EN BANC G.R. No. 81958 June 30, 1988 PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC., petitioner, vs. HON.

FRANKLIN M. DRILON as Secretary of Labor and Employment, and TOMAS D. ACHACOSO, as Administrator of the Philippine Overseas Employment Administration, respondents. Gutierrez & Alo Law Offices for petitioner.

SARMIENTO, J.: The petitioner, Philippine Association of Service Exporters, Inc. (PASEI, for short), a firm "engaged principally in the recruitment of Filipino workers, male and female, for overseas placement," 1 challenges the Constitutional validity of Department Order No. 1, Series of 1988, of the Department of Labor and Employment, in the character of "GUIDELINES GOVERNING THE TEMPORARY SUSPENSION OF DEPLOYMENT OF FILIPINO DOMESTIC AND HOUSEHOLD WORKERS," in this petition for certiorari and prohibition. Specifically, the measure is assailed for "discrimination against males or females;" 2 that it "does not apply to all Filipino workers but only to domestic helpers and females with similar skills;" 3 and that it is violative of the right to travel. It is held likewise to be an invalid exercise of the lawmaking power, police power being legislative, and not executive, in character. In its supplement to the petition, PASEI invokes Section 3, of Article XIII, of the Constitution, providing for worker participation "in policy and decision-making processes affecting their rights and benefits as may be provided by law." 4 Department Order No. 1, it is contended, was passed in the absence of prior consultations. It is claimed, finally, to be in violation of the Charter's non-impairment clause, in addition to the "great and irreparable injury" that PASEI members face should the Order be further enforced. On May 25, 1988, the Solicitor General, on behalf of the respondents Secretary of Labor and Administrator of the Philippine Overseas Employment Administration, filed a Comment informing the Court that on March 8, 1988, the respondent Labor Secretary lifted the deployment ban in the states of Iraq, Jordan, Qatar, Canada, Hongkong, United States, Italy, Norway, Austria, and Switzerland. * In submitting the validity of the challenged "guidelines," the Solicitor General invokes the police power of the Philippine State. It is admitted that Department Order No. 1 is in the nature of a police power measure. The only question is whether or not it is valid under the Constitution. The concept of police power is well-established in this jurisdiction. It has been defined as the "state authority to enact legislation that may interfere with personal liberty or property in order to promote the general welfare." 5 As defined, it consists of (1) an imposition of restraint upon liberty or property, (2) in order to foster the common good. It is not capable of an exact definition but has been, purposely, veiled in general terms to underscore its allcomprehensive embrace. "Its scope, ever-expanding to meet the exigencies of the times, even to anticipate the future where it could be done, provides enough room for an efficient and flexible response to conditions and circumstances thus assuring the greatest benefits." 6 It finds no specific Constitutional grant for the plain reason that it does not owe its origin to the Charter. Along with the taxing power and eminent domain, it is inborn in the very fact of statehood and sovereignty. It is a fundamental attribute of government that has enabled it to perform the most vital functions of governance. Marshall, to whom the expression has been credited, 7 refers to it succinctly as the plenary power of the State "to govern its citizens."8 "The police power of the State ... is a power coextensive with self- protection, and it is not inaptly termed the "law of overwhelming necessity." It may be said to be that inherent and plenary power in the State which enables it to prohibit all things hurtful to the comfort, safety, and welfare of society." 9

It constitutes an implied limitation on the Bill of Rights. According to Fernando, it is "rooted in the conception that men in organizing the state and imposing upon its government limitations to safeguard constitutional rights did not intend thereby to enable an individual citizen or a group of citizens to obstruct unreasonably the enactment of such salutary measures calculated to ensure communal peace, safety, good order, and welfare." 10 Significantly, the Bill of Rights itself does not purport to be an absolute guaranty of individual rights and liberties "Even liberty itself, the greatest of all rights, is not unrestricted license to act according to one's will." 11 It is subject to the far more overriding demands and requirements of the greater number. Notwithstanding its extensive sweep, police power is not without its own limitations. For all its awesome consequences, it may not be exercised arbitrarily or unreasonably. Otherwise, and in that event, it defeats the purpose for which it is exercised, that is, to advance the public good. Thus, when the power is used to further private interests at the expense of the citizenry, there is a clear misuse of the power. 12 In the light of the foregoing, the petition must be dismissed. As a general rule, official acts enjoy a presumed vahdity. 13 In the absence of clear and convincing evidence to the contrary, the presumption logically stands. The petitioner has shown no satisfactory reason why the contested measure should be nullified. There is no question that Department Order No. 1 applies only to "female contract workers," 14 but it does not thereby make an undue discrimination between the sexes. It is well-settled that "equality before the law" under the Constitution 15does not import a perfect Identity of rights among all men and women. It admits of classifications, provided that (1) such classifications rest on substantial distinctions; (2) they are germane to the purposes of the law; (3) they are not confined to existing conditions; and (4) they apply equally to all members of the same class. 16 The Court is satisfied that the classification made-the preference for female workers rests on substantial distinctions. As a matter of judicial notice, the Court is well aware of the unhappy plight that has befallen our female labor force abroad, especially domestic servants, amid exploitative working conditions marked by, in not a few cases, physical and personal abuse. The sordid tales of maltreatment suffered by migrant Filipina workers, even rape and various forms of torture, confirmed by testimonies of returning workers, are compelling motives for urgent Government action. As precisely the caretaker of Constitutional rights, the Court is called upon to protect victims of exploitation. In fulfilling that duty, the Court sustains the Government's efforts. The same, however, cannot be said of our male workers. In the first place, there is no evidence that, except perhaps for isolated instances, our men abroad have been afflicted with an Identical predicament. The petitioner has proffered no argument that the Government should act similarly with respect to male workers. The Court, of course, is not impressing some male chauvinistic notion that men are superior to women. What the Court is saying is that it was largely a matter of evidence (that women domestic workers are being ill-treated abroad in massive instances) and not upon some fanciful or arbitrary yardstick that the Government acted in this case. It is evidence capable indeed of unquestionable demonstration and evidence this Court accepts. The Court cannot, however, say the same thing as far as men are concerned. There is simply no evidence to justify such an inference. Suffice it to state, then, that insofar as classifications are concerned, this Court is content that distinctions are borne by the evidence. Discrimination in this case is justified. As we have furthermore indicated, executive determinations are generally final on the Court. Under a republican regime, it is the executive branch that enforces policy. For their part, the courts decide, in the proper cases, whether that policy, or the manner by which it is implemented, agrees with the Constitution or the laws, but it is not for them to question its wisdom. As a co-equal body, the judiciary has great respect for determinations of the Chief Executive or his subalterns, especially when the legislature itself has specifically given them enough room on how the law should be effectively enforced. In the case at bar, there is no gainsaying the fact, and the Court will deal with this at greater length shortly, that Department Order No. 1 implements the rule-making powers granted by the Labor Code. But what should be noted is the fact that in spite of such a fiction of finality, the Court is on its own persuaded that prevailing conditions indeed call for a deployment ban. There is likewise no doubt that such a classification is germane to the purpose behind the measure. Unquestionably, it is the avowed objective of Department Order No. 1 to "enhance the protection for Filipino female overseas

workers" 17 this Court has no quarrel that in the midst of the terrible mistreatment Filipina workers have suffered abroad, a ban on deployment will be for their own good and welfare. The Order does not narrowly apply to existing conditions. Rather, it is intended to apply indefinitely so long as those conditions exist. This is clear from the Order itself ("Pending review of the administrative and legal measures, in the Philippines and in the host countries . . ." 18), meaning to say that should the authorities arrive at a means impressed with a greater degree of permanency, the ban shall be lifted. As a stop-gap measure, it is possessed of a necessary malleability, depending on the circumstances of each case. Accordingly, it provides: 9. LIFTING OF SUSPENSION. The Secretary of Labor and Employment (DOLE) may, upon recommendation of the Philippine Overseas Employment Administration (POEA), lift the suspension in countries where there are: 1. Bilateral agreements or understanding with the Philippines, and/or,
2. Existing mechanisms providing for sufficient safeguards to ensure the welfare and protection of Filipino workers. 19

The Court finds, finally, the impugned guidelines to be applicable to all female domestic overseas workers. That it does not apply to "all Filipina workers" 20 is not an argument for unconstitutionality. Had the ban been given universal applicability, then it would have been unreasonable and arbitrary. For obvious reasons, not all of them are similarly circumstanced. What the Constitution prohibits is the singling out of a select person or group of persons within an existing class, to the prejudice of such a person or group or resulting in an unfair advantage to another person or group of persons. To apply the ban, say exclusively to workers deployed by A, but not to those recruited by B, would obviously clash with the equal protection clause of the Charter. It would be a classic case of what Chase refers to as a law that "takes property from A and gives it to B." 21 It would be an unlawful invasion of property rights and freedom of contract and needless to state, an invalid act. 22 (Fernando says: "Where the classification is based on such distinctions that make a real difference as infancy, sex, and stage of civilization of minority groups, the better rule, it would seem, is to recognize its validity only if the young, the women, and the cultural minorities are singled out for favorable treatment. There would be an element of unreasonableness if on the contrary their status that calls for the law ministering to their needs is made the basis of discriminatory legislation against them. If such be the case, it would be difficult to refute the assertion of denial of equal protection." 23 In the case at bar, the assailed Order clearly accords protection to certain women workers, and not the contrary.) It is incorrect to say that Department Order No. 1 prescribes a total ban on overseas deployment. From scattered provisions of the Order, it is evident that such a total ban has hot been contemplated. We quote: 5. AUTHORIZED DEPLOYMENT-The deployment of domestic helpers and workers of similar skills defined herein to the following [sic] are authorized under these guidelines and are exempted from the suspension. 5.1 Hirings by immediate members of the family of Heads of State and Government; 5.2 Hirings by Minister, Deputy Minister and the other senior government officials; and 5.3 Hirings by senior officials of the diplomatic corps and duly accredited international organizations. 5.4 Hirings by employers in countries with whom the Philippines have [sic] bilateral labor agreements or understanding. xxx xxx xxx 7. VACATIONING DOMESTIC HELPERS AND WORKERS OF SIMILAR SKILLS--Vacationing domestic helpers and/or workers of similar skills shall be allowed to process with the POEA and leave for worksite only if they are returning to the same employer to finish an existing or partially

served employment contract. Those workers returning to worksite to serve a new employer shall be covered by the suspension and the provision of these guidelines. xxx xxx xxx 9. LIFTING OF SUSPENSION-The Secretary of Labor and Employment (DOLE) may, upon recommendation of the Philippine Overseas Employment Administration (POEA), lift the suspension in countries where there are: 1. Bilateral agreements or understanding with the Philippines, and/or,
2. Existing mechanisms providing for sufficient safeguards to ensure the welfare and protection of Filipino workers. 24

xxx xxx xxx The consequence the deployment ban has on the right to travel does not impair the right. The right to travel is subject, among other things, to the requirements of "public safety," "as may be provided by law." 25 Department Order No. 1 is a valid implementation of the Labor Code, in particular, its basic policy to "afford protection to labor," 26 pursuant to the respondent Department of Labor's rule-making authority vested in it by the Labor Code.27 The petitioner assumes that it is unreasonable simply because of its impact on the right to travel, but as we have stated, the right itself is not absolute. The disputed Order is a valid qualification thereto. Neither is there merit in the contention that Department Order No. 1 constitutes an invalid exercise of legislative power. It is true that police power is the domain of the legislature, but it does not mean that such an authority may not be lawfully delegated. As we have mentioned, the Labor Code itself vests the Department of Labor and Employment with rulemaking powers in the enforcement whereof. 28 The petitioners's reliance on the Constitutional guaranty of worker participation "in policy and decision-making processes affecting their rights and benefits" 29 is not well-taken. The right granted by this provision, again, must submit to the demands and necessities of the State's power of regulation. The Constitution declares that:
Sec. 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. 30

"Protection to labor" does not signify the promotion of employment alone. What concerns the Constitution more paramountly is that such an employment be above all, decent, just, and humane. It is bad enough that the country has to send its sons and daughters to strange lands because it cannot satisfy their employment needs at home. Under these circumstances, the Government is duty-bound to insure that our toiling expatriates have adequate protection, personally and economically, while away from home. In this case, the Government has evidence, an evidence the petitioner cannot seriously dispute, of the lack or inadequacy of such protection, and as part of its duty, it has precisely ordered an indefinite ban on deployment. The Court finds furthermore that the Government has not indiscriminately made use of its authority. It is not contested that it has in fact removed the prohibition with respect to certain countries as manifested by the Solicitor General. The non-impairment clause of the Constitution, invoked by the petitioner, must yield to the loftier purposes targetted by the Government. 31 Freedom of contract and enterprise, like all other freedoms, is not free from restrictions, more so in this jurisdiction, where laissez faire has never been fully accepted as a controlling economic way of life. This Court understands the grave implications the questioned Order has on the business of recruitment. The concern of the Government, however, is not necessarily to maintain profits of business firms. In the ordinary sequence of events, it is profits that suffer as a result of Government regulation. The interest of the State is to provide a decent living to its citizens. The Government has convinced the Court in this case that this is its intent. We

do not find the impugned Order to be tainted with a grave abuse of discretion to warrant the extraordinary relief prayed for. WHEREFORE, the petition is DISMISSED. No costs. SO ORDERED. Yap, C.J., Fernan, Narvasa, Melencio-Herrera, Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin, Cortes and GrioAquino, JJ., concur. Gutierrez, Jr. and Medialdea, JJ., are on leave.

Footnotes 1 Rollo, 3. 2 Id., 12. 3 Id., 13. 4 CONST., Art XIII, Sec. 3. * Per reports, on June 14, 1988, the Government is said to have lifted the ban on five more countries: New Zealand Australia, Sweden, Spain, and West Germany. ("Maid export ban lifted in 5 states," The Manila Chronicle, June 14, 1988, p. 17, col. 2.) 5 Edu v. Ericta, No. L-32096, October 24, 1970, 35 SCRA 481, 487. 6 Supra, 488. 7 TRIBE, AMERICAN CONSTITUTIONAL LAW, 323 (1978). 8 Id. 9 Rubi v. Provincial Board of Mindoro, 39 Phil. 660, 708 (1919). 10 Edu v. Ericta, supra. 11 Rubi v. Provincial Board of Mindoro, supra, 704. 12 It is generally presumed, notwithstanding the plenary character of the lawmaking power, that the legislature must act for public purposes. In Pascual v. Secretary of Public Works [110 Phil. 331 (1960)], the Court nullified an act of Congress appropriating funds for a private purpose. The prohibition was not embodied in the Constitution then in force, however, it was presumed that Congress could not do it. 13 Ermita-Malate Hotel and Motel Operators Association, Inc. v. City Mayor of Manila, No. L-24693, July 31, 1967, 20 SCRA 849. 14 Dept. Order No. 1 (DOLE), February 10, 1988. 15 CONST., supra, Art. III, Sec. 1.

16 People v. Cayat, 68 Phil. 12 (1939). 17 Dept. Order No. 1, supra. 18 Supra. 19 Supra. 20 Rollo, Id., 13. 21 See TRIBE, Id., citing Calder v. Bull, 3 U.S. 386 (1798). 22 Id. 23 FERNANDO, THE CONSTITUTION OF THE PHILIPPINES 549-550 (1977). 24 Dept. Order No. 1, supra. 25 CONST., supra, Art. Ill, Sec. 6. 26 Pres. Decree No. 442, Art. 3. 27 Supra, Art. 5. 28 Supra. 29 CONST., supra, Art. XIII, Sec. 3. 30 Supra. 31 Heirs of Juancho Ardona v. Reyes, Nos. L-60549, 60553-60555, October 26, 1983, 125 SCRA 220.

THIRD DIVISION

[G.R. No. 138193. March 5, 2003]

OSM

SHIPPING PHILIPPINES, INC., petitioner, vs. RELATIONS COMMISSION (Third Division) GUERRERO,respondents. DECISION

NATIONAL LABOR and FERMIN F.

PANGANIBAN, J.:

The Rules of Court do not require that all supporting papers and documents accompanying a petition for certiorari should be duplicate originals or certified true copies. Furthermore, unilateral decisions to alter the use of a vessel from overseas service to coastwise shipping will not affect the validity of an existing employment contract validly executed. Workers should not be prejudiced by actions done solely by employers without the formers consent or participation.

The Case Before us is a Petition for Review on Certiorari[1] under Rule 45 of the Rules of Court, seeking to set aside the February 11, 1999 and the March 26, 1999 Resolutions of the Court of Appeals (CA) in CA-GR SP No. 50667. The assailed Resolutions dismissed a Petition filed in the CA, challenging an adverse ruling of the National Labor Relations Commission (NLRC). The first Resolution disposed as follows:

We resolve to OUTRIGHTLY DISMISS the petition.

[2]

The second Resolution[3] denied petitioners Motion for Reconsideration. On the other hand, the NLRC Decision disposed in this wise:

WHEREFORE, premises considered, the Decision appealed from is hereby MODIFIED in that respondents OSM Shipping Phils. Inc. and its principal, Philippine Carrier Shipping Agency Services Co. are jointly and severally ordered to pay complainant the sum of ELEVEN THOUSAND THREE HUNDRED FIFTY NINE and 65/100 [US dollars] (US$11,359.65) or its peso equivalent at the time of payment representing complainants unpaid salaries, accrued fi xed overtime pay, allowance, vacation leave pay and termination pay.
[4]

The Facts This case originated from a Complaint filed by Fermin F. Guerrero against OSM Shipping Philippines, Inc.; and its principal, Philippine Carrier Shipping Agency Services Co. The Complaint

was for illegal dismissal and non-payment of salaries, overtime pay and vacation pay. The facts are summarized in the NLRC Decision as follows:

[Private respondent] was hired by [Petitioner] OSM for and in behalf of its principal, Phil Carrier Shipping Agency Services Co. (PC-SLC) to board its vessel M/V [Princess] Hoa as a Master Mariner for a contract period of ten (10) months. Under the said contract, his basic monthly salary is US$1,070.00, US$220.00 allowance, US$321.00 fixed overtime, US$89 vacation leave pay per month for x x x 44 hours f] work per week. He boarded the vessel on July 21, 1994 and complied faithfully with the duties assigned to him. [Private respondent] alleged that from the start of his work with M/V Princess Hoa, he was not paid any compensation at all and was forced to disembark the vessel sometime in January 1995 because he cannot even buy his basic personal necessities. For almost seven (7) months, i.e. from July 1994 to January 1995, despite the services he rendered, no compensation or remuneration was ever paid to him. Hence, this case for illegal dismissal, [non-payment] of salaries, overtime pay and vacation pay. [Petitioner] OSM, for its part, alleged that on July 26, 1994, Concorde Pacific, an American company which owns M/V Princess Hoa, then a foreign registered vessel, appointed x x x Philippine Carrier Shipping Agency Services Co. (PC-SASCO) as ship manager particularly to negotiate, transact and deal with any third persons, entities or corporations in the planning of crewing selection or determination of qualifications of Filipino Seamen. On the same date, [Petitioner] OSM entered into a Crew Agreement with x x x PC-SASCO for the purpose of processing the documents of crew members of M/V Princess Hoa. The initial plan of the [s]hipowner was to use the vessel in the overseas trade, particularly the East Asian Growth Area. Thereafter, the contract of [private respondent] was processed before the POEA on September 20, 1994. OSM alleged further that the shipowner changed its plans on the use of the vessel. Instead of using it for overseas trade, it decided to use it in the coastwise trade, thus, the crewmembers hired never left the Philippines and were merely used by the shipowner in the coastwise trade. Considering that the M/V Princess Hoa was a foreign registered vessel and could not be used in the coastwise trade, the shipowner converted the vessel to Philippine registry on September 28, 1994 by way of bareboat chartering it out to another entity named Philippine Carrier Shipping Lines Co. (PCSLC). To do this, the shipowner through Conrado V. Tendido had to terminate its management agreement with x x x PC-SASCO on September 28, 1994 by a letter of termination dated September 20, 1994. In the same letter of termination, the ship owner stated that it has bareboat chartered out the vessel to said [PCSLC] and converted it into Philippine registry. Consequently, x x x PC-SASCO terminated its crew agreement with OSM in a letter dated December 5, 1994. Because of the bareboat charter of the vessel to PCSLC and its subsequent conversion to Philippine registry and use in coastwise trade as well as to the termination of the management agreement and crew agency agreement, a termination of contract ensued whereby PCSLC, the bareboat charterer, became the disponent owner/employer of the crew. As a disponent owner/employer, PCSLC is now responsible for the payment of complainants wages. x x x.
[5]

Labor Arbiter (LA) Manuel R. Caday rendered a Decision[6] in favor of Private Respondent Guerrero. Petitioner and its principal, Philippine Carrier Shipping Agency Services, Co. (PC-SASCO), were ordered to jointly and severally pay Guerrero his unpaid salaries and allowances, accrued fixed overtime pay, vacation leave pay and termination pay. The Decision held that there was a constructive dismissal of private respondent, since he had not been paid his salary for seven months. It also dismissed petitioners contention that there was a novation of the employment contract. On appeal, the NLRC (Third Division) affirmed the LAs Decision, with a modification as to the amount of liability. On January 28, 1999, petitioner filed with the CA a Petition [7] to set aside the NLRC judgment. The petition was dismissed, because petitioner had allegedly failed to comply with the requirements of Section 3 of Rule 46 of the Rules of Court. Specifically, petitioner had attached to its Petition, not a duplicate original or a certified true copy of the LAs Decision, but a mere machine copy thereof. Further, it had not indicated the actual address of Private Respondent Fermin F. Guerrero. [8] Hence, this Petition.[9]

The Issues In its Memorandum, petitioner raises the following issues for the Courts consideration:

1. Did not the Court of Appeals err in interpreting and applying the 1997 Rules when it required as attachment to the Petition for Certiorari the duplicate original of another Decision which is not-the subject of the said Petition? 2. Did not the Court of Appeals err in interpreting and applying the 1997 Rules when it disregarded the subsequent compliance made by petitioner? 3. Did not the Court of Appeals err in interpreting and applying the 1997 Rules when it did not consider the Notice to private respondent Guerrero through his counsel as Notice to Guerrero himself?
[10]

The foregoing issues all refer to the question of whether, procedurally, petitioner has complied with Section 3 of Rule 46 of the Rules of Court. Additionally and in the interest of speedy justice, this Court will also resolve the substantive issue brought before the CA: did the NLRC commit grave abuse of discretion in ruling in favor of private respondent? The Courts Ruling While petitioner is procedurally correct, the case should nonetheless be decided on the merits in favor of private respondent.

Procedural Issue:

Compliance with the Rules of Court

Petitioner puts at issue the proper interpretation of Section 3 of Rule 46 of the Rules of Court.[11] Specifically, was petitioner required to attach a certified true copy of the LAs Decision to its Petition for Certiorari challenging the NLRC judgment? Section 3 of Rule 46 does not require that all supporting papers and documents accompanying a petition be duplicate originals or certified true copies. Even under Rule 65 on certiorari and prohibition, petitions need to be accompanied only by duplicate originals or certified true copies of the questioned judgment, order or resolution. Other relevant documents and pleadings attached to it may be mere machine copies thereof.[12] Numerous decisions issued by this Court emphasize that in appeals under Rule 45 and in original civil actions for certiorari under Rule 65 in relation to Rules 46 and 56, what is required to be certified is the copy of the questioned judgment, final order or resolution.[13] Since the LAs Decision was not the questioned ruling, it did not have to be certified. What had to be certified was the NLRC Decision. And indeed it was. As to the alleged missing address of private respondent, the indication by petitioner that Guerrero could be served with process care of his counsel was substantial compliance with the Rules. This Court has held that the sending of pleadings to a party is not required, provided that the party is represented by counsel.[14] This rule is founded on considerations of fair play, inasmuch as an attorney of record is engaged precisely because a party does not feel competent to deal with the intricacies of law and procedure.[15] Both jurisprudence[16] and the basics of procedure[17]provide that when a party has appeared through counsel, service is to be made upon the latter, unless the court specifically orders that it be upon the party. We also note that from the inception of the case at the LAs office, all pleadings addressed to private respondent had always been sent to his counsel, Atty. Danilo G. Macalino. Note that private respondent, who was employed as a seaman, was often out of his home. The service of pleadings and other court processes upon him personally would have been futile, as he would not have been around to receive them. This Court has repeatedly held that while courts should meticulously observe the Rules, they should not be overly strict about procedural lapses that do not impair the proper administration of justice.[18] Rather, procedural rules should be liberally construed to secure the just, speedy and inexpensive disposition of every action and proceeding.[19]

Substantive Issue:

Liability of Petitioner for Unpaid Salaries It is worthwhile to note that what is involved in this case is the recovery of unpaid salaries and other monetary benefits. The Court is mindful of the plight of private respondent and, indeed, of workers in general who are seeking to recover wages that are being unlawfully withheld from them. Such recovery should not be needlessly delayed at the expense of their survival. This case is now on its ninth year since its inception at the LAs office. Its remand to the CA will only unduly delay its disposition. In the interest of substantial justice,[20] this Court will decide the case on the merits based upon the records of the case, particularly those relating to the OSM Shipping Philippines Petition before the CA. On behalf of its principal, PC-SASCO, petitioner does not deny hiring Private Respondent Guerrero as master mariner. However, it argues that since he was not deployed overseas, his employment contract became ineffective, because its object was allegedly absent. Petitioner

contends that using the vessel in coastwise trade and subsequently chartering it to another principal had the effect of novating the employment contract. We are not persuaded. As approved by the Philippine Overseas Employment Agency (POEA), petitioner was the legitimate manning agent of PC-SASCO.[21] As such, it was allowed to select, recruit, hire and deploy seamen on board the vessel M/V Princess Hoa, which was managed by its principal, PC-SASCO.[22] It was in this capacity that petitioner hired private respondent as master mariner. They then executed and agreed upon an employment contract. An employment contract, like any other contract, is perfected at the moment (1) the parties come to agree upon its terms; and (2) concur in the essential elements thereof: (a) consent of the contracting parties, (b) object certain which is the subject matter of the contract and (c) cause of the obligation.[23] Based on the perfected contract, Private Respondent Guerrero complied with his obligations thereunder and rendered his services on board the vessel. Contrary to petitioners contention, the contract had an object, which was the rendition of service by private respondent on board the vessel. The non-deployment of the ship overseas did not affect the validity of the perfected employment contract. After all, the decision to use the vessel for coastwise shipping was made by petitioner only and did not bear the written conformity of private respondent. A contract cannot be novated by the will of only one party. [24] The claim of petitioner that it processed the contract of private respondent with the POEA only after he had started working is also without merit. Petitioner cannot use its own misfeasance to defeat his claim. Petitioner, as manning agent, is jointly and severally liable with its principal, [25] PC-SASCO, for private respondents claim. This conclusion is in accordance with Section 1 of Rule II of the POEA Rules and Regulations.[26] Joint and solidary liability is meant to assure aggrieved workers of immediate and sufficient payment of what is due them.[27] The fact that petitioner and its principal have already terminated their agency agreement does not relieve the former of its liability. The reason for this ruling was given by this Court in Catan National Labor Relations Commission,[28] which we reproduce in part as follows:

This must be so, because the obligations covenanted in the [manning] agreement between the local agent and its foreign principal are not coterminus with the term of such agreement so that if either or both of the parties decide to end the agreement, the responsibilities of such parties towards the contracted employees under the agreement do not at all end, but the same extends up to and until the expiration of the, employment contracts of the employees recruited and employed pursuant to the said recruitment agreement. Otherwise, this will render nugatory the very purpose for which the law governing the employment of workers for foreign jobs abroad was enacted.
[29]

WHEREFORE, the assailed Resolutions are hereby SET ASIDE, and the September 10, 1998 NLRC Decision REINSTATED and AFFIRMED. Costs against petitioner. SO ORDERED. Puno, (Chairman), Sandoval-Gutierrez, and Carpio-Morales, JJ., concur. Corona, J., on leave.

[1]

Rollo, Vol. I, pp. 14-23. Id., p. 89. Written by Justice Renato C. Dacudao, member of the Special Tenth Division; concurred in by Justice Ma. Alicia Austria-Martinez (now SC justice and Division chairman) and Justice Rodrigo V. Cosico (acting member).

[2]

[3]

Id., p. 104. Written by Justice Renato C. Dacudao, member of the former Special Tenth Division; concurred in by Justices Rodrigo V. Cosico and Eloy R. Bello Jr., members. NLRC Decision, p. 17; rollo, Vol. I, p. 78. Written by Commissioner Tito F. Genilo and concurred in by Presiding Commissioner Lourdes C. Javier and Commissioner Ireneo B. Bernardo. Id., pp. 3-6 and 65-68. Rollo, vol. I, pp. 53-61. Id., pp. 27-35. Assailed CA Resolution, p. 1; rollo, Vol. I, p. 88. This case was deemed submitted for decision on July 2, 2002, upon the Courts receipt of private respondents Reply to petitioners Memorandum, and signed by Atty. Danilo G. Macalino of D.G. Macalino & Associates. Public respondents Memorandum, filed on April 16, 2001, was signed by Assistant Solicitor General Carlos N. Ortega, Assistant Solicitor General Roman G. del Rosario and Associate Solicitor Beatrice A. Caunan-Medina of the Office of the Solicitor General. Petitioners Memorandum, filed on March 14, 2001, was signed by Atty. Victor B. Roque. Petitioners Memorandum, p. 4; rollo, Vol. II, p. 79. Original in upper case. SEC. 3. Contents and filing of petition, effect of non-compliance with requirements. - The petition shall contain the full names and actual addresses of all the petitioners and respondents, a concise statement of the matters involved, the factual background of the case, and the grounds relied upon for the relief prayed for.

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[10]

[11]

In actions filed under Rule 65, the petition shall further indicate the material dates showing when notice of judgment or final order or resolution subject thereof was received, when a motion for new trial or reconsideration, if any, was filed and when notice of the denial thereof was received. It shall be filed in seven (7) clearly legible copies together with proof of service thereof on the respondent with the orig inal copy intended for the court indicated as such by the petitioner, and shall be accompanied by a clearly legible duplicate original or certified true copy of the judgment, order, resolution, or ruling subject thereof, such material portions of the record as are referred to therein, and other documents relevant or pertinent thereto. The certification shall be accomplished by the proper clerk of court or by his duly authorized representative, or by the proper officer of the court, tribunal, agency or office involved or by his duly authorized representative. The other requisite number of copies of the petition shall be accompanied by clearly legible plain copies of all documents attached to the original. The petitioner shall also submit together with the petition a sworn certification that he has not theretofore c ommenced any other action involving the same issues in the Supreme Court, the Court of Appeals or different divisions thereof, or any other tribunal or agency; if there is such other action or proceeding, he must state the status of the same; and if he should thereafter learn that a similar action or proceeding has been filed or is pending before the Supreme Court, the Court of Appeals, or different divisions thereof, or any other tribunal or agency, he undertakes to promptly inform the aforesaid courts and other tribunal or agency thereof within five (5) days therefrom. The petitioner shall pay the corresponding docket and other lawful fees to the clerk of court and deposit the amount of P500.00 for costs at the time of the filing of the petition. The failure of the petitioner to comply with any of the foregoing requirements shall be sufficient ground for the dismissal of the petition.
[12]

1 and 2, Rule 65 of the Rules of Court. Cadayona v. Court of Appeals, 324 SCRA 619, February 3, 2000, citing the following cases: Martinet v. Magallanes, GR No. 133766, January 13, 1999; Borja v. Judge Hontanosas Jr., GR No. 134748, January 13, 1999; Regalado et al. v. NLRC, GR No. 134671, January 13, 1999; G and M [Phils.], Inc. v. NLRC, GR No. 133836, January 13, 1999; Dimalanta v. People, GR No. 134798, November 9, 1998. Zoleta v. Drilon, 166 SCRA 548, October 18, 1988. Id., p. 554, citing JM Javier Logging Corporation v. Mardo, 24 SCRA 776, August 27, 1968. Ramos v. Court of Appeals, 321 SCRA 584, December 29, 1999; Galang v. Court of Appeals, 199 SCRA 683, July 29, 1991; Salen v. Dinglasan, 198 SCRA 623, June 28, 1991. 2, Rule 13 of the 1997 Rules of Court.

[13]

[14]

[15]

[16]

[17]

[18]

Director of Lands v. Court of Appeals, 303 SCRA 495, February 23, 1999; Uy Jr. v. Court of Appeals, 191 SCRA 275, November 9, 1990; Rinconada Telephone Company, Inc. v. Buenviaje, 184 SCRA 701, April 27, 1990; Seriav. Court of Appeals, 170 SCRA 421, February 21, 1989. 6, Rule I of the 1997 Rules of Court. Basco v. Court of Appeals, 326 SCRA 768, February 29, 2000; Beutifont Inc., v. Court of Appeals, 157 SCRA 481, January 29, 1988; Lianga Bqy Logging Co., Inc. v. Court of Appeals, 157 SCRA 357, January 28, 1988; Francisco v. City of Davao, 12 SCRA 628, December 24, 1964; Magno-Adamos v. Bagasao, 162 SCRA 747, June 28, 1988. NLRC Decision, p. 7; rollo, Vol. I, p. 69. Crew Agency Agreement, pp. 1-3; rollo, pp. 42-44. Limketkai Sons Milling, Inc. v. Court of Appeals, 250 SCRA 523, December 1, 1995; Ang Yu Asuncion v. Court of Appeals, 238 SCRA 602, December 2, 1994. Security Bank and Trust Company, Inc. v. Cuenca, 341 SCRA 781, October 3, 2000; Cruz v. Court of Appeals, 293 SCRA 239, July 27, 1998; Tiu Siuco v. Habana, 45 Phil. 707, February 21, 1924. Philippine Integrated Labor Assistance Corporation v. NLRC, 264 SCRA 418, November 19, 1996; Chavez v. BontoPerez, 242 SCRA 73, March 1, 1995; Teknika Skills and Trade Services, Inc. v. NLRC, 212 SCRA 132, August 4, 1992. SEC. 1. Requirements for Issuance of License. Every applicant for license to operate a private employment agency or manning agency shall submit a written application together with the following requirements: xxx xxx

[19]

[20]

[21]

[22]

[23]

[24]

[25]

[26]

xxx

f. A verified undertaking stating that the applicant: xxx (3) xxx xxx

Shall assume joint and solidary liability with the employer for all claims and liabilities which may arise in connection with the implementation of the contract; including but not limited to payment of wages, health and disability compensation and reparation[.]

[27]

PI Manpower Placements, Inc. v. NLRC (Second Division), 276 SCRA 451, July 31, 1997. 160 SCRA 691, April 15, 1988. Id., p. 695, citing NLRC Resolution in the same case, per Cortes, J.

[28]

[29]

FIRST DIVISION

[G.R. No. 120095. August 5, 1996]

JMM PROMOTION AND MANAGEMENT, INC., and KARY INTERNATIONAL, INC., petitioner, vs. HON. COURT OF APPEALS, HON. MA. NIEVES CONFESSOR, then Secretary of the Department of the Labor and Employment, HON. JOSE BRILLANTES, in his capacity as acting Secretary of the Department of Labor and Employment and HON. FELICISIMO JOSON, in his capacity as Administrator of the Philippine Overseas Employment Administration, respondents. DECISION
KAPUNAN, J.:

The limits of government regulation under the State's Police Power are once again at the vortex of the instant controversy. Assailed is the government's power to control deployment of female entertainers to Japan by requiring an Artist Record Book (ARB) as a precondition to the processing by the POEA of any contract for overseas employment. By contending that the right to overseas employment, is a property right within the meaning of the Constitution, petitioners vigorously aver that deprivation thereof allegedly through the onerous requirement of an ARB violates the due process clause and constitutes an invalid exercise of the police power. The factual antecedents are undisputed. Following the much-publicized death of Maricris Sioson in 1991, former President Corazon C. Aquino ordered a total ban against the deployment of performing artists to Japan and other foreign destinations. The ban was, however, rescinded after leaders of the overseas employment industry promised to extend full support for a program aimed at removing kinks in the system of deployment. In its place, the government, through the Secretary of Labor and Employment, subsequently issued Department Order No. 28, creating the Entertainment Industry Advisory Council (EIAC), which was tasked with issuing guidelines on the training, testing certification and deployment of performing artists abroad. Pursuant to the EIAC's recommendations,[1] the Secretary of Labor, on January 6, 1994, issued Department Order No. 3 establishing various procedures and requirements for screening performing artists under a new system of training, testing, certification and deployment of the former. Performing artists successfully hurdling the test, training and certification requirement were to be issued an Artist's Record Book (ARB), a necessary prerequisite to processing of any contract of employment by the POEA. Upon request of the industry, implementation of the process, originally scheduled for April 1, 1994, was moved to October 1, 1994. Thereafter, the Department of Labor, following the EIAC's recommendation, issued a series of orders fine-tuning and implementing the new system. Prominent among these orders were the following issuances:

1. Department Order No. 3-A, providing for additional guidelines on the training, testing, certification and deployment of performing artists.

