Pacific Cement Company Inc v. National Labor Relations Commission

JR., J.:

The instant petition seeks to annul on the ground of grave abuse of discretion the public respondent's decision dated August 19, 1986 ordering the reinstatement of the private respondents and the payment of backwages and damages. The antecedent facts of the case are as follows: Before their termination, private respondents Norberto S. Merto, Jr. and Fermin T. Baure worked as manager and assistant manager, respectively, in petitioner-company's port department in Surigao City. Sometime in January 1983, an investigation was conducted by petitioner Carmelo V. Villalobos, petitioner-company's internal auditor, regarding the operations at the private respondents' department.

The investigation uncovered certain irregularities for which the private respondents together with their Port Section Head, Luisito Bona were made responsible. The irregularities basically pertained to alterations and discrepancies in the port operations logbook concerning the utilization of and rental payment for the Uraga Lorain crane being leased from one Alfredo S. Chua for port operations in the private respondents' department. On February 7, 1983, the private respondents through separate memoranda issued by petitioners Albrecht Bake and Noel R. Tan were made to explain their involvement in the reported irregularities.

In the case of private respondent Merto, he was made to account for the representation he made that "the crane was at standby time despite (his) knowledge and consent of the fact that said crane was being utilized by the Philippine Ports Authority (PPA) for the removal and driving of fender piles at the government pier" for which rental payments were made to Chua in the 28th and 29th of November and on the 16th up to the 21st of December 1982. With respect to private respondent Baure, he was made to clarify the alterations in the port operations logbook relating to the incidents of August lst up to the 6th and August 12th, 1982 where "the original entries of either 'breakdown' or 'out-of-order' were clearly superimposed with the words 'stand-by' in bigger and bolder letters"

and where, as in Merto's case, rental payments were given to Chua. In the said memoranda, a provision for the preventive suspension of the private respondents was further included. Petitioner Ramon C. Ybud was assigned to handle the duties of the private respondents while they were on preventive suspension.

On February 8, 1983, both the private respondents wrote I separate explanation letters. Merto stated that his actions were in accordance with the provisions of the crane contract. His letter reads as follows: 038-83-034 I February 8, 1983 To : Dr. Albrecht H. Bake From : N.S. Merto Jr. CC : JLC, GM, AAI, RCY, file Re : Explanation Hereunder is my explanation to your Feb.

7 memo. The actions I took were in accordance with the provisions of the crane contract (attached) executed by the Company on October 28, 1982, as follows: 1. Paragraph 5 of said contract guarantees the crane owner a minimum 7 hours daily rental irrespective of whether the unit is used or not.

I do not think it is the intention of the company to deprive the crane owner that right if the latter was able to make use equal number of crane time in his performing a private work contract, i.e. PPA work, which he is expressly allowed to do. 2.

Paragraph 4 of the same contract, allows crane owner to perform private contractual work using the same contract unit. Because of this tolerance granted by the company to the crane owner, the stand by location station of the contract unit has to be made silent (unspecified) in the contract.

The contracting parties understood from the very beginning that the stand by location station of the crane may at any time be at the owner's place, or any other place where it can be conveniently called upon and immediately for use but never envisioned to be always at Portsite to enable the crane owner to qualify to have earned the stipulated guaranteed minimum daily rental. 3. Pertaining FTB and LDB my investigation disclosed that the superimpositions were done to rectify some deficiencies of the log book entries.

As to why company's option to utilize rented crane during its standby hours was not exercised, I have gathered the facts that our crane was then perfectly working well and use of option was considered not necessary. (Sgd.) NS MERTO JR. (Exh.

"4"-respondent and Exh. "B" complainants.' (Rollo, pp. 83-84) On the other hand, Baure disclaimed any direct participation in the irregularities and justified the erasures in the logbook in the following manner: "Surigao, February 8, 1983 "Mr. Albrecht H. Bake Vice President-Operation Pacific Cement Co., Inc. Surigao City Sir: This has reference to your letter of February 7, 1983 requesting explanation why no proper disciplinary and/or appropriate action should be taken against me for apparent involvement on the matters mentioned therein.

With respect to case No. 1 of your letter, I wish to state that I have no knowledge whatsoever nor did I participate in allowing the use of the crane by the Philippine Ports Authority during the periods comprising November 28 and 29 and December 16-21, inclusive. Mr. N.S. Merto whose signatures appear on the statements is in the best position to explain this matter. In case No. 2 the original entry of either 'breakdown' or 'out of order' during the period August 1-6 and 12, 1982 as appearing in the Port Operations Logbook is not entirely accurate as the crane was at standby time at the portsite.

Of course, during the period there were instances when the crane was checked up for minor mechanical defect to keep it always in a very good running condition but those brief instances of mechanical check-up might have occurred in the mind of Mr. Luisito D. Borja when he amended the original entries in the Port Operations Logbook to conform to the truth and the fact that the crane was neither out of order or broken down but on standby time and in good working condition at the portsite. As regards case No. 3, I feel that Mr. Borja is competent to explain the entries attributed to him in the Port Operations Logbook. May I include in this explanation that I have served this company for 18 years.

As one of the pioneers, I have always treasured my position the way I treasure my life. Now that I am nearing the period of my retirement, it would be the highest of irresponsibility for me to exchange my position for anything that would stain my clean record and leave a stigma upon my honor and that of my family. I trust, therefore, that the foregoing explanation rests with your satisfaction.

Very truly yours, (Sgd.) FERMIN T. BAURE, JR. cc: JCC; GM; AAI; RCY; NRT (Exh. '5' respondent (Rollo, pp. 84-85) A plant-level investigation ensued after which Borja was reinstated to his former position on February 16, 1983 after serving a 15-day suspension from work.

Pending official action on their cases, Merto and Baure, on February 21 and 22, 1983, respectively filed with the public respondent's Arbitration Branch in Region X a complaint for illegal suspension/dismissal, oppression and damages against the petitioners. On January 31, 1984, after a joint hearing, the Labor Arbiter rendered a decision against the petitioners with the following dispositive portion: "

WHEREFORE, IN VIEW OF THE FOREGOING, judgment is hereby rendered ordering Pacific Cement Co., Inc. to reinstate Norberto S. Merto, Jr. and Fermin T. Baure to their former position without loss of seniority lights and to pay them the following: I. NORBERTO S. MERTO, JR. 1. P 89,850.00 - as backwages and other benefits appurtenant to the position. 2. P 200,000.00 - as moral damages 3. P 100,000.00 - as exemplary damages 4. P 15,000.00 - reimbursement of actual expenses