross ignorance of existing jurisprudence changed their cause of action and violated their substantive rights. The Court likewise held that where the application of this rule of procedure will result in a manifest failure or miscarriage of justice, the rule may be relaxed.

In the light of the standards set in the above-cited cases and considering that the petitioners herein were given full opportunity to be heard and present their side to refute private respondent's claims against the corporation in the proceedings before the labor arbiter, the failure of petitioners' former counsel to post the bond amounts to a simple, not gross, negligence that will warrant the application of the exception to the general rule that a client is bound by the acts or mistakes of his counsel.

The petitioners assert as well that their subsequent posting of the bond on September 25, 2000 constituted good faith on their part to comply with the requirement for perfecting an appeal under Article 223 of the Labor Code and the NLRC Rules of Procedure.

Petitioners' assertion is untenable.

The intention of the lawmakers to make the bond an indispensable requisite for the perfection of an appeal by the employer is underscored by the provision that an appeal may be perfected only upon the posting of a cash or surety bond.[28] The language of the law is perfectly clear that the lawmakers intended the posting of a cash or surety bond by the employer to be an indispensable means by which an employer's appeal is perfected or completed. While the use of the word may makes the perfection of an appeal as optional on the part of the defeated party, but to do so the posting of an appeal bond is required by law.[29] Evidently then, the posting of a bond is mandatory, and the perfection of an appeal in the manner and within the period prescribed by law is not only mandatory but jurisdictional.[30] The rationale was aptly explained by the Court in Viron Garments Manufacturing Co., Inc. v. NLRC,[31] to wit:
The requirement that the employer post a cash or surety bond to perfect its/his appeal is apparently intended to assure the workers that if they prevail in the case, they will receive the money judgment in their favor upon the dismissal of the employer's appeal. It was intended to discourage employers from using an appeal to delay, or even evade, their obligation to satisfy their employees' just and lawful claims.
While the bond requirement on appeals involving monetary awards has been relaxed in certain cases, this can only be done where there was substantial compliance of the NLRC Rules of Procedure or where the appellants, at the very least, exhibited willingness to pay by posting a partial bond [32] or where the failure to comply with the requirements for perfection of appeal was justified.[33]

Here, the negligence and/or ignorance of the rules of petitioners' former counsel is not sufficient justification for their failure to comply with the posting of the bond within the reglementary period. Neither can petitioners' subsequent but belated posting of the bond be considered as substantial compliance warranting the relaxation of the rules in the interest of justice.

In Ong v. Court of Appeals[34], we held that in the instances where there was substantial compliance, the appellants, at the very least, exhibited willingness to pay by posting a partial bond or filing a motion for reduction of bond all within the 10-day period provided by law. In the present case, no such willingness was exhibited by petitioners as neither a full nor a partial appeal bond was filed within the reglementary period.

As correctly noted by the CA in its assailed Decision:
Be it noted that the petitioners received the Decision of the Labor Arbiter dated June 30, 2000 on July 14, 2000. The petitioners filed their motion for reconsideration which the NLRC treated as an appeal on July 24, 2000, sans the required bond. On August 31, 2000, the NLRC resolved to dismiss the appeal for failure to post the bond as mandated by law. It was only upon receipt of the aforesaid Resolution on September 15, 2000, that the petitioners were prompted to post the appeal bond. As a matter of fact, the filing thereof was further delayed as it was made only on September 25, 2000, ten (10) days after receipt of the Resolution. Obviously, the petitioner never intended to post the bond as it awaited two (2) months, more or less, from July 14, 2000, before it took the necessary steps to file the same. The petitioners' allegation that their signing officers were at that time out of the country does not justify their failure to file the same.[35]
Thus, in this case, since there was no appeal bond filed within the ten (10)-day period provided by law for the perfection of appeal, no appeal from the decision of the Labor Arbiter was perfected. Accordingly, said decision of the Labor Arbiter became final and executory and, therefore, immutable. Hence, the NLRC was correct in dismissing the petitioners' appeal therefrom. And a fortiori, so was the CA.

On a final note, we reiterate our pronouncement in Borja Estate v. Spouses Ballad[36], thus:
It bears stressing that the bond is sine qua non to the perfection of appeal from the labor arbiter's monetary award. The requirements for perfecting an appeal must be strictly followed as they are considered indispensable interdictions against needless delays and for orderly discharge of judicial business. The failure of the petitioners to comply with the requirements for perfection of appeal had the effect of rendering the decision of the labor arbiter final and executory and placing it beyond the power of the NLRC to review or reverse it. As a losing party has the right to file an appeal within the prescribed period, so also the winning party has the correlative right to enjoy the finality of the resolution of his/her case.