2. Department Order No. 3-B, pertaining to the Artist Record Book (ARB) requirement, which could be processed only after the artist could show proof of academic and skills training and has passed the required tests. 3. Department Order No. 3-E, providing the minimum salary a performing artist ought to receive (not less than US$600.00 for those bound for Japan) and the authorized deductions therefrom. 4. Department Order No. 3-F, providing for the guidelines on the issuance and use of the ARB by returning performing artists who, unlike new artists, shall only undergo a Special Orientation Program (shorter than the basic program) although they must pass the academic test.
In Civil Case No. 95-72750, the Federation of Entertainment Talent Managers of the Philippines (FETMOP), on January 27, 1995 filed a class suit assailing these department orders, principally contending that said orders 1) violated the constitutional right to travel; 2) abridged existing contracts for employment; and 3) deprived individual artists of their licenses without due process of law. FETMOP, likewise, averred that the issuance of the Artist Record Book (ARB) was discriminatory and illegal and "in gross violation of the constitutional right... to life liberty and property." Said Federation consequently prayed for the issuance of a writ of preliminary injunction against the aforestated orders. On February 2, 1992, JMM Promotion and Management, Inc. and Kary International, Inc., herein petitioners, filed a Motion for Intervention in said civil case, which was granted by the trial court in an Order dated 15 February, 1995. However, on February 21, 1995, the trial court issued an Order denying petitioners' prayer for a writ of preliminary injunction and dismissed the complaint. On appeal from the trial court's Order, respondent court, in CA G.R. SP No. 36713 dismissed the same. Tracing the circumstances which led to the issuance of the ARB requirement and the assailed Department Order, respondent court concluded that the issuances constituted a valid exercise by the state of the police power. We agree. The latin maxim salus populi est suprema lex embodies the character of the entire spectrum of public laws aimed at promoting the general welfare of the people under the State's police power. As an inherent attribute of sovereignty which virtually "extends to all public needs," [2] this "least limitable"[3] of governmental powers grants a wide panoply of instruments through which the state, as parens patriae gives effect to a host of its regulatory powers. Describing the nature and scope of the police power, Justice Malcolm, in the early case of Rubi v. Provincial Board of Mindoro[4] wrote:

"The police power of the State," one court has said...'is a power coextensive with self-protection, and is not inaptly termed 'the law of overruling necessity.' It may be said to be that inherent and plenary power in the state which enables it to prohibit all things hurtful to the comfort, safety and welfare of society.' Carried onward by the current of legislature, the judiciary rarely attempts to dam the onrushing power of legislative discretion, provided the purposes of the law do not go beyond the great principles that mean security for the public welfare or do not arbitrarily interfere with the right of the individual."
[5]

Thus, police power concerns government enactments which precisely interfere with personal liberty or property in order to promote the general welfare or the common good. As the assailed Department Order enjoys a presumed validity, it follows that the burden rests upon petitioners to demonstrate that the said order, particularly, its ARB requirement, does not enhance the public welfare or was exercised arbitrarily or unreasonably. A thorough review of the facts and circumstances leading to the issuance of the assailed orders compels us to rule that the Artist Record Book requirement and the questioned Department Order related to its issuance were issued by the Secretary of Labor pursuant to a valid exercise of the police power. In 1984, the Philippines emerged as the largest labor sending country in Asia dwarfing the labor export of countries with mammoth populations such as India and China. According to the National Statistics Office, this diaspora was augmented annually by over 450,000 documented and clandestine or illegal (undocumented) workers who left the country for various destinations abroad, lured by higher salaries, better work opportunities and sometimes better living conditions. Of the hundreds of thousands of workers who left the country for greener pastures in the last few years, women composed slightly close to half of those deployed, constituting 47% between 19871991, exceeding this proportion (58%) by the end of 1991, [6] the year former President Aquino instituted the ban on deployment of performing artists to Japan and other countries as a result of the gruesome death of Filipino entertainer Maricris Sioson. It was during the same period that this Court took judicial notice not only of the trend, but also of the fact that most of our women, a large number employed as domestic helpers and entertainers, worked under exploitative conditions "marked by physical and personal abuse." [7] Even then, we noted that "[t]he sordid tales of maltreatment suffered by migrant Filipina workers, even rape and various forms of torture, confirmed by testimonies of returning workers" compelled "urgent government action."[8] Pursuant to the alarming number of reports that a significant number of Filipina performing artists ended up as prostitutes abroad (many of whom were beaten, drugged and forced into prostitution), and following the deaths of a number of these women, the government began instituting measures aimed at deploying only those individuals who met set standards which would qualify them as legitimate performing artists. In spite of these measures, however, a number of our countrymen have nonetheless fallen victim to unscrupulous recruiters, ending up as virtual slaves controlled by foreign crime syndicates and forced into jobs other than those indicated in their employment contracts. Worse, some of our women have been forced into prostitution. Thus, after a number of inadequate and failed accreditation schemes, the Secretary of Labor issued on August 16, 1993, D.O. No. 28, establishing the Entertainment Industry Advisory Council (EIAC), the policy advisory body of DOLE on entertainment industry matters.[9] Acting on the recommendations of the said body, the Secretary of Labor, on January 6, 1994, issued the assailed orders. These orders embodied EIAC's Resolution No. 1, which called for guidelines on screening, testing and accrediting performing overseas Filipino artists. Significantly, as the respondent court noted, petitioners were duly represented in the EIAC,[10] which gave the recommendations on which the ARB and other requirements were based. Clearly, the welfare of Filipino performing artists, particularly the women was paramount in the issuance of Department Order No. 3. Short of a total and absolute ban against the deployment of performing artists to "high risk" destinations, a measure which would only drive recruitment further underground, the new scheme at the very least rationalizes the method of screening performing artists by requiring reasonable educational and artistic skills from them and limits deployment to only those individuals adequately prepared for the unpredictable demands of employment as artists

abroad. It cannot be gainsaid that this scheme at least lessens the room for exploitation by unscrupulous individuals and agencies. Moreover, here or abroad, selection of performing artists is usually accomplished by auditions, where those deemed unfit are usually weeded out through a process which is inherently subjective and vulnerable to bias and differences in taste. The ARB requirement goes one step further, however, attempting to minimize the subjectivity of the process by defining the minimum skills required from entertainers and performing artists. As the Solicitor General observed, this should be easily met by experienced artists possessing merely basic skills. The tests are aimed at segregating real artists or performers from those passing themselves off as such, eager to accept any available job and therefore exposing themselves to possible exploitation. As to the other provisions of Department Order No. 3 questioned by petitioners, we see nothing wrong with the requirement for document and booking confirmation (D.O. 3-C), a minimum salary scale (D.O. 3-E), or the requirement for registration of returning performers. The requirement for a venue certificate or other documents evidencing the place and nature of work allows the government closer monitoring of foreign employers and helps keep our entertainers away from prostitution fronts and other worksites associated with unsavory, immoral, illegal or exploitative practices. Parenthetically, none of these issuances appear to us, by any stretch of the imagination, even remotely unreasonable or arbitrary. They address a felt need of according greater protection for an oft-exploited segment of our OCW's. They respond to the industry's demand for clearer and more practicable rules and guidelines. Many of these provisions were fleshed out following recommendations by, and after consultations with, the affected sectors and non-government organizations. On the whole, they are aimed at enhancing the safety and security of entertainers and artists bound for Japan and other destinations, without stifling the industry's concerns for expansion and growth. In any event, apart from the State's police power, the Constitution itself mandates government to extend the fullest protection to our overseas workers. The basic constitutional statement on labor, embodied in Section 18 of Article II of the Constitution provides:

Sec. 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare.
More emphatically, the social justice provision on labor of the 1987 Constitution in its first paragraph states: The State shall afford full protection to labor, local and overseas, organized and unorganized and promote full employment and equality of employment opportunities for all. Obviously, protection to labor does not indicate promotion of employment alone. Under the welfare and social justice provisions of the Constitution, the promotion of full employment, while desirable, cannot take a backseat to the government's constitutional duty to provide mechanisms for the protection of our workforce, local or overseas. As this Court explained in Philippine Association of Service Exporters (PASEI) v. Drilon,[11] in reference to the recurring problems faced by our overseas workers:

What concerns the Constitution more paramountly is that such an employment be above all, decent, just, and humane. It is bad enough that the country has to send its sons and daughters to strange lands because it cannot satisfy their employment needs at home. Under these circumstances, the Government is duty-bound to insure that our toiling expatriates have adequate protection, personally and economically, while away from home.

We now go to petitioners' assertion that the police power cannot, nevertheless, abridge the right of our performing workers to return to work abroad after having earlier qualified under the old process, because, having previously been accredited, their accreditation became a property right," protected by the due process clause. We find this contention untenable. A profession, trade or calling is a property right within the meaning of our constitutional guarantees. One cannot be deprived of the right to work and the right to make a living because these rights are property rights, the arbitrary and unwarranted deprivation of which normally constitutes an actionable wrong.[12] Nevertheless, no right is absolute, and the proper regulation of a profession, calling, business or trade has always been upheld as a legitimate subject of a valid exercise of the police power by the state particularly when their conduct affects either the execution of legitimate governmental functions, the preservation of the State, the public health and welfare and public morals. According to the maxim, sic utere tuo ut alienum non laedas, it must of course be within the legitimate range of legislative action to define the mode and manner in which every one may so use his own property so as not to pose injury to himself or others.[13] In any case, where the liberty curtailed affects at most the rights of property, the permissible scope of regulatory measures is certainly much wider.[14] To pretend that licensing or accreditation requirements violates the due process clause is to ignore the settled practice, under the mantle of the police power, of regulating entry to the practice of various trades or professions. Professionals leaving for abroad are required to pass rigid written and practical exams before they are deemed fit to practice their trade. Seamen are required to take tests determining their seamanship. Locally, the Professional Regulation Commission has began to require previously licensed doctors and other professionals to furnish documentary proof that they had either re-trained or had undertaken continuing education courses as a requirement for renewal of their licenses. It is not claimed that these requirements pose an unwarranted deprivation of a property right under the due process clause. So long as Professionals and other workers meet reasonable regulatory standards no such deprivation exists. Finally, it is a futile gesture on the part of petitioners to invoke the non-impairment clause of the Constitution to support their argument that the government cannot enact the assailed regulatory measures because they abridge the freedom to contract. In Philippine Association of Service Exporters, Inc. vs. Drilon, we held that "[t]he non-impairment clause of the Constitution... must yield to the loftier purposes targeted by the government." [15] Equally important, into every contract is read provisions of existing law, and always, a reservation of the police power for so long as the agreement deals with a subject impressed with the public welfare. A last point. Petitioners suggest that the singling out of entertainers and performing artists under the assailed department orders constitutes class legislation which violates the equal protection clause of the Constitution. We do not agree. The equal protection clause is directed principally against undue favor and individual or class privilege. It is not intended to prohibit legislation which is limited to the object to which it is directed or by the territory in which it is to operate. It does not require absolute equality, but merely that all persons be treated alike under like conditions both as to privileges conferred and liabilities imposed.[16] We have held, time and again, that the equal protection clause of the Constitution does not forbid classification for so long as such classification is based on real and substantial differences having a reasonable relation to the subject of the particular legislation. [17] If classification is germane to the purpose of the law, concerns all members of the class, and applies equally to present and future conditions, the classification does not violate the equal protection guarantee. In the case at bar, the challenged Department Order clearly applies to all performing artists and entertainers destined for jobs abroad. These orders, we stressed hereinbefore, further the

Constitutional mandate requiring Government to protect our workforce, particularly those who may be prone to abuse and exploitation as they are beyond the physical reach of government regulatory agencies. The tragic incidents must somehow stop, but short of absolutely curtailing the right of these performers and entertainers to work abroad, the assailed measures enable our government to assume a measure of control. WHEREFORE, finding no reversible error in the decision sought to be reviewed, petition is hereby DENIED. SO ORDERED. Padilla (Chairman), Bellosillo, Vitug, and Hermosisima, Jr., JJ., concur.

[1]

EIAC, Res. No. 1. Noble State Bank v. Haskel, 219 US 112 (1911). Smith, Bell and Co. v. Natividad, 40 Phil. 136 (1919). 39 Phil 660, 708 (1919). Id., at 708-709. Source: National Statistics Office, 1992. Philippine Association of Service Exporters, Inc. v. Drilon 163 SCRA 386, 392 (1988). Id. Department Order No. 28 vests the EIAC with the following principal functions:

[2]

[3]

[4]

[5]

[6]

[7]

[8]

[9]

a) recommend to the DOLE policies, plans and programs for the development of the entertainment industry, local and overseas, including but not limited to talents training and upgrading, employment standards and other internationally acceptable trade practices; b) promote ethical business standards and dignified workplaces; c) act as the coordinating body for all training programs and technical assistance to the entertainment industry; d) advise the DOLE on the institutionalization of an internationally acceptable system of manpower development, talent protection and welfare; e) assist the appropriate agencies, private or public in the implementation of a trainors and training and upgrading program; f) review existing issuances on the industry including the system of training, testing and accreditation of performing artists/talents and recommend to the Secretary such measures or schemes as are deemed necessary for its proper compliance xxx xxx.
[10]

The EIAC is chaired by an Undersecretary of Labor and is composed of 3 representatives from the government, 2 representatives from the employers' sector, one representative from the talent developers, 2 representatives from the workers' sector and one representative from the Non-government Organizations.
[11]

Id.

[12]

Phil. Movie Workers' Assn. v. Premier Productions, Inc., 92 Phil. 8423 (1953); National Labor Union vs. Court of Industrial Relations, 68 Phil. 732 (1939).
[13]

Case vs. Board of Helath, 24 Phil. 250, 280 (1913). Ermita Malate Hotel and Motel Operators vs. City of Manila, 20 SCRA 849 (1967). Supra, note 6, at 397. Itchong, etc., et al. vs. Hernandez, 101 Phil. 1155 (1957).

[14]

[15]

[16]

SECOND DIVISION

[G.R. No. 131719. May 25, 2004]

THE EXECUTIVE SECRETARY, THE SECRETARY OF JUSTICE, THE SECRETARY OF LABOR AND EMPLOYMENT, AND THE SECRETARY OF FOREIGN AFFAIRS, OWWA ADMINISTRATOR, and POEA ADMINISTRATOR, petitioners, vs. THE HON. COURT OF APPEALS and ASIAN RECRUITMENT COUNCIL PHILIPPINE CHAPTER (ARCO-PHIL.), INC., representing its members: Worldcare Services Internationale, Inc., Steadfast International Recruitment Corporation, Dragon International Manpower Services Corporation, Verdant Manpower Mobilization Corporation, Brent Overseas Personnel, Inc., ARL Manpower Services, Inc., Dahlzhen International Services, Inc., Interworld Placement Center, Inc., Lakas Tao Contract Services, Ltd. Co., and SSC Multiservices, respondents. DECISION
CALLEJO, SR., J.:

In this petition for review on certiorari, the Executive Secretary of the President of the Philippines, the Secretary of Justice, the Secretary of Foreign Affairs, the Secretary of Labor and Employment, the POEA Administrator and the OWWA Administrator, through the Office of the Solicitor General, assail the Decision[1] of the Court of Appeals in CA-G.R. SP No. 38815 affirming the Order[2] of the Regional Trial Court of Quezon City dated August 21, 1995 in Civil Case No. Q-95-24401, granting the plea of the petitioners therein for a writ of preliminary injunction and of the writ of preliminary injunction issued by the trial court on August 24, 1995.

The Antecedents Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995, took effect on July 15, 1995. The Omnibus Rules and Regulations Implementing the Migrant Workers and Overseas Filipino Act of 1995 was, thereafter, published in the April 7, 1996 issue of the Manila Bulletin. However, even before the law took effect, the Asian Recruitment Council Philippine Chapter, Inc. (ARCO-Phil.) filed, on July 17, 1995, a petition for declaratory relief under Rule 63 of the Rules of Court with the Regional Trial Court of Quezon City to declare as unconstitutional Section 2, paragraph (g), Section 6, paragraphs (a) to (j), (l) and (m), Section 7, paragraphs (a) and (b), and Sections 9 and 10 of the law, with a plea for the issuance of a temporary restraining order and/or writ of preliminary injunction enjoining the respondents therein from enforcing the assailed provisions of the law. In a supplement to its petition, the ARCO-Phil. alleged that Rep. Act No. 8042 was self-executory and that no implementing rules were needed. It prayed that the court issue a temporary restraining order to enjoin the enforcement of Section 6, paragraphs (a) to (m) on illegal recruitment, Section 7

on penalties for illegal recruitment, and Section 9 on venue of criminal actions for illegal recruitments, viz:

Viewed in the light of the foregoing discussions, there appears to be urgent an imperative need for this Honorable Court to maintain the status quo by enjoining the implementation or effectivity of the questioned provisions of RA 8042, by way of a restraining order otherwise, the member recruitment agencies of the petitioner will suffer grave or irreparable damage or injury. With the effectivity of RA 8042, a great majority of the duly licensed recruitment agencies have stopped or suspended their operations for fear of being prosecuted under the provisions of a law that are unjust and unconstitutional. This Honorable Court may take judicial notice of the fact that processing of deployment papers of overseas workers for the past weeks have come to a standstill at the POEA and this has affected thousands of workers everyday just because of the enactment of RA 8042. Indeed, this has far reaching effects not only to survival of the overseas manpower supply industry and the active participating recruitment agencies, the countrys economy which has survived mainly due to the dollar remittances of the overseas workers but more importantly, to the poor and the needy who are in dire need of income-generating jobs which can only be obtained from abroad. The loss or injury that the recruitment agencies will suffer will then be immeasurable and irreparable. As of now, even foreign employers have already reduced their manpower requirements from the Philippines due to their knowledge that RA 8042 prejudiced and adversely affected the local recruitment agencies.
[3]

On August 1, 1995, the trial court issued a temporary restraining order effective for a period of only twenty (20) days therefrom. After the petitioners filed their comment on the petition, the ARCO-Phil. filed an amended petition, the amendments consisting in the inclusion in the caption thereof eleven (11) other corporations which it alleged were its members and which it represented in the suit, and a plea for a temporary restraining order enjoining the respondents from enforcing Section 6 subsection (i), Section 6 subsection (k) and paragraphs 15 and 16 thereof, Section 8, Section 10, paragraphs 1 and 2, and Sections 11 and 40 of Rep. Act No. 8042. The respondent ARCO-Phil. assailed Section 2(g) and (i), Section 6 subsection (a) to (m), Section 7(a) to (b), and Section 10 paragraphs (1) and (2), quoted as follows:

(g) THE STATE RECOGNIZES THAT THE ULTIMATE PROTECTION TO ALL MIGRANT WORKERS IS THE POSSESSION OF SKILLS. PURSUANT TO THIS AND AS SOON AS PRACTICABLE, THE GOVERNMENT SHALL DEPLOY AND/OR ALLOW THE DEPLOYMENT ONLY OF SKILLED FILIPINO WORKERS.
[4]

Sec. 2 subsection (i, 2nd par.) Nonetheless, the deployment of Filipino overseas workers, whether land-based or sea-based, by local service contractors and manning agents employing them shall be encourages (sic). Appropriate incentives may be extended to them. II. ILLEGAL RECRUITMENT

SEC. 6. Definition. For purposes of this Act, illegal recruitment shall mean any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, or procuring workers and includes referring, contract services, promising or advertising for employment abroad, whether for profit or not, when undertaken by a non-licensee or non-holder of authority contemplated under Article 13(f) of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines: Provided, That any such non-licensee or non-holder who, in any manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so engaged. It shall, likewise, include the following acts, whether committed by any person, whether a non-licensee, non-holder, licensee or holder of authority: (a) To charge or accept directly or indirectly any amount greater than that specified in the schedule of allowable fees prescribed by the Secretary of Labor and Employment, or to make a worker pay any amount greater than that actually received by him as a loan or advance; (b) To furnish or publish any false notice or information or document in relation to recruitment or employment; (c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under the Labor Code; (d) To induce or attempt to induce a worker already employed to quit his employment in order to offer him another unless the transfer is designed to liberate a worker from oppressive terms and conditions of employment; (e) To influence or attempt to influence any person or entity not to employ any worker who has not applied for employment through his agency; (f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines; (g) To obstruct or attempt to obstruct inspection by the Secretary of Labor and Employment or by his duly authorized representative; (h) To fail to submit reports on the status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor and Employment; (i) To substitute or alter to the prejudice of the worker, employment contracts approved and verified by the Department of Labor and Employment from the time of actual signing thereof by the parties up to and including the period of the expiration of the same without the approval of the Department of Labor and Employment; (j) For an officer or agent of a recruitment or placement agency to become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of a travel agency;

(k) To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations other than those authorized under the Labor Code and its implementing rules and regulations; (l) Failure to actually deploy without valid reason as determined by the Department of Labor and Employment; and (m) Failure to reimburse expenses incurred by the worker in connection with his documentation and processing for purposes of deployment, in cases where the deployment does not actually take place without the workers fault. Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage. Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring or confederating with one another. It is deemed committed in large scale if committed against three (3) or more persons individually or as a group. The persons criminally liable for the above offenses are the principals, accomplices and accessories. In case of juridical persons, the officers having control, management or direction of their business shall be liable. SEC. 7. Penalties. (a) Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6) years and one (1) day but not more than twelve (12) years and a fine of not less than two hundred thousand pesos (P200,000.00) nor more than five hundred thousand pesos (P500,000.00). (b) The penalty of life imprisonment and a fine of not less than five hundred thousand pesos (P500,000.00) nor more than one million pesos (P1,000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein. Provided, however, That the maximum penalty shall be imposed if the person illegally recruited is less than eighteen (18) years of age or committed by a non-licensee or non-holder of authority. Sec. 8. Prohibition on Officials and Employees. It shall be unlawful for any official or employee of the Department of Labor and Employment, the Philippine Overseas Employment Administration (POEA), or the Overseas Workers Welfare Administration (OWWA), or the Department of Foreign Affairs, or other government agencies involved in the implementation of this Act, or their relatives within the fourth civil degree of consanguinity or affinity, to engage, directly or indirectly, in the business of recruiting migrant workers as defined in this Act. The penalties provided in the immediate preceding paragraph shall be imposed upon them. (underscoring supplied)

Sec. 10, pars. 1 & 2. Money Claims. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages. The liability of the principal/employer and the recruitment/placement agency for any and all claims under this section shall be joint and several. This provision shall be incorporated in the contract for overseas employment and shall be a condition precedent for its approval. The performance bond to be filed by the recruitment/placement agency, as provided by law, shall be answerable for all money claims or damages that may be awarded to the workers. If the recruitment/placement agency is a juridical being, the corporate officers and directors and partners as the case may be, shall themselves be jointly and solidarily liable with the corporation or partnership for the aforesaid claims and damages. SEC. 11. Mandatory Periods for Resolution of Illegal Recruitment Cases. The preliminary investigations of cases under this Act shall be terminated within a period of thirty (30) calendar days from the date of their filing. Where the preliminary investigation is conducted by a prosecution officer and a prima facie case is established, the corresponding information shall be filed in court within twenty-four (24) hours from the termination of the investigation. If the preliminary investigation is conducted by a judge and a prima facie case is found to exist, the corresponding information shall be filed by the proper prosecution officer within forty-eight (48) hours from the date of receipt of the records of the case.
The respondent averred that the aforequoted provisions of Rep. Act No. 8042 violate Section 1, Article III of the Constitution.[5] According to the respondent, Section 6(g) and (i) discriminated against unskilled workers and their families and, as such, violated the equal protection clause, as well as Article II, Section 12[6] and Article XV, Sections 1[7] and 3(3) of the Constitution.[8] As the law encouraged the deployment of skilled Filipino workers, only overseas skilled workers are granted rights. The respondent stressed that unskilled workers also have the right to seek employment abroad. According to the respondent, the right of unskilled workers to due process is violated because they are prevented from finding employment and earning a living abroad. It cannot be argued that skilled workers are immune from abuses by employers, while unskilled workers are merely prone to such abuses. It was pointed out that both skilled and unskilled workers are subjected to abuses by foreign employers. Furthermore, the prohibition of the deployment of unskilled workers abroad would only encourage fly-by-night illegal recruiters. According to the respondent, the grant of incentives to service contractors and manning agencies to the exclusion of all other licensed and authorized recruiters is an invalid classification. Licensed and authorized recruiters are thus deprived of their right to property and due process and to the equality of the person. It is understandable for the law to prohibit illegal recruiters, but to discriminate against licensed and registered recruiters is unconstitutional. The respondent, likewise, alleged that Section 6, subsections (a) to (m) is unconstitutional because licensed and authorized recruitment agencies are placed on equal footing with illegal

recruiters. It contended that while the Labor Code distinguished between recruiters who are holders of licenses and non-holders thereof in the imposition of penalties, Rep. Act No. 8042 does not make any distinction. The penalties in Section 7(a) and (b) being based on an invalid classification are, therefore, repugnant to the equal protection clause, besides being excessive; hence, such penalties are violative of Section 19(1), Article III of the Constitution.[9] It was also pointed out that the penalty for officers/officials/employees of recruitment agencies who are found guilty of economic sabotage or large-scale illegal recruitment under Rep. Act No. 8042 is life imprisonment. Since recruitment agencies usually operate with a manpower of more than three persons, such agencies are forced to shut down, lest their officers and/or employees be charged with large scale illegal recruitment or economic sabotage and sentenced to life imprisonment. Thus, the penalty imposed by law, being disproportionate to the prohibited acts, discourages the business of licensed and registered recruitment agencies. The respondent also posited that Section 6(m) and paragraphs (15) and (16), Sections 8, 9 and 10, paragraph 2 of the law violate Section 22, Article III of the Constitution[10] prohibiting ex-post facto laws and bills of attainder. This is because the provisions presume that a licensed and registered recruitment agency is guilty of illegal recruitment involving economic sabotage, upon a finding that it committed any of the prohibited acts under the law. Furthermore, officials, employees and their relatives are presumed guilty of illegal recruitment involving economic sabotage upon such finding that they committed any of the said prohibited acts. The respondent further argued that the 90-day period in Section 10, paragraph (1) within which a labor arbiter should decide a money claim is relatively short, and could deprive licensed and registered recruiters of their right to due process. The period within which the summons and the complaint would be served on foreign employees and, thereafter, the filing of the answer to the complaint would take more than 90 days. This would thereby shift on local licensed and authorized recruiters the burden of proving the defense of foreign employers. Furthermore, the respondent asserted, Section 10, paragraph 2 of the law, which provides for the joint and several liability of the officers and employees, is a bill of attainder and a violation of the right of the said corporate officers and employees to due process. Considering that such corporate officers and employees act with prior approval of the board of directors of such corporation, they should not be liable, jointly and severally, for such corporate acts. The respondent asserted that the following provisions of the law are unconstitutional:

SEC. 9. Venue. A criminal action arising from illegal recruitment as defined herein shall be filed with the Regional Trial Court of the province or city where the offense was committed or where the offended party actually resides at the time of the commission of the offense: Provided, That the court where the criminal action is first filed shall acquire jurisdiction to the exclusion of other courts: Provided, however, That the aforestated provisions shall also apply to those criminal actions that have already been filed in court at the time of the effectivity of this Act. SEC. 10. Money Claims. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages.

Sec. 40. The departments and agencies charged with carrying out the provisions of this Act shall, within ninety (90) days after the effectiviy of this Act, formulate the necessary rules and regulations for its effective implementation.
According to the respondent, the said provisions violate Section 5(5), Article VIII of the Constitution[11] because they impair the power of the Supreme Court to promulgate rules of procedure. In their answer to the petition, the petitioners alleged, inter alia, that (a) the respondent has no cause of action for a declaratory relief; (b) the petition was premature as the rules implementing Rep. Act No. 8042 not having been released as yet; (c) the assailed provisions do not violate any provisions of the Constitution; and, (d) the law was approved by Congress in the exercise of the police power of the State. In opposition to the respondents plea for injunctive relief, the petitioners averred that:

As earlier shown, the amended petition for declaratory relief is devoid of merit for failure of petitioner to demonstrate convincingly that the assailed law is unconstitutional, apart from the defect and impropriety of the petition. One who attacks a statute, alleging unconstitutionality must prove its invalidity beyond reasonable doubt (Caleon v. Agus Development Corporation, 207 SCRA 748). All reasonable doubts should be resolved in favor of the constitutionality of a statute (People v. Vera, 65 Phil. 56). This presumption of constitutionality is based on the doctrine of separation of powers which enjoin upon each department a becoming respect for the acts of the other departments (Garcia vs. Executive Secretary, 204 SCRA 516 [1991]). Necessarily, the ancillary remedy of a temporary restraining order and/or a writ of preliminary injunction prayed for must fall. Besides, an act of legislature approved by the executive is presumed to be within constitutional bounds (National Press Club v. Commission on Elections, 207 SCRA 1).
[12]

After the respective counsels of the parties were heard on oral arguments, the trial court issued on August 21, 1995, an order granting the petitioners plea for a writ of preliminary injunction upon a bond of P50,000. The petitioner posted the requisite bond and on August 24, 1995, the trial court issued a writ of preliminary injunction enjoining the enforcement of the following provisions of Rep. Act No. 8042 pending the termination of the proceedings:

Section 2, subsections (g) and (i, 2nd par.); Section 6, subsections (a) to (m), and pars. 15 & 16; Section 7, subsections (a) & (b); Section 8; Section 9; Section 10; pars. 1 & 2; Section 11; and Section 40 of Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995.
[13]

The petitioners filed a petition for certiorari with the Court of Appeals assailing the order and the writ of preliminary injunction issued by the trial court on the following grounds:

1. Respondent ARCO-PHIL. had utterly failed to show its clear right/s or that of its memberagencies to be protected by the injunctive relief and/or violation of said rights by the enforcement of the assailed sections of R.A. 8042; 2. Respondent Judge fixed a P50,000 injunction bond which is grossly inadequate to answer for the damage which petitioner-officials may sustain, should respondent ARCO-PHIL. be finally adjudged as not being entitled thereto.
[14]

The petitioners asserted that the respondent is not the real party-in-interest as petitioner in the trial court. It is inconceivable how the respondent, a non-stock and non-profit corporation, could sustain direct injury as a result of the enforcement of the law. They argued that if, at all, any damage would result in the implementation of the law, it is the licensed and registered recruitment agencies and/or the unskilled Filipino migrant workers discriminated against who would sustain the said injury or damage, not the respondent. The respondent, as petitioner in the trial court, was burdened to adduce preponderant evidence of such irreparable injury, but failed to do so. The petitioners further insisted that the petition a quo was premature since the rules and regulations implementing the law had yet to be promulgated when such petition was filed. Finally, the petitioners averred that the respondent failed to establish the requisites for the issuance of a writ of preliminary injunction against the enforcement of the law and the rules and regulations issued implementing the same. On December 5, 1997, the appellate court came out with a four-page decision dismissing the petition and affirming the assailed order and writ of preliminary injunction issued by the trial court. The appellate court, likewise, denied the petitioners motion for reconsideration of the said decision. The petitioners now come to this Court in a petition for review on certiorari on the following grounds:

1. Private respondent ARCO-PHIL. had utterly failed to show its clear right/s or that of its member-agencies to be protected by the injunctive relief and/or violation of said rights by the enforcement of the assailed sections of R.A. 8042; 2. The P50,000 injunction bond fixed by the court a quo and sustained by the Court of Appeals is grossly inadequate to answer for the damage which petitioners-officials may sustain, should private respondent ARCO-PHIL. be finally adjudged as not being entitled thereto.
[15]

On February 16, 1998, this Court issued a temporary restraining order enjoining the respondents from enforcing the assailed order and writ of preliminary injunction.

The Issues The core issue in this case is whether or not the trial court committed grave abuse of its discretion amounting to excess or lack of jurisdiction in issuing the assailed order and the writ of preliminary injunction on a bond of only P50,000 and whether or not the appellate court erred in affirming the trial courts order and the writ of preliminary injunction issued by it. The petitioners contend that the respondent has no locus standi. It is a non-stock, non-profit organization; hence, not the real party-in-interest as petitioner in the action. Although the respondent filed the petition in the Regional Trial Court in behalf of licensed and registered recruitment agencies, it failed to adduce in evidence a certified copy of its Articles of Incorporation and the resolutions of the said members authorizing it to represent the said agencies in the proceedings. Neither is the suit of the respondent a class suit so as to vest in it a personality to assail Rep. Act No. 8042; the respondent is service-oriented while the recruitment agencies it purports to represent are profitoriented. The petitioners assert that the law is presumed constitutional and, as such, the respondent was burdened to make a case strong enough to overcome such presumption and establish a clear right to injunctive relief. The petitioners bewail the P50,000 bond fixed by the trial court for the issuance of a writ of preliminary injunction and affirmed by the appellate court. They assert that the amount is grossly

inadequate to answer for any damages that the general public may suffer by reason of the nonenforcement of the assailed provisions of the law. The trial court committed a grave abuse of its discretion in granting the respondents plea for injunctive relief, and the appellate court erred in affirming the order and the writ of preliminary injunction issued by the trial court. The respondent, for its part, asserts that it has duly established its locus standi and its right to injunctive relief as gleaned from its pleadings and the appendages thereto. Under Section 5, Rule 58 of the Rules of Court, it was incumbent on the petitioners, as respondents in the RTC, to show cause why no injunction should issue. It avers that the injunction bond posted by the respondent was more than adequate to answer for any injury or damage the petitioners may suffer, if any, by reason of the writ of preliminary injunction issued by the RTC. In any event, the assailed provisions of Rep. Act No. 8042 exposed its members to the immediate and irreparable damage of being deprived of their right to a livelihood without due process, a property right protected under the Constitution. The respondent contends that the commendable purpose of the law to eradicate illegal recruiters should not be done at the expense and to the prejudice of licensed and authorized recruitment agencies. The writ of preliminary injunction was necessitated by the great number of duly licensed recruitment agencies that had stopped or suspended their business operations for fear that their officers and employees would be indicted and prosecuted under the assailed oppressive penal provisions of the law, and meted excessive penalties. The respondent, likewise, urges that the Court should take judicial notice that the processing of deployment papers of overseas workers have come to a virtual standstill at the POEA. The Courts Ruling The petition is meritorious.

The Respondent Has Locus Standi To File the Petition in the RTC in Representation of the Eleven Licensed and Registered Recruitment Agencies Impleaded in the Amended Petition The modern view is that an association has standing to complain of injuries to its members. This view fuses the legal identity of an association with that of its members. [16] An association has standing to file suit for its workers despite its lack of direct interest if its members are affected by the action. An organization has standing to assert the concerns of its constituents. [17] In Telecommunications and Broadcast Attorneys of the Philippines v. Commission on Elections,[18] we held that standing jus tertii would be recognized only if it can be shown that the party suing has some substantial relation to the third party, or that the right of the third party would be diluted unless the party in court is allowed to espouse the third partys constitutional claims. In this case, the respondent filed the petition for declaratory relief under Rule 64 of the Rules of Court for and in behalf of its eleven (11) licensed and registered recruitment agencies which are its members, and which approved separate resolutions expressly authorizing the respondent to file the said suit for and in their behalf. We note that, under its Articles of Incorporation, the respondent was organized for the purposes inter alia of promoting and supporting the growth and development of the manpower recruitment industry, both in the local and international levels; providing, creating and

exploring employment opportunities for the exclusive benefit of its general membership; enhancing and promoting the general welfare and protection of Filipino workers; and, to act as the representative of any individual, company, entity or association on matters related to the manpower recruitment industry, and to perform other acts and activities necessary to accomplish the purposes embodied therein. The respondent is, thus, the appropriate party to assert the rights of its members, because it and its members are in every practical sense identical. The respondent asserts that the assailed provisions violate the constitutional rights of its members and the officers and employees thereof. The respondent is but the medium through which its individual members seek to make more effective the expression of their voices and the redress of their grievances.[19] However, the respondent has no locus standi to file the petition for and in behalf of unskilled workers. We note that it even failed to implead any unskilled workers in its petition. Furthermore, in failing to implead, as parties-petitioners, the eleven licensed and registered recruitment agencies it claimed to represent, the respondent failed to comply with Section 2 of Rule 63[20] of the Rules of Court. Nevertheless, since the eleven licensed and registered recruitment agencies for which the respondent filed the suit are specifically named in the petition, the amended petition is deemed amended to avoid multiplicity of suits.[21]

The Assailed Order and Writ of Preliminary Injunction Is Mooted By Case Law The respondent justified its plea for injunctive relief on the allegation in its amended petition that its members are exposed to the immediate and irreparable danger of being deprived of their right to a livelihood and other constitutional rights without due process, on its claim that a great number of duly licensed recruitment agencies have stopped or suspended their operations for fear that (a) their officers and employees would be prosecuted under the unjust and unconstitutional penal provisions of Rep. Act No. 8042 and meted equally unjust and excessive penalties, including life imprisonment, for illegal recruitment and large scale illegal recruitment without regard to whether the recruitment agencies involved are licensed and/or authorized; and, (b) if the members of the respondent, which are licensed and authorized, decide to continue with their businesses, they face the stigma and the curse of being labeled illegal recruiters. In granting the respondents plea for a writ of preliminary injunction, the trial court held, without stating the factual and legal basis therefor, that the enforcement of Rep. Act No. 8042, pendente lite, would cause grave and irreparable injury to the respondent until the case is decided on its merits. We note, however, that since Rep. Act No. 8042 took effect on July 15, 1995, the Court had, in a catena of cases, applied the penal provisions in Section 6, including paragraph (m) thereof, and the last two paragraphs therein defining large scale illegal recruitment committed by officers and/or employees of recruitment agencies by themselves and in connivance with private individuals, and imposed the penalties provided in Section 7 thereof, including the penalty of life imprisonment.[22] The Informations therein were filed after preliminary investigations as provided for in Section 11 of Rep. Act No. 8042 and in venues as provided for in Section 9 of the said act. In People v. Chowdury,[23] we held that illegal recruitment is a crime of economic sabotage and must be enforced. In People v. Diaz,[24] we held that Rep. Act No. 8042 is but an amendment of the Labor Code of the Philippines and is not an ex-post facto law because it is not applied retroactively. In JMM Promotion and Management, Inc. v. Court of Appeals ,[25] the issue of the extent of the police power of the State to regulate a business, profession or calling vis--vis the equal protection clause and the non-impairment clause of the Constitution were raised and we held, thus:

A profession, trade or calling is a property right within the meaning of our constitutional guarantees. One cannot be deprived of the right to work and the right to make a living because these rights are property rights, the arbitrary and unwarranted deprivation of which normally constitutes an actionable wrong. Nevertheless, no right is absolute, and the proper regulation of a profession, calling, business or trade has always been upheld as a legitimate subject of a valid exercise of the police power by the state particularly when their conduct affects either the execution of legitimate governmental functions, the preservation of the State, the public health and welfare and public morals. According to the maxim, sic utere tuo ut alienum non laedas, it must of course be within the legitimate range of legislative action to define the mode and manner in which every one may so use his own property so as not to pose injury to himself or others. In any case, where the liberty curtailed affects at most the rights of property, the permissible scope of regulatory measures is certainly much wider. To pretend that licensing or accreditation requirements violates the due process clause is to ignore the settled practice, under the mantle of the police power, of regulating entry to the practice of various trades or professions. Professionals leaving for abroad are required to pass rigid written and practical exams before they are deemed fit to practice their trade. Seamen are required to take tests determining their seamanship. Locally, the Professional Regulation Commission has begun to require previously licensed doctors and other professionals to furnish documentary proof that they had either re-trained or had undertaken continuing education courses as a requirement for renewal of their licenses. It is not claimed that these requirements pose an unwarranted deprivation of a property right under the due process clause. So long as professionals and other workers meet reasonable regulatory standards no such deprivation exists. Finally, it is a futile gesture on the part of petitioners to invoke the non-impairment clause of the Constitution to support their argument that the government cannot enact the assailed regulatory measures because they abridge the freedom to contract. In Philippine Association of Service Exporters, Inc. vs. Drilon, we held that [t]he non-impairment clause of the Constitution must yield to the loftier purposes targeted by the government. Equally important, into every contract is read provisions of existing law, and always, a reservation of the police power for so long as the agreement deals with a subject impressed with the public welfare. A last point. Petitioners suggest that the singling out of entertainers and performing artists under the assailed department orders constitutes class legislation which violates the equal protection clause of the Constitution. We do not agree. The equal protection clause is directed principally against undue favor and individual or class privilege. It is not intended to prohibit legislation which is limited to the object to which it is directed or by the territory in which it is to operate. It does not require absolute equality, but merely that all persons be treated alike under like conditions both as to privileges conferred and liabilities imposed. We have held, time and again, that the equal protection clause of the Constitution does not forbid classification for so long as such classification is based on real and substantial differences having a reasonable relation to the subject of the particular legislation. If classification is germane to the purpose of the law, concerns all members of the class, and applies

equally to present and future conditions, the classification does not violate the equal protection guarantee.
[26]

The validity of Section 6 of R.A. No. 8042 which provides that employees of recruitment agencies may be criminally liable for illegal recruitment has been upheld in People v. Chowdury:[27]

As stated in the first sentence of Section 6 of RA 8042, the persons who may be held liable for illegal recruitment are the principals, accomplices and accessories. An employee of a company or corporation engaged in illegal recruitment may be held liable as principal, together with his employer, if it is shown that he actively and consciously participated in illegal recruitment. It has been held that the existence of the corporate entity does not shield from prosecution the corporate agent who knowingly and intentionally causes the corporation to commit a crime. The corporation obviously acts, and can act, only by and through its human agents, and it is their conduct which the law must deter. The employee or agent of a corporation engaged in unlawful business naturally aids and abets in the carrying on of such business and will be prosecuted as principal if, with knowledge of the business, its purpose and effect, he consciously contributes his efforts to its conduct and promotion, however slight his contribution may be.
[28]

By its rulings, the Court thereby affirmed the validity of the assailed penal and procedural provisions of Rep. Act No. 8042, including the imposable penalties therefor. Until the Court, by final judgment, declares that the said provisions are unconstitutional, the enforcement of the said provisions cannot be enjoined.

The RTC Committed Grave Abuse of Its Discretion Amounting to Excess or Lack of Jurisdiction in Issuing the Assailed Order and the Writ of Preliminary Injunction The matter of whether to issue a writ of preliminary injunction or not is addressed to the sound discretion of the trial court. However, if the court commits grave abuse of its discretion in issuing the said writ amounting to excess or lack of jurisdiction, the same may be nullified via a writ of certiorari and prohibition. In Social Security Commission v. Judge Bayona,[29] we ruled that a law is presumed constitutional until otherwise declared by judicial interpretation. The suspension of the operation of the law is a matter of extreme delicacy because it is an interference with the official acts not only of the duly elected representatives of the people but also of the highest magistrate of the land. In Younger v. Harris, Jr.,[30] the Supreme Court of the United States emphasized, thus:

Federal injunctions against state criminal statutes, either in their entirety or with respect to their separate and distinct prohibitions, are not to be granted as a matter of course, even if such statutes are unconstitutional. No citizen or member of the community is immune from prosecution, in good faith, for his alleged criminal acts. The imminence of such a prosecution even though alleged to be unauthorized and, hence, unlawful is not alone ground for relief in equity which exerts its extraordinary powers only to prevent irreparable injury to the plaintiff who seeks its aid. 752 Beal v. Missouri Pacific Railroad Corp., 312 U.S. 45, 49, 61 S.Ct. 418, 420, 85 L.Ed. 577.

And similarly, in Douglas, supra, we made clear, after reaffirming this rule, that: It does not appear from the record that petitioners have been threatened with any injury other than that incidental to every criminal proceeding brought lawfully and in good faith 319 U.S., at 164, 63 S.Ct., at 881.
[31]

The possible unconstitutionality of a statute, on its face, does not of itself justify an injunction against good faith attempts to enforce it, unless there is a showing of bad faith, harassment, or any other unusual circumstance that would call for equitable relief.[32] The on its face invalidation of statutes has been described as manifestly strong medicine, to be employed spari ngly and only as a last resort, and is generally disfavored.[33] To be entitled to a preliminary injunction to enjoin the enforcement of a law assailed to be unconstitutional, the party must establish that it will suffer irreparable harm in the absence of injunctive relief and must demonstrate that it is likely to succeed on the merits, or that there are sufficiently serious questions going to the merits and the balance of hardships tips decidedly in its favor.[34] The higher standard reflects judicial deference toward legislation or regulations developed through presumptively reasoned democratic processes. Moreover, an injunction will alter, rather than maintain, the status quo, or will provide the movant with substantially all the relief sought and that relief cannot be undone even if the defendant prevails at a trial on the merits.[35] Considering that injunction is an exercise of equitable relief and authority, in assessing whether to issue a preliminary injunction, the courts must sensitively assess all the equities of the situation, including the public interest.[36] In litigations between governmental and private parties, courts go much further both to give and withhold relief in furtherance of public interest than they are accustomed to go when only private interests are involved.[37] Before the plaintiff may be entitled to injunction against future enforcement, he is burdened to show some substantial hardship.[38] The fear or chilling effect of the assailed penal provisions of the law on the members of the respondent does not by itself justify prohibiting the State from enforcing them against those whom the State believes in good faith to be punishable under the laws:

Just as the incidental chilling effect of such statutes does not automatically render them unconstitutional, so the chilling effect that admittedly can result from the very existence of certain laws on the statute books does not in itself justify prohibiting the State from carrying out the important and necessary task of enforcing these laws against socially harmful conduct that the State believes in good faith to be punishable under its laws and the Constitution.
[39]

It must be borne in mind that subject to constitutional limitations, Congress is empowered to define what acts or omissions shall constitute a crime and to prescribe punishments therefor.[40]The power is inherent in Congress and is part of the sovereign power of the State to maintain peace and order. Whatever views may be entertained regarding the severity of punishment, whether one believes in its efficiency or its futility, these are peculiarly questions of legislative policy. [41] The comparative gravity of crimes and whether their consequences are more or less injurious are matters for the State and Congress itself to determine.[42] Specification of penalties involves questions of legislative policy.[43] Due process prohibits criminal stability from shifting the burden of proof to the accused, punishing wholly passive conduct, defining crimes in vague or overbroad language and failing to grant fair warning of illegal conduct.[44] Class legislation is such legislation which denies rights to one which are accorded to others, or inflicts upon one individual a more severe penalty than is imposed upon another in like case offending.[45] Bills of attainder are legislative acts which inflict punishment on individuals or members of a particular group without a judicial trial. Essential to a bill of attainder are

a specification of certain individuals or a group of individuals, the imposition of a punishment, penal or otherwise, and the lack of judicial trial.[46] Penalizing unlicensed and licensed recruitment agencies and their officers and employees and their relatives employed in government agencies charged with the enforcement of the law for illegal recruitment and imposing life imprisonment for those who commit large scale illegal recruitment is not offensive to the Constitution. The accused may be convicted of illegal recruitment and large scale illegal recruitment only if, after trial, the prosecution is able to prove all the elements of the crime charged.[47] The possibility that the officers and employees of the recruitment agencies, which are members of the respondent, and their relatives who are employed in the government agencies charged in the enforcement of the law, would be indicted for illegal recruitment and, if convicted sentenced to life imprisonment for large scale illegal recruitment, absent proof of irreparable injury, is not sufficient on which to base the issuance of a writ of preliminary injunction to suspend the enforcement of the penal provisions of Rep. Act No. 8042 and avert any indictments under the law. [48] The normal course of criminal prosecutions cannot be blocked on the basis of allegations which amount to speculations about the future.[49] There is no allegation in the amended petition or evidence adduced by the respondent that the officers and/or employees of its members had been threatened with any indictments for violations of the penal provisions of Rep. Act No. 8042. Neither is there any allegation therein that any of its members and/or their officers and employees committed any of the acts enumerated in Section 6(a) to (m) of the law for which they could be indicted. Neither did the respondent adduce any evidence in the RTC that any or all of its members or a great number of other duly licensed and registered recruitment agencies had to stop their business operations because of fear of indictments under Sections 6 and 7 of Rep. Act No. 8042. The respondent merely speculated and surmised that licensed and registered recruitment agencies would close shop and stop business operations because of the assailed penal provisions of the law. A writ of preliminary injunction to enjoin the enforcement of penal laws cannot be based on such conjectures or speculations. The Court cannot take judicial notice that the processing of deployment papers of overseas workers have come to a virtual standstill at the POEA because of the assailed provisions of Rep. Act No. 8042. The respondent must adduce evidence to prove its allegation, and the petitioners accorded a chance to adduce controverting evidence. The respondent even failed to adduce any evidence to prove irreparable injury because of the enforcement of Section 10(1)(2) of Rep. Act No. 8042. Its fear or apprehension that, because of time constraints, its members would have to defend foreign employees in cases before the Labor Arbiter is based on speculations. Even if true, such inconvenience or difficulty is hardly irreparable injury. The trial court even ignored the public interest involved in suspending the enforcement of Rep. Act No. 8042 vis--vis the eleven licensed and registered recruitment agencies represented by the respondent. In People v. Gamboa,[50] we emphasized the primary aim of Rep. Act No. 8042:

Preliminarily, the proliferation of illegal job recruiters and syndicates preying on innocent people anxious to obtain employment abroad is one of the primary considerations that led to the enactment of The Migrant Workers and Overseas Filipinos Act of 1995. Aimed at affording greater protection to overseas Filipino workers, it is a significant improvement on existing laws in the recruitment and placement of workers for overseas employment. Otherwise known as the Magna Carta of OFWs, it broadened the concept of illegal recruitment under the Labor Code and provided stiffer penalties thereto, especially those that constitute economic sabotage, i.e., Illegal Recruitment in Large Scale and Illegal Recruitment Committed by a Syndicate.
[51]

By issuing the writ of preliminary injunction against the petitioners sans any evidence, the trial court frustrated, albeit temporarily, the prosecution of illegal recruiters and allowed them to continue victimizing hapless and innocent people desiring to obtain employment abroad as overseas workers, and blocked the attainment of the salutary policies [52] embedded in Rep. Act No. 8042. It bears stressing that overseas workers, land-based and sea-based, had been remitting to the Philippines billions of dollars which over the years had propped the economy. In issuing the writ of preliminary injunction, the trial court considered paramount the interests of the eleven licensed and registered recruitment agencies represented by the respondent, and capriciously overturned the presumption of the constitutionality of the assailed provisions on the barefaced claim of the respondent that the assailed provisions of Rep. Act No. 8042 are unconstitutional. The trial court committed a grave abuse of its discretion amounting to excess or lack of jurisdiction in issuing the assailed order and writ of preliminary injunction. It is for this reason that the Court issued a temporary restraining order enjoining the enforcement of the writ of preliminary injunction issued by the trial court. IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The assailed decision of the appellate court is REVERSED AND SET ASIDE. The Order of the Regional Trial Court dated August 21, 1995 in Civil Case No. Q-95-24401 and the Writ of Preliminary Injunction issued by it in the said case on August 24, 1995 are NULLIFIED. No costs. SO ORDERED. Quisumbing, (Acting Chairman), Austria-Martinez, and Tinga, JJ., concur. Puno, (Chairman), J., on official leave.

[1]

Penned by Associate Justice Jesus M. Elbinias with Associate Justices Hector L. Hofilea and Omar U. Amin concurring. Penned by Judge Teodoro P. Regino, who was later promoted Associate Justice of the Court of Appeals. Records, Vol. I, pp. 86-87. Section 2, paragraph (g). Section 1. No person shall be deprived of life, liberty or property without due process of law, nor shall any person be denied the equal protection of the laws. Sec. 12. The State recognizes the sanctity of family life and shall protect and strengthen the family as a basic autonomous social institution. It shall equally protect the life of the mother and the life of the unborn from conception. The natural and primary right and duty of parents in the rearing of the youth for civic efficiency and the development of moral character shall receive the support of the Government.

[2]

[3]

[4]

[5]

[6]

[7]

Section 1. The State recognizes the Filipino family as the foundation of the nation. Accordingly, it shall strengthen its solidarity and actively promote its total development. Sec. 3. The State shall defend the following: (3) The right of the family to a family living wage and income.

[8]

[9]

Sec. 19. (1) Excessive fines shall not be imposed, nor cruel, degrading or inhuman punishment inflicted. Neither shall death penalty be imposed, unless, for compelling reasons involving heinous crimes, the Congress hereafter provides for it. Any death penalty already imposed shall be reduced to reclusion perpetua. (Section 19, Article III of the Constitution.) Sec. 22. No ex-post facto law or bill of attainder shall be enacted.

[10]

[11]

(5) Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice, and procedure in all courts, the admission to the practice of law, the Integrated Bar, and legal assistance to the underprivileged. Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases, shall be uniform for all courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules of procedure of special courts and quasi-judicial bodies shall remain effective unless disapproved by the Supreme Court. Records, Vol. I, p. 223. Id. at 235. CA Rollo, p. 10. Rollo, p. 19. W.C.M. Winston Co., Inc. v. Bernardi, 730 F2d 486 (1984), citing NACCP v. Alabama, 2 L.ed.2d 1488 (1958). Maite v. Chicago Board of Education, 415 NE2d 1034 (1980), cited in DeWitt County Taxpayers Association v. The County Board of Deliot County, 445 NE2d 509 (1983). 289 SCRA 337 (1998). National Associates for the Advancement of Colored People v. State of Alabama, 2 L.Ed.2d 1488 (1958). SEC. 2. Parties. All persons who have or claim any interest which would be affected by the declaration shall be made parties; and no declaration shall, except as otherwise provided in these Rules, prejudice the rights of persons not parties to the action. SEC. 11. Misjoinder and non-joinder of parties. Neither misjoinder nor non-joinder of parties is ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the action and on such terms as are just. Any claim against a misjoined party may be severed and proceeded with separately. People v. Navarra, 352 SCRA 84 (2001); People v. Fajardo, 345 SCRA 395 (2000); People v. Saulo, 344 SCRA 605 (2000); People v. Gamboa, 341 SCRA 451 (2000); People v. Banzales, 336 SCRA 64 (2000); People v. Ordoo, 335 SCRA 331 (2000); People v. Mercado de Arabia, 332 SCRA 49 (2000); People v. Moreno, 314 SCRA 556 (1999); People v. Castillon, 306 SCRA 271 (1999); People v. Mercado, 304 SCRA 504 (1999); People v. Peralta, 283 SCRA 81 (1997); People v. Ortiz-Miyake, 279 SCRA 180 (1997); People v. Villas, 277 SCRA 391 (1997); People v. Santos, 276 SCRA 329 (1997); People v. Tan Tiong Meng, 271 SCRA 125 (1997); People v. Maozca, 269 SCRA 513 (1997); People v. Seoron, 267 SCRA 278 (1997); People v. De Leon, 267 SCRA 644 (1997); People v. Benemerito, 264 SCRA 677 (1996); People v. Pabalan, 262 SCRA 574 (1996); People v. Calonzo, 262 SCRA 534 (1996). 325 SCRA 572 (2000). 259 SCRA 441 (1996). 260 SCRA 319 (1996). Id. at 330-332. Supra at note 23. Supra. 5 SCRA 126 (1962). 27 L.Ed.2d 669 (1971). Ibid. Id.; Fieger v. Thomas, 74 F.3d 740 (1996). Broaderick v. Oklahoma, 37 L.Ed.2d 841. Latino Officers Association v. Safir, 170 F.3d 167 (1999). Forest City Daly Housing, Inc. v. Town of North Hempstead, 175 F.3d 144 (1999). Beal v. Stern, 184 F.3d 117 (1999). Maryland Commission on Human Relations v. Downey Communications, Inc., 110 Md.App. 493, 678 A.2d 55 (1996).

[12]

[13]

[14]

[15]

[16]

[17]

[18]

[19]

[20]

[21]

[22]

[23]

[24]

[25]

[26]

[27]

[28]

[29]

[30]

[31]

[32]

[33]

[34]

[35]

[36]

[37]

[38]

Croselto v. State Bar of Wisconsin, 12 F.3d 396 (1993). Younger v. Harris, Jr., supra. U.S. v. Schnell, 982 F.2d 216 (1992); United States v. Bogle, 689 F.Supp. 1121 (1988). United States v. Bogle, supra. Collins v. Joluston, 59 L.Ed. 1071 (1915). Gore v. United States, 62 L.Ed.2d 1405 (1958). U.S. v. Schnell, supra. State v. Murray, 175 NE 666 (1919). Misolas v. Panga, 181 SCRA 648 (1990). The essential elements for illegal recruitment are:

[39]

[40]

[41]

[42]

[43]

[44]

[45]

[46]

[47]

(1) the offender undertakes either any activity within the meaning of recruitment and placement defined under Art. 13(b), or any of the prohibited practices enumerated under Article 34 of the Labor Code; and (2) he has no valid license or authority required by law to enable one to lawfully engage in recruitment and placement of workers. [People v. Pascua, 366 SCRA 505 (2001)]. The essential elements for large scale illegal recruitment are: (1) (2) (3)
[48]

the accused engages in the recruitment and placement of workers, as defined under Article 13(b) or in any prohibited activities under Article 34 of the Labor Code; accused has not complied with the guidelines issued by the Secretary of Labor and Employment, particularly with respect to the securing of a license or an authority to recruit and deploy workers, whether locally or overseas; and accused commits the same against three (3) or more persons, individually or as a group. [People v. Saulo, 344 SCRA 605 (2000)].

See Beal v. Pacific Railroad Corporation, 85 L.Ed. 577, cited in Younger v. Harris, Jr., supra. Boyle v. Landry, 27 L.Ed.2d 696 (1971). 341 SCRA 451 (2000). Id. at 456-458. (a) In the pursuit of an independent foreign policy and while considering national sovereignty, territorial integrity, national interest and the right to self-determination paramount in its relations with other states, the State shall, at all times, uphold the dignity of its citizens whether in country or overseas, in general, and Filipino migrant workers, in particular. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. Towards this end, the State shall provide adequate and timely social, economic and legal services to Filipino migrant workers. While recognizing the significant contribution of Filipino migrant workers to the national economy through their foreign exchange remittances, the State does not promote overseas employment as a means to sustain economic growth and achieve national development. The existence of the overseas employment program rests solely on the assurance that the dignity and fundamental human rights and freedoms of the Filipino citizen shall not, at any time, be compromised or violated. The State, therefore, shall continuously create local employment opportunities and promote the equitable distribution of wealth and the benefits of development. The State affirms the fundamental equality before the law of women and men and the significant role of women in nation-building. Recognizing the contribution of overseas migrant women workers and their particular vulnerabilities, the State shall apply gender sensitive criteria in the formulation and implementation of policies and programs affecting migrant workers and the composition of bodies tasked for the welfare of migrant workers. Free access to the courts and quasi-judicial bodies and adequate legal assistance shall not be denied to any person by reason of poverty. In this regard, it is imperative that an effective mechanism be instituted to ensure that the rights and interest of distressed overseas Filipinos, in general, and Filipino migrant workers, in particular, documented or undocumented, are adequately protected and safeguarded.

[49]

[50]

[51]

[52]

(b)

(c)

(d)

(e)

(f)

The right of Filipino migrant workers and all overseas Filipinos to participate in the democratic decision-making processes of the State and to be represented in institutions relevant to overseas employment is recognized and guaranteed. The State recognizes that the ultimate protection to all migrant workers is the possession of skills. Pursuant to this and as soon as practicable, the government shall deploy and/or allow the deployment only of skilled Filipino workers. Non-governmental organizations, duly recognized as legitimate, are partners of the State in the protection of Filipino migrant workers and in the promotion of their welfare. The State shall cooperate with them in a spirit of trust and mutual respect. Government fees and other administrative costs of recruitment, introduction, placement and assistance to migrant workers shall be rendered free without prejudice to the provision of Section 36 hereof.

(g)

(h)

(i)

Nonetheless, the deployment of Filipino overseas workers, whether land-based or sea-based, by local service contractors and manning agencies employing them shall be encouraged. Appropriate incentives may be extended to them. (Records, Vol. I, p. 35.)

THIRD DIVISION SUNACE INTERNATIONAL MANAGEMENT SERVICES, INC. Petitioner, G.R. No. 161757 Present: QUISUMBING, J., Chairperson, CARPIO, CARPIO MORALES, and TINGA, JJ.

- versus -

NATIONAL LABOR RELATIONS COMMISSION, Second Division;HON. ERNESTO S. DINOPOL, in his capacity as Labor Arbiter, NLRC; NCR, Arbitration Branch, Quezon City and DIVINA A. MONTEHERMOZO, Respondents.

Promulgated: January 25, 2006

x - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

DECISION

CARPIO MORALES, J.:

Petitioner, Sunace International Management Services (Sunace), a corporation duly organized and existing under the laws of the Philippines, deployed to Taiwan Divina A. Montehermozo (Divina) as a domestic helper under a 12-month contract effective February 1, 1997. The deployment was with the assistance of a Taiwanese broker, Edmund Wang, President of Jet Crown International Co., Ltd.
[1]

After her 12-month contract expired on February 1, 1998, Divina continued working for her Taiwanese employer, Hang Rui Xiong, for two more years, after which she returned to the Philippines on February 4, 2000. Shortly after her return or on February 14, 2000, Divina filed a complaint before the National Labor Relations Commission (NLRC) against Sunace, one Adelaide Perez, the Taiwanese broker, and the employer-foreign principal alleging that she was jailed for three months and that she was underpaid.
[2]

The following day or on February 15, 2000, Labor Arbitration Associate Regina T. Gavin issued Summons to the Manager of Sunace, furnishing it with a copy o f Divinas complaint and directing it to appear for mandatory conference on February 28, 2000.
[3]

The scheduled mandatory conference was reset. It appears to have been concluded, however. On April 6, 2000, Divina filed her Position Paper claiming that under her original oneyear contract and the 2-year extended contract which was with the knowledge and consent of Sunace, the following amounts representing income tax and savings were deducted:
[4]

Year

Deduction for Income Tax NT10,450.00 NT9,500.00 NT13,300.00

Deduction for Savings

1997 1998 1999

NT23,100.00 NT36,000.00 NT36,000.00;[5]

and while the amounts deducted in 1997 were refunded to her, those deducted in 1998 and 1999 were not. On even date, Sunace, by its Proprietor/General Manager Maria Luisa Olarte, filed its Verified Answer and Position Paper, claiming as follows, quoted verbatim:
[6]

COMPLAINANT IS NOT ENTITLED FOR THE REFUND OF HER 24 MONTHS SAVINGS 3. Complainant could not anymore claim nor entitled for the refund of her 24 months savings as she already took back her saving already last year and the employer did not deduct any money from her salary, in accordance with a Fascimile Message from the respondent SUNACEs employer, Jet Crown International Co. Ltd., a xerographic copy of which is herewith attached as ANNEX 2hereof; COMPLAINANT IS NOT ENTITLED TO REFUND OF HER 14 MONTHS TAX AND PAYMENT OF ATTORNEYS FEES 4. There is no basis for the grant of tax refund to the complainant as the she finished her one year contract and hence, was not illegally dismissed by her employer. She could only lay claim over the tax refund or much more be awarded of damages such as attorneys fees as said reliefs are available only when the dismissal of a migrant worker is without just valid or lawful cause as defined by law or contract. The rationales behind the award of tax refund and payment of attorneys fees is not to enrich the complainant but to compensate him for actual injury suffered. Complainant did not suffer injury, hence, does not deserve to be compensated for whatever kind of damages.

Hence, the complainant has NO cause of action against respondent SUNACE for monetary claims, considering that she has been totally paid of all the monetary benefits due her under her Employment Contract to her full satisfaction. 6. Furthermore, the tax deducted from her salary is in compliance with the Taiwanese law, which respondent SUNACE has no control and complainant has to obey and this Honorable Office has no authority/jurisdiction to intervene because the power to tax is a sovereign power which the Taiwanese Government is supreme in its own territory. The sovereign power of taxation of a state is recognized under international law and among sovereign states.

7. That respondent SUNACE respectfully reserves the right to file supplemental Verified Answer and/or Position Paper to substantiate its prayer for the dismissal of the above case against the herein respondent. AND BY WAY OF x x x x (Emphasis and underscoring supplied)

Reacting to Divinas Position Paper, Sunace filed on April 25, 2000 an . . . ANSWER TO COMPLAINANTS POSITION PAPER alleging that Divinas 2-year extension of her contract was without its knowledge and consent, hence, it had no liability attaching to any claim arising therefrom, and Divina in fact executed a Waiver/Quitclaim and Release of Responsibility and an Affidavit of Desistance, copy of each document was annexed to said . . . ANSWER TO COMPLAINANTS POSITION PAPER.
[7]

To Sunaces . . . ANSWER TO COMPLAINANTS POSITION PAPER, Divina filed a 2-page reply, without, however, refuting Sunaces disclaimer of knowledge of the extension of her contract and without saying anything about the Release, Waiver and Quitclaim and Affidavit of Desistance.
[8]

The Labor Arbiter, rejected Sunaces claim that the extension of Divinas contract for two more years was without its knowledge and consent in this wise:
We reject Sunaces submission that it should not be held responsible for the amount withheld because her contract was extended for 2 more years without its knowledge and consent because as Annex B[9] shows, Sunace and Edmund Wang have not stopped communicating with each other and yet the matter of the contracts extension and Sunaces alleged non-consent thereto has not been categorically established. What Sunace should have done was to write to POEA about the extension and its objection thereto, copy furnished the complainant herself, her foreign employer, Hang Rui Xiong and the Taiwanese broker, Edmund Wang. And because it did not, it is presumed to have consented to the extension and should be liable for anything that resulted thereform (sic).[10] (Underscoring supplied)

The Labor Arbiter rejected too Sunaces argument that it is not liable on accou nt of Divinas execution of a Waiver and Quitclaim and an Affidavit of Desistance. Observed the Labor Arbiter:
Should the parties arrive at any agreement as to the whole or any part of the dispute, the same shall be reduced to writing and signed by the parties and their respective counsel (sic), if any, before the Labor Arbiter. The settlement shall be approved by the Labor Arbiter after being satisfied that it was voluntarily entered into by the parties and after having explained to them the terms and consequences thereof. A compromise agreement entered into by the parties not in the presence of the Labor Arbiter before whom the case is pending shall be approved by him, if after confronting the parties, particularly the complainants, he is satisfied that they understand the terms and conditions of the settlement and that it was entered into freely voluntarily (sic) by them and the agreement is not contrary to law, morals, and public policy. And because no consideration is indicated in the documents, we strike them down as contrary to law, morals, and public policy.[11]

He accordingly decided in favor of Divina, by decision of October 9, 2000, the dispositive portion of which reads:
[12]

Wherefore, judgment is hereby rendered ordering respondents SUNACE INTERNATIONAL SERVICES and its owner ADELAIDA PERGE, both in their personal capacities and as agent of Hang Rui Xiong/Edmund Wang to jointly and severally pay complainant DIVINA A. MONTEHERMOZO the sum of NT91,950.00 in its peso equivalent at the date of payment, as refund for the amounts which she is hereby adjudged entitled to as earlier discussed plus 10% thereof as attorneys fees since compelled to litigate, complainant had to engage the services of counsel. SO ORDERED.[13] (Underescoring supplied)

On appeal of Sunace, the NLRC, by Resolution of April 30, 2002, affirmed the Labor Arbiters decision.
[14]

Via petition for certiorari, Sunace elevated the case to the Court of Appeals which dismissed it outright by Resolution of November 12, 2002, the full text of which reads:
[15] [16]

The petition for certiorari faces outright dismissal. The petition failed to allege facts constitutive of grave abuse of discretion on the part of the public respondent amounting to lack of jurisdiction when the NLRC affirmed the Labor Arbiters finding that petitioner Sunace International Management Services impliedly consented

to the extension of the contract of private respondent Divina A. Montehermozo. It is undisputed that petitioner was continually communicating with private respondents foreign employer (sic). As agent of the foreign principal, petitioner cannot profess ignorance of such extension as obviously, the act of the principal extending complainant (sic) employment contract necessarily bound it. Grave abuse of discretion is not present in the case at bar. ACCORDINGLY, COURSE and DISMISSED.[17] SO ORDERED. (Emphasis on words in capital letters in the original; emphasis on words in small letters and underscoring supplied) the petition is hereby DENIED DUE

Its Motion for Reconsideration having been denied by the appellate court by Resolution of January 14, 2004, Sunace filed the present petition for review on certiorari.
[18]

The Court of Appeals affirmed the Labor Arbiter and NLRCs finding that Sunace knew of and impliedly consented to the extension of Divinas 2-year contract. It went on to state that It is undisputed that [Sunace] was continually communicating with [Divinas] foreign employer. It thus concluded that [a]s agent of the foreign principal, petitioner cannot profess ignorance of such extension as obviously, the act of the principal extending complainant (sic) employment contract necessarily bound it. Contrary to the Court of Appeals finding, the alleged continuous communication was with the Taiwanese broker Wang, not with the foreign employer Xiong. The February 21, 2000 telefax message from the Taiwanese broker to Sunace, the only basis of a finding of continuous communication, reads verbatim:
xxxx Regarding to Divina, she did not say anything about her saving in police station. As we contact with her employer, she took back her saving already last years. And they did not deduct any money from her salary. Or she will call back her employer to check it again. If her employer said yes! we will get it back for her.

Thank you and best regards. (sgd.) Edmund Wang President[19]

The finding of the Court of Appeals solely on the basis of the above-quoted telefax message, that Sunace continually communicated with the foreign principal (sic) and therefore was aware of and had consented to the execution of the extension of the contract is misplaced. The message does not provide evidence that Sunace was privy to the new contract executed after the expiration on February 1, 1998 of the original contract. That Sunace and the Taiwanese broker communicated regarding Divinas allegedly withheld savings does not necessarily mean that Sunace ratified the extension of the contract. As Sunace points out in its Reply filed before the Court of Appeals,
[20]

As can be seen from that letter communication, it was just an information given to the petitioner that the private respondent had t[aken] already her savings from her foreign employer and that no deduction was made on her salary. It contains nothing about the extension or the petitioners consent thereto.[21]

Parenthetically, since the telefax message is dated February 21, 2000, it is safe to assume that it was sent to enlighten Sunace who had been directed, by Summons issued on February 15, 2000, to appear on February 28, 2000 for a mandatory conference following Divinas filing of the complaint on February 14, 2000. Respecting the Court of Appeals following dictum:
As agent of its foreign principal, [Sunace] cannot profess ignorance of such an extension as obviously, the act of its principal extending [Divinas] employment contract necessarily bound it,[22]

it too is a misapplication, a misapplication of the theory of imputed knowledge. The theory of imputed knowledge ascribes the knowledge of the agent, Sunace, to the principal, employer Xiong, not the other way around. The knowledge of the principalforeign employer cannot, therefore, be imputed to its agent Sunace.
[23]

There being no substantial proof that Sunace knew of and consented to be bound under the 2-year employment contract extension, it cannot be said to be privy thereto. As such, it and its owner cannot be held solidarily liable for any of Divinas claims arising from the 2 -year employment extension. As the New Civil Code provides,
Contracts take effect only between the parties, their assigns, and heirs, except in case where the rights and obligations arising from the contract are not transmissible by their nature, or by stipulation or by provision of law.[24]

Furthermore, as Sunace correctly points out, there was an implied revocation of its agency relationship with its foreign principal when, after the termination of the original

employment contract, the foreign principal directly negotiated with Divina and entered into a new and separate employment contract in Taiwan. Article 1924 of the New Civil Code reading
The agency is revoked if the principal directly manages the business entrusted to the agent, dealing directly with third persons.

thus applies. In light of the foregoing discussions, consideration of the validity of the Waiver and Affidavit of Desistance which Divina executed in favor of Sunace is rendered unnecessary. WHEREFORE, the petition is GRANTED. The challenged resolutions of the Court of Appeals are hereby REVERSED and SET ASIDE. The complaint of respondent Divina A. Montehermozo against petitioner is DISMISSED. SO ORDERED.

CONCHITA CARPIO MORALES Associate Justice

WE CONCUR:

LEONARDO A. QUISUMBING Associate Justice Chairperson

ANTONIO T. CARPIO Associate Justice

DANTE O. TINGA Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

LEONARDO A. QUISUMBING Associate Justice Chairperson

CERTIFICATION Pursuant to Article VIII, Section 13 of the Constitution, and the Division Chairmans Attestation, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court.

ARTEMIO V. PANGANIBAN Chief Justice

[1] [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] [12] [13] [14] [15] [16]

[17] [18] [19] [20] [21] [22] [23]

[24]

NLRC records, p. 18. Id. at 2. Id. at 5. Id. at 21-26. Id. at 52. Id. at 13-19. Id. at 28-34. Id. at 36-37. Photocopy of a telefax message of Taiwanese broker Wang to Sunace, NLRC records, p. 26. NLRC records, pp. 55-56. Id. at 56-57 (citations omitted). Id. at 51-58. Id. at 57-58. Id. at 190-196. CA rollo, pp. 2-113. Penned by Associate Justice Ruben T. Reyes with Associate Justices Remedios Salazar-Fernando and Edgardo F. Sundiam, concurring. CA rollo, pp. 115-116 (citations omitted). Id. at 154-157. Supra note 9. CA rollo, pp. 146-152. Id. at 148. Id. at 29, 116 and 157. Rovels Enterprises, Inc. v. Ocampo, G.R. No. 136821, October 17, 2002, 391 SCRA 176; vide Air France v. Court of Appeals, et al., 211 Phil. 601 (1983). CIVIL CODE, Article 1311.

People of the Philippines vs. Domingo Panis GR No. L5867477, July 11, 1990

FACTS: On January 9, 1981, four information were filed in the in the Court of First Instance (CFI) of Zambales and Olongapo City alleging that herein private respondent Serapio Abug, "without first securing a license from the Ministry of Labor as a holder of authority to operate a fee-charging employment agency, did then and there wilfully, unlawfully and criminally operate a private fee charging employment agency by charging fees and expenses (from) and promising employment in Saudi Arabia" to four separate individuals. Abug filed a motion to quash contending that he cannot be charged for illegal recruitment because according to him, Article 13(b) of the Labor Code says there would be illegal recruitment only "whenever two or more persons are in any manner promised or offered any employment for a fee . Denied at first, the motion to quash was reconsidered and granted by the Trial Court in its Orders dated June 24, 1981, and September 17, 1981. In the instant case, the view of the private respondents is that to constitute recruitment and placement, all the acts mentioned in this article should involve dealings with two or more persons as an indispensable requirement. On the other hand, the petitioner argues that the requirement of two or more persons is imposed only where the recruitment and placement consists of an offer or promise of employment to such persons and always in consideration of a fee. ISSUE: Whether or not Article 13(b) of the Labor Code provides for the innocence or guilt of the private respondent of the crime of illegal recruitment COURT RULING: The Supreme Court reversed the CFIs Orders and reinstated all four information filed against private respondent. The Article 13(b) of the Labor Code was merely intended to create a presumption, and not to impose a condition on the basic rule nor to provide an exception thereto. Where a fee is collected in consideration of a promise or offer of employment to two or more prospective workers, the individual or entity dealing with them shall be deemed to be engaged in the act of recruitment and placement. The words "shall be deemed" create the said presumption.

FIRST DIVISION

[G.R. No. 121777. January 24, 2001]

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. CAROL M. DELA PIEDRA, accused-appellant. DECISION
KAPUNAN, J.:

Accused-appellant Carol M. dela Piedra questions her conviction for illegal recruitment in large scale and assails, as well, the constitutionality of the law defining and penalizing said crime. The Court affirms the constitutionality of the law and the conviction of the accused, but reduces the penalty imposed upon her. The accused was charged before the Regional Trial Court of Zamboanga City in an information alleging:

That on or about January 30, 1994, in the City of Zamboanga, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, without having previously obtained from the Philippine Overseas Employment Administration, a license or authority to engage in recruitment and overseas placement of workers, did then and there, wilfully, unlawfully and feloniously, offer and promise for a fee employment abroad particularly in Singapore thus causing Maria Lourdes Modesto [y] Gadrino, Nancy Araneta y Aliwanag and Jennelyn Baez y Timbol, all qualified to apply, in fact said Maria Lourdes Modesto had already advanced the amount of P2,000.00 to the accused for and in consideration of the promised employment which did not materialized [sic] thus causing damage and prejudice to the latter in the said sum; furthermore, the acts complained of herein tantamount [sic] to economic sabotage in that the same were committed in large scale.[1]
Arraigned on June 20, 1994, the accused pleaded not guilty[2] to these charges. At the trial, the prosecution presented five (5) witnesses, namely, Erlie Ramos, SPO2 Erwin Manalopilar, Eileen Fermindoza, Nancy Araneta and Lourdes Modesto. The succeeding narration is gathered from their testimonies: On January 30, 1994, at exactly 10:00 in the morning, Erlie Ramos, Attorney II of the Philippine Overseas Employment Agency (POEA), received a telephone call from an unidentified woman inquiring about the legitimacy of the recruitment conducted by a certain Mrs. Carol Figueroa. Ramos, whose duties include the surveillance of suspected illegal recruiters, immediately contacted a friend, a certain Mayeth Bellotindos, so they could both go to No. 26-D, Tetuan Highway, Sta. Cruz, Zamboanga City, where the recruitment was reportedly being undertaken. Upon arriving at the reported area at around 4:00 p.m., Bellotindos entered the house and pretended to be an applicant. Ramos remained outside and stood on the pavement, from where he was able to see around six (6) persons in the houses sala. Ramos even heard a woman, identified as Carol Fegueroa, talk about the possible employment she has to provide in Singapore and the documents that the applicants have to comply with. Fifteen (15) minutes later, Bellotindos came out with a bio-data form in hand.

On February 1, 1994, Ramos conferred with a certain Capt. Mendoza of the Criminal Investigation Service (CIS) to organize the arrest of the alleged illegal recruiter. Also present were other members of the CIS, including Col. Rodolfo Almonte, Regional Director of the PNP-CIS for Region IX, Eileen Fermindoza, and a certain SPO3 Santos. The group planned to entrap the illegal recruiter the next day by having Fermindoza pose as an applicant.[3] On February 2, 1994, at around 8:00 p.m., Col. Almonte directed the case to SPO2 Erwin Manalopilar, a member of the Philippine National Police who was assigned as an investigator of the CIS, to conduct a surveillance of the area to confirm the report of illegal recruitment. Accordingly, he, along with Eileen Fermindoza, immediately proceeded to Tetuan Highway. The two did not enter the house where the recruitment was supposedly being conducted, but Fermindoza interviewed two people who informed them that some people do go inside the house. Upon returning to their office at around 8:30 a.m., the two reported to Capt. Mendoza who organized a team to conduct the raid. The raiding team, which included Capt. Mendoza, SPO2 Manalopilar, Fermindoza and a certain Oscar Bucol, quickly set off and arrived at the reported scene at 9:30 that morning. There they met up with Erlie Ramos of the POEA. Fermindoza then proceeded to enter the house while the rest of the team posted themselves outside to secure the area. Fermindoza was instructed to come out after she was given a bio-data form, which will serve as the teams cue to enter the house.[4] Fermindoza introduced herself as a job applicant to a man and a woman, apparently the owners of the house, and went inside. There, she saw another woman, later identified as Jasmine, coming out of the bathroom. The man to whom Fermindoza earlier introduced herself told Jasmine that Fermindoza was applying for a position. Jasmine, who was then only wearing a towel, told her that she would just get dressed. Jasmine then came back and asked Fermindoza what position she was applying for. Fermindoza replied that she was applying to be a babysitter or any other work so long as she could go abroad. Jasmine then gave her an application form. A few minutes later, a certain Carol arrived. Jasmine informed Carol that Fermindoza was an applicant. Fermindoza asked Carol what the requirements were and whether she (Fermindoza) was qualified. Carol told Fermindoza that if she had a passport, she could fill up the application papers. Fermindoza replied that she had no passport yet. Carol said she need not worry since Jasmine will prepare the passport for her. While filling up the application form, three women who appeared to be friends of Jasmine arrived to follow up the result of their applications and to give their advance payment. Jasmine got their papers and put them on top of a small table. Fermindoza then proceeded to the door and signaled to the raiding party by raising her hand. Capt. Mendoza asked the owners of the house, a married couple, for permission to enter the same. The owners granted permission after the raiding party introduced themselves as members of the CIS. Inside the house, the raiding party saw some supposed applicants. Application forms, already filled up, were in the hands of one Mrs. Carol Figueroa. The CIS asked Figueroa if she had a permit to recruit. Figueroa retorted that she was not engaged in recruitment. Capt. Mendoza nevertheless proceeded to arrest Figueroa. He took the application forms she was holding as the raiding party seized the other papers[5] on the table.[6] The CIS team then brought Figueroa, a certain Jasmine Alejandro, and the three women suspected to be applicants, to the office for investigation.[7] In the course of their investigation, the CIS discovered that Carol Figueroa had many aliases, among them, Carol Llena and Carol dela Piedra. The accused was not able to present any authority to recruit when asked by the investigators.[8] A check by Ramos with the POEA revealed that the acused was not licensed or authorized to conduct recruitment.[9] A certification[10] dated February 2, 1994 stating thus was executed by Renegold M. Macarulay, Officer-in-Charge of the POEA. The CIS likewise interviewed the supposed applicants, Lourdes Modesto, Nancy Araneta and Jennelyn Baez, all registered nurses working at the Cabato Medical Hospital, who executed their respective written statements.[11]

At the trial, Nancy Araneta, 23, recounted that she was at Jasmine Alejandros house in the afternoon of January 30, 1994. Araneta had learned from Sandra Aquino, also a nurse at the Cabato Medical Hospital, that a woman was there to recruit job applicants for Singapore. Araneta and her friends, Jennelyn Baez and Sandra Aquino, arrived at Jasmines house at around 4:30 p.m. Jasmine welcomed them and told them to sit down. They listened to the recruiter who was then talking to a number of people. The recruiter said that she was recruiting nurses for Singapore. Araneta and her friends then filled up bio-data forms and were required to submit pictures and a transcript of records. They were also told to pay P2,000, and the rest will be salary deduction. Araneta submitted her bio-data form to Carol that same afternoon, but did not give any money because she was not yet sure. On the day of the raid on February 2, 1994, Araneta was again at the Alejandro residence to submit her transcript of records and her picture. She arrived at the house 30 minutes before the raid but did not witness the arrest since she was at the porch when it happened.[12] Maria Lourdes Modesto, 26, was also in Jasmine Alejandros house on January 30, 1994. A friend of Jasmine had informed her that there was someone recruiting in Jasmines house. Upon arriving at the Alejandro residence, Lourdes was welcomed by Jasmine. Lourdes recalled that Carol Figueroa was already briefing some people when she arrived. Carol Figueroa asked if they would like a good opportunity since a hospital was hiring nurses. She gave a breakdown of the fees involved: P30,000 for the visa and the round trip ticket, and P5,000 as placement fee and for the processing of the papers. The initial payment was P2,000, while P30,000 will be by salary deduction. Lourdes filled up the application form and submitted it to Jasmine. After the interview, she gave the initial payment of P2,000 to Jasmine, who assured Lourdes that she was authorized to receive the money. On February 2, 1994, however, Lourdes went back to the house to get back the money. Jasmine gave back the money to Lourdes after the raid.[13] Denial comprised the accuseds defense. Carol dela Piedra, 37, is a housewife and a resident of Cebu City. Her husband is a businessman from Cebu, the manager of the Region 7 Branch of the Grollier International Encyclopedia. They own an apartment in Cebu City, providing lodging to students. The accused claimed that she goes to Singapore to visit her relatives. She first traveled to Singapore on August 21, 1993 as a tourist, and came back to the Philippines on October 20 of the same year. Thereafter, she returned to Singapore on December 10, 1993. On December 21, 1993, while in Singapore, the accused was invited to a Christmas party sponsored by the Zamboanga City Club Association. On that occasion, she met a certain Laleen Malicay, who sought her help. A midwife, Malicay had been working in Singapore for six (6) years. Her employer is a certain Mr. Tan, a close friend of Carol. According to the accused, Malicay sent P15,000 home for her father who was then seriously ill. Malicay was not sure, however, whether her father received the money so she requested the accused to verify from her relatives receipt thereof. She informed the accused that she had a cousin by the name of Jasmine Alejandro. Malicay gave the accused Jasmines telephone number, address and a sketch of how to get there. The accused returned to the country on January 21, 1994. From Cebu City, the accused flew to Zamboanga City on January 23, 1994 to give some presents to her friends. On January 30, 1994, the accused called up Jasmine Alejandro, Laleen Malicays cousin, to inform her that she would be going to her house. At around noon that day, the accused, accompanied by her friend Hilda Falcasantos, arrived at the house where she found Jasmine entertaining some friends. Jasmine came down with two of her friends whom she introduced as her classmates. Jasmine told them that the accused was a friend of Laleen Malicay.