WHEREFORE, the instant petition is DENIED and the Decision dated January 11, 2002 of the Court of Appeals is hereby AFFIRMED.

Costs against the petitioners.


Puno, C.J. (Chairperson), Carpio, Corona, and Azcuna, JJ., concur.

[1] Penned by Associate Justice Delilah Vidallon-Magtolis with Associate Justices Edgardo P. Cruz and Juan Q. Enriquez, Jr., concurring; rollo, pp. 43-50.

[2] Id., pp. 44-46.

[3] Id., pp. 51-57.

[4] Id., pp. 63-67.

[5] Id., pp. 68-74.

[6] Id., pp. 77-78.

[7] CA Record, pp. 110-112.

[8] Id., p. 106.

[9] Rollo, pp. 80-81.

[10] CA Record, pp. 2-18.

[11] Supra at note 1.

[12] Id., p. 82.

[13] Id., p. 89.

[14] Id., p. 90.

[15] Id., p. 92.

[16] Stolt-Nielsen Marine Services, Inc. v. NLRC, G.R. No. 147623, December 13, 2005, 477 SCRA 516, 527.

[17] Article 223 of the Labor Code, as amended, sets forth the rules on appeal from a Labor Arbiter's monetary award, thus:
ART. 223. Appeal. - Decisions, awards or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt of such decisions, awards, or orders.


In case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Commission, in the amount equivalent to the monetary award in the judgment appealed from.
[18] Rule VI of the New Rules of Procedure of the NLRC which implements Article 223 of the Labor Code pertinently provides the following:
Section. 1. Periods of Appeal.- Decisions, awards, or orders of the Labor Arbiter and the POEA Administrator shall be final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt of such decisions, awards or orders of the Labor Arbiter or of the Administrator, and in case of a decision of the Regional Director or his duly authorized Hearing Officer within five (5) calendar days from receipt of such decisions, awards or orders xxx

Section 3. Requisites for Perfection of Appeal.-(a) The appeal shall be filed within the reglementary period as provided in Sec. 1 of this Rule; shall be under oath with proof of payment of the required appeal fee and the posting of a cash or surety bond as provided in Sec. 5 of this Rule; shall be accompanied by memorandum of appeal which shall state the grounds relied upon and the arguments in support thereof; the relief prayed for; and a statement of the date when the appellant received the appealed decision, order or award and proof of service on the other party of such appeal.

A mere notice of appeal without complying with the other requisite afore-stated shall not stop the running of the period for perfecting an appeal.

Section 5. Appeal Fee.-- The appellant shall pay an appeal fee of One hundred (P100.00) pesos to the Regional Arbitration Branch, Regional Office, or to the Philippine Overseas Employment Administration and the official receipt of such payment shall be attached to the records of the case.

Section 6. Bond.-- In case the decision of the Labor Arbiter, the Regional Director or his duly authorized Hearing Officer involves a monetary award, an appeal by the employer shall be perfected only upon the posting of a cash or surety bond, which shall be in effect until final disposition of the case, issued by a reputable bonding company duly accredited by the Commission or the Supreme Court in an amount equivalent to the monetary award, exclusive of damages and attorney's fees.


The Commission may, in justifiable cases and upon Motion of the Appellant, reduce the amount of the bond. The filing of the motion to reduce bond shall not stop the running of the period to perfect appeal.

Section 7. No extension of Period.- No motion or request for extension of the period within which to perfect an appeal shall be allowed.
[19] Id., Section 3.

[20] Producer's Bank v. Court of Appeals, G.R. No. 126620, April 17, 2002, 381 SCRA 185, 192.

[21] Id.

[22] Balgami, et al. v. Court of Appeals G.R. No. 131287, December 9, 2004, 445 SCRA 591, 600.

[23] G.R. No. 111478, March 13, 1997, 269 SCRA 534.

[24] G.R. No. 94457, March 18, 1991, 195 SCRA 418.

[25] G.R. No. 94457, October 16, 1997, 280 SCRA 642.

[26] Id., pp. 657-660. Also cited in Producer's Bank v. Court of Appeals, G.R. No. 126620, April 17, 2002, 381 SCRA 185.

[27] No. L-60578, February 23, 1988, 158 SCRA 69, 77.

[28] Borja Estate v. Spouses Ballad G.R. No. 152550,June 8, 2005, 459 SCRA 657, 667.

[29] Id., pp. 667-668.

[30] Id., p. 668.

[31] G.R. No. March 18, 1992, 207 SCRA 339, 342.

[32] Ong v. Court of Appeals, G.R. No. 152494, September 22, 2004, 438 SCRA 668, 678.

[33] Supra at note 28, p. 669.

[34] Supra at note 32.

[35] Rollo, pp. 49-50.

[36] Supra at note 28, p. 670.

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