The accused relayed to Jasmine Malicays message regarding the money the latter had sent. Jasmine assured her that they received the money, and asked Carol to tell Malicay to send more money for medicine for Malicays mother. Jasmine also told her that she would send something for Malicay when the accused goes back to Singapore. The accused replied that she just needed to confirm her flight back to Cebu City, and will return to Jasmines house. After the meeting with Jasmine, the accused went shopping with Hilda Falcasantos. The accused was in the house for only fifteen (15) minutes. On February 2, 1994, the accused went to the Philippine Airlines office at 7:30 in the morning to confirm her 5:30 p.m. flight to Cebu City. She then proceeded to Jasmines residence, arriving there at past 8 a.m. Inside the house, she met a woman who asked her, Are you Carol from Singapore? The accused, in turn, asked the woman if she could do anything for her. The woman inquired from Carol if she was recruiting. Carol replied in the negative, explaining that she was there just to say goodbye to Jasmine. The woman further asked Carol what the requirements were if she (the woman) were to go to Singapore. Carol replied that she would need a passport. Two (2) minutes later, three (3) girls entered the house looking for Jasmine. The woman Carol was talking with then stood up and went out. A minute after, three (3) members of the CIS and a POEA official arrived. A big man identified himself as a member of the CIS and informed her that they received a call that she was recruiting. They told her she had just interviewed a woman from the CIS. She denied this, and said that she came only to say goodbye to the occupants of the house, and to get whatever Jasmine would be sending for Laleen Malicay. She even showed them her ticket for Cebu City. Erlie Ramos then went up to Jasmines room and returned with some papers. The accused said that those were the papers that Laleen Malicay requested Jasmine to give to her (the accused). The accused surmised that because Laleen Malicay wanted to go home but could not find a replacement, one of the applicants in the forms was to be her (Malicays) substitute. Ramos told the accused to explain in their office. The accused denied in court that she went to Jasmines residence to engage in recruitment. She claimed she came to Zamboanga City to visit her friends, to whom she could confide since she and her husband were having some problems. She denied she knew Nancy Araneta or that she brought information sheets for job placement. She also denied instructing Jasmine to collect P2,000 from alleged applicants as processing fee.[14] The accused presented two witnesses to corroborate her defense. The first, Jasmine Alejandro, 23, testified that she met the accused for the first time only on January 30, 1994 when the latter visited them to deliver Laleen Malicays message regarding the money she sent. Carol, who was accompanied by a certain Hilda Falcasantos, stayed in their house for 10 to 15 minutes only. Carol came back to the house a few days later on February 2 at around 8:00 in the morning to get the envelope for the candidacy of her daughter. Jasmine did not elaborate. Jasmine denied that she knew Nancy Araneta or Lourdes Modesto. She denied that the accused conducted recruitment. She claimed she did not see Carol distribute bio-data or application forms to job applicants. She disclaimed any knowledge regarding the P2,000 application fee.[15] The other defense witness, Ernesto Morales, a policeman, merely testified that the accused stayed in their house in No. 270 Tugbungan, Zamboanga City, for four (4) days before her arrest, although she would sometimes go downtown alone. He said he did not notice that she conducted any recruitment.[16] On May 5, 1995, the trial court rendered a decision convicting the accused, thus:

WHEREFORE, in view of all the foregoing consideration[s][,] this Court finds the accused Carol dela Piedra alias Carol Llena and Carol Figueroa guilty beyond reasonable doubt of Illegal Recruitment committed in a large scale and hereby sentences her to suffer the penalty of LIFE IMPRISONMENT and to pay a fine of P100,000.00, and also to pay the costs.

Being a detention prisoner, the said accused is entitled to the full time of the period of her detention during the pendency of this case under the condition set forth in Article 29 of the Revised Penal Code. SO ORDERED.[17]
The accused, in this appeal, ascribes to the trial court the following errors:
I

WITH DUE RESPECT, THE LOWER COURT ERRED IN NOT FINDING SEC. 13 (B) OF P.D. 442[,] AS AMENDED[,] OTHERWISE KNOWN AS [THE] ILLEGAL RECRUITMENT LAW UNCONSTITUTIONAL.
II

WITH DUE RESPECT, THE LOWER COURT ERRED IN NOT HOLDING THAT THE APPREHENDING TEAM COMPOSED OF POEA AND CIS REPRESENTATIVES ENTERED INTO [sic] THE RESIDENCE OF JASMIN[E] ALEJANDRO WITHOUT ANY SEARCH WARRANT IN VIOLATION OF ARTICLE III, SECTION 2 OF THE PHILIPPINE CONSTITUTION, AND ANY EVIDENCE OBTAINED IN VIOLATION THEREOF, SHALL BE INADMISSIBLE FOR ANY PURPOSE IN ANY PROCEEDING AS PROVIDED UNDER ARTICLE III, SECTION 3, (2) OF THE SAME CONSTITUTION;
III

WITH DUE RESPECT, THE LOWER COURT ERRED IN IGNORING THAT WHEN SPO2 [sic] EILE[E]N FERMINDOZA ENTERED THE RESIDENCE OF JASMIN[E] ALEJANDRO, THERE WAS NO CRIME COMMITTED WHATSOEVER, HENCE THE ARREST OF THE ACCUSED-APPELLANT WAS ILLEGAL;
[IV]

WITH DUE RESPECT, THE LOWER COURT ERRED IN NOT DISCOVERING THAT SPO2 [sic] EILE[E]N FERMINDOZA WAS NOT ILLEGALLY RECRUITED BY THE ACCUSED-APPELLANT, HENCE, ACCUSED-APPELLANT SHOULD BE ACQUITTED;
V

WITH DUE RESPECT, THE LOWER COURT ERRED IN NOT DETECTING THAT NANCY ARANETA WAS NOT ILLEGALLY RECRUITED BY THE ACCUSEDAPPELLANT, HENCE, ACCUSED SHOULD BE EXONERATED;
VI

WITH DUE RESPECT, THE LOWER COURT ERRED IN NOT REALIZING THAT MARIA LOURDES MODESTO WAS NOT ILLEGALLY RECRUITED BY THE ACCUSED-APPELLANT, HENCE, ACCUSED-APPELLANT SHOULD BE EXCULPATED;

VII

WITH DUE RESPECT, THE LOWER COURT ERRED IN FINDING THAT THE ACCUSED-APPELLANT WAS CHARGED WITH LARGE SCALE ILLEGAL RECRUITMENT ON JANUARY 30, 1994, THE DATE STATED IN THE INFORMATION AS THE DATE OF THE CRIME, BUT ACCUSED WAS ARRESTED ON FEB. 2, 1994 AND ALL THE EVIDENCES [sic] INDICATED [sic] THAT THE ALLEGED CRIME WERE [sic] COMMITTED ON FEB. 2, 1994, HENCE, THE INFORMATION IS FATALLY DEFECTIVE;
VIII

WITH DUE RESPECT, THE LOWER COURT ERRED IN NOT FINDING THAT THE ALLEGED CRIME OF ILLEGAL RECRUITMENT WAS COMMITTED NOT ON [sic] LARGE SCALE, HENCE, THE PENALTY SHOULD NOT BE LIFE IMPRISONMENT;
IX

WITH DUE RESPECT, THE LOWER COURT ERRED IN NOT FINDING THAT THOSE EVIDENCES [sic] SEIZED AT THE HOUSE OF JASMIN[E] ALEJANDRO AND PRESENTED TO THE COURT WERE PLANTED BY A BOGUS ATTORNEY[,] ERLIE S. RAMOS OF THE POEA;
X

WITH DUE RESPECT, THE LOWER COURT ERRED IN NOT DISCOVERING THAT ACCUSED-APPELLANT DID NOT RECEIVE ANY PAYMENT EVEN A SINGLE CENTAVO FROM THE ALLEGED VICTIMS WHO DID NOT SUFFER DAMAGE IN ANY MANNER, YET SHE WAS CONVICTED TO SERVE HER ENTIRE LIFE BEHIND PRISON BARS. SUCH PUNISHMENT WAS CRUEL AND UNUSUAL, HENCE, A WANTON VIOLATION OF THE CONSTITUTION.[18]
In the first assigned error, appellant maintains that the law defining recruitment and placement violates due process. Appellant also avers, as part of her sixth assigned error, that she was denied the equal protection of the laws. We shall address the issues jointly. Appellant submits that Article 13 (b) of the Labor Code defining recruitment and placement is void for vagueness and, thus, violates the due process clause.[19] Due process requires that the terms of a penal statute must be sufficiently explicit to inform those who are subject to it what conduct on their part will render them liable to its penalties. [20] A criminal statute that fails to give a person of ordinary intelligence fair notice that his contemplated conduct is forbidden by the statute, or is so indefinite that it encourages arbitrary and erratic arrests and convictions, is void for vagueness. [21] The constitutional vice in a vague or indefinite statute is the injustice to the accused in placing him on trial for an offense, the nature of which he is given no fair warning.[22] We reiterated these principles in People vs. Nazario:[23]

As a rule, a statute or act may be said to be vague when it lacks comprehensible standards that men of common intelligence must necessarily guess at its meaning and differ as to its application. It is repugnant to the Constitution in two respects: (1) it violates due process for failure to accord persons, especially the parties targeted by it, fair notice of the conduct to avoid; and (2) it leaves law enforcers unbridled discretion in carrying out its provisions and become an arbitrary flexing of the Government muscle.
We added, however, that:

x x x the act must be utterly vague on its face, that is to say, it cannot be clarified by either a saving clause or by construction. Thus, in Coates v. City of Cincinnati, the U.S. Supreme Court struck down an ordinance that had made it illegal for three or more persons to assemble on any sidewalk and there conduct themselves in a manner annoying to persons passing by. Clearly, the ordinance imposed no standard at all because one may never know in advance what annoys some people but does not annoy others. Coates highlights what has been referred to as a perfectly vague act whose o bscurity is evident on its face. It is to be distinguished, however, from legislation couched in imprecise languagebut which nonetheless specifies a standard though defectively phrasedin which case, it may be saved by proper construction.
Here, the provision in question reads:

ART. 13. Definitions.(a) x x x. (b) Recruitment and placement refers to any 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: Provided, That any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement.
x x x. When undertaken by non-licensees or non-holders of authority, recruitment activities are punishable as follows:

ART. 38. Illegal Recruitment. (a) Any recruitment activities, including the prohibited practices enumerated under Article 34 of this Code, to be undertaken by non-licensees or non-holders of authority shall be deemed illegal and punishable under Article 39 of this Code. The Ministry of Labor and Employment or any law enforcement officer may initiate complaints under this Article. (b) Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage and shall be penalized in accordance with Article 39 hereof. Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme defined under the first paragraph hereof. Illegal

recruitment is deemed committed in large scale if committed against three (3) or more persons individually or as a group.
x x x.

Art. 39. Penalties. (a) The penalty of life imprisonment and a fine of One Hundred Thousand Pesos (P100,000) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein: (b) Any licensee or holder of authority found violating or causing another to violate any provision of this Title or its implementing rules and regulations, shall upon conviction thereof, suffer the penalty of imprisonment of not less than five years or a fine of not less than P10,000 nor more than P50,000 or both such imprisonment and fine, at the discretion of the court; (c) Any person who is neither a licensee nor a holder of authority under this Title found violating any provision thereof or its implementing rules and regulations shall, upon conviction thereof, suffer the penalty of imprisonment of not less than four years nor more than eight years or a fine of not less than P20,000 nor more than P100,000 or both such imprisonment and fine, at the discretion of the court;
x x x. In support of her submission that Article 13 (b) is void for vagueness, appellant invokes People vs. Panis,[24] where this Court, to use appellants term, criticized the definition of recruitment and placement as follows: It is unfortunate that we can only speculate on the meaning of the questioned provision for lack of records of debates and deliberations that would otherwise have been available if the Labor Code had been enacted as a statute rather than a presidential decree is that they could be, and sometimes were, issued without previous public discussion or consultation, the promulgator heeding only his own counsel or those of his close advisers in their lofty pinnacle of power. The not infrequent results are rejection, intentional or not, of the interest of the greater number and, as in the instant case, certain esoteric provisions that one cannot read against the background facts usually reported in the legislative journals. If the Court in Panis had to speculate on the meaning of the questioned provision, appellant asks, what more the ordinary citizen who does not possess the necessary [legal] knowledge? Appellant further argues that the acts that constitute recruitment and placement suffer from overbreadth since by merely referring a person for employment, a person may be convicted of illegal recruitment. These contentions cannot be sustained. Appellants reliance on People vs. Panis is misplaced. The issue in Panis was whether, under the proviso of Article 13 (b), the crime of illegal recruitment could be committed only whenever two or more persons are in any manner promised or offered any employment for a fee. The Court held in the negative, explaining:

As we see it, the proviso was intended neither to impose a condition on the basic rule nor to provide an exception thereto but merely to create a presumption. The presumption is that the individual or entity is engaged in recruitment and placement whenever he or it is dealing with two or more persons to whom, in consideration of a fee, an offer or promise of employment is made in the course of the canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring (of) workers.

The number of persons dealt with is not an essential ingredient of the act of recruitment and placement of workers. Any of the acts mentioned in the basic rule in Article 13(b) will constitute recruitment and placement even if only one prospective worker is involved. The proviso merely lays down a rule of evidence that where a fee is collected in consideration of a promise or offer of employment to two or more prospective workers, the individual or entity dealing with them shall be deemed to be engaged in the act of recruitment and placement. The words shall be deemed create that presumption. This is not unlike the presumption in article 217 of the Revised Penal Code, for example, regarding the failure of a public officer to produce upon lawful demand funds or property entrusted to his custody. Such failure shall be prima facie evidence that he has put them to personal use; in other words, he shall be deemed to have malversed such funds or property. In the instant case, the word shall be deemed should by the same token be given the force of a disputable presumption or of prima facie evidence of engaging in recruitment and placement. It is unfortunate that we can only speculate on the meaning of the questioned provision for lack of records of debates and deliberations that would otherwise have been available if the Labor Code had been enacted as a statute rather than a presidential decree is that they could be, and sometimes were, issued without previous public discussion or consultation, the promulgator heeding only his own counsel or those of his close advisers in their lofty pinnacle of power. The not infrequent results are rejection, intentional or not, of the interest of the greater number and, as in the instant case, certain esoteric provisions that one cannot read against the background facts usually reported in the legislative journals. At any rate, the interpretation here adopted should give more force to the campaign against illegal recruitment and placement, which has victimized many Filipino workers seeking a better life in a foreign land, and investing hard-earned savings or even borrowed funds in pursuit of their dream, only to be awakened to the reality of a cynical deception at the hands of their own countrymen.
Evidently, therefore, appellant has taken the penultimate paragraph in the excerpt quoted above out of context. The Court, in Panis, merely bemoaned the lack of records that would help shed light on the meaning of the proviso. The absence of such records notwithstanding, the Court was able to arrive at a reasonable interpretation of the proviso by applying principles in criminal law and drawing from the language and intent of the law itself. Section 13 (b), therefore, is not a perfectly vague act whose obscurity is evident on its face. If at all, the proviso therein is merely couched in imprecise language that was salvaged by proper construction. It is not void for vagueness.

An act will be declared void and inoperative on the ground of vagueness and uncertainty, only upon a showing that the defect is such that the courts are unable to determine, with any reasonable degree of certainty, what the legislature intended. x x x. In this connection we cannot pretermit reference to the rule that legislation should not be held invalid on the ground of uncertainty if susceptible of any reasonable construction that will support and give it effect. An Act will not be declared inoperative and ineffectual on the ground that it furnishes no adequate means to secure the purpose for which it is passed, if men of common sense and reason can devise and provide the means, and all the instrumentalities necessary for its execution are within the reach of those intrusted therewith.[25]

That Section 13 (b) encompasses what appellant apparently considers as customary and harmless acts such as labor or employment referral (referring an applicant, according to appellant, for employment to a prospective employer) does not render the law overbroad. Evidently, appellant misapprehends concept of overbreadth. A statute may be said to be overbroad where it operates to inhibit the exercise of individual freedoms affirmatively guaranteed by the Constitution, such as the freedom of speech or religion. A generally worded statute, when construed to punish conduct which cannot be constitutionally punished is unconstitutionally vague to the extent that it fails to give adequate warning of the boundary between the constitutionally permissible and the constitutionally impermissible applications of the statute.[26] In Blo Umpar Adiong vs. Commission on Elections,[27] for instance, we struck down as void for overbreadth provisions prohibiting the posting of election propaganda in any place including private vehicles other than in the common poster areas sanctioned by the COMELEC. We held that the challenged provisions not only deprived the owner of the vehicle the use of his property but also deprived the citizen of his right to free speech and information. The prohibition in Adiong, therefore, was so broad that it covered even constitutionally guaranteed rights and, hence, void for overbreadth. In the present case, however, appellant did not even specify what constitutionally protected freedoms are embraced by the definition of recruitment and placement that would render the same constitutionally overbroad. Appellant also invokes the equal protection clause[28] in her defense. She points out that although the evidence purportedly shows that Jasmine Alejandro handed out application forms and even received Lourdes Modestos payment, appellant was the only one criminally charged. Alejandro, on the other hand, remained scot-free. From this, appellant concludes that the prosecution discriminated against her on grounds of regional origins. Appellant is a Cebuana while Alejandro is a Zamboanguea, and the alleged crime took place in Zamboanga City. The argument has no merit. At the outset, it may be stressed that courts are not confined to the language of the statute under challenge in determining whether that statute has any discriminatory effect. A statute nondiscriminatory on its face may be grossly discriminatory in its operation.[29] Though the law itself be fair on its face and impartial in appearance, yet, if it is applied and administered by public authority with an evil eye and unequal hand, so as practically to make unjust and illegal discriminations between persons in similar circumstances, material to their rights, the denial of equal justice is still within the prohibition of the Constitution.[30] The prosecution of one guilty person while others equally guilty are not prosecuted, however, is not, by itself, a denial of the equal protection of the laws.[31] Where the official action purports to be in conformity to the statutory classification, an erroneous or mistaken performance of the statutory duty, although a violation of the statute, is not without more a denial of the equal protection of the laws.[32] The unlawful administration by officers of a statute fair on its face, resulting in its unequal application to those who are entitled to be treated alike, is not a denial of equal protection unless there is shown to be present in it an element of intentional orpurposeful discrimination. This may appear on the face of the action taken with respect to a particular class or person, or it may only be shown by extrinsic evidence showing a discriminatory design over another not to be inferred from the action itself. But a discriminatory purpose is not presumed, there must be a showing of clear and intentional discrimination.[33] Appellant has failed to show that, in charging appellant in court, that there was a clear and intentional discrimination on the part of the prosecuting officials. The discretion of who to prosecute depends on the prosecutions sound assessment whether the evidence before it can justify a reasonable belief that a person has committed an offense. [34] The presumption is that the prosecuting officers regularly performed their duties,[35] and this presumption can be overcome only by proof to the contrary, not by mere speculation. Indeed, appellant has not presented any evidence to overcome this presumption. The mere allegation that appellant, a Cebuana, was charged with the commission of a crime, while a Zamboanguea, the guilty party in appellants eyes, was not, is insufficient to support a conclusion that the prosecution officers denied appellant equal protection of the laws.

There is also common sense practicality in sustaining appellants prosecution.

While all persons accused of crime are to be treated on a basis of equality before the law, it does not follow that they are to be protected in the commission of crime. It would be unconscionable, for instance, to excuse a defendant guilty of murder because others have murdered with impunity. The remedy for unequal enforcement of the law in such instances does not lie in the exoneration of the guilty at the expense of society x x x. Protection of the law will be extended to all persons equally in the pursuit of their lawful occupations, but no person has the right to demand protection of the law in the commission of a crime.[36]
Likewise,

[i]f the failure of prosecutors to enforce the criminal laws as to some persons should be converted into a defense for others charged with crime, the result would be that the trial of the district attorney for nonfeasance would become an issue in the trial of many persons charged with heinous crimes and the enforcement of law would suffer a complete breakdown.[37]
We now come to the third, fourth and fifth assigned errors, all of which involve the finding of guilt by the trial court. Illegal recruitment is committed when two elements concur. First, the offender has no valid license or authority required by law to enable one to lawfully engage in recruitment and placement of workers. Second, he or she undertakes either any activity within the meaning of recruitment and placement defined under Article 13 (b), or any prohibited practices enumerated under Article 34 of the Labor Code. [38] In case of illegal recruitmentin large scale, a third element is added: that the accused commits said acts against three or more persons, individually or as a group.[39] In this case, the first element is present. The certification of POEA Officer-in-Charge Macarulay states that appellant is not licensed or authorized to engage in recruitment and placement. The second element is also present. Appellant is presumed engaged in recruitment and placement under Article 13 (b) of the Labor Code. Both Nancy Araneta and Lourdes Modesto testified that appellant promised them employment for a fee. Their testimonies corroborate each other on material points: the briefing conducted by appellant, the time and place thereof, the fees involved. Appellant has not shown that these witnesses were incited by any motive to testify falsely against her. The absence of evidence as to an improper motive actuating the principal witnesses of the prosecution strongly tends to sustain that no improper motive existed and that their testimony is worthy of full faith and credence.[40] Appellants denials cannot prevail over the positive declaration of the prosecution witnesses. Affirmative testimony of persons who are eyewitnesses of the fact asserted easily overrides negative testimony.[41] That appellant did not receive any payment for the promised or offered employment is of no moment. From the language of the statute, the act of recruitment may be for profit or not; it suffices that the accused promises or offers for a fee employment to warrant conviction for illegal recruitment. The testimonies of Araneta and Modesto, coming as they do from credible witnesses, meet the standard of proof beyond reasonable doubt that appellant committed recruitment and placement. We therefore do not deem it necessary to delve into the second and third assigned errors assailing the legality of appellants arrest and the seizure of the application forms. A warrantless arrest, when unlawful, has the effect of invalidating the search incidental thereto and the articles so seized are rendered inadmissible in evidence.[42] Here, even if the documents seized were deemed inadmissible, her conviction would stand in view of Araneta and Modestos testimonies.

Appellant attempts to cast doubt on the prosecutions case by claiming in her ninth assigned error that Erlie Ramos of the POEA supposedly planted the application forms. She also assails his character, alleging that he passed himself off as a lawyer, although this was denied by Ramos. The claim of frame-up, like alibi, is a defense that has been invariably viewed by the Court with disfavor for it can easily be concocted but difficult to prove.[43] Apart from her self-serving testimony, appellant has not offered any evidence that she was indeed framed by Ramos. She has not even hinted at any motive for Ramos to frame her. Law enforcers are presumed to have performed their duties regularly in the absence of evidence to the contrary.[44] Considering that the two elements of lack of license or authority and the undertaking of an activity constituting recruitment and placement are present, appellant, at the very least, is liable for simple illegal recruitment. But is she guilty of illegal recruitment in large scale? We find that she is not. A conviction for large scale illegal recruitment must be based on a finding in each case of illegal recruitment of three or more persons whether individually or as a group.[45] In this case, only two persons, Araneta and Modesto, were proven to have been recruited by appellant. The third person named in the complaint as having been promised employment for a fee, Jennelyn Baez, was not presented in court to testify. It is true that law does not require that at least three victims testify at the trial; nevertheless, it is necessary that there is sufficient evidence proving that the offense was committed against three or more persons.[46] In this case, evidence that appellant likewise promised her employment for a fee is sketchy. The only evidence that tends to prove this fact is the testimony of Nancy Araneta, who said that she and her friends, Baez and Sandra Aquino, came to the briefing and that they (she and her friends) filled up application forms. The affidavit[47] Baez executed jointly with Araneta cannot support Aranetas testimony. The affidavit was neither identified, nor its contents affirmed, by Baez. Insofar as it purports to prove that appellant recruited Baez, therefore, the affidavit is hearsay and inadmissible.[48] In any case, hearsay evidence, such as the said affidavit, has little probative value.[49] Neither can appellant be convicted for recruiting CIS agent Eileen Fermindoza or even the other persons present in the briefing of January 30, 1994. Appellant is accused of recruiting only the three persons named in the information Araneta, Modesto and Baez. The information does not include Fermindoza or the other persons present in the briefing as among those promised or offered employment for a fee. To convict appellant for the recruitment and placement of persons other than those alleged to have been offered or promised employment for a fee would violate her right to be informed of the nature and cause of the accusation against her.[50] In any event, the purpose of the offer of the testimonies of Araneta, Morales and Fermindoza, respectively, was limited as follows:
FISCAL BELDUA: Your Honor please, we are offering the oral testimony of the witness, as one of those recruited by the accused, and also to identify some exhibits for the prosecution and as well as to identify the accused.[51]

xxx
FISCAL BELDUA: We are offering the oral testimony of the witness, Your Honor, to testify on the fact about her recruitment by the accused and immediately before the recruitment, as well as to identify some exhibits for the prosecution, and also the accused in this case, Your Honor.[52]

xxx
FISCAL BELDUA: This witness is going to testify that at around that date Your Honor, she was connected with the CIS, that she was instructed together with a companion to conduct a surveillance on the place where the illegal recruitment was

supposed to be going on, that she acted as an applicant, Your Honor, to ascertain the truthfulness of the illegal recruitment going on, to identify the accused, as well as to identify some exhibits for the prosecution.[53]

xxx Courts may consider a piece of evidence only for the purpose for which it was offered, [54] and the purpose of the offer of their testimonies did not include the proving of the purported recruitment of other supposed applicants by appellant. Appellant claims in her seventh assigned error that the information is fatally defective since it charges her with committing illegal recruitment in large scale on January 30, 1994 while the prosecution evidence supposedly indicates that she committed the crime on February 2, 1994. We find that the evidence for the prosecution regarding the date of the commission of the crime does not vary from that charged in the information. Both Nancy Araneta and Lourdes Modesto testified that on January 30, 1994, while in the Alejandro residence, appellant offered them employment for a fee. Thus, while the arrest was effected only on February 2, 1994, the crime had already been committed three (3) days earlier on January 30, 1994. The eighth and tenth assigned errors, respectively, pertain to the penalty of life imprisonment imposed by the trial court as well as the constitutionality of the law prescribing the same, appellant arguing that it is unconstitutional for being unduly harsh.[55] The penalty of life imprisonment imposed upon appellant must be reduced. Because the prosecution was able to prove that appellant committed recruitment and placement against two persons only, she cannot be convicted of illegal recruitment in large scale, which requires that recruitment be committed against three or more persons. Appellant can only be convicted of two counts of simple illegal recruitment, one for that committed against Nancy Araneta, and another count for that committed against Lourdes Modesto. Appellant is sentenced, for each count, to suffer the penalty of four (4) to six (6) years of imprisonment and to pay a fine of P30,000.00. This renders immaterial the tenth assigned error, which assumes that the proper imposable penalty upon appellant is life imprisonment. WHEREFORE, the decision of the regional trial court is MODIFIED. Appellant is hereby declared guilty of illegal recruitment on two (2) counts and is sentenced, for each count, to suffer the penalty of four (4) to six (6) years of imprisonment and to pay a fine of P30,000.00. SO ORDERED. Davide, Jr., C.J., (Chairman), Puno, Pardo, and Ynares-Santiago, JJ., concur.

[1] [2] [3] [4] [5]

Records, p. 1. Id., at 28. TSN, July 11, 1994, pp. 3-13, 26-39. TSN, July 12, 1994, pp. 7-14, 35-56, 82-88, 102-110.

The documents seized include: Exhibit C, the application form of one Josilyn Villa, consisting of four (4) pages; Exhibit D, the application form of one Shirley Estrada, consisting of nine (9) pages; Exhibit E, the application form of one Cora Iglesia, with an annex of nine (9) pages; Exhibit F, the application form of Jocelyn Santos. Exhibit G, the application form of Jennifer Alejandro; Exhibit H, the application form of one Geraldine Reyes; Exhibit I, the application form of Lilibeth Estrada, consisting of six (6) pages; Exhibit J, is the application form of Geraldine Sunga; Exhibit K, is the diploma of Shirley Estrada, together with a photocopy of her passport; Exhibit L, a certification that Jasmine Alejandro rendered services as Staff Nurse wit h the Camp Navarro General Hospital.
[6]

TSN, July 12, 1994, pp. 88-101, 110-124.

[7] [8] [9]

TSN, July 12, 1994, pp. 28-34. TSN, July 11, 1994, pp. 18-19; TSN, July 12, 1994, p. 18. TSN, July 11, 1994, pp. 21-22. Exhibit A. Exhibits M and N. Araneta and Baez executed a Joint Affidavit. TSN, August 15, 1994, pp. 4-18. Id., at 21-35. TSN, September 19, 1994, pp. 5-39. TSN, September 28, 1994, pp. 4-8. TSN, October 13, 1994, pp. 2-7. Decision of the Regional Trial Court, p. 24. Brief for the Accused-Appellant, pp. 1-4. Constitution, Article III, Section 1. Connally v. General Construction Co., 269 US 385, 70 L Ed 322 46 S Ct 126 (1926). Colautti v. Franklin, 439 US 379, 58 L Ed 2d 596, 99 S Ct 675 (1979). American Communications Asso. v. Douds, 339 US 382, 94 L Ed 925, 70 S Ct 674 (1950). 165 SCRA 186 (1988). 142 SCRA 664 (1986). People vs. Rosenthal and Osmea, 68 Phil. 328 (1939). Wright vs. Georgia, 373 US 284, 10 L Ed 2d 349, 83 S Ct 1240 (1963). 207 SCRA 712 (1992). Constitution, Article III, Section 1. American Motorists Ins. Co. v. Starnes, 425 US 637, 48 L Ed 2d 263, 96 S Ct 1800 (1976).

[10] [11] [12] [13] [14] [15] [16] [17] [18] [19] [20] [21] [22] [23] [24] [25] [26] [27] [28] [29] [30]

Yick Wo v. Hopkins, 118 US 356, 30 L Ed 1012, 18 S Ct 583 (1886), cited in Genaro Reyes Construction, Inc. vs. Court of Appeals, 234 SCRA 16 (1994).
[31] [32] [33] [34] [35] [36] [37] [38]

Application of Finn, 356 P.2d 685 (1960). Snowden v. Hughes, 321 US 1, 88 L Ed 497, 64 S Ct 397 (1943). Ibid. Tan, Jr. vs. Sandiganbayan (Third Division), 292 SCRA 452 (1998). Rules Of Court, Rule 131, Sec. 5 (m). People v. Montgomery, 117 P.2d 437 (1941). State v. Hicks, 325 P.2d 794 (1958).

Abaca vs. Court of Appeals, 290 SCRA 657 (1998); Darvin vs. Court of Appeals, 292 SCRA 534 (1998); People vs. Juego, 298 SCRA 22 (1998).
[39]

People vs. Benedictus, 288 SCRA 319 (1998); People vs. Sadiosa, 290 SCRA 92 (1998); People vs. Sanchez, 291 SCRA 333 (1998); People vs. Saley, 291 SCRA 715 (1998); People vs. Ganaden, 299 SCRA 433 (1998).
[40] [41] [42] [43]

People vs. Badozo, 215 SCRA 33 (1992). People vs. Santos, 276 SCRA 329 (1997). E.g., Espano vs. Court of Appeals, 288 SCRA 558 (1998) Espano vs. Court of Appeals, supra; People vs. Alegro, 275 SCRA 216 (1997).

[44] [45] [46] [47] [48] [49] [50] [51] [52] [53] [54] [55]

Marco vs. Court of Appeals, 273 SCRA 276 (1997). People vs. Reyes, 242 SCRA 264 (1995). People vs. Ortiz-Miyake, 279 SCRA 180 (1997). Exhibit N. See People vs. Manhuyod, Jr., 290 SCRA 257 (1998); and People vs. Quidato, Jr., 297 SCRA 1 (1998). Salonga vs. Pao, 134 SCRA 438 (1985). Constitution, Article III, Section 14 (1); Rules of Court, Rule 115, Section 1 (b). TSN, August 15, 1994, p. 3. Id., at 20. TSN, July 12, 1994, pp. 79-80. People vs. Lapay, 298 SCRA 62 (1998).

Section 19 (1), Article III of the Constitution states: Excessive fines shall not be imposed, nor cruel, degrading or inhuman punishment i

SECOND DIVISION

G.R. No. 113161 August 29, 1995 PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. LOMA GOCE y OLALIA, DAN GOCE and NELLY D. AGUSTIN, accused. NELLY D. AGUSTIN, accusedappellant.

REGALADO, J.: On January 12, 1988, an information for illegal recruitment committed by a syndicate and in large scale, punishable under Articles 38 and 39 of the Labor Code (Presidential Decree No. 442) as amended by Section 1(b) of Presidential Decree No. 2018, was filed against spouses Dan and Loma Goce and herein accused-appellant Nelly Agustin in the Regional Trial Court of Manila, Branch 5, alleging
That in or about and during the period comprised between May 1986 and June 25, 1987, both dates inclusive, in the City of Manila, Philippines, the said accused, conspiring and confederating together and helping one another, representing themselves to have the capacity to contract, enlist and transport Filipino workers for employment abroad, did then and there willfully and unlawfully, for a fee, recruit and promise employment/job placement abroad, to (1) Rolando Dalida y Piernas, (2) Ernesto Alvarez y Lubangco, (3) Rogelio Salado y Savillo, (4) Ramona Salado y Alvarez, (5) Dionisio Masaya y de Guzman, (6) Dave Rivera y de Leon, (7) Lorenzo Alvarez y Velayo, and (8) Nelson Trinidad y Santos, without first having secured the required license or authority from the Department of Labor. 1

On January 21, 1987, a warrant of arrest was issued against the three accused but not one of them was arrested.2 Hence, on February 2, 1989, the trial court ordered the case archived but it issued a standing warrant of arrest against the accused. 3 Thereafter, on learning of the whereabouts of the accused, one of the offended parties, Rogelio Salado, requested on March 17, 1989 for a copy of the warrant of arrest. 4 Eventually, at around midday of February 26, 1993, Nelly Agustin was apprehended by the Paraaque police. 5 On March 8, 1993, her counsel filed a motion to revive the case and requested that it be set for hearing "for purposes of due process and for the accused to immediately have her day in court" 6 Thus, on April 15, 1993, the trial court reinstated the case and set the arraignment for May 3, 1993, 7 on which date of Agustin pleaded not guilty 8 and the case subsequently went to trial. Four of the complainants testified for the prosecution. Rogelio Salado was the first to take the witness stand and he declared that sometime in March or April, 1987, he was introduced by Lorenzo Alvarez, his brother-in-law and a coapplicant, to Nelly Agustin in the latter's residence at Factor, Dongalo, Paraaque, Metro Manila. Representing herself as the manager of the Clover Placement Agency, Agustin showed him a job order as proof that he could readily be deployed for overseas employment. Salado learned that he had to pay P5,000.00 as processing fee, which amount he gave sometime in April or May of the same year. He was issued the corresponding receipt. 9 Also in April or May, 1987, Salado, accompanied by five other applicants who were his relatives, went to the office of the placement agency at Nakpil Street, Ermita, Manila where he saw Agustin and met the spouses Dan and Loma Goce, owners of the agency. He submitted his bio-data and learned from Loma Goce that he had to give P12,000.00, instead of the original amount of P5,000.00 for the placement fee. Although surprised at the new and higher sum, they subsequently agreed as long as there was an assurance that they could leave for abroad. 10 Thereafter, a receipt was issued in the name of the Clover Placement Agency showing that Salado and his aforesaid co-applicants each paid P2,000.00, instead of the P5,000.00 which each of them actually paid. Several months passed but Salado failed to leave for the promised overseas employment. Hence, in October, 1987, along with the other recruits, he decided to go to the Philippine Overseas Employment Administration (POEA) to verify the real status of Clover Placement Agency. They discovered that said agency was not duly licensed to recruit job

applicants. Later, upon learning that Agustin had been arrested, Salado decided to see her and to demand the return of the money he had paid, but Agustin could only give him P500.00. 11 Ramona Salado, the wife of Rogelio Salado, came to know through her brother, Lorenzo Alvarez, about Nelly Agustin. Accompanied by her husband, Rogelio, Ramona went to see Agustin at the latter's residence. Agustin persuaded her to apply as a cutter/sewer in Oman so that she could join her husband. Encouraged by Agustin's promise that she and her husband could live together while working in Oman, she instructed her husband to give Agustin P2,000.00 for each of them as placement fee, or the total sum of P4,000.00. 12 Much later, the Salado couple received a telegram from the placement agency requiring them to report to its office because the "NOC" (visa) had allegedly arrived. Again, around February, or March, 1987, Rogelio gave P2,000.00 as payment for his and his wife's passports. Despite follow-up of their papers twice a week from February to June, 1987, he and his wife failed to leave for abroad. 13 Complainant Dionisio Masaya, accompanied by his brother-in-law, Aquiles Ortega, applied for a job in Oman with the Clover Placement Agency at Paraaque, the agency's former office address. There, Masaya met Nelly Agustin, who introduced herself as the manager of the agency, and the Goce spouses, Dan and Loma, as well as the latter's daughter. He submitted several pertinent documents, such as his bio-data and school credentials. 14 In May, 1986, Masaya gave Dan Goce P1,900.00 as an initial downpayment for the placement fee, and in September of that same year, he gave an additional P10,000.00. He was issued receipts for said amounts and was advised to go to the placement office once in a while to follow up his application, which he faithfully did. Much to his dismay and chagrin, he failed to leave for abroad as promised. Accordingly, he was forced to demand that his money be refunded but Loma Goce could give him back only P4,000.00 in installments. 15 As the prosecution's fourth and last witness, Ernesto Alvarez took the witness stand on June 7, 1993. He testified that in February, 1987, he met appellant Agustin through his cousin, Larry Alvarez, at her residence in Paraaque. She informed him that "madalas siyang nagpapalakad sa Oman" and offered him a job as an ambulance driver at the Royal Hospital in Oman with a monthly salary of about $600.00 to $700.00. 16 On March 10, 1987, Alvarez gave an initial amount of P3,000.00 as processing fee to Agustin at the latter's residence. In the same month, he gave another P3,000.00, this time in the office of the placement agency. Agustin assured him that he could leave for abroad before the end of 1987. He returned several times to the placement agency's office to follow up his application but to no avail. Frustrated, he demanded the return of the money he had paid, but Agustin could only give back P500.00. Thereafter, he looked for Agustin about eight times, but he could no longer find her. 17 Only herein appellant Agustin testified for the defense. She asserted that Dan and Loma Goce were her neighbors at Tambo, Paraaque and that they were licensed recruiters and owners of the Clover Placement Agency. Previously, the Goce couple was able to send her son, Reynaldo Agustin, to Saudi Arabia. Agustin met the aforementioned complainants through Lorenzo Alvarez who requested her to introduce them to the Goce couple, to which request she acceded. 18 Denying any participation in the illegal recruitment and maintaining that the recruitment was perpetrated only by the Goce couple, Agustin denied any knowledge of the receipts presented by the prosecution. She insisted that the complainants included her in the complaint thinking that this would compel her to reveal the whereabouts of the Goce spouses. She failed to do so because in truth, so she claims, she does not know the present address of the couple. All she knew was that they had left their residence in 1987. 19 Although she admitted having given P500.00 each to Rogelio Salado and Alvarez, she explained that it was entirely for different reasons. Salado had supposedly asked for a loan, while Alvarez needed money because he was sick at that time. 20 On November 19, 1993, the trial court rendered judgment finding herein appellant guilty as a principal in the crime of illegal recruitment in large scale, and sentencing her to serve the penalty of life imprisonment, as well as to pay a fine of P100,000.00. 21

In her present appeal, appellant Agustin raises the following arguments: (1) her act of introducing complainants to the Goce couple does not fall within the meaning of illegal recruitment and placement under Article 13(b) in relation to Article 34 of the Labor Code; (2) there is no proof of conspiracy to commit illegal recruitment among appellant and the Goce spouses; and (3) there is no proof that appellant offered or promised overseas employment to the complainants. 22 These three arguments being interrelated, they will be discussed together. Herein appellant is accused of violating Articles 38 and 39 of the Labor Code. Article 38 of the Labor Code, as amended by Presidential Decree No. 2018, provides that any recruitment activity, including the prohibited practices enumerated in Article 34 of said Code, undertaken by non-licensees or non-holders of authority shall be deemed illegal and punishable under Article 39 thereof. The same article further provides that illegal recruitment shall be considered an offense involving economic sabotage if any of these qualifying circumstances exist, namely, (a) when illegal recruitment is committed by a syndicate, i.e., if it is carried out by a group of three or more persons conspiring and/or confederating with one another; or (b) when illegal recruitment is committed in large scale, i.e., if it is committed against three or more persons individually or as a group. At the outset, it should be made clear that all the accused in this case were not authorized to engage in any recruitment activity, as evidenced by a certification issued by Cecilia E. Curso, Chief of the Licensing and Regulation Office of the Philippine Overseas Employment Administration, on November 10, 1987. Said certification states that Dan and Loma Goce and Nelly Agustin are neither licensed nor authorized to recruit workers for overseas employment. 23 Appellant does not dispute this. As a matter of fact her counsel agreed to stipulate that she was neither licensed nor authorized to recruit applicants for overseas employment. Appellant, however, denies that she was in any way guilty of illegal recruitment. 24 It is appellant's defensive theory that all she did was to introduce complainants to the Goce spouses. Being a neighbor of said couple, and owing to the fact that her son's overseas job application was processed and facilitated by them, the complainants asked her to introduce them to said spouses. Allegedly out of the goodness of her heart, she complied with their request. Such an act, appellant argues, does not fall within the meaning of "referral" under the Labor Code to make her liable for illegal recruitment. Under said Code, recruitment and placement refers to any 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; provided, that any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement. 25 On the other hand, referral is the act of passing along or forwarding of an applicant for employment after an initial interview of a selected applicant for employment to a selected employer, placement officer or bureau. 26 Hence, the inevitable query is whether or not appellant Agustin merely introduced complainants to the Goce couple or her actions went beyond that. The testimonial evidence hereon show that she indeed further committed acts constitutive of illegal recruitment. All four prosecution witnesses testified that it was Agustin whom they initially approached regarding their plans of working overseas. It was from her that they learned about the fees they had to pay, as well as the papers that they had to submit. It was after they had talked to her that they met the accused spouses who owned the placement agency. As correctly held by the trial court, being an employee of the Goces, it was therefore logical for appellant to introduce the applicants to said spouses, they being the owners of the agency. As such, appellant was actually making referrals to the agency of which she was a part. She was therefore engaging in recruitment activity. 27 Despite Agustin's pretensions that she was but a neighbor of the Goce couple, the testimonies of the prosecution witnesses paint a different picture. Rogelio Salado and Dionisio Masaya testified that appellant represented herself as the manager of the Clover Placement Agency. Ramona Salado was offered a job as a cutter/sewer by Agustin the first time they met, while Ernesto Alvarez remembered that when he first met Agustin, the latter represented herself as "nagpapaalis papunta sa Oman." 28 Indeed, Agustin played a pivotal role in the operations of the recruitment agency, working together with the Goce couple. There is illegal recruitment when one gives the impression of having the ability to send a worker abroad." 29 It is undisputed that appellant gave complainants the distinct impression that she had the power or ability to send people

abroad for work such that the latter were convinced to give her the money she demanded in order to be so employed. 30 It cannot be denied that Agustin received from complainants various sums for purpose of their applications. Her act of collecting from each of the complainants payment for their respective passports, training fees, placement fees, medical tests and other sundry expenses unquestionably constitutes an act of recruitment within the meaning of the law. In fact, appellant demanded and received from complainants amounts beyond the allowable limit of P5,000.00 under government regulations. It is true that the mere act of a cashier in receiving money far exceeding the amount allowed by law was not considered per se as "recruitment and placement" in contemplation of law, but that was because the recipient had no other participation in the transactions and did not conspire with her co-accused in defrauding the victims. 31 That is not the case here. Appellant further argues that "there is no evidence of receipts of collections/payments from complainants to appellant." On the contrary, xerox copies of said receipts/vouchers were presented by the prosecution. For instance, a cash voucher marked as Exhibit D, 32 showing the receipt of P10,000.00 for placement fee and duly signed by appellant, was presented by the prosecution. Another receipt, identified as Exhibit E, 33 was issued and signed by appellant on February 5, 1987 to acknowledge receipt of P4,000.00 from Rogelio and Ramona Salado for "processing of documents for Oman." Still another receipt dated March 10, 1987 and presented in evidence as Exhibit F, shows that appellant received from Ernesto Alvarez P2,000.00 for "processing of documents for Oman."34 Apparently, the original copies of said receipts/vouchers were lost, hence only xerox copies thereof were presented and which, under the circumstances, were admissible in evidence. When the original writing has been lost or destroyed or cannot be produced in court, upon proof of its execution and loss or destruction, or unavailability, its contents may be proved by a copy or a recital of its contents in some authentic document, or by the recollection of witnesses. 35 Even assuming arguendo that the xerox copies presented by the prosecution as secondary evidence are not allowable in court, still the absence thereof does not warrant the acquittal of appellant. In People vs. Comia, 36where this particular issue was involved, the Court held that the complainants' failure to ask for receipts for the fees they paid to the accused therein, as well as their consequent failure to present receipts before the trial court as proof of the said payments, is not fatal to their case. The complainants duly proved by their respective testimonies that said accused was involved in the entire recruitment process. Their testimonies in this regard, being clear and positive, were declared sufficient to establish that factum probandum. Indeed, the trial court was justified and correct in accepting the version of the prosecution witnesses, their statements being positive and affirmative in nature. This is more worthy of credit than the mere uncorroborated and self-serving denials of appellant. The lame defense consisting of such bare denials by appellant cannot overcome the evidence presented by the prosecution proving her guilt beyond reasonable doubt. 37 The presence of documentary evidence notwithstanding, this case essentially involves the credibility of witnesses which is best left to the judgment of the trial court, in the absence of abuse of discretion therein. The findings of fact of a trial court, arrived at only after a hearing and evaluation of what can usually be expected to be conflicting testimonies of witnesses, certainly deserve respect by an appellate court. 38 Generally, the findings of fact of the trial court on the matter of credibility of witnesses will not be disturbed on appeal. 39 In a last-ditch effort to exculpate herself from conviction, appellant argues that there is no proof of conspiracy between her and the Goce couple as to make her liable for illegal recruitment. We do not agree. The evidence presented by the prosecution clearly establish that appellant confabulated with the Goces in their plan to deceive the complainants. Although said accused couple have not been tried and convicted, nonetheless there is sufficient basis for appellant's conviction as discussed above. In People vs. Sendon, 40 we held that the non-prosecution of another suspect therein provided no ground for the appellant concerned to fault the decision of the trial court convicting her. The prosecution of other persons, equally or more culpable than herein appellant, may come later after their true identities and addresses shall have been ascertained and said malefactors duly taken into custody. We see no reason why the same doctrinal rule and course of procedure should not apply in this case.

WHEREFORE, the appealed judgment of the court a quo is hereby AFFIRMED in toto, with costs against accusedappellant Nelly D. Agustin. SO ORDERED. Narvasa, C.J., Puno, Mendoza and Francisco, JJ., concur.

Footnotes 1 Original Record, 1. 2 Ibid., 8-9. 3 Ibid., 17. 4 Ibid., 24. 5 Ibid., 27. 6 Ibid., 30. 7 Ibid., 33. 8 Ibid., 44. 9 TSN, May 12, 1993, 2-3, 8, 12. 10 Ibid., id., 3-5, 10, 13. 11 Ibid., id., 7-8, 12-16. 12 Ibid., May 25, 1993, 15-17. 13 Ibid., id., 18-20. 14 Ibid., id., 3-5, 11-12. 15 Ibid., id., 5-9. 16 Ibid., June 7, 1993, 2-5. 17 Ibid., id., 4-10. 18 Ibid., June 30, 2-3. 19 Ibid., id., 5. 20 Ibid., id., 6-7. 21 Penned by Presiding Judge Cesar J. Mindaro. 22 Appellant's Brief, 10; Rollo, 194.

23 Original Record, 153. 24 TSN, June 11, 1993, 8. 25 Article 13(b), Labor Code. 26 Webster's Third New International Dictionary, 1986 Ed., 1908. 27 Decision, 7; Original Record, 172. 28 TSN., June 7, 1993, 3. 29 People vs. Manungas, Jr., G.R. Nos. 91552-55, March 10, 1994, 231 SCRA 1. 30 People vs. Villafuerte, G.R. Nos. 93723-27, May 6, 1994, 232 SCRA 225. 31 People vs. Gaoat, G.R. No. 97028, May 21, 1993, 222 SCRA 385. 32 Original Record, 155. 33 Ibid., 156. 34 Ibid., 157. 35 Section 4, Rule 130, Rules of Court. 36 G.R. No. 109761, September 1, 1994, 236 SCRA 185. 37 People vs. Resuma, G.R. Nos. 106640-42, June 15, 1994. 38 People vs. Jumao-as, G.R. No. 101334, February 14, 1994, 230 SCRA 70. 39 People vs. Yap, G.R. No. 103517, February 9, 1994, 229 SCRA 787. 40 G.R. Nos. 101579-89, December 15, 1993, 228 SCRA 489.

SECOND DIVISION

[G.R. Nos. 115338-39. September 16, 1997]

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, MIYAKE accused-appellant. DECISION

REGALADO, J.:

vs. LANIE

ORTIZ-

Accused-appellant Lanie Ortiz-Miyake was charged with illegal recruitment in large scale in the Regional Trial Court of Makati on a complaint initiated by Elenita Marasigan, Imelda Generillo and Rosamar del Rosario. In addition, she was indicted for estafa by means of false pretenses in the same court, the offended party being Elenita Marasigan alone. The information in the charge of illegal recruitment in large scale in Criminal Case No. 92-6153 reads as follows:

That in or about the period comprised from June 1992 to August 1992, in the Municipality of Paraaque, Metro Manila, Philippines and within the jurisdiction of this Honorable Court, the above-named accused, falsely representing herself to have the capacity and power to contract, enlist and recruit workers for employment abroad did then and there willfully, unlawfully, and feloniously collect for a fee, recruit and promise employment/job placement abroad to the following persons, to wit: 1) Rosamar del Rosario; 2) Elenita Marasigan; 3) Imelda Generillo, without first securing the required license or authority from the Department of Labor and Employment, thus amounting to illegal recruitment in large scale, in violation of the aforecited law.
[1]

The information in the charge for estafa in Criminal Case No. 92-6154 alleges:

That in or about or sometime in the month of August, 1992, in the Municipality of Paraaque, Metro Manila, Philippines and within the jurisdiction of this Honorable Court, the above-named accused, by means of false pretenses executed prior to or simultaneously with the commission of the fraud, falsely pretending to have the capacity and power to send complainant Elenita Marasigan to work abroad, succeeded in inducing the latter to give and deliver to her the total sum of P23,000.00, the accused knowing fully well that the said manifestations and representation are false and fraudulent and calculated only to deceive the said complainant to part with her money, and, once in possession thereof, the said accused did then and there willfully, unlawfully and feloniously appropriate, apply and convert the same to her own personal use and benefit, to the damage and prejudice of the said Elenita Marasigan, in the aforementioned amount of P23,000.00.
[2]

Upon arraignment, appellant pleaded not guilty to the charges and the cases were tried jointly in Branch 145 of the Regional Trial Court of Makati.

Of the three complainants in the case for illegal recruitment in large scale, Marasigan was the only one who testified at the trial. The two other complainants, Generillo and Del Rosario, were unable to testify as they were then abroad. Marasigan testified that she was a 32 year-old unmarried sales representative in 1992 when she was introduced to appellant by her co-complainants. [3] Appellant promised Marasigan a job as a factory worker in Taiwan for a P5,000.00 fee. At that time, Marasigan had a pending application for overseas employment pending in a recruitment agency. Realizing that the fee charged by appellant was much lower than that of the agency, Marasigan withdrew her money from the agency and gave it to appellant. [4] Marasigan paid appellant P5,000.00, but she was later required to make additional payments. By the middle of the year, she had paid a total of P23,000.00 on installment basis. [5] Save for two receipts, [6] Marasigan was not issued receipts for the foregoing payments despite her persistence in requesting for the same. Marasigan was assured by appellant that obtaining a Taiwanese visa would not be a problem. [7] She was also shown a plane ticket to Taiwan, allegedly issued in her name. [8] Appellant issued Marasigan a photocopy of her plane ticket, [9] the original of which was promised to be given to her before her departure. [10] Marasigan was never issued a visa. [11] Neither was she given the promised plane ticket. Unable to depart for Taiwan, she went to the travel agency which issued the ticket and was informed that not only was she not booked by appellant for the alleged flight, but that the staff in the agency did not even know appellant. Later, Marasigan proceeded to the supposed residence of appellant and was informed that appellant did not live there. [12] Upon verification with the Philippine Overseas Employment Administration (POEA), it was revealed that appellant was not authorized to recruit workers for overseas employment. [13] Marasigan wanted to recover her money but, by then, appellant could no longer be located. The prosecution sought to prove that Generillo and Del Rosario, the two other complainants in the illegal recruitment case, were also victimized by appellant. In lieu of their testimonies, the prosecution presented as witnesses Lilia Generillo, the mother of Imelda Generillo, and Victoria Amin, the sister of Del Rosario. Lilia Generillo claimed that she gave her daughter P8,000.00 to cover her application for placement abroad which was made through appellant. [14] Twice, she accompanied her daughter to the residence of appellant so that she could meet her; however, she was not involved in the transactions between her daughter and appellant. [15] Neither was she around when payments were made to appellant. Imelda Generillo was unable to leave for abroad and Lilia Generillo concluded that she had become a victim of illegal recruitment. The prosecution presented Victoria Amin, the sister of Rosamar Del Rosario, to show that the latter was also a victim of illegal recruitment. Victoria Amin testified that appellant was supposed to provide her sister a job abroad. She claimed that she gave her sister a total of P10,000.00 which was intended to cover the latters processing fee. [16] Victoria Amin never met appellant and was not around when her sister made payments. She assumed that the money was paid to appellant based on receipts, allegedly issued by appellant, which her sister showed her. [17] Del Rosario was unable to leave for abroad despite the representations of appellant. Victoria Amin claimed that her sister, like Marasigan and Generillo, was a victim of illegal recruitment.

The final witness for the prosecution was Riza Balberte, [18] a representative of the POEA, who testified that appellant was neither licensed nor authorized to recruit workers for overseas employment, POEA certificate certification. [19] Upon the foregoing evidence, the prosecution sought to prove that although two of the three complainants in the illegal recruitment case were unable to testify, appellant was guilty of committing the offense against all three complainants and, therefore, should be convicted as charged. On the other hand, appellant, who was the sole witness for the defense, denied that she recruited the complainants for overseas employment and claimed that the payments made to her were solely for purchasing plane tickets at a discounted rate as she had connections with a travel agency. [20] She denied that she was paid by Marasigan the amount of P23,000.00, claiming that she was paid only P8,000.00, as shown by a receipt. She further insisted that, through the travel agency,[21] she was able to purchase discounted plane tickets for the complainants upon partial payment of the ticket prices, the balance of which she guaranteed. According to her, the complainants were supposed to pay her the balance but because they failed to do so, she was obliged to pay the entire cost of each ticket. The evidence presented by the parties were thus contradictory but the trial court found the prosecutions evidence more credible. On December 17, 1993, judgment was rendered by said court convicting appellant of both crimes as charged. [22] In convicting appellant of illegal recruitment in large scale, the lower court adopted a previous decision of Branch 78 of the Metropolitan Trial Court of Paraaque as a basis for the judgment. Said previous decision was a conviction for estafa promulgated on July 26, 1993, [23] rendered in Criminal Cases Nos. 74852-53, involving the same circumstances in the instant case, wherein complainants Generillo and Del Rosario charged appellant with two counts of estafa. This decision was not appealed and had become final and executory. In thus convicting appellant in the illegal recruitment case, the decision therein of the Regional Trial Court stated that the facts in the foregoing estafa cases were the same as those in the illegal recruitment case before it. It, therefore, adopted the facts and conclusions established in the earlier decision as its own findings of facts and as its rationale for the conviction in the case before it. [24] In Criminal Case No. 92-6153, the Makati court sentenced appellant to serve the penalty of life imprisonment for illegal recruitment in large scale, as well as to pay a fine of P100,000.00. Appellant was also ordered to reimburse the complainants the following payments made to her, viz.: (a) Marasigan, P23,000.00; (b) Generillo, P2,500.00; and (c) Del Rosario, P2,500.00. In the same judgment and for the estafa charged in Criminal Case No. 92-6154, the Makati court sentenced appellant to suffer imprisonment of four (4) years and two (2) months of prision correccional, as minimum, to eight (8) years of prision mayor, as maximum, and to pay the costs. In the instant petition, appellant seeks the reversal of the foregoing judgment of the Regional Trial Court of Makati convicting her of illegal recruitment in large scale and estafa. Specifically, she insists that the trial court erred in convicting her of illegal recruitment in large scale as the evidence presented was insufficient. Moreover, appellant claims that she is not guilty of acts constituting illegal recruitment, in large scale or otherwise, because contrary to the findings of the trial court, she did not recruit the complainants but merely purchased plane tickets for them. Finally, she contends that in convicting her of estafa, the lower court erred as she did not misappropriate the money paid to her by Marasigan, hence there was no damage to the complainants which would substantiate the conviction. We uphold the finding that appellant is guilty but we are, compelled to modify the judgment for the offenses she should be convicted of and the corresponding penalties therefor.

Appellant maintains that her conviction for illegal recruitment in large scale is erroneous. It is her view that in the prosecution of a case for such offense, at least three complainants are required to appear as witnesses in the trial and, since Marasigan was the only complainant presented as a witness, the conviction was groundless. The Solicitor General also advocates the conviction of appellant for simple illegal recruitment which provides a lower penalty. The Court finds the arguments of the Solicitor General meritorious and adopts his position. The Labor Code defines recruitment and placement as x x x any 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 x x x. [25] Illegal recruitment is likewise defined and made punishable under the Labor Code, thus:

Art. 38. Illegal Recruitment. (a) Any recruitment activities, including the prohibited practices enumerated under Article 34 of this Code, to be undertaken by non-licensees or non-holders of authority shall be deemed illegal and punishable under Article 39 of this Code. x x x. (b) Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage and shall be penalized in accordance with Article 39 hereof. x x x Illegal recruitment is deemed committed in large scale if committed against three (3) or more persons individually or as a group. Art. 39. Penalties. (a) The penalty of life imprisonment and a fine of One Hundred Thousand Pesos (P100,000.00) shall be imposed if Illegal Recruitment constitutes economic sabotage as defined herein;
xxx

(c) Any person who is neither a licensee nor a holder of authority under this Title found violating any provision thereof or its implementing rules and regulations shall, upon conviction thereof, suffer the penalty of imprisonment of not less than four (4) years nor more than eight (8) years or a fine of not less than P20,000.00 nor more than P100,000.00, or both such imprisonment and fine, at the discretion of the court. x x x
[26]

During the pendency of this case, Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995, was passed increasing the penalty for illegal recruitment. This new law, however, does not apply to the instant case because the offense charged herein was committed in 1992, before the effectivity of said Republic Act No. 8042. Hence, what are applicable are the aforecited Labor Code provisions. It is evident that in illegal recruitment cases, the number of persons victimized is determinative. Where illegal recruitment is committed against a lone victim, the accused may be convicted of simple illegal recruitment which is punishable with a lower penalty under Article 39(c) of the Labor Code. Corollarily, where the offense is committed against three or more persons, it is

qualified to illegal recruitment in large scale which provides a higher penalty under Article 39(a) of the same Code. The position of the Solicitor General is that the conviction of appellant should be merely for the lesser offense of simple illegal recruitment. He submits that the Regional Trial Court of Makati erred in convicting appellant of illegal recruitment in large scale because the conviction was based on an earlier decision of the Metropolitan Trial Court of Paraaque where appellant was found guilty of estafa committed against Generillo and Del Rosario. It is argued that the Makati court could not validly adopt the facts embodied in the decision of the Paraaque court to show that illegal recruitment was committed against Generillo and Del Rosario as well. Illegal recruitment was allegedly proven to have been committed against only one person, particularly, Elenita Marasigan. Appellant, therefore, may only be held guilty of simple illegal recruitment and not of such offense in large scale. He further submits that the adoption by the Makati court of the facts in the decision of the Paraaque court for estafa to constitute the basis of the subsequent conviction for illegal recruitment is erroneous as it is a violation of the right of appellant to confront the witnesses, that is, complainants Generillo and Del Rosario, during trial before it. He cites the pertinent provision of Rule 115 of the Rules of Court, to wit:

Section 1. Rights of accused at the trial. In all criminal prosecutions, the accused shall be entitled:
xxx

(f) To confront and cross-examine the witnesses against him at the trial. Either party may utilize as part of its evidence the testimony of a witness who is deceased, out of or cannot, with due diligence be found in the Philippines, unavailable or otherwise unable to testify, given in another case or proceeding, judicial or administrative, involving the same parties and subject matter, the adverse party having had the opportunity to cross-examine him.
xxx It will be noted that the principle embodied in the foregoing rule is likewise found in the following provision of Rule 130:

Section 47. Testimony or deposition at a former proceeding. - The testimony or deposition of a witness deceased or unable to testify, given in a former case or proceeding, judicial or administrative, involving the same parties and subject matter, may be given in evidence against the adverse party who had the opportunity to cross-examine him.
Under the aforecited rules, the accused in a criminal case is guaranteed the right of confrontation. Such right has two purposes: first, to secure the opportunity of cross-examination; and, second, to allow the judge to observe the deportment and appearance of the witness while testifying. [27] This right, however, is not absolute as it is recognized that it is sometimes impossible to recall or produce a witness who has already testified in a previous proceeding, in which event his previous testimony is made admissible as a distinct piece of evidence, by way of exception to the hearsay rule. [28] The previous testimony is made admissible because it makes the administration of justice orderly and expeditious. [29] Under these rules, the adoption by the Makati trial court of the facts stated in the decision of the Paraaque trial court does not fall under the exception to the right of confrontation as the exception

contemplated by law covers only the utilization of testimonies of absent witnesses made in previous proceedings, and does not include utilization of previous decisions or judgments. In the instant case, the prosecution did not offer the testimonies made by complainants Generillo and Del Rosario in the previous estafa case. Instead, what was offered, admitted in evidence, and utilized as a basis for the conviction in the case for illegal recruitment in large scale was the previous decision in the estafa case. A previous decision or judgment, while admissible in evidence, may only prove that an accused was previously convicted of a crime. [30] It may not be used to prove that the accused is guilty of a crime charged in a subsequent case, in lieu of the requisite evidence proving the commission of the crime, as said previous decision is hearsay. To sanction its being used as a basis for conviction in a subsequent case would constitute a violation of the right of the accused to confront the witnesses against him. As earlier stated, the Makati courts utilization of and reliance on the previous decision of the Paraaque court must be rejected. Every conviction must be based on the findings of fact made by a trial court according to its appreciation of the evidence before it. A conviction may not be based merely on the findings of fact of another court, especially where what is presented is only its decision sans the transcript of the testimony of the witnesses who testified therein and upon which the decision is based. Furthermore, this is not the only reason why appellant may not be held liable for illegal recruitment in large scale. An evaluation of the evidence presented before the trial court shows us that, apart from the adopted decision in the previous estafa case, there was no other basis for said trial courts conclusion that illegal recruitment in large scale was committed against all three complainants. The distinction between simple illegal recruitment and illegal recruitment in large scale are emphasized by jurisprudence. Simple illegal recruitment is committed where a person: (a) undertakes any recruitment activity defined under Article 13(b) or any prohibited practice enumerated under Articles 34 and 38 of the Labor Code; and (b) does not have a license or authority to lawfully engage in the recruitment and placement of workers. [31] On the other hand, illegal recruitment in large scale further requires a third element, that is, the offense is committed against three or more persons, individually or as a group. [32] In illegal recruitment in large scale, while the law does not require that at least three victims testify at the trial, it is necessary that there is sufficient evidence proving that the offense was committed against three or more persons. This Court agrees with the trial court that the evidence presented sufficiently proves that illegal recruitment was committed by appellant against Marasigan, but the same conclusion cannot be made as regards Generillo and Del Rosario as well. The testimonies of Generillos mother, Lilia Generillo, and Del Rosarios sist er, Victoria Amin, reveal that these witnesses had no personal knowledge of the actual circumstances surrounding the charges filed by Generillo and Del Rosario for illegal recruitment in large scale. Neither of these witnesses was privy to the transactions between appellant and each of the two complainants. The witnesses claimed that appellant illegally recruited Generillo and Del Rosario. Nonetheless, we find their averments to be unfounded as they were not even present when Generillo and Del Rosario negotiated with and made payments to appellant. For insufficiency of evidence and in the absence of the third element of illegal recruitment in large scale, particularly, that the offense is committed against three or more persons, we cannot affirm the conviction for illegal recruitment in large scale. Nonetheless, we agree with the finding of the trial court that appellant illegally recruited Marasigan, for which she must be held liable for the lesser offense of simple illegal recruitment.

Appellants defense that she did not recruit Marasigan but merely purchased a plane ticket for her is belied by the evidence as it is undeniable that she represented to Marasigan that she had the ability to send people to work as factory workers in Taiwan. Her pretext that the fees paid to her were merely payments for a plane ticket is a desperate attempt to exonerate herself from the charges and cannot be sustained. Furthermore, no improper motive may be attributed to Marasigan in charging appellant. The fact that Marasigan was poor does not make her so heartless as to contrive a criminal charge against appellant. She was a simple woman with big dreams and it was appellants duplicity which reduced those dreams to naught. Marasigan had no motive to testify falsely against appellant except to tell the truth. [33] Besides, if there was anyone whose testimony needed corroboration, it was appellant as there was nothing in her testimony except the bare denial of the accusations. [34] If appellant really intended to purchase a plane ticket and not to recruit Marasigan, she should have presented evidence to support this claim. Also, in her testimony, appellant named an employee in the travel agency who was allegedly her contact person for the purchase of the ticket. She could have presented that person, or some other employee of the agency, to show that the transaction was merely for buying a ticket. Her failure to do the foregoing acts belies her pretensions. The Court likewise affirms the conviction of appellant for estafa which was committed against Marasigan. Conviction under the Labor Code for illegal recruitment does not preclude punishment under the Revised Penal Code for the felony of estafa. [35] This Court is convinced that the prosecution proved beyond reasonable doubt that appellant violated Article 315(2)(a) of the Revised Penal Code which provides that estafa is committed:

2. By means of any of the following false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud: (a) By using fictitious name or falsely pretending to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or by means of other similar deceits.
The evidence is clear that in falsely pretending to possess power to deploy persons for overseas placement, appellant deceived the complainant into believing that she would provide her a job in Taiwan. Her assurances made Marasigan exhaust whatever resources she had to pay the placement fee required in exchange for the promised job. The elements of deceit and damage for this form of estafa are indisputably present, hence the conviction for estafa in Criminal Case No. 92-6154 should be affirmed. Under the Revised Penal Code, an accused found guilty of estafa shall be sentenced to:

x x x The penalty of prision correccional in its maximum period to prision mayor in its minimum period, if the amount of the fraud is over 12,000 but does not exceed 22,000 pesos, and if such amount exceeds the latter sum, the penalty provided in this paragraph shall be imposed in its maximum period, adding one year for each additional 10,000 pesos x x x.
[36]

The amount involved in the estafa case is P23,000.00. Applying the Indeterminate Sentence Law, the maximum penalty shall be taken from the maximum period of the foregoing basic penalty, specifically, within the range of imprisonment from six (6) years, eight (8) months and twenty-one (21) days to eight (8) years. On the other hand, the minimum penalty of the indeterminate sentence shall be within the range of the penalty next lower in degree to that provided by law, without considering the incremental

penalty for the amount in excess of P22,000.00. [37] That penalty immediately lower in degree is prison correccional in its minimum and medium periods, with a duration of six (6) months and one (1) day to four (4) years and two (2) months. On these considerations, the trial court correctly fixed the minimum and maximum terms of the indeterminate sentence in the estafa case. While we must be vigilant and should punish, to the fullest extent of the law, those who prey upon the desperate with empty promises of better lives, only to feed on their aspirations, we must not be heedless of the basic rule that a conviction may be sustained only where it is for the correct offense and the burden of proof of the guilt of the accused has been met by the prosecution. WHEREFORE, the judgment of the court a quo finding accused-appellant Lanie Ortiz-Miyake guilty beyond reasonable doubt of the crimes of illegal recruitment in large scale (Criminal Case No. 92-6153) and estafa (Criminal Case No. 92-6154) is hereby MODIFIED, as follows:

1) Accused-appellant is declared guilty beyond reasonable doubt of simple illegal recruitment, as defined in Article 38(a) of the Labor Code, as amended. She is hereby ordered to serve an indeterminate sentence of four (4) years, as minimum, to eight (8) years, as maximum, and to pay a fine of P100,000.00. 2) In Criminal Case No. 92-6154 for estafa, herein accused-appellant is ordered to serve an indeterminate sentence of four (4) years and two (2) months of prision correccional, as minimum, to eight (8) years of prision mayor, as maximum, and to reimburse Elenita Marasigan the sum of P23,000.00.
In all other respects, the aforestated judgment is AFFIRMED, with costs against accusedappellant in both instances. SO ORDERED. Puno, Mendoza, and Torres, Jr., JJ., concur.

[1]

Original Record, 1. Ibid., 10. TSN, November 10, 1992, 8-9; TSN, June 22, 1993, 8. Ibid., Id., 8-9. Ibid., Id., 9-11. Ibid., Id., Id. Ibid., September 22, 1993, 2-3. Ibid., November 10, 1992, 5-6. Exhibits A and 4; Original Record, 151. TSN, November 10, 1992, 5-6. Ibid., September 22, 1993, 2-3. Ibid., November 10, 1992, 7. Exhibits D and F; Original Record, 152, 154. TSN, February 9, 1993, 4.

[2]

[3]

[4]

[5]

[6]

[7]

[8]

[9]

[10]

[11]

[12]

[13]

[14]

[15]

Ibid., Id., 6. Ibid., March 24, 1993, 3. Ibid., Id., 6-7. Her name is also spelled as Riza Belberde in the transcript of records. Exhibits D and F; Original Record, 192, 154. TSN, June 22, 1993, 11. Ibid., id., id. Per Judge Job B. Madayag, Branch 145, Regional Trial Court of Makati; Original Record, 200-207. The decision was penned by Judge Vivencio G. Lirio, Branch 78, Metropolitan Trial Court of Paraaque; Exhibits G, G1-G3; Original Record, 155-158. Original Record, 206. Article 13(b), Labor Code (Presidential Decree No. 442, as amended). Articles 38 and 39 of the Labor Code, as amended by Presidential Decree No. 2018 which took effect on January 26, 1986. People vs. Estenzo, etc., et al., L-41166, August 25, 1976, 72 SCRA 428; U.S. vs. Javier, 37 Phil. 449 (1918). People, et al. vs. Villaluz, etc., et al., L-33459, October 20, 1983, 125 SCRA 116. 29A Am Jur 2d, Evidence Sec. 891, 310. Arambulo vs. Manila Electric Co., 55 Phil. 75 (1930). People vs. Coral, G.R. Nos. 97849-54, March 1, 1994, 230 SCRA 499; People vs. Sendon, G.R. Nos. 101579-82, December 15, 1993, 228 SCRA 489; People vs. Duque, G.R. No. 100285, August 13, 1992, 212 SCRA 607. People vs. Coronacion, et al., G.R. No. 97845, September 29, 1994, 237 SCRA 227; People vs. Comia, G.R. No. 109761, September 1, 1994, 236 SCRA 185. See People vs. Villafuerte, G.R. Nos. 93723-27, May 6, 1994, 232 SCRA 225; People vs. Alforte, et al., G.R. Nos. 91711-15, March 3, 1993, 219 SCRA 458. People vs. Reyes, et al., G.R. No. 105204, March 9, 1995, 242 SCRA 264. People vs. Turda, G.R. Nos. 97044-46, July 6, 1994, 233 SCRA 702; People vs. Manungas, Jr., G.R. Nos. 91552-55, March 10, 1994, 231 SCRA 1. Article 315, Revised Penal Code. People vs. Pabalan, G.R. Nos. 115350 and 117819-21, September 30, 1996.

[16]

[17]

[18]

[19]

[20]

[21]

[22]

[23]

[24]

[25]

[26]

[27]

[28]

[29]

[30]

[31]

[32]

[33]

[34]

[35]

[36]

[37]

SECOND DIVISION

STOLT-NIELSEN TRANSPORTATION GROUP, INC. AND CHUNG GAI SHIP MANAGEMENT, Petitioners,

G.R. No. 177498

Present:

CARPIO, J., Chairperson, PEREZ, SERENO, -versusREYES, and PERLAS-BERNABE, JJ.* SULPECIO MEDEQUILLO, JR., Respondent. January 18, 2012 x------------------------------------------------x

Promulgated:

DECISION

PEREZ, J.:

Before the Court is a Petition for Review on Certiorari of the Decision of the First Division of the Court of Appeals in CA-G.R. SP No. 91632 dated 31 January 2007, denying the petition for certiorari filed by Stolt-Nielsen Transportation Group, Inc. and Chung Gai Ship Management (petitioners) and affirming the Resolution of the National Labor Relations Commission (NLRC). The dispositive portion of the assailed decision reads:
1 2

WHEREFORE, the petition is hereby DENIED. Accordingly, the assailed Decision promulgated on February 28, 2003 and the Resolution dated July 27, 2005 are AFFIRMED.

The facts as gathered by this Court follow:

On 6 March 1995, Sulpecio Madequillo (respondent) filed a complaint before the Adjudication Office of the Philippine Overseas Employment Administration (POEA) against the petitioners for illegal dismissal under a first contract and for failure to deploy under a second contract. In his complaint-affidavit, respondent alleged that:
4

1.

On 6 November 1991(First Contract), he was hired by Stolt-Nielsen Marine Services, Inc on behalf of its principal Chung-Gai Ship Management of Panama as Third Assistant Engineer on board the vessel Stolt Aspiration for a period of nine (9) months;

2.

He would be paid with a monthly basic salary of $808.00 and a fixed overtime pay of $404.00 or a total of $1,212.00 per month during the employment period commencing on 6 November 1991;

3.

On 8 November 1991, he joined the vessel MV Stolt Aspiration;

4.

On February 1992 or for nearly three (3) months of rendering service and while the vessel was at Batangas, he was ordered by the ships master to disembark the vessel and repatriated back to Manila for no reason or explanation;

5.

Upon his return to Manila, he immediately proceeded to the petitioners office where he was transferred employment with another vessel named MV Stolt Pride under the same terms and conditions of the First Contract;

6.

On 23 April 1992, the Second Contract was noted and approved by the POEA;

7.

The POEA, without knowledge that he was not deployed with the vessel, certified the Second Employment Contract on 18 September 1992.

Despite the commencement of the Second Contract on 21 April 1992, petitioners failed to deploy him with the vessel MV Stolt Pride; 9. He made a follow-up with the petitioner but the same refused to comply with the Second Employment Contract.
8.

10.

On 22 December 1994, he demanded for his passport, seamans book and other employment documents. However, he was only allowed to claim the said documents in exchange of his signing a document;

11.

He was constrained to sign the document involuntarily because without these documents, he could not seek employment from other agencies.

He prayed for actual, moral and exemplary damages as well as attorneys fees for his illegal dismissal and in view of the Petitioners bad faith in not complying with the Second Contract.

The case was transferred to the Labor Arbiter of the DOLE upon the effectivity of the Migrant Workers and Overseas Filipinos Act of 1995.

The parties were required to submit their respective position papers before the Labor Arbiter. However, petitioners failed to submit their respective pleadings despite the opportunity given to them.
5

On 21 July 2000, Labor Arbiter Vicente R. Layawen rendered a judgment finding that the respondent was constructively dismissed by the petitioners. The dispositive portion reads:
6

WHEREFORE, premises considered, judgment is hereby rendered, declaring the respondents guilty of constructively dismissing the complainant by not honoring the employment contract. Accordingly, respondents are hereby ordered jointly and solidarily to pay complainant the following:

1.

$12,537.00 or its peso equivalent at the time of payment.

The Labor Arbiter found the first contract entered into by and between the complainant and the respondents to have been novated by the execution of the second contract. In other words, respondents cannot be held liable for the first contract but are clearly and definitely liable for the breach of the second contract. However, he ruled that there was no substantial evidence to grant the prayer for moral and exemplary damages.
8 9

The petitioners appealed the adverse decision before the National Labor Relations Commission assailing that they were denied due process, that the respondent cannot be considered as dismissed from employment because he was not even deployed yet and the monetary award in favor of the respondent was exorbitant and not in accordance with law.
10

On 28 February 2003, the NLRC affirmed with modification the Decision of the Labor Arbiter. The dispositive portion reads:

WHEREFORE, premises considered, the decision under review is hereby, MODIFIED BY DELETING the award of overtime pay in the total amount of Three Thousand Six Hundred Thirty Six US Dollars (US $3,636.00).

In all other respects, the assailed decision so stands as, AFFIRMED.

11

Before the NLRC, the petitioners assailed that they were not properly notified of the hearings that were conducted before the Labor Arbiter. They further alleged that after the suspension of proceedings before the POEA, the only notice they received was a copy of the decision of the Labor Arbiter.
12

The NLRC ruled that records showed that attempts to serve the various notices of hearing were made on petitioners counsel on record but these failed on account of their failure to furnish the Office of the Labor Arbiter a copy of any notice of change of address. There was also no evidence that a service of notice of change of address was served on the POEA.
13

The NLRC upheld the finding of unjustified termination of contract for failure on the part of the petitioners to present evidence that would justify their non-deployment of the respondent. It denied the claim of the petitioners that the monetary award should be limited only to three (3) months for
14

every year of the unexpired term of the contract. It ruled that the factual incidents material to the case transpired within 1991-1992 or before the effectivity of Republic Act No. 8042 or the Migrant Workers and Overseas Filipinos Act of 1995 which provides for such limitation.
15

However, the NLRC upheld the reduction of the monetary award with respect to the deletion of the overtime pay due to the non-deployment of the respondent.
16

The Partial Motion for Reconsideration filed by the petitioners was denied by the NLRC in its Resolution dated 27 July 2005.
17

The petitioners filed a Petition for Certiorari before the Court of Appeals alleging grave abuse of discretion on the part of NLRC when it affirmed with modification the ruling of the Labor Arbiter. They prayed that the Decision and Resolution promulgated by the NLRC be vacated and another one be issued dismissing the complaint of the respondent.

Finding no grave abuse of discretion, the Court of Appeals AFFIRMED the Decision of the labor tribunal.

The Courts Ruling

The following are the assignment of errors presented before this Court:

I.

THE COURT A QUO ERRED IN FINDING THAT THE SECOND CONTRACT NOVATED THE FIRST CONTRACT.

1.

THERE WAS NO NOVATION OF THE FIRST CONTRACT BY THE SECOND CONTRACT; THE ALLEGATION OF ILLEGAL DISMISSAL UNDER THE FIRST CONTRACT MUST BE RESOLVED SEPARATELY FROM THE ALLEGATION OF FAILURE TO DEPLOY UNDER THE SECOND CONTRACT.

2.

THE ALLEGED ILLEGAL DISMISSAL UNDER THE FIRST CONTRACT TRANSPIRED MORE THAN THREE (3) YEARS AFTER THE CASE WAS FILED AND THEREFORE HIS CASE SHOULD HAVE BEEN DISMISSED FOR BEING BARRED BY PRESCRIPTION.

II.

THE COURT A QUO ERRED IN RULING THAT THERE WAS CONSTRUCTIVE DISMISSAL UNDER THE SECOND CONTRACT.

1.

IT IS LEGALLY IMPOSSIBLE TO HAVE CONSTRUCTIVE DISMISSAL WHEN THE EMPLOYMENT HAS NOT YET COMMENCED.

2.

ASSUMING THERE WAS OMISSION UNDER THE SECOND CONTRACT, PETITIONERS CAN ONLY BE FOUND AS HAVING FAILED IN DEPLOYING PRIVATE RESPONDENT BUT WITH VALID REASON.

III. THE COURT A QUO ERRED IN FAILING TO FIND THAT EVEN ASSUMING THERE WAS BASIS FOR HOLDING PETITIONER LIABLE FOR FAILURE TO DEPLOY RESPONDENT, THE POEA RULES PENALIZES SUCH OMISSION WITH A MERE REPRIMAND.
18

The petitioners contend that the first employment contract between them and the private respondent is different from and independent of the second contract subsequently executed upon repatriation of respondent to Manila.

We do not agree.

Novation is the extinguishment of an obligation by the substitution or change of the obligation by a subsequent one which extinguishes or modifies the first, either by changing the object or principal conditions, or, by substituting another in place of the debtor, or by subrogating a

third person in the rights of the creditor. In order for novation to take place, the concurrence of the following requisites is indispensable:
1. There must be a previous valid obligation, 2. There must be an agreement of the parties concerned to a new contract, 3. There must be the extinguishment of the old contract, and 4. There must be the validity of the new contract.
19

In its ruling, the Labor Arbiter clarified that novation had set in between the first and second contract. To quote:

xxx [T]his office would like to make it clear that the first contract entered into by and between the complainant and the respondents is deemed to have been novated by the execution of the second contract. In other words, respondents cannot be held liable for the first contract but are clearly and definitely liable for the breach of the second contract.
20

This ruling was later affirmed by the Court of Appeals in its decision ruling that:

Guided by the foregoing legal precepts, it is evident that novation took place in this particular case. The parties impliedly extinguished the first contract by agreeing to enter into the second contract to placate Medequillo, Jr. who was unexpectedly dismissed and repatriated to Manila. The second contract would not have been necessary if the petitioners abided by the terms and conditions of Madequillo, Jr.s employment under the first contract. The records also reveal that the 2nd contract extinguished the first contract by changing its object or principal. These contracts were for overseas employment aboard different vessels. The first contract was for employment aboard the MV Stolt Aspiration while the second contract involved working in another vessel, the MV Stolt Pride. Petitioners and Madequillo, Jr. accepted the terms and conditions of the second contract. Contrary to petitioners assertion, the first contract was a previous valid contract since it had not yet been terminated at the time of Medequillo, Jr.s repatriation to Manila. The legality of his dismissal had not yet been resolved with finality. Undoubtedly, he was still employed under the first contract when he negotiated with petitioners on the second contract. As such, the NLRC correctly ruled that petitioners could only be held liable under the second contract.
21

We concur with the finding that there was a novation of the first employment contract. We reiterate once more and emphasize the ruling in Reyes v. National Labor Relations Commission, to wit:
22

x x x [F]indings of quasi-judicial bodies like the NLRC, and affirmed by the Court of Appeals in due course, are conclusive on this Court, which is not a trier of facts.

xxxx

x x x Findings of fact of administrative agencies and quasi-judicial bodies, which have acquired expertise because their jurisdiction is confined to specific matters, are generally accorded not only respect, but finality when affirmed by the Court of Appeals. Such findings deserve full respect and, without justifiable reason, ought not to be altered, modified or reversed.(Emphasis supplied)
23

With the finding that respondent was still employed under the first contract when he negotiated with petitioners on the second contract, novation became an unavoidable conclusion.
24

Equally settled is the rule that factual findings of labor officials, who are deemed to have acquired expertise in matters within their jurisdiction, are generally accorded not only respect but even finality by the courts when supported by substantial evidence, i.e., the amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion. But these findings are not infallible. When there is a showing that they were arrived at arbitrarily or in disregard of the evidence on record, they may be examined by the courts. In this case, there was no showing of any arbitrariness on the part of the lower courts in their findings of facts. Hence, we follow the settled rule.
25 26

We need not dwell on the issue of prescription. It was settled by the Court of Appeals with its ruling that recovery of damages under the first contract was already time-barred. Thus:

Accordingly, the prescriptive period of three (3) years within which Medequillo Jr. may initiate money claims under the 1st contract commenced on the date of his repatriation. xxx The start of the three (3) year prescriptive period must therefore be reckoned on February 1992, which by Medequillo Jr.s own admission was the date of his repatriation to Manila. It was at this point in time that Medequillo Jr.s cause of action already accrued under the first contract.

He had until February 1995 to pursue a case for illegal dismissal and damages arising from the 1st contract. With the filing of his Complaint-Affidavit on March 6, 1995, which was clearly beyond the prescriptive period, the cause of action under the 1st contract was already timebarred.
27

The issue that proceeds from the fact of novation is the consequence of the non-deployment of respondent.

The petitioners argue that under the POEA Contract, actual deployment of the seafarer is a suspensive condition for the commencement of the employment. We agree with petitioners on such point. However, even without actual deployment, the perfected contract gives rise to obligations on the part of petitioners.
28

A contract is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service. The contracting parties may establish such stipulations, clauses, terms and conditions as they may deem convenient, provided they are not contrary to law, morals, good customs, public order, or public policy.
29 30

The POEA Standard Employment Contract provides that employment shall commence upon the actual departure of the seafarer from the airport or seaport in the port of hire. We adhere to the terms and conditions of the contract so as to credit the valid prior stipulations of the parties before the controversy started. Else, the obligatory force of every contract will be useless. Parties are bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which, according to their nature, may be in keeping with good faith, usage and law.
31 32

Thus, even if by the standard contract employment commences only upon actual departure of the seafarer, this does not mean that the seafarer has no remedy in case of non-deployment without any valid reason. Parenthetically, the contention of the petitioners of the alleged poor performance of respondent while on board the first ship MV Stolt Aspiration cannot be sustained to justify the non-deployment, for no evidence to prove the same was presented.
33

We rule that distinction must be made between the perfection of the employment contract and the commencement of the employer-employee relationship. The perfection of the contract, which in this case coincided with the date of execution thereof, occurred when petitioner and respondent agreed on the object and the cause, as well as the rest of the terms and conditions therein. The commencement of the employer-employee relationship, as earlier discussed, would

have taken place had petitioner been actually deployed from the point of hire. Thus, even before the start of any employer-employee relationship, contemporaneous with the perfection of the employment contract was the birth of certain rights and obligations, the breach of which may give rise to a cause of action against the erring party. Thus, if the reverse had happened, that is the seafarer failed or refused to be deployed as agreed upon, he would be liable for damages.
34

Further, we do not agree with the contention of the petitioners that the penalty is a mere reprimand.

The POEA Rules and Regulations Governing Overseas Employment dated 31 May 1991 provides for the consequence and penalty against in case of non-deployment of the seafarer without any valid reason. It reads:
35

Section 4. Workers Deployment. An agency shall deploy its recruits within the deployment period as indicated below:

xxx

b. Thirty (30) calendar days from the date of processing by the administration of the employment contracts of seafarers.

Failure of the agency to deploy a worker within the prescribed period without valid reasons shall be a cause for suspension or cancellation of license or fine. In addition, the agency shall return all documents at no cost to the worker.(Emphasis and underscoring supplied)

The appellate court correctly ruled that the penalty of reprimand provided under Rule IV, Part VI of the POEA Rules and Regulations Governing the Recruitment and Employment of Landbased Overseas Workers is not applicable in this case. The breach of contract happened on February 1992 and the law applicable at that time was the 1991 POEA Rules and Regulations Governing Overseas Employment. The penalty for non-deployment as discussed is suspension or cancellation of license or fine.
36

Now, the question to be dealt with is how will the seafarer be compensated by reason of the unreasonable non-deployment of the petitioners?

The POEA Rules Governing the Recruitment and Employment of Seafarers do not provide for the award of damages to be given in favor of the employees. The claim provided by the same law refers to a valid contractual claim for compensation or benefits arising from employeremployee relationship or for any personal injury, illness or death at levels provided for within the terms and conditions of employment of seafarers. However, the absence of the POEA Rules with regard to the payment of damages to the affected seafarer does not mean that the seafarer is precluded from claiming the same. The sanctions provided for non-deployment do not end with the suspension or cancellation of license or fine and the return of all documents at no cost to the worker. As earlier discussed, they do not forfend a seafarer from instituting an action for damages against the employer or agency which has failed to deploy him.
37

We thus decree the application of Section 10 of Republic Act No. 8042 (Migrant Workers Act) which provides for money claims by reason of a contract involving Filipino workers for overseas deployment. The law provides:

Sec. 10. Money Claims. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages. x x x (Underscoring supplied)

Following the law, the claim is still cognizable by the labor arbiters of the NLRC under the second phrase of the provision.

Applying the rules on actual damages, Article 2199 of the New Civil Code provides that one is entitled to an adequate compensation only for such pecuniary loss suffered by him as he has duly proved. Respondent is thus liable to pay petitioner actual damages in the form of the loss of nine (9) months worth of salary as provided in the contract. This is but proper because of the nondeployment of respondent without just cause.
38

WHEREFORE, the appeal is DENIED. The 31 January 2007 Decision of the Court of Appeals in CA-G.R. SP. No. 91632 is hereby AFFIRMED. The Petitioners are hereby ordered to pay Sulpecio Medequillo, Jr., the award of actual damages equivalent to his salary for nine (9) months as provided by the Second Employment Contract.

SO ORDERED.

JOSE PORTUGAL PEREZ Associate Justice

WE CONCUR:

ANTONIO T. CARPIO Associate Justice Chairperson

MARIA LOURDES P. A. SERENO Associate Justice

BIENVENIDO L. REYES Associate Justice

ESTELA M. PERLAS-BERNABE Associate Justice ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

ANTONIO T. CARPIO Associate Justice Chairperson

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division Chairpersons Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

RENATO C. CORONA

Chief Justice

1* Designated as additional member per Special Order No. 1174 dated 9 January 2012. Rule 45, Rule on Civil Procedure. 2Penned by Associate Justice Mariano C. Del Castillo (now a Member of this Court) with Presiding Justice Ruben T. Reyes (former Member of this Court) and Associate Justice Arcangelita Romilla Lontok, concurring. Rollo, pp. 38-54. 3Id. at 53. 4Id. at 134-139. 5Id. at 61. 6Id. at 59-62. 7Id. at 62. 8Id. 9Id. 10Id. at 64. 11Id. at 68. 12Id. at 64-65. 13Id. at 65. 14Id. at 66. 15Id. at 67. 16Id. 17Id. at 72. 18Id. at 20-21. 19Philippine Savings Bank v. Sps. Maalac, Jr. , 496 Phil, 671, 686-687 (2005); Azolla Farms v. Court of Appeals, 484 Phil. 745, 754755. 20Rollo, p. 61. 21Id. at 45-46. 22G.R. No. 160233, 8 August 2007, 529 SCRA 487. 23Id. at 494 and 499. 24Rollo, p. 46.

25Prince Transport, Inc. v. Garcia, G.R. No. 167291, 12 January 2011, 639 SCRA 312, 324 citing Philippine Veterans Bank v. National Labor Relations Commission, G.R. No. 188882, 30 March 2010, 617 SCRA 204. 26Id. at 324-325 citing Faeldonia v. Tong Yak Groceries, G.R. No. 182499, 2 October 2009, 602 SCRA 677, 684. 27Rollo, pp. 47-48. 28Id. at 48. 29Article 1305, New Civil Code. 30Article 1306, New Civil Code. 31Rollo, p. 48. 32Article 1315, New Civil Code. 33Rollo, p. 50. 34Santiago v. CF Sharp Crew Management, Inc ., G.R. No. 162419, 10 July 2007, 527 SCRA 165, 176. 35Section 4, par. (b), Rule II, Book III. 36Section 1 (C) 4. Failure to deploy a worker within the prescribed period without valid reason: 1st Offense Reprimand. 37Santiago v. CF Sharp Crew Management, Inc. , Supra note 33 at 176-177. 38In Legahi v. National Labor Relations Commission, 376 Phil. 557, 566 (1999), we held: Petitioner's dismissal without a valid cause constitute a breach of contract. Consequently, he should only be paid the unexpired portion of his employment contract.

Republic of the Philippines Supreme Court Manila

FIRST DIVISION PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee, G.R. No. 173198 Present: CORONA, C.J., Chairperson, VELASCO, JR., LEONARDO-DE CASTRO, - versus PERALTA,* and PEREZ, JJ.

Promulgated:

DOLORES OCDEN,

June 1, 2011

Accused-Appellant. x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

LEONARDO-DE CASTRO, J.:

For Our consideration is an appeal from the Decision[1] dated April 21, 2006 of the Court of Appeals in CA-G.R. CR.-H.C. No. 00044, which affirmed with modification the Decision[2] dated July 2, 2001 of the Regional Trial Court (RTC), Baguio City, Branch 60, in Criminal Case No. 16315-R. The RTC found accused-appellant Dolores Ocden(Ocden) guilty of illegal recruitment in large scale, as defined and penalized under Article 13(b), in relation to Articles 38(b), 34, and 39 of Presidential Decree No. 442, otherwise known as the New Labor Code of the Philippines, as amended, in Criminal Case No. 16315-R; and of the crime of estafa under paragraph 2(a), Article 315 of the Revised Penal Code, in Criminal Case Nos. 16316-R, 16318-R, and 16964-R.[3] The Court of Appeals affirmed Ocdens convict ion in all four cases, but modified the penalties imposed in Criminal Case Nos. 16316-R, 16318-R, and 16964-R, The Amended Information[4] for illegal recruitment in large scale in Criminal Case No. 16315-R reads:
That during the period from May to December, 1998, in the City of Baguio, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, did then and there willfully, unlawfully and feloniously for a fee, recruit and promise employment as factory workers in Italy to more than three (3) persons including, but not limited to the following: JEFFRIES C. GOLIDAN, HOWARD C. GOLIDAN, KAREN M. SIMEON, JEAN S. MAXIMO, NORMA PEDRO, MARYLYN MANA-A, RIZALINA FERRER, and MILAN DARING without said accused having first secured the necessary license or authority from the Department of Labor and Employment.

Ocden was originally charged with six counts of estafa in Criminal Case Nos. 16316-R, 16318-R, 16350-R, 16369-R, 16964-R, and 16966-R. The Information in Criminal Case No. 16316-R states:
That sometime during the period from October to December, 1998 in the City of Baguio, Philippines and within the jurisdiction of this Honorable Court, the above-named accused, did then and there willfully, unlawfully and feloniously defraud JEFFRIES C. GOLIDAN, by way of false pretenses, which are executed prior to or simultaneous with the commission of the fraud, as follows, to wit: the accused knowing fully well that she is not (sic) authorized job recruiter for persons intending to secure work abroad convinced said Jeffries C. Golidan and pretended that she could secure a job for him/her abroad, for and in consideration of the sum of P70,000.00 when in truth and in fact they could not; the said Jeffries C. Golidan deceived and convinced by the false pretenses employed by the accused parted away the total sum of P70,000.00, in favor of the accused, to the damage and prejudice of the said Jeffries C. Golidan in the aforementioned amount of SEVENTY THOUSAND PESOS(P70,000,00), Philippine Currency.[5]

The Informations in the five other cases for estafa contain substantially the same allegations as the one above-quoted, except for the private complainants names, the date of commission of the offense, and the amounts defrauded, to wit:
Case No. Complainant Name of the Commission of Date of Defrauded the Offense Sometime during the period from October to December 1998 Sometime in May, 1998 Sometime during the period from November 13, 1998 to December 10, 1998 Sometime in September Sometime in September 1998 Amount Private

16318-R

Howard C. Golidan

P70,000.00

16350-R 16369-R

Norma Pedro Milan O. Daring

P65,000.00 P70.000.00

16964-R 16966-R

Rizalina Ferrer Marilyn Mana-a

P70,000.00 P70,000.00[6]

All seven cases against Ocden were consolidated on July 31, 2000 and were tried jointly after Ocden pleaded not guilty. The prosecution presented three witnesses namely: Marilyn Mana-a (Mana-a) and Rizalina Ferrer (Ferrer), complainants; and Julia Golidan (Golidan), mother of complainants Jeffries and Howard Golidan. Mana-a testified that sometime in the second week of August 1998, she and Isabel Dao-as (Dao-as) went to Ocdens house in Baguio City to apply for work as factory workers in Italy with monthly salaries of US$1,200.00. They were required by Ocden to submit their bio-data and passports, pay the placement fee of P70,000.00, and to undergo medical examination. Upon submitting her bio-data and passport, Mana-a paid Ocden P500.00 for her certificate of employment and P20,000.00 as down payment for her placement fee. On September 8, 1998, Ocden accompanied Mana-a and 20 other applicants to Zamora Medical Clinic in Manila for their medical examinations, for which each of the applicants paidP3,000.00. Mana-a also paid to Ocden P22,000.00 as the second installment on her placement fee. When Josephine Lawanag (Lawanag), Mana-as sister, withdrew her application, Lawanags P15,000.00 placement fee, already paid to Ocden, was credited to Mana-a.[7]

Mana-a failed to complete her testimony, but the RTC considered the same as no motion to strike the said testimony was filed. Ferrer narrated that she and her daughter Jennilyn were interested to work overseas. About the second week of September 1998, they approached Ocden through Fely Alipio (Alipio). Ocden showed Ferrer and Jennilyn a copy of a job order from Italy for factory workers who could earn as much as $90,000.00 to $100,000.00. [8] In the first week of October 1998, Ferrer and Jennilyn decided to apply for work, so they submitted their passports and pictures to Ocden. Ferrer also went to Manila for medical examination, for which she spent P3,500.00. Ferrer paid to Ocden on November 20, 1998 the initial amount of P20,000.00, and on December 8, 1998 the balance of her and Jennilyns placement fees. All in all, Ferrer paid Ocden P140,000.00, as evidenced by the receipts issued by Ocden.[9] Ferrer, Jennilyn, and Alipio were supposed to be included in the first batch of workers to be sent to Italy. Their flight was scheduled on December 10, 1998. In preparation for their flight to Italy, the three proceeded to Manila. In Manila, they were introduced by Ocden to Erlinda Ramos (Ramos). Ocden and Ramos then accompanied Ferrer, Jennilyn, and Alipio to the airport where they took a flight to Zamboanga. Ocden explained to Ferrer, Jennilyn, and Alipio that they would be transported to Malaysia where their visa application for Italy would be processed. Sensing that they were being fooled, Ferrer and Jennilyn decided to get a refund of their money, but Ocden was nowhere to be found. Ferrer would later learn from the Baguio office of the Philippine Overseas Employment Administration (POEA) that Ocden was not a licensed recruiter. Expecting a job overseas, Ferrer took a leave of absence from her work. Thus, she lost income amounting to P17,700.00, equivalent to her salary for one and a half months. She also spent P30,000.00 for transportation and food expenses.[10] According to Golidan, the prosecutions third witness, sometime in October 1998, she inquired from Ocden about the latters overseas recruitment. Ocden informed Golidan that the placement fee was P70,000.00 for each applicant, that the accepted applicants would be sent by batches overseas, and that priority would be given to those who paid their placement fees early. On October 30, 1998, Golidan brought her sons, Jeffries and Howard, to Ocden. On the same date, Jeffries and Howard handed over to Ocden their passports and P40,000.00 as down payment on their placement fees. On December 10, 1998, Jeffries and Howard paid the balance of their placement fees amounting toP100,000.00. Ocden issued receipts for these two payments.[11] Ocden then informed Golidan that the first batch of accepted applicants had already left, and that Jeffries would be included in the second batch for deployment, while Howard in the third batch. In anticipation of their deployment to Italy, Jeffries and Howard left for Manila on December 12, 1998 and December 18, 1998, respectively. Through a telephone call, Jeffries

informed Golidan that his flight to Italy was scheduled on December 16, 1998. However, Golidan was surprised to again receive a telephone call from Jeffries saying that his flight to Italy was delayed due to insufficiency of funds, and that Ocden went back to Baguio City to look for additional funds. When Golidan went to see Ocden, Ocden was about to leave for Manila so she could be there in time for the scheduled flights of Jeffries and Howard. On December 19, 1998, Golidan received another telephone call from Jeffries who was in Zamboanga with the other applicants. Jeffries informed Golidan that he was stranded in Zamboanga because Ramos did not give him his passport. Ramos was the one who briefed the overseas job applicants in Baguio City sometime in November 1998. Jeffries instructed Golidan to ask Ocdens help in looking for Ramos. Golidan, however, could not find Ocden in Baguio City. On December 21, 1998, Golidan, with the other applicants, Mana-a and Dao-as, went to Manila to meet Ocden. When Golidan asked why Jeffries was in Zamboanga, Ocden replied that it would be easier for Jeffries and the other applicants to acquire their visas to Italy in Zamboanga. Ocden was also able to contact Ramos, who assured Golidan that Jeffries would be able to get his passport. When Golidan went back home to Baguio City, she learned through a telephone call from Jeffries that Howard was now likewise stranded in Zamboanga. By January 1999, Jeffries and Howard were still in Zamboanga. Jeffries refused to accede to Golidans prodding for him and Howard to go home, saying that the recruiters were already working out the release of the funds for the applicants to get to Italy. Golidan went to Ocden, and the latter told her not to worry as her sons would already be flying to Italy because the same factory owner in Italy, looking for workers, undertook to shoulder the applicants travel expenses. Yet, Jeffries called Golidan once more telling her that he and the other applicants were still in Zamboanga. Golidan went to Ocdens residence. This time, Ocdens husband gave Golidan P23,000.00 which the latter could use to fetch the applicants, including Jeffries and Howard, who were stranded in Zamboanga. Golidan traveled again to Manila with Mana-a and Dao-as. When they saw each other, Golidan informed Ocden regarding the P23,000.00 which the latters husband gave to her. Ocden begged Golidan to give her the money because she needed it badly. Of the P23,000.00, Golidan retained P10,000.00, Dao-as received P3,000.00, and Ocden got the rest. Jeffries was able to return to Manila on January 16, 1999. Howard and five other applicants, accompanied by Ocden, also arrived in Manila five days later. Thereafter, Golidan and her sons went to Ocdens residence to ask for a refund of the money they had paid to Ocden. Ocden was able to return only P50,000.00. Thus, out of the total amount of P140,000.00 Golidan and her sons paid to Ocden, they were only able to get back the sum of P60,000.00. After all that had happened, Golidan and her sons went to the Baguio office of the POEA, where they discovered that Ocden was not a licensed recruiter.[12] The defense presented the testimony of Ocden herself.

Ocden denied recruiting private complainants and claimed that she was also an applicant for an overseas job in Italy, just like them. Ocden identified Ramos as the recruiter. Ocden recounted that she met Ramos at a seminar held in St. Theresas Compound, Navy Base, Baguio City, sometime in June 1998. The seminar was arranged by Aida Comila (Comila), Ramoss sub-agent. The seminar was attended by about 60 applicants, including Golidan. Ramos explained how one could apply as worker in a stuff toys factory in Italy. After the seminar, Comila introduced Ocden to Ramos. Ocden decided to apply for the overseas job, so she gave her passport and pictures to Ramos. Ocden also underwent medical examination at Zamora Medical Clinic in Manila, and completely submitted the required documents to Ramos in September 1998. After the seminar, many people went to Ocdens house to inquire about the job s available in Italy. Since most of these people did not attend the seminar, Ocden asked Ramos to conduct a seminar at Ocdens house. Two seminars were held at Ocdens house, one in September and another in December 1998. After said seminars, Ramos designated Ocden as leader of the applicants. As such, Ocden received her co-applicants applications and documents; accompanied her co-applicants to Manila for medical examination because she knew the location of Zamora Medical Clinic; and accepted placement fees in the amount of P70,000.00 each from Mana-a and Ferrer and from Golidan, the amount of P140,000.00 (for Jeffries and Howard). Ramos instructed Ocden that the applicants should each pay P250,000.00 and if the applicants could not pay the full amount, they would have to pay the balance through salary deductions once they start working in Italy. Ocden herself paid Ramos P50,000.00 as placement fee and executed a promissory note in Ramoss favor for the balance, just like any other applicant who failed to pay the full amount. Ocden went to Malaysia with Ramoss male friend but she failed to get her visa for Italy. Ocden denied deceiving Mana-a and Ferrer. Ocden alleged that she turned over to Ramos the money Mana-a and Ferrer gave her, although she did not indicate in the receipts she issued that she received the money for and on behalf of Ramos. Ocden pointed out that she and some of her co-applicants already filed a complaint against Ramos before the National Bureau of Investigation (NBI) offices in Zamboanga City and Manila.[13] On July 2, 2001, the RTC rendered a Decision finding Ocden guilty beyond reasonable doubt of the crimes of illegal recruitment in large scale (Criminal Case No. 16315-R) and three counts of estafa (Criminal Case Nos. 16316-R, 16318-R, and 16964-R). The dispositive portion of said decision reads:
WHEREFORE, premises considered, judgment is hereby rendered as follows:

1. In Criminal Case No. 16315-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable doubt of the crime of Illegal Recruitment committed in large scale as defined and penalized under Article 13(b) in relation to Article 38(b), 34 and 39 of the Labor Code as amended by P.D. Nos. 1693, 1920, 2018 and R.A. 8042. She is hereby sentenced to suffer the penalty of life imprisonment and to pay a fine of P100,000.00; 2. In Criminal Case No. 16316-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable doubt of the crime of estafa and sentences her to suffer an indeterminate penalty ranging from two (2) years, eleven (11) months and ten (10) days of prision correccional, as minimum, up to nine (9) years and nine (9) months of prision mayor, as maximum, and to indemnify the complainant Jeffries Golidan the amount of P40,000.00; 3. In Criminal Case No. 16318-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable doubt of the crime of estafa and sentences her to suffer an indeterminate penalty ranging from two (2) years, eleven (11) months and ten (10) days of prision correccional, as minimum, up to nine (9) years and nine (9) months of prision mayor, as maximum, and to indemnify Howard Golidan the amount of P40,000.00; 4. In Criminal Case No. 16350-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of estafa for lack of evidence and a verdict of acquittal is entered in her favor; 5. In Criminal Case No. 16369-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of estafa for lack of evidence and a verdict of acquittal is hereby entered in her favor; 6. In Criminal Case No. 16964-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable doubt of the crime of estafa and sentences her to suffer an indeterminate penalty of Four (4) years and Two (2) months of prision correccional, as minimum, up to Twelve (12) years and Nine (9) months of reclusion temporal, as maximum, and to indemnify Rizalina Ferrer the amount ofP70,000.00; and 7. In Criminal Case No. 16966-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of estafa for insufficiency of evidence and a verdict of acquittal is hereby entered in her favor. In the service of her sentence, the provisions of Article 70 of the Penal Code shall be observed.[14]

Aggrieved by the above decision, Ocden filed with the RTC a Notice of Appeal on August 15, 2001.[15] The RTC erroneously sent the records of the cases to the Court of Appeals, which, in turn, correctly forwarded the said records to us. In our Resolution[16] dated May 6, 2002, we accepted the appeal and required the parties to file their respective briefs. In the same resolution, we directed the Superintendent of the Correctional Institute for Women to confirm Ocdens detention thereat.

Ocden filed her Appellant's Brief on August 15, 2003,[17] while the People, through the Office of the Solicitor General, filed its Appellee's Brief on January 5, 2004.[18] Pursuant to our ruling in People v. Mateo,[19] we transferred Ocdens appeal to the Court of Appeals. On April 21, 2006, the appellate court promulgated its Decision, affirming Ocdens conviction but modifying the penalties imposed upon her for the three counts of estafa, viz:
[T]he trial court erred in the imposition of accused-appellants penalty.

Pursuant to Article 315 of the RPC, the penalty for estafa is prision correccional in its maximum period to prision mayor in its minimum period. If the amount of the fraud exceeds P22,000.00, the penalty provided shall be imposed in its maximum period (6 years, 8 months and 21 days to 8 years), adding 1 year for each additional P10,000.00; but the total penalty which may be imposed shall not exceed 20 years.

Criminal Case Nos. 16316-R and 16318-R involve the amount of P40,000.00 each. Considering that P18,000.00 is the excess amount, only 1 year should be added to the penalty in its maximum period or 9 years. Also, in Criminal Case No. 16964-R, the amount involved is P70,000.00. Thus, the excess amount is P48,000.00 and only 4 years should be added to the penalty in its maximum period.

WHEREFORE, the instant appeal is DISMISSED. The assailed Decision, dated 02 July 2001, of the Regional Trial Court (RTC) of Baguio City, Branch 60 is hereby AFFIRMED with the following MODIFICATIONS:

1. In Criminal Case No. 16316-R, accused-appellant is sentenced to 2 years, 11 months, and 10 days of prision correccional, as minimum to 9 years of prision mayor, as maximum and to indemnify Jeffries Golidan the amount of P40,000.00;

2. In Criminal Case No. 16318-R, accused-appellant is sentenced to 2 years, 11 months, and 10 days of prision correccional, as minimum to 9 years of prision mayor, as maximum and to indemnify Howard Golidan the amount of P40,000.00; and

3. In Criminal Case No. 16964-R, accused-appellant is sentenced to 4 years and 2 months of prision correccional, as minimum to 12 years of prision mayor, as maximum and to indemnify Rizalina Ferrer the amount of P70,000.00.[20]

Hence, this appeal, in which Ocden raised the following assignment of errors:

THE TRIAL COURT ERRED IN CONVICTING ACCUSED-APPELLANT OF ILLEGAL RECRUITMENT COMMITTED IN LARGE SCALE ALTHOUGH THE CRIME WAS NOT PROVEN BEYOND REASONABLE DOUBT.

II

THE TRIAL COURT ERRED IN CONVICTING ACCUSED-APPELLANT OF ESTAFA IN CRIMINAL CASES NOS. 16316-R, 16318-R AND 16[9]64-R.[21]

After a thorough review of the records of the case, we find nothing on record that would justify a reversal of Ocdens conviction. Illegal recruitment in large scale Ocden contends that the prosecution failed to prove beyond reasonable doubt that she is guilty of the crime of illegal recruitment in large scale. Other than the bare allegations of the prosecution witnesses, no evidence was adduced to prove that she was a non-licensee or nonholder of authority to lawfully engage in the recruitment and placement of workers. No certification attesting to this fact was formally offered in evidence by the prosecution.

Ocdens aforementioned contentions are without merit.

Article 13, paragraph (b) of the Labor Code defines and enumerates the acts which constitute recruitment and placement:

(b) Recruitment and placement refers to any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, or procuring workers, and includes referrals, contract services, promising for advertising for employment locally or abroad, whether for profit or not: Provided, That any person or

entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement.

The amendments to the Labor Code introduced by Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995, broadened the concept of illegal recruitment and provided stiffer penalties, especially for those that constitute economic sabotage, i.e., illegal recruitment in large scale and illegal recruitment committed by a syndicate. Pertinent provisions of Republic Act No. 8042 are reproduced below:

SEC. 6. Definition. - For purposes of this Act, illegal recruitment shall mean any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, or procuring workers and includes referring, contract services, promising or advertising for employment abroad, whether for profit or not, when undertaken by a non-licensee or non-holder of authority contemplated under Article 13(f) of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines: Provided, That any such nonlicensee or non-holder who, in any manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so engaged. It shall likewise include the following acts, whether committed by any person, whether a non-licensee, non-holder, licensee or holder of authority:

(a) To charge or accept directly or indirectly any amount greater than that specified in the schedule of allowable fees prescribed by the Secretary of Labor and Employment, or to make a worker pay any amount greater than that actually received by him as a loan or advance;

(b) To furnish or publish any false notice or information or document in relation to recruitment or employment;

(c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under the Labor Code;

(d) To induce or attempt to induce a worker already employed to quit his employment in order to offer him another unless the transfer is designed to liberate a worker from oppressive terms and conditions of employment;

(e) To influence or attempt to influence any person or entity not to employ any worker who has not applied for employment through his agency;

(f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines;

(g) To obstruct or attempt to obstruct inspection by the Secretary of Labor and Employment or by his duly authorized representative;

(h) To fail to submit reports on the status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor and Employment;

(i) To substitute or alter to the prejudice of the worker, employment contracts approved and verified by the Department of Labor and Employment from the time of actual signing thereof by the parties up to and including the period of the expiration of the same without the approval of the Department of Labor and Employment;

(j) For an officer or agent of a recruitment or placement agency to become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of a travel agency;

(k) To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations other than those authorized under the Labor Code and its implementing rules and regulations;

(l) Failure to actually deploy without valid reason as determined by the Department of Labor and Employment; and

(m) Failure to reimburse expenses incurred by the worker in connection with his documentation and processing for purposes of deployment, in cases where the deployment does not actually take place without the worker's fault. Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage.

Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring or confederating with one another. It is deemed committed in large scale if committed against three (3) or more persons individually or as a group.

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Sec. 7. Penalties.

(a) Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6) years and one (1) day but not more than twelve (12) years and a fine of Two hundred thousand pesos (P200,000.00) nor more than Five hundred thousand pesos (P500,000.00).

(b) The penalty of life imprisonment and a fine of not less than Five hundred thousand pesos (P500,000.00) nor more than One million pesos (P1,000,000.00) shall be imposed if illegal recruitmentconstitutes economic sabotage as defined herein.

Provided, however, That the maximum penalty shall be imposed if the person illegally recruited is less than eighteen (18) years of age or committed by a non-licensee or non-holder of authority. (Emphasis ours.)

It is well-settled that to prove illegal recruitment, it must be shown that appellant gave complainants the distinct impression that he had the power or ability to send complainants abroad for work such that the latter were convinced to part with their money in order to be employed.[22] As testified to by Mana-a, Ferrer, and Golidan, Ocden gave such an impression through the following acts: (1) Ocden informed Mana-a, Ferrer, and Golidan about the job opportunity in Italy and the list of necessary requirements for application; (2) Ocden required Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, to attend the seminar conducted by Ramos at Ocdens house in Baguio City; (3) Ocden received the job applications, pictures, biodata, passports, and the certificates of previous employment (which was also issued by Ocden upon payment of P500.00), of Mana-a, Ferrer, and Golidans sons, Jeffries and Howard; (4) Ocden personally accompanied Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, for their medical examinations in Manila; (5) Ocden received money paid as placement fees by Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, and even issued receipts for the same; and (6) Ocden assured Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, that they would be deployed to Italy.

It is not necessary for the prosecution to present a certification that Ocden is a nonlicensee or non-holder of authority to lawfully engage in the recruitment and placement of

workers. Section 6 of Republic Act No. 8042 enumerates particular acts which would constitute illegal recruitment whether committed by any person, whether a non-licensee, non-holder, licensee or holder of authority. Among such acts, under Section 6(m) of Republic Act No. 8042, is the *f+ailure to reimburse expenses incurred by the worker in connection with his documentation and processing for purposes of deployment, in cases where the deployment does not actually take place without the workers fault.

Since illegal recruitment under Section 6(m) can be committed by any person, even by a licensed recruiter, a certification on whether Ocden had a license to recruit or not, is inconsequential. Ocden committed illegal recruitment as described in said provision by receiving placement fees from Mana-a, Ferrer, and Golidans two sons, Jeffries and Howard, evidenced by receipts Ocden herself issued; and failing to reimburse/refund to Mana-a, Ferrer, and Golidans two sons the amounts they had paid when they were not able to leave for Italy, through no fault of their own.

Ocden questions why it was Golidan who testified for private complainants Jeffries and Howard. Golidan had no personal knowledge of the circumstances proving illegal recruitment and could not have testified on the same. Also, Jeffries and Howard already executed an affidavit of desistance. All Golidan wants was a reimbursement of the placement fees paid. Contrary to Ocdens claims, Golidan had personal knowledge of Ocdens illegal recruitment activities, which she could competently testify to. Golidan herself had personal dealings with Ocden as Golidan assisted her sons, Jeffries and Howard, in completing the requirements for their overseas job applications, and later on, in getting back home from Zamboanga where Jeffries and Howard were stranded, and in demanding a refund from Ocden of the placement fees paid. That Golidan is seeking a reimbursement of the placement fees paid for the failed deployment of her sons Jeffries and Howard strengthens, rather than weakens, the prosecutions case. Going back to illegal recruitment under Section 6(m) of Republic Act No. 8042, failure to reimburse the expenses incurred by the worker when deployment does not actually take place, without the workers fault, is illegal recruitment.

The affidavit of desistance purportedly executed by Jeffries and Howard does not exonerate Ocden from criminal liability when the prosecution had successfully proved her guilt beyond reasonable doubt. In People v. Romero,[23] we held that:
The fact that complainants Bernardo Salazar and Richard Quillope executed a Joint Affidavit of Desistance does not serve to exculpate accused-appellant from criminal liability

insofar as the case for illegal recruitment is concerned since the Court looks with disfavor the dropping of criminal complaints upon mere affidavit of desistance of the complainant, particularly where the commission of the offense, as is in this case, is duly supported by documentary evidence. Generally, the Court attaches no persuasive value to affidavits of desistance, especially when it is executed as an afterthought. It would be a dangerous rule for courts to reject testimonies solemnly taken before the courts of justice simply because the witnesses who had given them, later on, changed their mind for one reason or another, for such rule would make solemn trial a mockery and place the investigation of truth at the mercy of unscrupulous witness. Complainants Bernardo Salazar and Richard Quillope may have a change of heart insofar as the offense wrought on their person is concerned when they executed their joint affidavit of desistance but this will not affect the public prosecution of the offense itself. It is relevant to note that the right of prosecution and punishment for a crime is one of the attributes that by a natural law belongs to the sovereign power instinctly charged by the common will of the members of society to look after, guard and defend the interests of the community, the individual and social rights and the liberties of every citizen and the guaranty of the exercise of his rights. This cardinal principle which states that to the State belongs the power to prosecute and punish crimes should not be overlooked since a criminal offense is an outrage to the sovereign State.[24]

In her bid to exculpate herself, Ocden asserts that she was also just an applicant for overseas employment; and that she was receiving her co-applicants job applications and other requirements, and accepting her co-applicants payments of placement fees, because she was designated as the applicants leader by Ramos, the real recruiter. Ocdens testimony is self-serving and uncorroborated. Ocdens denial of any illegal recruitment activity cannot stand against the prosecution witnesses positive identification of her in court as the person who induced them to part with their money upon the misrepresentation and false promise of deployment to Italy as factory workers. Besides, despite several opportunities given to Ocden by the RTC, she failed to present Ramos, who Ocden alleged to be the real recruiter and to whom she turned over the placement fees paid by her coapplicants. Between the categorical statements of the prosecution witnesses, on the one hand, and the bare denial of Ocden, on the other, the former must perforce prevail. An affirmative testimony is far stronger than a negative testimony especially when the former comes from the mouth of a credible witness. Denial, same as an alibi, if not substantiated by clear and convincing evidence, is negative and self-serving evidence undeserving of weight in law. It is considered with suspicion and always received with caution, not only because it is inherently weak and unreliable but also because it is easily fabricated and concocted.[25] Moreover, in the absence of any evidence that the prosecution witnesses were motivated by improper motives, the trial courts assessment of the credibility of the witnesses shall not be interfered with by this Court.[26] It is a settled rule that factual findings of the trial courts,

including their assessment of the witnesses credibility, are entitled to great weight and respect by the Supreme Court, particularly when the Court of Appeals affirmed such findings. After all, the trial court is in the best position to determine the value and weight of the testimonies of witnesses. The absence of any showing that the trial court plainly overlooked certain facts of substance and value that, if considered, might affect the result of the case, or that its assessment was arbitrary, impels the Court to defer to the trial courts determination according credibility to the prosecution evidence.[27] Ocden further argues that the prosecution did not sufficiently establish that she illegally recruited at least three persons, to constitute illegal recruitment on a large scale. Out of the victims named in the Information, only Mana-a and Ferrer testified in court. Mana-a did not complete her testimony, depriving Ocden of the opportunity to cross-examine her; and even if Mana-as testimony was not expunged from the record, it was insufficient to prove illegal recruitment by Ocden. Although Ferrer testified that she and Mana-a filed a complaint for illegal recruitment against Ocden, Ferrers testimony is competent only as to the illegal recruitment activities committed by Ocden against her, and not against Mana-a. Ocden again objects to Golidans testimony as hearsay, not being based on Golidans personal knowledge. Under the last paragraph of Section 6, Republic Act No. 8042, illegal recruitment shall be considered an offense involving economic sabotage if committed in a large scale, that is, committed against three or more persons individually or as a group. In People v. Hu,[28] we held that a conviction for large scale illegal recruitment must be based on a finding in each case of illegal recruitment of three or more persons, whether individually or as a group. While it is true that the law does not require that at least three victims testify at the trial, nevertheless, it is necessary that there is sufficient evidence proving that the offense was committed against three or more persons. In this case, there is conclusive evidence that Ocden recruited Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, for purported employment as factory workers in Italy. As aptly observed by the Court of Appeals:
Mana-as testimony, although not completed, sufficiently established that accusedappellant promised Mana-a a job placement in a factory in Italy for a fee with accused-appellant even accompanying her for the required medical examination. Likewise, Julia Golidans testimony adequately proves that accused-appellant recruited Jeffries and Howard Golidan for a job in Italy, also for a fee. Contrary to the accused-appellants contention, Julia had personal knowledge of the facts and circumstances surrounding the charges for illegal recruitment and estafa filed by her sons. Julia was not only privy to her sons recruitment but also directly transacted with accused-appellant, submitting her sons requirements and paying the placement fees as evidenced by a receipt issued in her name. Even after the placement did not materialize, Julia acted with her sons to secure the partial reimbursement of the placement fees.[29]

And even though only Ferrer and Golidan testified as to Ocdens failure to reimburse the placements fees paid when the deployment did not take place, their testimonies already established the fact of non-reimbursement as to three persons, namely, Ferrer and Golidans two sons, Jeffries and Howard.

Section 7(b) of Republic Act No. 8042 prescribes a penalty of life imprisonment and a fine of not less than P500,000.00 nor more than P1,000,000.00 if the illegal recruitment constitutes economic sabotage. The RTC, as affirmed by the Court of Appeals, imposed upon Ocden the penalty of life imprisonment and a fine of onlyP100,000.00. Since the fine of P100,000 is below the minimum set by law, we are increasing the same to P500,000.00.

Estafa We are likewise affirming the conviction of Ocden for the crime of estafa. The very same evidence proving Ocdens liability for illegal recruitment also established her liability for estafa. It is settled that a person may be charged and convicted separately of illegal recruitment under Republic Act No. 8042 in relation to the Labor Code, and estafa under Article 315, paragraph 2(a) of the Revised Penal Code. We explicated in People v. Yabut[30] that:
In this jurisdiction, it is settled that a person who commits illegal recruitment may be charged and convicted separately of illegal recruitment under the Labor Code and estafa under par. 2(a) of Art. 315 of the Revised Penal Code. The offense of illegal recruitment is malum prohibitum where the criminal intent of the accused is not necessary for conviction, while estafa is malum in se where the criminal intent of the accused is crucial for conviction. Conviction for offenses under the Labor Code does not bar conviction for offenses punishable by other laws. Conversely, conviction for estafa under par. 2(a) of Art. 315 of the Revised Penal Code does not bar a conviction for illegal recruitment under the Labor Code. It follows that ones acquittal of the crime of estafa will not necessarily result in his acquittal of the crime of illegal recruitment in large scale, and vice versa.[31]

Article 315, paragraph 2(a) of the Revised Penal Code defines estafa as:

Art. 315. Swindling (estafa). - Any person who shall defraud another by any of the means mentioned hereinbelow x x x:

xxxx

2. By means of any of the following false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud: (a) By using fictitious name, or falsely pretending to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions; or by means of other similar deceits.

The elements of estafa are: (a) that the accused defrauded another by abuse of confidence or by means of deceit, and (b) that damage or prejudice capable of pecuniary estimation is caused to the offended party or third person.[32]

Both these elements are present in the instant case. Ocden represented to Ferrer, Golidan, and Golidans two sons, Jeffries and Howard, that she could provide them with overseas jobs. Convinced by Ocden, Ferrer, Golidan, and Golidans sons paid substantial amounts as placement fees to her. Ferrer and Golidans sons were never able to leave for Italy, instead, they ended up in Zamboanga, where, Ocden claimed, it would be easier to have their visas to Italy processed. Despite the fact that Golidans sons, Jeffries and Howard, were stranded in Zamboanga for almost a month, Ocden still assured them and their mother that they would be able to leave for Italy. There is definitely deceit on the part of Ocden and damage on the part of Ferrer and Golidans sons, thus, justifying Ocdens conviction for estafa in Criminal Case Nos. 16316-R, 16318-R, and 16964-R.

The penalty for estafa depends on the amount of defraudation. According to Article 315 of the Revised Penal Code:

Art. 315. Swindling (estafa). Any person who shall defraud another by any of the means mentioned hereinbelow shall be punished by:

1st. The penalty of prision correccional in its maximum period to prision mayor in its minimum period, if the amount of the fraud is over 12,000 pesos but does not exceed 22,000 pesos; and if such amount exceeds the latter sum, the penalty provided in this paragraph shall be imposed in its maximum period, adding one year for each additional 10,000 pesos; but the total penalty which may be imposed shall not exceed twenty years. In such cases, and in connection with the accessory penalties which may be imposed and for the purpose of the other provisions of this Code, the penalty shall be termed prision mayor or reclusion temporal, as the case may be.

The prescribed penalty for estafa under Article 315 of the Revised Penal Code, when the amount of fraud is over P22,000.00, is prision correccional maximum to prision

mayor minimum, adding one year to the maximum period for each additional P10,000.00, provided that the total penalty shall not exceed 20 years.

Applying the Indeterminate Sentence Law, we take the minimum term from the penalty next lower than the minimum prescribed by law, or anywhere within prision correccional minimum and medium (i.e., from 6 months and 1 day to 4 years and 2 months).[33] Consequently, both the RTC and the Court of Appeals correctly fixed the minimum term in Criminal Case Nos. 16316-R and 16318-R at 2 years, 11 months, and 10 days of prision correccional; and in Criminal Case No. 16964-R at 4 years and 2 months of prision correccional, since these are within the range of prision correccional minimum and medium.

As for the maximum term under the Indeterminate Sentence Law, we take the maximum period of the prescribed penalty, adding 1 year of imprisonment for everyP10,000.00 in excess of P22,000.00, provided that the total penalty shall not exceed 20 years. To compute the maximum period of the prescribed penalty, the time included inprision correccional maximum to prision mayor minimum shall be divided into three equal portions, with each portion forming a period. Following this computation, the maximum period for prision correccional maximum to prision mayor minimum is from 6 years, 8 months, and 21 days to 8 years. The incremental penalty, when proper, shall thus be added to anywhere from 6 years, 8 months, and 21 days to 8 years, at the discretion of the court.[34]

In computing the incremental penalty, the amount defrauded shall be substracted by P22,000.00, and the difference shall be divided by P10,000.00. Any fraction of a year shall be discarded as was done starting with People v. Pabalan.[35]

In Criminal Case Nos. 16316-R and 16318-R, brothers Jeffries and Howard Golidan were each defrauded of the amount of P40,000.00, for which the Court of Appeals sentenced Ocden to an indeterminate penalty of 2 years, 11 months, and 10 days of prision correccional as minimum, to 9 years of prision mayor as maximum. Upon review, however, we modify the maximum term of the indeterminate penalty imposed on Ocden in said criminal cases. Since the amount defrauded exceeds P22,000.00 by P18,000.00, 1 year shall be added to the maximum period of the prescribed penalty (anywhere between 6 years, 8 months, and 21 days to 8 years). There being no aggravating circumstance, we apply the lowest of the maximum period, which is 6 years, 8 months, and 21 days. Adding the one year incremental penalty, the

maximum term of Ocdens indeterminate sentence in these two cases is only 7 years, 8 months, and 21 days of prision mayor.

In Criminal Cases No. 19694-R, Ferrer was defrauded of the amount of P70,000.00, for which the Court of Appeals sentenced Ocden to an indeterminate penalty of 4 years and 2 months of prision correccional, as minimum, to 12 years of prision mayor, as maximum. Upon recomputation, we also have to modify the maximum term of the indeterminate sentence imposed upon Ocden in Criminal Case No. 19694-R. Given that the amount defrauded exceeds P22,000.00 by P48,000.00, 4 years shall be added to the maximum period of the prescribed penalty (anywhere between 6 years, 8 months, and 21 days to 8 years). There likewise being no aggravating circumstance in this case, we add the 4 years of incremental penalty to the lowest of the maximum period, which is 6 years, 8 months, and 21 days. The maximum term, therefor, of Ocdens indeterminate sentence in Criminal Case No. 19694-R is only 10 years, 8 months, and 21 days of prision mayor.

WHEREFORE, the instant appeal of accused-appellant Dolores Ocden is DENIED. The Decision dated April 21, 2006 of the Court of Appeals in CA-G.R. CR.-H.C. No. 00044 is AFFIRMED with MODIFICATION to read as follows:

1. In Criminal Case No. 16315-R, the Court finds the accused, Dolores Ocden, GUILTY beyond reasonable doubt of the crime of Illegal Recruitment committed in large scale as defined and penalized under Article 13(b) in relation to Articles 38(b), 34 and 39 of the Labor Code, as amended. She is hereby sentenced to suffer the penalty of life imprisonment and to pay a fine of P500,000.00;

2. In Criminal Case No. 16316-R, the Court finds the accused, Dolores Ocden, GUILTY beyond reasonable doubt of the crime of estafa and sentences her to an indeterminate penalty of 2 years, 11 months, and 10 days of prision correccional, as minimum, to 7 years, 8 months, and 21 days of prision mayor, as maximum, and to indemnify Jeffries Golidan the amount of P40,000.00;

3. In Criminal Case No. 16318-R, the Court finds the accused, Dolores Ocden, GUILTY beyond reasonable doubt of the crime of estafa and sentences her to an indeterminate penalty of 2 years, 11 months, and 10 days of prision correccional, as minimum,

to 7 years, 8 months, and 21 days of prision mayor, as maximum, and to indemnify Howard Golidan the amount of P40,000.00; and

4. In Criminal Case No. 16964-R, the Court finds the accused, Dolores Ocden, GUILTY beyond reasonable doubt of the crime of estafa and sentences her to an indeterminate penalty of 4 years and 2 months of prision correccional, as minimum, to 10 years, 8 months, and 21 days of prision mayor, as maximum, and to indemnify Rizalina Ferrer the amount of P70,000.00.

SO ORDERED.

TERESITA J. LEONARDO-DE CASTRO Associate Justice

WE CONCUR:

RENATO C. CORONA Chief Justice Chairperson

PRESBITERO J. VELASCO, JR. Associate Justice

DIOSDADO M. PERALTA Associate Justice

JOSE PORTUGAL PEREZ Associate Justice

CERTIFICATION Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

RENATO C. CORONA Chief Justice

* [1]

[2] [3]

[4] [5] [6] [7] [8] [9] [10] [11]

Per Special Order No. 994 dated May 27, 2011. Rollo, pp. 3-20; penned by Associate Justice Noel G. Tijam with Associate Justices Elvi John S. Asuncion and Arcangelita Romilla-Lontok, concurring. Records (Crim. Case No. 16964-R), pp. 253-262; penned by Judge Edilberto T. Claravall. Originally, Ocden was indicted for six counts of Estafa (Criminal Case Nos. 16316-R, 16318-R, 16350-R, 16369-R, 16964-R and 16966-R). Records (Crim. Case No. 16315-R), p. 1. Records (Crim. Case No. 16316-R), p. 1. Rollo, p. 4. TSN, October 10, 2000, pp. 1-6. TSN, January 8, 2001, p. 4. Records (Crim. Case No. 16964-R), p. 179; Exhibits A, A-1 and A-2. TSN, January 8, 2001, pp. 1-15. Records (Crim. Case No. 16318-R), pp. 54-55, Exhibits A-1 and A-2. TSN, November 14, 2000, pp. 1-9; November 20, 2000, pp. 1-15. TSN, February 27, 2001, pp. 1-15; March 6, 2001, pp. 1-6. Records (Crim. Case No. 16964-R), pp. 261-262. Id. at 263. CA rollo, p. 38. Id. at 67-85. Id. at 111-134. G.R. Nos. 147678-87, July 7, 2004, 433 SCRA 640. Rollo, pp. 18-19. CA rollo, p. 69. People v. Gasacao, 511 Phil. 435, 445 (2005). G.R. Nos. 103385-88, July 26, 1993, 224 SCRA 749. Id. at 757. People v. Bulfango, 438 Phil. 651, 657 (2002). People v. Saulo, 398 Phil. 544, 554 (2000). People v. Nogra, G.R. No. 170834, August 29, 2008, 563 SCRA 723, 735. G.R. No. 182232, October 6, 2008, 567 SCRA 696, 705. Rollo, p. 16. 374 Phil. 575 (1999). Id. at 586. People v. Ballesteros, 435 Phil. 205, 228 (2002). People v. Temporada, G.R. No. 173473, December 17, 2008, 574 SCRA 258, 299. Id. 331 Phil. 64, 85 (1996).

[12] [13] [14] [15] [16] [17] [18] [19] [20] [21] [22]

[23] [24] [25] [26] [27] [28] [29] [30] [31] [32] [33] [34] [35]

Republic of the Philippines

Supreme Court
Manila EN BANC
ANTONIO M. SERRANO, Petitioner, G.R. No. 167614 Present: PUNO, C.J., QUISUMBING, YNARES-SANTIAGO, CARPIO, AUSTRIA-MARTINEZ, CORONA, CARPIO MORALES, TINGA, CHICO-NAZARIO, VELASCO, Jr., NACHURA, LEONARDO-DE CASTRO, BRION, and PERALTA, JJ.

- versus -

GALLANT MARITIME SERVICES, INC. and MARLOW NAVIGATION Promulgated: CO., INC., Respondents. March 24, 2009 x----------------------------------------------------------x

DECISION

AUSTRIA-MARTINEZ, J.:
For decades, the toil of solitary migrants has helped lift entire families and communities out of poverty. Their earnings have built houses, provided health care, equipped schools and planted the seeds of businesses. They have woven together the world by transmitting ideas and knowledge from country to country. They have provided the dynamic human link between cultures, societies and economies.Yet, only

recently have we begun to understand not only how much international migration impacts development, but how smart public policies can magnify this effect.

United Nations Secretary-General Ban Ki-Moon Global Forum on Migration and Development Brussels, July 10, 2007[1]

For Antonio Serrano (petitioner), a Filipino seafarer, the last clause in the 5th paragraph of Section 10, Republic Act (R.A.) No. 8042,[2] to wit:
Sec. 10. Money Claims. - x x x In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, the workers shall be entitled to the full reimbursement of his placement fee with interest of twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less. x x x x (Emphasis and underscoring supplied)

does not magnify the contributions of overseas Filipino workers (OFWs) to national development, but exacerbates the hardships borne by them by unduly limiting their entitlement in case of illegal dismissal to their lump-sum salary either for the unexpired portion of their employment contract or for three months for every year of the unexpired term, whichever is less (subject clause). Petitioner claims that the last clause violates the OFWs' constitutional rights in that it impairs the terms of their contract, deprives them of equal protection and denies them due process. By way of Petition for Review under Rule 45 of the Rules of Court, petitioner assails the December 8, 2004 Decision[3] and April 1, 2005 Resolution[4] of the Court of Appeals (CA), which applied the subject clause, entreating this Court to declare the subject clause unconstitutional. Petitioner was hired by Gallant Maritime Services, Inc. and Marlow Navigation Co., Ltd. (respondents) under a Philippine Overseas Employment Administration (POEA)-approved Contract of Employment with the following terms and conditions:
Duration of contract Position Basic monthly salary Hours of work Overtime Vacation leave with pay 12 months Chief Officer US$1,400.00 48.0 hours per week US$700.00 per month 7.00 days per month[5]

On March 19, 1998, the date of his departure, petitioner was constrained to accept a downgraded employment contract for the position of Second Officer with a monthly salary of US$1,000.00, upon the assurance and representation of respondents that he would be made Chief Officer by the end of April 1998.[6]

Respondents did not deliver on their promise to make petitioner Chief Officer.[7] Hence, petitioner refused to stay on as Second Officer and was repatriated to thePhilippines on May 26, 1998.[8] Petitioner's employment contract was for a period of 12 months or from March 19, 1998 up to March 19, 1999, but at the time of his repatriation on May 26, 1998, he had served only two (2) months and seven (7) days of his contract, leaving an unexpired portion of nine (9) months and twenty-three (23) days. Petitioner filed with the Labor Arbiter (LA) a Complaint[9] against respondents for constructive dismissal and for payment of his money claims in the total amount of US$26,442.73, broken down as follows:
May 27/31, 1998 (5 days) incl. Leave pay June 01/30, 1998 July 01/31, 1998 August 01/31, 1998 Sept. 01/30, 1998 Oct. 01/31, 1998 Nov. 01/30, 1998 Dec. 01/31, 1998 Jan. 01/31, 1999 Feb. 01/28, 1999 Mar. 1/19, 1999 (19 days) incl. leave pay Amount adjusted to chief mate's salary (March 19/31, 1998 to April 1998) + TOTAL CLAIM US$ 413.90 2,590.00 2,590.00 2,590.00 2,590.00 2,590.00 2,590.00 2,590.00 2,590.00 2,590.00 1,640.00
--------------------------------------------------------------------------------

25,382.23 1/30, 1,060.50[10]

----------------------------------------------------------------------------------------------

US$ 26,442.73[11]

as well as moral and exemplary damages and attorney's fees. The LA rendered a Decision dated July 15, 1999, declaring the dismissal of petitioner illegal and awarding him monetary benefits, to wit:
WHEREFORE, premises considered, judgment is hereby rendered declaring that the dismissal of the complainant (petitioner) by the respondents in the above-entitled case was illegal and the respondents are hereby ordered to pay the complainant [petitioner], jointly and severally, in Philippine Currency, based on the rate of exchange prevailing at the time of payment, the amount of EIGHT THOUSAND SEVEN HUNDRED SEVENTY U.S. DOLLARS (US $8,770.00), representing the complainants salary for three (3) months of the unexpired portion of the aforesaid contract of employment.

The respondents are likewise ordered to pay the complainant [petitioner], jointly and severally, in Philippine Currency, based on the rate of exchange prevailing at the time of payment, the amount of FORTY FIVE U.S. DOLLARS (US$ 45.00),[12] representing the complainants claim for a salary differential. In addition, the respondents are hereby ordered to pay the complainant, jointly and severally, in Philippine Currency, at the exchange rate prevailing at the time of payment, the complainants (petitioner's) claim for attorneys fees equivalent to ten percent (10%) of the total amount awarded to the aforesaid employee under this Decision. The claims of the complainant for moral and exemplary damages are hereby DISMISSED for lack of merit. All other claims are hereby DISMISSED. SO ORDERED.[13] (Emphasis supplied)

In awarding petitioner a lump-sum salary of US$8,770.00, the LA based his computation on the salary period of three months only -- rather than the entire unexpired portion of nine months and 23 days of petitioner's employment contract - applying the subject clause. However, the LA applied the salary rate of US$2,590.00, consisting of petitioner's [b]asic salary, US$1,400.00/month + US$700.00/month, fixed overtime pay, + US$490.00/month, vacation leave pay = US$2,590.00/compensation per month.[14] Respondents appealed[15] to the National Labor Relations Commission (NLRC) to question the finding of the LA that petitioner was illegally dismissed. Petitioner also appealed[16] to the NLRC on the sole issue that the LA erred in not applying the ruling of the Court in Triple Integrated Services, Inc. v. National Labor Relations Commission[17] that in case of illegal dismissal, OFWs are entitled to their salaries for the unexpired portion of their contracts.[18] In a Decision dated June 15, 2000, the NLRC modified the LA Decision, to wit:
WHEREFORE, the Decision dated 15 July 1999 is MODIFIED. Respondents are hereby ordered to pay complainant, jointly and severally, in Philippine currency, at the prevailing rate of exchange at the time of payment the following: 1. Three (3) months salary $1,400 x 3 2. Salary differential US$4,245.00 3. 10% Attorneys fees TOTAL The other findings are affirmed. SO ORDERED.[19]

US$4,200.00 45.00 424.50 US$4,669.50

The NLRC corrected the LA's computation of the lump-sum salary awarded to petitioner by reducing the applicable salary rate from US$2,590.00 to US$1,400.00 because R.A. No. 8042 does not provide for the award of overtime pay, which should be proven to have been actually performed, and for vacation leave pay.[20] Petitioner filed a Motion for Partial Reconsideration, but this time he questioned the constitutionality of the subject clause.[21] The NLRC denied the motion.[22] Petitioner filed a Petition for Certiorari[23] with the CA, reiterating the constitutional challenge against the subject clause.[24] After initially dismissing the petition on a technicality, the CA eventually gave due course to it, as directed by this Court in its Resolution dated August 7, 2003 which granted the petition for certiorari, docketed as G.R. No. 151833, filed by petitioner. In a Decision dated December 8, 2004, the CA affirmed the NLRC ruling on the reduction of the applicable salary rate; however, the CA skirted the constitutional issue raised by petitioner.[25] His Motion for Reconsideration[26] having been denied by the CA,[27] petitioner brings his cause to this Court on the following grounds:
I The Court of Appeals and the labor tribunals have decided the case in a way not in accord with applicable decision of the Supreme Court involving similar issue of granting unto the migrant worker back wages equal to the unexpired portion of his contract of employment instead of limiting it to three (3) months II In the alternative that the Court of Appeals and the Labor Tribunals were merely applying their interpretation of Section 10 of Republic Act No. 8042, it is submitted that the Court of Appeals gravely erred in law when it failed to discharge its judicial duty to decide questions of substance not theretofore determined by the Honorable Supreme Court, particularly, the constitutional issues raised by the petitioner on the constitutionality of said law, which unreasonably, unfairly and arbitrarily limits payment of the award for back wages of overseas workers to three (3) months. III Even without considering the constitutional limitations [of] Sec. 10 of Republic Act No. 8042, the Court of Appeals gravely erred in law in excluding from petitioners award the overtime pay and vacation pay provided in his contract since under the contract they form part of his salary.[28]

On February 26, 2008, petitioner wrote the Court to withdraw his petition as he is already old and sickly, and he intends to make use of the monetary award for his medical treatment and medication.[29] Required to comment, counsel for petitioner filed a motion, urging the court to allow partial execution of the undisputed monetary award and, at the same time, praying that the constitutional question be resolved.[30]

Considering that the parties have filed their respective memoranda, the Court now takes up the full merit of the petition mindful of the extreme importance of the constitutional question raised therein. On the first and second issues The unanimous finding of the LA, NLRC and CA that the dismissal of petitioner was illegal is not disputed. Likewise not disputed is the salary differential of US$45.00 awarded to petitioner in all three fora. What remains disputed is only the computation of the lump-sum salary to be awarded to petitioner by reason of his illegal dismissal. Applying the subject clause, the NLRC and the CA computed the lump-sum salary of petitioner at the monthly rate of US$1,400.00 covering the period of three months out of the unexpired portion of nine months and 23 days of his employment contract or a total of US$4,200.00. Impugning the constitutionality of the subject clause, petitioner contends that, in addition to the US$4,200.00 awarded by the NLRC and the CA, he is entitled to US$21,182.23 more or a total of US$25,382.23, equivalent to his salaries for the entire nine months and 23 days left of his employment contract, computed at the monthly rate of US$2,590.00.[31] The Arguments of Petitioner Petitioner contends that the subject clause is unconstitutional because it unduly impairs the freedom of OFWs to negotiate for and stipulate in their overseas employment contracts a determinate employment period and a fixed salary package.[32] It also impinges on the equal protection clause, for it treats OFWs differently from local Filipino workers (local workers) by putting a cap on the amount of lump-sum salary to which OFWs are entitled in case of illegal dismissal, while setting no limit to the same monetary award for local workers when their dismissal is declared illegal; that the disparate treatment is not reasonable as there is no substantial distinction between the two groups;[33] and that it defeats Section 18,[34] Article II of the Constitution which guarantees the protection of the rights and welfare of all Filipino workers, whether deployed locally or overseas.[35] Moreover, petitioner argues that the decisions of the CA and the labor tribunals are not in line with existing jurisprudence on the issue of money claims of illegally dismissed OFWs. Though there are conflicting rulings on this, petitioner urges the Court to sort them out for the guidance of affected OFWs.[36] Petitioner further underscores that the insertion of the subject clause into R.A. No. 8042 serves no other purpose but to benefit local placement agencies. He marks the statement made by the Solicitor General in his Memorandum, viz.:

Often, placement agencies, their liability being solidary, shoulder the payment of money claims in the event that jurisdiction over the foreign employer is not acquired by the court or if the foreign employer reneges on its obligation. Hence, placement agencies that are in good faith and which fulfill their obligations are unnecessarily penalized for the acts of the foreign employer. To protect them and to promote their continued helpful contribution in deploying Filipino migrant workers, liability for money claims was reduced under Section 10 of R.A. No. 8042. [37] (Emphasis supplied)

Petitioner argues that in mitigating the solidary liability of placement agencies, the subject clause sacrifices the well-being of OFWs. Not only that, the provision makes foreign employers better off than local employers because in cases involving the illegal dismissal of employees, foreign employers are liable for salaries covering a maximum of only three months of the unexpired employment contract while local employers are liable for the full lump-sum salaries of their employees. As petitioner puts it:
In terms of practical application, the local employers are not limited to the amount of backwages they have to give their employees they have illegally dismissed, following well-entrenched and unequivocal jurisprudence on the matter. On the other hand, foreign employers will only be limited to giving the illegally dismissed migrant workers the maximum of three (3) months unpaid salaries notwithstanding the unexpired term of the contract that can be more than three (3) months.[38]

Lastly, petitioner claims that the subject clause violates the due process clause, for it deprives him of the salaries and other emoluments he is entitled to under his fixed-period employment contract.[39] The Arguments of Respondents In their Comment and Memorandum, respondents contend that the constitutional issue should not be entertained, for this was belatedly interposed by petitioner in his appeal before the CA, and not at the earliest opportunity, which was when he filed an appeal before the NLRC.[40] The Arguments of the Solicitor General The Solicitor General (OSG)[41] points out that as R.A. No. 8042 took effect on July 15, 1995, its provisions could not have impaired petitioner's 1998 employment contract. Rather, R.A. No. 8042 having preceded petitioner's contract, the provisions thereof are deemed part of the minimum terms of petitioner's employment, especially on the matter of money claims, as this was not stipulated upon by the parties.[42] Moreover, the OSG emphasizes that OFWs and local workers differ in terms of the nature of their employment, such that their rights to monetary benefits must necessarily be treated differently. The OSG enumerates the essential elements that distinguish OFWs from local workers: first, while local workers perform their jobs within Philippine territory, OFWs perform their jobs for foreign employers, over whom it is difficult for our courts to acquire jurisdiction, or against whom it is almost impossible to enforce judgment; and second, as held in Coyoca v. National Labor Relations

Commission[43] and Millares v. National Labor Relations Commission,[44] OFWs are contractual employees who can never acquire regular employment status, unlike local workers who are or can become regular employees. Hence, the OSG posits that there are rights and privileges exclusive to local workers, but not available to OFWs; that these peculiarities make for a reasonable and valid basis for the differentiated treatment under the subject clause of the money claims of OFWs who are illegally dismissed. Thus, the provision does not violate the equal protection clause nor Section 18, Article II of the Constitution.[45] Lastly, the OSG defends the rationale behind the subject clause as a police power measure adopted to mitigate the solidary liability of placement agencies for this redounds to the benefit of the migrant workers whose welfare the government seeks to promote. The survival of legitimate placement agencies helps [assure] the government that migrant workers are properly deployed and are employed under decent and humane conditions.[46] The Court's Ruling The Court sustains petitioner on the first and second issues. When the Court is called upon to exercise its power of judicial review of the acts of its co-equals, such as the Congress, it does so only when these conditions obtain: (1) that there is an actual case or controversy involving a conflict of rights susceptible of judicial determination;[47] (2) that the constitutional question is raised by a proper party[48]and at the earliest opportunity;[49] and (3) that the constitutional question is the very lis mota of the case,[50] otherwise the Court will dismiss the case or decide the same on some other ground.[51] Without a doubt, there exists in this case an actual controversy directly involving petitioner who is personally aggrieved that the labor tribunals and the CA computed his monetary award based on the salary period of three months only as provided under the subject clause. The constitutional challenge is also timely. It should be borne in mind that the requirement that a constitutional issue be raised at the earliest opportunity entails the interposition of the issue in the pleadings before a competent court, such that, if the issue is not raised in the pleadings before that competent court, it cannot be considered at the trial and, if not considered in the trial, it cannot be considered on appeal.[52] Records disclose that the issue on the constitutionality of the subject clause was first raised, not in petitioner's appeal with the NLRC, but in his Motion for Partial Reconsideration with said labor tribunal,[53] and reiterated in his Petition for Certiorari before the CA.[54] Nonetheless, the issue is deemed seasonably raised because it is not the NLRC but the CA which has the competence to resolve the constitutional issue. The NLRC is a labor tribunal that merely performs a quasi-judicial function its function in the present case is limited to determining questions of fact to which the legislative policy of R.A. No. 8042 is to be applied and to resolving such questions in accordance with the standards laid

down by the law itself;[55] thus, its foremost function is to administer and enforce R.A. No. 8042, and not to inquire into the validity of its provisions. The CA, on the other hand, is vested with the power of judicial review or the power to declare unconstitutional a law or a provision thereof, such as the subject clause.[56] Petitioner's interposition of the constitutional issue before the CA was undoubtedly seasonable. The CA was therefore remiss in failing to take up the issue in its decision. The third condition that the constitutional issue be critical to the resolution of the case likewise obtains because the monetary claim of petitioner to his lump-sum salary for the entire unexpired portion of his 12-month employment contract, and not just for a period of three months, strikes at the very core of the subject clause. Thus, the stage is all set for the determination of the constitutionality of the subject clause. Does the subject clause violate Section 10, Article III of the Constitution on non-impairment of contracts?

The answer is in the negative. Petitioner's claim that the subject clause unduly interferes with the stipulations in his contract on the term of his employment and the fixed salary package he will receive[57] is not tenable. Section 10, Article III of the Constitution provides:
No law impairing the obligation of contracts shall be passed.

The prohibition is aligned with the general principle that laws newly enacted have only a prospective operation,[58] and cannot affect acts or contracts already perfected;[59]however, as to laws already in existence, their provisions are read into contracts and deemed a part thereof.[60] Thus, the nonimpairment clause under Section 10, Article II is limited in application to laws about to be enacted that would in any way derogate from existing acts or contracts by enlarging, abridging or in any manner changing the intention of the parties thereto. As aptly observed by the OSG, the enactment of R.A. No. 8042 in 1995 preceded the execution of the employment contract between petitioner and respondents in 1998. Hence, it cannot be argued that R.A. No. 8042, particularly the subject clause, impaired the employment contract of the parties. Rather, when the parties executed their 1998 employment contract, they were deemed to have incorporated into it all the provisions of R.A. No. 8042.

But even if the Court were to disregard the timeline, the subject clause may not be declared unconstitutional on the ground that it impinges on the impairment clause, for the law was enacted in the exercise of the police power of the State to regulate a business, profession or calling, particularly the recruitment and deployment of OFWs, with the noble end in view of ensuring respect for the dignity and well-being of OFWs wherever they may be employed.[61] Police power legislations adopted by the State to promote the health, morals, peace, education, good order, safety, and general welfare of the people are generally applicable not only to future contracts but even to those already in existence, for all private contracts must yield to the superior and legitimate measures taken by the State to promote public welfare.[62] Does the subject clause violate Section 1, Article III of the Constitution, and Section 18, Article II and Section 3, Article XIII on labor as a protected sector?

The answer is in the affirmative. Section 1, Article III of the Constitution guarantees:
No person shall be deprived of life, liberty, or property without due process of law nor shall any person be denied the equal protection of the law.

Section 18,[63] Article II and Section 3,[64] Article XIII accord all members of the labor sector, without distinction as to place of deployment, full protection of their rights and welfare. To Filipino workers, the rights guaranteed under the foregoing constitutional provisions translate to economic security and parity: all monetary benefits should be equally enjoyed by workers of similar category, while all monetary obligations should be borne by them in equal degree; none should be denied the protection of the laws which is enjoyed by, or spared the burden imposed on, others in like circumstances.[65] Such rights are not absolute but subject to the inherent power of Congress to incorporate, when it sees fit, a system of classification into its legislation; however, to be valid, the classification must comply with these requirements: 1) it is based on substantial distinctions; 2) it is germane to the purposes of the law; 3) it is not limited to existing conditions only; and 4) it applies equally to all members of the class.[66] There are three levels of scrutiny at which the Court reviews the constitutionality of a classification embodied in a law: a) the deferential or rational basis scrutiny in which the challenged classification needs only be shown to be rationally related to serving a legitimate state interest;[67] b)

the middle-tier or intermediate scrutiny in which the government must show that the challenged classification serves an important state interest and that the classification is at least substantially related to serving that interest;[68] and c) strict judicial scrutiny[69] in which a legislative classification which impermissibly interferes with the exercise of a fundamental right[70] or operates to the peculiar disadvantage of a suspect class[71] is presumed unconstitutional, and the burden is upon the government to prove that the classification is necessary to achieve a compelling state interest and that it is the least restrictive means to protect such interest.[72] Under American jurisprudence, strict judicial scrutiny is triggered by suspect classifications[73] based on race[74] or gender[75] but not when the classification is drawn along income categories.[76] It is different in the Philippine setting. In Central Bank (now Bangko Sentral ng Pilipinas) Employee Association, Inc. v. Bangko Sentral ng Pilipinas,[77] the constitutionality of a provision in the charter of the Bangko Sentral ng Pilipinas (BSP), a government financial institution (GFI), was challenged for maintaining its rank-and-file employees under the Salary Standardization Law (SSL), even when the rank-and-file employees of other GFIs had been exempted from the SSL by their respective charters. Finding that the disputed provision contained a suspect classification based on salary grade, the Court deliberately employed the standard of strict judicial scrutiny in its review of the constitutionality of said provision. More significantly, it was in this case that the Court revealed the broad outlines of its judicial philosophy, to wit:
Congress retains its wide discretion in providing for a valid classification, and its policies should be accorded recognition and respect by the courts of justice except when they run afoul of the Constitution. The deference stops where the classification violates a fundamental right, or prejudices persons accorded special protection by the Constitution. When these violations arise, this Court must discharge its primary role as the vanguard of constitutional guaranties, and require a stricter and more exacting adherence to constitutional limitations. Rational basis should not suffice. Admittedly, the view that prejudice to persons accorded special protection by the Constitution requires a stricter judicial scrutiny finds no support in American or English jurisprudence. Nevertheless, these foreign decisions and authorities are not per se controlling in this jurisdiction. At best, they are persuasive and have been used to support many of our decisions. We should not place undue and fawning reliance upon them and regard them as indispensable mental crutches without which we cannot come to our own decisions through the employment of our own endowments. We live in a different ambience and must decide our own problems in the light of our own interests and needs, and of our qualities and even idiosyncrasies as a people, and always with our own concept of law and justice. Our laws must be construed in accordance with the intention of our own lawmakers and such intent may be deduced from the language of each law and the context of other local legislation related thereto. More importantly, they must be construed to serve our own public interest which is the be-all and the end-all of all our laws. And it need not be stressed that our public interest is distinct and different from others. xxxx

Further, the quest for a better and more equal world calls for the use of equal protection as a tool of effective judicial intervention. Equality is one ideal which cries out for bold attention and action in the Constitution. The Preamble proclaims equality as an ideal precisely in protest against crushing inequities in Philippine society. The command to promote social justice in Article II, Section 10, in all phases of national development, further explicitated in Article XIII, are clear commands to the State to take affirmative action in the direction of greater equality. x x x [T]here is thus in the Philippine Constitution no lack of doctrinal support for a more vigorous state effort towards achieving a reasonable measure of equality. Our present Constitution has gone further in guaranteeing vital social and economic rights to marginalized groups of society, including labor. Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on the humane justification that those with less privilege in life should have more in law. And the obligation to afford protection to labor is incumbent not only on the legislative and executive branches but also on the judiciary to translate this pledge into a living reality. Social justice calls for the humanization of laws and the equalization of social and economic forces by the State so that justice in its rational and objectively secular conception may at least be approximated. xxxx Under most circumstances, the Court will exercise judicial restraint in deciding questions of constitutionality, recognizing the broad discretion given to Congress in exercising its legislative power. Judicial scrutiny would be based on the rational basis test, and the legislative discretion would be given deferential treatment. But if the challenge to the statute is premised on the denial of a fundamental right, or the perpetuation of prejudice against persons favored by the Constitution with special protection, judicial scrutiny ought to be more strict. A weak and watered down view would call for the abdication of this Courts solemn duty to strike down any law repugnant to the Constitution and the rights it enshrines. This is true whether the actor committing the unconstitutional act is a private person or the government itself or one of its instrumentalities. Oppressive acts will be struck down regardless of the character or nature of the actor. xxxx In the case at bar, the challenged proviso operates on the basis of the salary grade or officeremployee status. It is akin to a distinction based on economic class and status, with the higher grades as recipients of a benefit specifically withheld from the lower grades. Officers of the BSP now receive higher compensation packages that are competitive with the industry, while the poorer, low-salaried employees are limited to the rates prescribed by the SSL. The implications are quite disturbing: BSP rank-and-file employees are paid the strictly regimented rates of the SSL while employees higher in rank - possessing higher and better education and opportunities for career advancement - are given higher compensation packages to entice them to stay. Considering that majority, if not all, the rank-and-file employees consist of people whose status and rank in life are less and limited, especially in terms of job marketability, it is they - and not the officers - who have the real economic and financial need for the adjustment . This is in accord with the policy of the Constitution "to free the people from poverty, provide adequate social services, extend to them a decent standard of living, and improve the quality of life for all. Any act of Congress that runs counter to this constitutional desideratum deserves strict scrutiny by this Court before it can pass muster. (Emphasis supplied)

Imbued with the same sense of obligation to afford protection to labor, the Court in the present case also employs the standard of strict judicial scrutiny, for it perceives in the subject clause a suspect classification prejudicial to OFWs. Upon cursory reading, the subject clause appears facially neutral, for it applies to all OFWs. However, a closer examination reveals that the subject clause has a discriminatory intent against, and an invidious impact on, OFWs at two levels:
First, OFWs with employment contracts of less than one year vis--vis OFWs with employment contracts of one year or more; Second, among OFWs with employment contracts of more than one year; and Third, OFWs vis--vis local workers with fixed-period employment;

OFWs with employment contracts of less than one year vis--vis OFWs with employment contracts of one year or more As pointed out by petitioner,[78] it was in Marsaman Manning Agency, Inc. v. National Labor Relations Commission[79] (Second Division, 1999) that the Court laid down the following rules on the application of the periods prescribed under Section 10(5) of R.A. No. 804, to wit:
A plain reading of Sec. 10 clearly reveals that the choice of which amount to award an illegally dismissed overseas contract worker, i.e., whether his salaries for the unexpired portion of his employment contract or three (3) months salary for every year of the unexpired term, whichever is less, comes into play only when the employment contract concerned has a term of at least one (1) year or more. This is evident from the words for every year of the unexpired term which follows the words salaries x x x for three months. To follow petitioners thinking that private respondent is entitled to three (3) months salary only simply because it is the lesser amount is to completely disregard and overlook some words used in the statute while giving effect to some. This is contrary to the well-established rule in legal hermeneutics that in interpreting a statute, care should be taken that every part or word thereof be given effect since the lawmaking body is presumed to know the meaning of the words employed in the statue and to have used them advisedly. Ut res magis valeat quam pereat.[80] (Emphasis supplied)

In Marsaman, the OFW involved was illegally dismissed two months into his 10-month contract, but was awarded his salaries for the remaining 8 months and 6 days of his contract. Prior to Marsaman, however, there were two cases in which the Court made conflicting rulings on Section 10(5). One was Asian Center for Career and Employment System and Services v. National Labor Relations Commission (Second Division, October 1998),[81] which involved an OFW who was awarded a two-year employment contract,but was dismissed after working for one year and two months. The LA declared his dismissal illegal and awarded him SR13,600.00 as lump-sum salary

covering eight months, the unexpired portion of his contract. On appeal, the Court reduced the award to SR3,600.00 equivalent to his three months salary, this being the lesser value, to wit:
Under Section 10 of R.A. No. 8042, a worker dismissed from overseas employment without just, valid or authorized cause is entitled to his salary for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less. In the case at bar, the unexpired portion of private respondents employment contract is eight (8) months. Private respondent should therefore be paid his basic salary corresponding to three (3) months or a total of SR3,600.[82]

Another was Triple-Eight Integrated Services, Inc. v. National Labor Relations Commission (Third Division, December 1998),[83] which involved an OFW (therein respondent Erlinda Osdana) who was originally granted a 12-month contract, which was deemed renewed for another 12 months. After serving for one year and seven-and-a-half months, respondent Osdana was illegally dismissed, and the Court awarded her salaries for the entire unexpired portion of four and one-half months of her contract. The Marsaman interpretation of Section 10(5) has since been adopted in the following cases:

Case Title

Contract Period 6 months 9 months

Period of Service 2 months 8 months

Unexpired Period 4 months 4 months

Period Applied in the Computation of the Monetary Award 4 months 4 months

Skippers v. Maguad[84] Bahia Shipping v. Reynaldo Chua [85]

Centennial 9 months Transmarine v. dela Cruz l[86] Talidano v. Falcon[87] Univan v. CA [88] Oriental v. CA [89] PCL v. NLRC[90] Olarte v. Nayona[91] 12 months 12 months

4 months

5 months

5 months

3 months 3 months

9 months 9 months 10 months more or less 9 months 11 months and 9 days

3 months 3 months 3 months 3 months 3 months

12 months more than 2 months 12 months more than 2 months 12 months 21 days

JSS v. Ferrer[92]

12 months

16 days 9 months and 7 days 10 months

11 months and 24 days 2 months and 23 days 2 months

3 months 2 months and 23 days Unexpired portion

Pentagon v. 12 months [93] Adelantar Phil. Employ v. Paramio, et al.[94] Flourish Maritime v. Almanzor [95] 12 months

2 years

26 days

23 months and 4 days 1 year, 9 months and 28 days

6 months or 3 months for each year of contract 6 months or 3 months for each year of contract

Athenna 1 year, 10 Manpower v. months and Villanos [96] 28 days

1 month

As the foregoing matrix readily shows, the subject clause classifies OFWs into two categories. The first category includes OFWs with fixed-period employment contracts of less than one year; in case of illegal dismissal, they are entitled to their salaries for the entire unexpired portion of their contract. The second category consists of OFWs with fixed-period employment contracts of one year or more; in case of illegal dismissal, they are entitled to monetary award equivalent to only 3 months of the unexpired portion of their contracts. The disparity in the treatment of these two groups cannot be discounted. In Skippers, the respondent OFW worked for only 2 months out of his 6-month contract, but was awarded his salaries for the remaining 4 months. In contrast, the respondent OFWs in Oriental and PCL who had also worked for about 2 months out of their 12-month contracts were awarded their salaries for only 3 months of the unexpired portion of their contracts. Even the OFWs involved in Talidano and Univan who had worked for a longer period of 3 months out of their 12-month contracts before being illegally dismissed were awarded their salaries for only 3 months. To illustrate the disparity even more vividly, the Court assumes a hypothetical OFW-A with an employment contract of 10 months at a monthly salary rate of US$1,000.00 and a hypothetical OFW-B with an employment contract of 15 months with the same monthly salary rate of US$1,000.00. Both commenced work on the same day and under the same employer, and were illegally dismissed after one month of work. Under the subject clause, OFW-A will be entitled to US$9,000.00, equivalent to his salaries for the remaining 9 months of his contract, whereas OFW-B will be entitled to only US$3,000.00, equivalent to his salaries for 3 months of the unexpired portion of his contract, instead of US$14,000.00 for the unexpired portion of 14 months of his contract, as the US$3,000.00 is the lesser amount. The disparity becomes more aggravating when the Court takes into account jurisprudence that, prior to the effectivity of R.A. No. 8042 on July 14, 1995,[97] illegally dismissed OFWs, no matter

how long the period of their employment contracts, were entitled to their salaries for the entire unexpired portions of their contracts. The matrix below speaks for itself:
Case Title Contract Period 2 years 2 years 2 years 2 years 2 years 12 months 12 months Period of Service 2 months 7 days 9 months 2 months 5 months 4 months 6 months and 22 days Unexpired Period 22 months 23 months and 23 days 15 months 22 months 19 months 8 months Period Applied in the Computation of the Monetary Award 22 months 23 months and 23 days 15 months 22 months 19 months 8 months

ATCI v. CA, et al.[98] Phil. Integrated v. NLRC[99] JGB v. NLC[100] Agoy v. NLRC[101] EDI v. NLRC, et al.[102] Barros v. NLRC, et al.[103] Philippine Transmarine v. [104] Carilla

5 months and 5 months and 18 days 18 days

It is plain that prior to R.A. No. 8042, all OFWs, regardless of contract periods or the unexpired portions thereof, were treated alike in terms of the computation of their monetary benefits in case of illegal dismissal. Their claims were subjected to a uniform rule of computation: their basic salaries multiplied by the entire unexpired portion of their employment contracts. The enactment of the subject clause in R.A. No. 8042 introduced a differentiated rule of computation of the money claims of illegally dismissed OFWs based on their employment periods, in the process singling out one category whose contracts have an unexpired portion of one year or more and subjecting them to the peculiar disadvantage of having their monetary awards limited to their salaries for 3 months or for the unexpired portion thereof, whichever is less, but all the while sparing the other category from such prejudice, simply because the latter's unexpired contracts fall short of one year. Among OFWs With Employment Contracts of More Than One Year

Upon closer examination of the terminology employed in the subject clause, the Court now has misgivings on the accuracy of the Marsaman interpretation.

The Court notes that the subject clause or for three (3) months for every year of the unexpired term, whichever is less contains the qualifying phrases every year and unexpired term. By its ordinary meaning, the word term means a limited or definite extent of time.[105] Corollarily, that every year is but part of an unexpired term is significant in many ways: first, the unexpired term must be at least one year, for if it were any shorter, there would be no occasion for such unexpired term to be measured by every year; and second, the original term must be more than one year, for otherwise, whatever would be the unexpired term thereof will not reach even a year. Consequently, the more decisive factor in the determination of when the subject clause for three (3) months for every year of the unexpired term, whichever is less shall apply is not the length of the original contract period as held in Marsaman,[106] but the length of the unexpired portion of the contract period -- the subject clause applies in cases when the unexpired portion of the contract period is at least one year, which arithmetically requires that the original contract period be more than one year. Viewed in that light, the subject clause creates a sub-layer of discrimination among OFWs whose contract periods are for more than one year: those who are illegally dismissed with less than one year left in their contracts shall be entitled to their salaries for the entire unexpired portion thereof, while those who are illegally dismissed with one year or more remaining in their contracts shall be covered by the subject clause, and their monetary benefits limited to their salaries for three months only. To concretely illustrate the application of the foregoing interpretation of the subject clause, the Court assumes hypothetical OFW-C and OFW-D, who each have a 24-month contract at a salary rate of US$1,000.00 per month. OFW-C is illegally dismissed on the 12th month, and OFW-D, on the 13th month. Considering that there is at least 12 months remaining in the contract period of OFW-C, the subject clause applies to the computation of the latter's monetary benefits. Thus, OFW-C will be entitled, not to US$12,000,00 or the latter's total salaries for the 12 months unexpired portion of the contract, but to the lesser amount of US$3,000.00 or the latter's salaries for 3 months out of the 12-month unexpired term of the contract. On the other hand, OFW-D is spared from the effects of the subject clause, for there are only 11 months left in the latter's contract period. Thus, OFW-D will be entitled to US$11,000.00, which is equivalent to his/her total salaries for the entire 11-month unexpired portion. OFWs vis--vis Local Workers With Fixed-Period Employment

As discussed earlier, prior to R.A. No. 8042, a uniform system of computation of the monetary awards of illegally dismissed OFWs was in place. This uniform system was applicable even to local workers with fixed-term employment.[107] The earliest rule prescribing a uniform system of computation was actually Article 299 of the Code of Commerce (1888),[108] to wit:

Article 299. If the contracts between the merchants and their shop clerks and employees should have been made of a fixed period, none of the contracting parties, without the consent of the other, may withdraw from the fulfillment of said contract until the termination of the period agreed upon. Persons violating this clause shall be subject to indemnify the loss and damage suffered, with the exception of the provisions contained in the following articles.

In Reyes v. The Compaia Maritima,[109] the Court applied the foregoing provision to determine the liability of a shipping company for the illegal discharge of its managers prior to the expiration of their fixed-term employment. The Court therein held the shipping company liable for the salaries of its managers for the remainder of their fixed-term employment. There is a more specific rule as far as seafarers are concerned: Article 605 of the Code of Commerce which provides:
Article 605. If the contracts of the captain and members of the crew with the agent should be for a definite period or voyage, they cannot be discharged until the fulfillment of their contracts, except for reasons of insubordination in serious matters, robbery, theft, habitual drunkenness, and damage caused to the vessel or to its cargo by malice or manifest or proven negligence.

Article 605 was applied to Madrigal Shipping Company, Inc. v. Ogilvie,[110] in which the Court held the shipping company liable for the salaries and subsistence allowance of its illegally dismissed employees for the entire unexpired portion of their employment contracts. While Article 605 has remained good law up to the present,[111] Article 299 of the Code of Commerce was replaced by Art. 1586 of the Civil Code of 1889, to wit:
Article 1586. Field hands, mechanics, artisans, and other laborers hired for a certain time and for a certain work cannot leave or be dismissed without sufficient cause, before the fulfillment of the contract. (Emphasis supplied.)

Citing Manresa, the Court in Lemoine v. Alkan[112] read the disjunctive "or" in Article 1586 as a conjunctive "and" so as to apply the provision to local workers who are employed for a time certain although for no particular skill. This interpretation of Article 1586 was reiterated in Garcia Palomar v. Hotel de France Company.[113] And in bothLemoine and Palomar, the Court adopted the general principle that in actions for wrongful discharge founded on Article 1586, local workers are entitled to recover damages to the extent of the amount stipulated to be paid to them by the terms of their contract. On the computation of the amount of such damages, the Court in Aldaz v. Gay[114] held:
The doctrine is well-established in American jurisprudence, and nothing has been brought to our attention to the contrary under Spanish jurisprudence, that when an employee is wrongfully discharged it is his duty to seek other employment of the same kind in the same community, for the purpose of reducing the damages resulting from such wrongful discharge. However, while this is the general rule, the burden of showing that he failed to make an effort to secure other employment of a like nature, and that other

employment of a like nature was obtainable, is upon the defendant. When an employee is wrongfully discharged under a contract of employment his prima facie damage is the amount which he would be entitled to had he continued in such employment until the termination of the period. (Howard vs. Daly, 61 N. Y., 362; Allen vs. Whitlark, 99 Mich., 492; Farrell vs. School District No. 2, 98 Mich., [115] 43.) (Emphasis supplied)

On August 30, 1950, the New Civil Code took effect with new provisions on fixed-term employment: Section 2 (Obligations with a Period), Chapter 3, Title I, and Sections 2 (Contract of Labor) and 3 (Contract for a Piece of Work), Chapter 3, Title VIII, Book IV.[116] Much like Article 1586 of the Civil Code of 1889, the new provisions of the Civil Code do not expressly provide for the remedies available to a fixed-term worker who is illegally discharged. However, it is noted that in Mackay Radio & Telegraph Co., Inc. v. Rich,[117] the Court carried over the principles on the payment of damages underlying Article 1586 of the Civil Code of 1889 and applied the same to a case involving the illegal discharge of a local worker whose fixed-period employment contract was entered into in 1952, when the new Civil Code was already in effect.[118] More significantly, the same principles were applied to cases involving overseas Filipino workers whose fixed-term employment contracts were illegally terminated, such as in First Asian Trans & Shipping Agency, Inc. v. Ople,[119] involving seafarers who were illegally discharged. In Teknika Skills and Trade Services, Inc. v. National Labor Relations Commission,[120] an OFW who was illegally dismissed prior to the expiration of her fixed-period employment contract as a baby sitter, was awarded salaries corresponding to the unexpired portion of her contract. The Court arrived at the same ruling in Anderson v. National Labor Relations Commission,[121] which involved a foreman hired in 1988 in Saudi Arabia for a fixed term of two years, but who was illegally dismissed after only nine months on the job -- the Court awarded him salaries corresponding to 15 months, the unexpired portion of his contract. In Asia World Recruitment, Inc. v. National Labor Relations Commission,[122] a Filipino working as a security officer in 1989 in Angola was awarded his salaries for the remaining period of his 12-month contract after he was wrongfully discharged. Finally, in Vinta Maritime Co., Inc. v. National Labor Relations Commission,[123] an OFW whose 12-month contract was illegally cut short in the second month was declared entitled to his salaries for the remaining 10 months of his contract. In sum, prior to R.A. No. 8042, OFWs and local workers with fixed-term employment who were illegally discharged were treated alike in terms of the computation of their money claims: they were uniformly entitled to their salaries for the entire unexpired portions of their contracts. But with the enactment of R.A. No. 8042, specifically the adoption of the subject clause, illegally dismissed OFWs with an unexpired portion of one year or more in their employment contract have since been differently treated in that their money claims are subject to a 3-month cap, whereas no such limitation is imposed on local workers with fixed-term employment. The Court concludes that the subject clause contains a suspect classification in that, in the computation of the monetary benefits of fixed-term employees who are illegally discharged, it imposes

a 3-month cap on the claim of OFWs with an unexpired portion of one year or more in their contracts, but none on the claims of other OFWs or local workers with fixed-term employment. The subject clause singles out one classification of OFWs and burdens it with a peculiar disadvantage. There being a suspect classification involving a vulnerable sector protected by the Constitution, the Court now subjects the classification to a strict judicial scrutiny, and determines whether it serves a compelling state interest through the least restrictive means. What constitutes compelling state interest is measured by the scale of rights and powers arrayed in the Constitution and calibrated by history.[124] It is akin to the paramount interest of the state[125] for which some individual liberties must give way, such as the public interest in safeguarding health or maintaining medical standards,[126] or in maintaining access to information on matters of public concern.[127] In the present case, the Court dug deep into the records but found no compelling state interest that the subject clause may possibly serve. The OSG defends the subject clause as a police power measure designed to protect the employment of Filipino seafarers overseas x x x. By limiting the liability to three months [sic], Filipino seafarers have better chance of getting hired by foreign employers. The limitation also protects the interest of local placement agencies, which otherwise may be made to shoulder millions of pesos in termination pay.[128] The OSG explained further:
Often, placement agencies, their liability being solidary, shoulder the payment of money claims in the event that jurisdiction over the foreign employer is not acquired by the court or if the foreign employer reneges on its obligation. Hence, placement agencies that are in good faith and which fulfill their obligations are unnecessarily penalized for the acts of the foreign employer. To protect them and to promote their continued helpful contribution in deploying Filipino migrant workers, liability for money are reduced under Section 10 of RA 8042. This measure redounds to the benefit of the migrant workers whose welfare the government seeks to promote. The survival of legitimate placement agencies helps [assure] the government that migrant workers are properly deployed and are employed under decent and humane conditions.[129] (Emphasis supplied)

However, nowhere in the Comment or Memorandum does the OSG cite the source of its perception of the state interest sought to be served by the subject clause. The OSG locates the purpose of R.A. No. 8042 in the speech of Rep. Bonifacio Gallego in sponsorship of House Bill No. 14314 (HB 14314), from which the law originated;[130] but the speech

makes no reference to the underlying reason for the adoption of the subject clause. That is only natural for none of the 29 provisions in HB 14314 resembles the subject clause. On the other hand, Senate Bill No. 2077 (SB 2077) contains a provision on money claims, to wit:
Sec. 10. Money Claims. - Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of the complaint, the claim arising out of an employeremployee relationship or by virtue of any law or contract involving Filipino workers for overseas employment including claims for actual, moral, exemplary and other forms of damages. The liability of the principal and the recruitment/placement agency or any and all claims under this Section shall be joint and several. Any compromise/amicable settlement or voluntary agreement on any money claims exclusive of damages under this Section shall not be less than fifty percent (50%) of such money claims: Provided, That any installment payments, if applicable, to satisfy any such compromise or voluntary settlement shall not be more than two (2) months. Any compromise/voluntary agreement in violation of this paragraph shall be null and void. Non-compliance with the mandatory period for resolutions of cases provided under this Section shall subject the responsible officials to any or all of the following penalties: (1) The salary of any such official who fails to render his decision or resolution within the prescribed period shall be, or caused to be, withheld until the said official complies therewith; (2) Suspension for not more than ninety (90) days; or (3) Dismissal from the service with disqualification to hold any appointive public office for five (5) years. Provided, however, That the penalties herein provided shall be without prejudice to any liability which any such official may have incurred under other existing laws or rules and regulations as a consequence of violating the provisions of this paragraph.

But significantly, Section 10 of SB 2077 does not provide for any rule on the computation of money claims. A rule on the computation of money claims containing the subject clause was inserted and eventually adopted as the 5th paragraph of Section 10 of R.A. No. 8042. The Court examined the rationale of the subject clause in the transcripts of the Bicameral Conference Committee (Conference Committee) Meetings on the Magna Carta on OCWs (Disagreeing Provisions of Senate Bill No. 2077 and House Bill No. 14314). However, the Court finds no discernible state interest, let alone a compelling one, that is sought to be protected or advanced by the adoption of the subject clause.

In fine, the Government has failed to discharge its burden of proving the existence of a compelling state interest that would justify the perpetuation of the discrimination against OFWs under the subject clause. Assuming that, as advanced by the OSG, the purpose of the subject clause is to protect the employment of OFWs by mitigating the solidary liability of placement agencies, such callous and cavalier rationale will have to be rejected. There can never be a justification for any form of government action that alleviates the burden of one sector, but imposes the same burden on another sector, especially when the favored sector is composed of private businesses such as placement agencies, while the disadvantaged sector is composed of OFWs whose protection no less than the Constitution commands. The idea that private business interest can be elevated to the level of a compelling state interest is odious. Moreover, even if the purpose of the subject clause is to lessen the solidary liability of placement agencies vis-a-vis their foreign principals, there are mechanisms already in place that can be employed to achieve that purpose without infringing on the constitutional rights of OFWs. The POEA Rules and Regulations Governing the Recruitment and Employment of Land-Based Overseas Workers, dated February 4, 2002, imposes administrative disciplinary measures on erring foreign employers who default on their contractual obligations to migrant workers and/or their Philippine agents. These disciplinary measures range from temporary disqualification to preventive suspension. The POEA Rules and Regulations Governing the Recruitment and Employment of Seafarers, dated May 23, 2003, contains similar administrative disciplinary measures against erring foreign employers. Resort to these administrative measures is undoubtedly the less restrictive means of aiding local placement agencies in enforcing the solidary liability of their foreign principals. Thus, the subject clause in the 5th paragraph of Section 10 of R.A. No. 8042 is violative of the right of petitioner and other OFWs to equal protection. Further, there would be certain misgivings if one is to approach the declaration of the unconstitutionality of the subject clause from the lone perspective that the clause directly violates state policy on labor under Section 3,[131] Article XIII of the Constitution. While all the provisions of the 1987 Constitution are presumed self-executing,,[132] there are some which this Court has declared not judicially enforceable, Article XIII being one,[133] particularly Section 3 thereof, the nature of which, this Court, in Agabon v. National Labor Relations Commission,[134] has described to be not self-actuating:

Thus, the constitutional mandates of protection to labor and security of tenure may be deemed as self-executing in the sense that these are automatically acknowledged and observed without need for any enabling legislation. However, to declare that the constitutional provisions are enough to guarantee the full exercise of the rights embodied therein, and the realization of ideals therein expressed, would be impractical, if not unrealistic. The espousal of such view presents the dangerous tendency of being overbroad and exaggerated. The guarantees of "full protection to labor" and "security of tenure", when examined in isolation, are facially unqualified, and the broadest interpretation possible suggests a blanket shield in favor of labor against any form of removal regardless of circumstance. This interpretation implies an unimpeachable right to continued employment-a utopian notion, doubtless-but still hardly within the contemplation of the framers. Subsequent legislation is still needed to define the parameters of these guaranteed rights to ensure the protection and promotion, not only the rights of the labor sector, but of the employers' as well. Without specific and pertinent legislation, judicial bodies will be at a loss, formulating their own conclusion to approximate at least the aims of the Constitution. Ultimately, therefore, Section 3 of Article XIII cannot, on its own, be a source of a positive enforceable right to stave off the dismissal of an employee for just cause owing to the failure to serve proper notice or hearing. As manifested by several framers of the 1987 Constitution, the provisions on social justice require legislative enactments for their enforceability.[135] (Emphasis added)

Thus, Section 3, Article XIII cannot be treated as a principal source of direct enforceable rights, for the violation of which the questioned clause may be declared unconstitutional. It may unwittingly risk opening the floodgates of litigation to every worker or union over every conceivable violation of so broad a concept as social justice for labor. It must be stressed that Section 3, Article XIII does not directly bestow on the working class any actual enforceable right, but merely clothes it with the status of a sector for whom the Constitution urges protection through executive or legislative action and judicial recognition. Its utility is best limited to being an impetus not just for the executive and legislative departments, but for the judiciary as well, to protect the welfare of the working class. And it was in fact consistent with that constitutional agenda that the Court inCentral Bank (now Bangko Sentral ng Pilipinas) Employee Association, Inc. v. Bangko Sentral ng Pilipinas, penned by then Associate Justice now Chief Justice Reynato S. Puno, formulated the judicial precept that when the challenge to a statute is premised on the perpetuation of prejudice against persons favored by the Constitution with special protection -- such as the working class or a section thereof -- the Court may recognize the existence of a suspect classification and subject the same to strict judicial scrutiny. The view that the concepts of suspect classification and strict judicial scrutiny formulated in Central Bank Employee Association exaggerate the significance of Section 3, Article XIII is a groundless apprehension. Central Bank applied Article XIII in conjunction with the equal protection clause. Article XIII, by itself, without the application of the equal protection clause, has no life or force of its own as elucidated in Agabon.

Along the same line of reasoning, the Court further holds that the subject clause violates petitioner's right to substantive due process, for it deprives him of property, consisting of monetary benefits, without any existing valid governmental purpose.[136] The argument of the Solicitor General, that the actual purpose of the subject clause of limiting the entitlement of OFWs to their three-month salary in case of illegal dismissal, is to give them a better chance of getting hired by foreign employers. This is plain speculation. As earlier discussed, there is nothing in the text of the law or the records of the deliberations leading to its enactment or the pleadings of respondent that would indicate that there is an existing governmental purpose for the subject clause, or even just a pretext of one. The subject clause does not state or imply any definitive governmental purpose; and it is for that precise reason that the clause violates not just petitioner's right to equal protection, but also her right to substantive due process under Section 1,[137] Article III of the Constitution. The subject clause being unconstitutional, petitioner is entitled to his salaries for the entire unexpired period of nine months and 23 days of his employment contract, pursuant to law and jurisprudence prior to the enactment of R.A. No. 8042. On the Third Issue Petitioner contends that his overtime and leave pay should form part of the salary basis in the computation of his monetary award, because these are fixed benefits that have been stipulated into his contract. Petitioner is mistaken. The word salaries in Section 10(5) does not include overtime and leave pay. For seafarers like petitioner, DOLE Department Order No. 33, series 1996, provides a Standard Employment Contract of Seafarers, in which salary is understood as the basic wage, exclusive of overtime, leave pay and other bonuses; whereas overtime pay is compensation for all work performed in excess of the regular eight hours, and holiday pay is compensation for any work performed on designated rest days and holidays. By the foregoing definition alone, there is no basis for the automatic inclusion of overtime and holiday pay in the computation of petitioner's monetary award, unless there is evidence that he performed work during those periods. As the Court held in Centennial Transmarine, Inc. v. Dela Cruz,[138]
However, the payment of overtime pay and leave pay should be disallowed in light of our ruling in Cagampan v. National Labor Relations Commission, to wit:

The rendition of overtime work and the submission of sufficient proof that said was actually performed are conditions to be satisfied before a seaman could be entitled to overtime pay which should be computed on the basis of 30% of the basic monthly salary. In short, the contract provision guarantees the right to overtime pay but the entitlement to such benefit must first be established. In the same vein, the claim for the day's leave pay for the unexpired portion of the contract is unwarranted since the same is given during the actual service of the seamen.

WHEREFORE, the Court GRANTS the Petition. The subject clause or for three months for every year of the unexpired term, whichever is less in the 5th paragraph of Section 10 of Republic Act No. 8042 is DECLARED UNCONSTITUTIONAL; and the December 8, 2004 Decision and April 1, 2005 Resolution of the Court of Appeals areMODIFIED to the effect that petitioner is AWARDED his salaries for the entire unexpired portion of his employment contract consisting of nine months and 23 days computed at the rate of US$1,400.00 per month. No costs. SO ORDERED.

MA. ALICIA AUSTRIA-MARTINEZ Associate Justice

WE CONCUR:

REYNATO S. PUNO Chief Justice

LEONARDO A. QUISUMBING Associate Justice

CONSUELO YNARES-SANTIAGO Associate Justice

ANTONIO T. CARPIO Associate Justice

RENATO C. CORONA Associate Justice

CONCHITA CARPIO MORALES Associate Justice

DANTE O. TINGA Associate Justice

(On leave) MINITA V. CHICO-NAZARIO Associate Justice

PRESBITERO J. VELASCO, JR. Associate Justice

ANTONIO EDUARDO B. NACHURA Associate Justice

TERESITA J. LEONARDODE CASTRO Associate Justice

(see concurring opinion) ARTURO D. BRION Associate Justice

DIOSDADO M. PERALTA Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court.

REYNATO S. PUNO

Chief Justice

[1] [2] [3]

[4] [5] [6] [7] [8] [9] [10]

[11] [12]

[13] [14] [15] [16] [17] [18] [19] [20] [21] [22] [23] [24] [25] [26] [27] [28] [29] [30] [31] [32] [33] [34] [35] [36] [37] [38] [39] [40] [41]

[42] [43] [44] [45] [46] [47]

[48]

http://www.un.org/News/Press/docs/2007/sgsm11084.doc.htm. Migrant Workers and Overseas Filipinos Act of 1995, effective July 15, 1995. Penned by Associate Justice Andres B. Reyes, Jr. and concurred in by Associate Justices Lucas P. Bersamin and Celia C. LibreaLeagogo; rollo, p. 231. Id. at 248. Rollo, p. 57. Id. at 58. Id. at 59. Id. at 48. Id. at 55. According to petitioner, this amount represents the pro-rated difference between the salary of US$2,590.00 per month which he was supposed to receive as Chief Officer from March 19, 1998 to April 30, 1998 and the salary of US$1,850.00 per month which he was actually paid as Second Officer for the same period. See LA Decision, rollo, pp. 107 and 112. Position Paper, id. at 53-54. The LA awarded petitioner US$45.00 out of the US$1,480.00 salary differential to which petitioner is entitled in view of his having received from respondents US$1,435.00 as evidenced by receipts marked as Annexes F, G and H, id. at 319-321. Id. at 114. Rollo, pp. 111-112. Id. at 124. Id. at 115. G.R. No. 129584, December 3, 1998, 299 SCRA 608. Appeal Memorandum, rollo, p. 121. Id. at 134. NLRC Decision, rollo, p. 140. Id. at 146-150. Id. at 153. Id. at 155. Id. at 166-177. CA Decision, id. at 239-241. Id. at 242. Id. at 248. Petition, rollo, p. 28. Id. at 787. Id. at 799. Rollo, p. 282 Memorandum for Petitioner, id. at 741-742. Id. at 746-753. Section 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare. Rollo, pp. 763-766. Petition, id. at 735. Memorandum of the Solicitor General, rollo, p. 680. Memorandum for Petitioner, id. at 755. Id. at 761-763. Rollo, pp. 645-646 and 512-513. Alfredo L. Benipayo was Solicitor General at the time the Comment was filed. Antonio Eduardo B. Nachura (now an Associate Justice of the Supreme Court) was Solicitor General when the Memorandum was filed. Memorandum of the Solicitor General, id. at 662-665. G.R. No. 113658, March 31, 1995, 243 SCRA 190. G.R. No. 110524, July 29, 2002, 385 SCRA 306. Memorandum of the Solicitor General, rollo, pp. 668-678. Id. at 682. The Province of North Cotabato v. The Government of the Republic of the Philippines Peace Panel on Ancestral Domain, G.R. No. 183591 October 14, 2008. Automotive Industry Workers Alliance v. Romulo, G.R. No. 157509, January 18, 2005, 449 SCRA 1.

[49] [50] [51]

[52] [53] [54] [55] [56] [57] [58] [59] [60]

[61]

[62] [63] [64]

[65]

[66]

[67] [68] [69]

[70]

[71] [72] [73]

[74] [75] [76] [77] [78] [79] [80] [81] [82]

David v. Macapagal-Arroyo, G.R. No. 171396, May 3, 2006, 489 SCRA 160. Arceta v. Mangrobang, G.R. No. 152895, June 15, 2004, 432 SCRA 136. Moldex Realty, Inc. v. Housing and Land Use Regulatory Board, G.R. No. 149719, June 21, 2007, 525 SCRA 198; Marasigan v. Marasigan, G.R. No. 156078, March 14, 2008, 548 SCRA 409. Matibag v. Benipayo, G.R. No. 149036, April 2, 2002, 380 SCRA 49. Rollo, p. 145. Id. at 166. Smart Communications, Inc. v. National Telecommunications Commission, G.R. No. 151908, August 12, 2003, 408 SCRA 678. Equi-Asia Placement, Inc. v. Department of Foreign Affairs, G.R. No. 152214, September 19, 2006, 502 SCRA 295. Memorandum for Petitioner, rollo, pp. 741-742. Ortigas & Co., Ltd. v. Court of Appeals, G.R. No. 126102, December 4, 2000, 346 SCRA 748. Picop Resources, Inc. v. Base Metals Mineral Resources Corporation, G.R. No. 163509, December 6, 2006, 510 SCRA 400. Walker v. Whitehead, 83 U.S. 314 (1873); Wood v. Lovett, 313 U.S. 362, 370 (1941); Intrata-Assurance Corporation v. Republic of the Philippines, G.R. No. 156571, July 9, 2008; Smart Communications, Inc. v. City of Davao, G.R. No. 155491, September 16, 2008. Executive Secretary v. Court of Appeals, G.R. No. 131719, May 25, 2004, 429 SCRA 81, citing JMM Promotion and Management, Inc. v. Court of Appeals, G.R. No. 120095, August 5, 1996, 260 SCRA 319. Ortigas & Co., Ltd. v. Court of Appeals, supra note 58. Section 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare. Section 3, The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. See City of Manila v. Laguio, G.R. No. 118127, April 12, 2005, 455 SCRA 308; Pimentel III v. Commission on Elections, G.R. No. 178413, March 13, 2008, 548 SCRA 169. League of Cities of the Philippines v. Commission on Elections G.R. No. 176951, November 18, 2008; Beltran v. Secretary of Health, G.R. No. 139147,November 25, 2005, 476 SCRA 168. Association of Small Landowners in the Philippines v. Secretary of Agrarian Reform, G.R. No. 78742, July 14, 1989, 175 SCRA 343. Los Angeles v. Almeda Books, Inc., 535 U.S. 425 (2002); Craig v. Boren, 429 US 190 (1976). There is also the "heightened scrutiny" standard of review which is less demanding than "strict scrutiny" but more demanding than the standard rational relation test. Heightened scrutiny has generally been applied to cases that involve discriminatory classifications based on sex or illegitimacy, such as in Plyler v. Doe, 457 U.S. 202, where a heightened scrutiny standard was used to invalidate a State's denial to the children of illegal aliens of the free public education that it made available to other residents. America v. Dale, 530 U.S. 640 (2000); Parents Involved in Community Schools v. Seattle School District No. 1, 551 U.S. (2007); http://www.supremecourtus.gov/opinions/06pdf/05-908.pdf. Adarand Constructors, Inc. v. Pea, 515 US 230 (1995). Grutter v. Bollinger, 539 US 306 (2003); Bernal v. Fainter, 467 US 216 (1984). The concept of suspect classification first emerged in the famous footnote in the opinion of Justice Harlan Stone in U.S. v. Carolene Products Co., 304 U.S. 144 (1938), the full text of which footnote is reproduced below: There may be narrower scope for operation of the presumption of constitutionality when legislation appears on its face to be within a specific prohibition of the Constitution, such as those of the first ten amendments, which are deemed equally specific when held to be embraced within the Fourteenth. See Stromberg v. California, 283 U.S. 359, 369-370; Lovell v. Griffin, 303 U.S. 444, 452. It is unnecessary to consider now whether legislation which restricts those political processes which can ordinarily be expected to bring about repeal of undesirable legislation is to be subjected to more exacting judicial scrutiny under the general prohibitions of the Fourteenth Amendment than are most other types of legislation. On restrictions upon the right to vote, see Nixon v. Herndon, 273 U.S. 536; Nixon v. Condon, 286 U.S. 73; on restraints upon the dissemination of information, see Near v. Minnesota ex rel. Olson, 283 U.S. 697, 713714, 718-720, 722; Grosjean v. American Press Co., 297 U.S. 233; Lovell v. Griffin, supra; on interferences with political organizations, see Stromberg v. California, supra, 369; Fiske v. Kansas, 274 U.S. 380; Whitney v. California, 274 U.S. 357, 373-378; Herndon v. Lowry, 301 U.S. 242, and see Holmes, J., in Gitlow v. New York, 268 U.S. 652, 673; as to prohibition of peaceable assembly, see De Jonge v. Oregon, 299 U.S. 353, 365. Nor need we enquire whether similar considerations enter into the review of statutes directed at particular religious, Pierce v. Society of Sisters, 268 U.S. 510, or national, Meyer v. Nebraska, 262 U.S. 390; Bartels v. Iowa, 262 U.S. 404; Farrington v. Tokushige, 273 U.S. 284, or racial minorities, Nixon v. Herndon, supra; Nixon v. Condon, supra: whether prejudice against discrete and insular minorities may be a special condition, which tends seriously to curtail the operation of those political processes ordinarily to be relied upon to protect minorities, and which may call for a correspondingly more searching judicial inquiry. Compare McCulloch v. Maryland, 4 Wheat. 316, 428; South Carolina v. Barnwell Bros., 303U.S. 177, 184, n 2, and cases cited. Korematsu v. United States, 323 U.S. 214 (1944); Regents of the University of California v. Bakke, 438 U.S. 265 (1978). Frontiero v. Richardson, 411 U.S. 677 (1973); U.S. v. Virginia, 518 U.S. 515 (1996). San Antonio Independent School District v. Rodriguez, 411 U.S. 1 (1973). G.R. No. 148208, December 15, 2004, 446 SCRA 299. Rollo, pp. 727 and 735. 371 Phil. 827 (1999). Id. at 840-841. G.R. No. 131656, October 20, 1998, 297 SCRA 727. Id.

[83] [84] [85] [86] [87] [88] [89] [90] [91] [92] [93] [94] [95] [96]

Supra note 17. G.R. No. 166363, August 15, 2006, 498 SCRA 639. G.R. No. 162195, April 8, 2008, 550 SCRA 600. G.R. No. 180719, August 22, 2008. G.R. No. 172031, July 14, 2008, 558 SCRA 279. G.R. No. 157534, June 18, 2003 (Resolution). G.R. No. 153750, January 25, 2006, 480 SCRA 100. G.R. No. 148418, July 28, 2005, 464 SCRA 314. G.R. No. 148407, November 12, 2003, 415 SCRA 720. G.R. No. 156381, October 14, 2005, 473 SCRA 120. G.R. No. 157373, July 27, 2004, 435 SCRA 342. G.R. No. 144786, April 15, 2004, 427 SCRA 732. G.R. No. 177948, March 14, 2008, 548 SCRA 712. G.R. No. 151303, April 15, 2005, 456 SCRA 313. Asian Center v. National Labor Relations Commission, supra note 81. G.R. No. 143949, August 9, 2001, 362 SCRA 571. G.R. No. 123354, November 19, 1996, 264 SCRA 418. G.R. No. 109390, March 7, 1996, 254 SCRA 457. G.R. No. 112096, January 30, 1996, 252 SCRA 588. G.R. No. 145587, October 26, 2007, 537 SCRA 409. G.R. No. 123901, September 22, 1999, 315 SCRA 23. G.R. No. 157975, June 26, 2007, 525 SCRA 586. www.merriam-webster.com/dictionary visited on November 22, 2008 at 3:09. See also Flourish, supra note 95; and Athena, supra note 96. It is noted that both petitioner and the OSG drew comparisons between OFWs in general and local workers in general. However, the Court finds that the more relevant comparison is between OFWs whose employment is necessarily subject to a fixed term and local workers whose employment is also subject to a fixed term. Promulgated on August 6, 1888 by Queen Maria Cristina of Spain and extended to the Philippines by Royal Decree of August 8, 1888. It took effect on December 1, 1888. No. 1133, March 29, 1904, 3 SCRA 519. No. L-8431, October 30, 1958, 104 SCRA 748. See also Wallem Philippines Shipping, Inc. v. Hon. Minister of Labor, No. L-50734-37, February 20, 1981, 102 SCRA 835, where Madrigal Shipping Company, Inc. v. Ogilvie is cited. No. L-10422, January 11, 1916, 33 SCRA 162. No. L-15878, January 11, 1922, 42 SCRA 660. 7 Phil. 268 (1907). See also Knust v. Morse, 41 Phil 184 (1920). Brent School, Inc. v. Zamora, No. L-48494, February 5, 1990, 181 SCRA 702. No. L-22608, June 30, 1969, 28 SCRA 699. The Labor Code itself does not contain a specific provision for local workers with fixed-term employment contracts. As the Court observed in Brent School, Inc., the concept of fixed-term employment has slowly faded away from our labor laws, such that reference to our labor laws is of limited use in determining the monetary benefits to be awarded to fixed-term workers who are illegally dismissed. No. L-65545, July 9, 1986., 142 SCRA 542. G.R. No. 100399, August 4, 1992, 212 SCRA 132. G.R. No. 111212, January 22, 1996, 252 SCRA 116. G.R. No. 113363, August 24, 1999, 313 SCRA 1. G.R. No. 113911, January 23, 1998, 284 SCRA 656. See Estrada v. Escritor, A.M. No. P-02-1651, August 4, 2003, 408 SCRA 1. Id. Roe v. Wade, 410 U.S. 113 (1971); see also Carey v. Population Service International, 431 U.S. 678 (1977). Sabio v. Gordon, G.R. Nos. 174340, 174318, 174177, October 16, 2006, 504 SCRA 704. Comment, rollo, p. 555. Memorandum of the Solicitor General, id. at 682-683 Id. at p. 693. Section 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law. The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster industrial peace.

[97] [98] [99] [100] [101] [102] [103] [104] [105] [106] [107]

[108]

[109] [110] [111]

[112] [113] [114] [115] [116] [117] [118]

[119] [120] [121] [122] [123] [124] [125] [126] [127] [128] [129] [130] [131]

[132] [133] [134] [135] [136] [137]

[138]

The State shall regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits of production and the right of enterprises to reasonable returns to investments, and to expansion and growth. Manila Prince Hotel v. Government Service Insurance System, G.R. No. 122156, February 3, 1997, 267 SCRA 408. Basco v. Philippine Amusement and Gaming Corporation, G.R. No. 91649, May 14, 1991, 197 SCRA 52. G.R. No. 158693, November 17, 2004, 442 SCRA 573. Agabon v. National Labor Relations Commission , supra note 134, at 686. Associated Communications and Wireless Services, Ltd. v. Dumlao, G. R. No. 136762, November 21, 2002, 392 SCRA 269. Section 1. No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws. G.R. No. 180719, August 22, 2008. See also PCL Shipping Philippines, Inc. v. National Labor Relations Commission. G.R. No. 153031, December 14, 2006, 511 SCRA 44.

THIRD DIVISION
BECMEN SERVICE EXPORTER AND PROMOTION, INC., Petitioner, G.R. Nos. 182978-79 Present: Ynares-Santiago, J.(Chairperson), Carpio Morales,* Chico-Nazario, Nachura, and Peralta, JJ.

- versus -

SPOUSES SIMPLICIO and MILA CUARESMA (for and in behalf of their daughter, Jasmin G. Cuaresma), WHITE FALCON SERVICES, INC. and JAIME ORTIZ (President, White Falcon Services, Inc.), Respondents. x ------------------------------------------------------ x SPOUSES SIMPLICIO and MILA CUARESMA (for and in behalf of their daughter, Jasmin G. Cuaresma), Petitioners, - versus WHITE FALCON SERVICES, INC. Promulgated: and BECMEN SERVICE EXPORTER AND PROMOTION, INC., Respondents. April 7, 2009 x ---------------------------------------------------------------------------------------- x G.R. Nos. 184298-99

DECISION
YNARES-SANTIAGO, J.:
These consolidated petitions assail the Amended Decision[1] of the Court of Appeals dated May 14, 2008 in CA-G.R. SP No. 80619 and CA-G.R. SP No. 81030 finding White Falcon Services, Inc. and Becmen Service Exporter and Promotion, Inc. solidarily liable to indemnify spouses Simplicio and Mila Cuaresma the amount of US$4,686.73 in actual damages with interest. On January 6, 1997, Jasmin Cuaresma (Jasmin) was deployed by Becmen Service Exporter and Promotion, Inc.[2] (Becmen) to serve as assistant nurse in Al-Birk Hospital in the Kingdom of Saudi Arabia (KSA), for a contract duration of three years, with a corresponding salary of US$247.00 per month. Over a year later, she died allegedly of poisoning. Jessie Fajardo, a co-worker of Jasmin, narrated that on June 21, 1998, Jasmin was found dead by a female cleaner lying on the floor inside her dormitory room with her mouth foaming and smelling of poison.[3] Based on the police report and the medical report of the examining physician of the AlBirk Hospital, who conducted an autopsy of Jasmins body, the likely cause of her death was poisoning. Thus:
According to letter No. 199, dated 27.2.1419H, issued by Al-Birk Police Station, for examining the corpse of Jasmin Cuaresma, 12.20 P.M. 27.2.1419H, Sunday, at Al-Birk Hospital. 1. The Police Report on the Death 2. The Medical Diagnosis Sex: Female Age: 25 years Relg: Christian

The said person was brought to the Emergency Room of the hospital; time 12.20 P.M. and she was unconscious, blue, no pulse, no respiration and the first aid esd undertaken but without success. 3. Diagnosis and Opinion: Halt in blood circulation respiratory system and brain damage due to an apparent poisoning which is under investigation.[4] Name: Jasmin Cuaresma Sex: Female Marital Status: Single

Nationality: Philipino (sic)

Religion: Christian Address: Al-Birk Genrl. Hospital

Profession: Nurse Birth Place: The Philippines

On 27.2.1419H, Dr. Tariq Abdulminnem and Dr. Ashoki Komar, both have examined the dead body of Jasmin Cuaresma, at 12.20 P.M., Sunday, 22.2.14189H, and the result was: 1. Report of the Police on the death 2. Medical Examination: Blue skin and paleness on the Extrimes (sic), total halt to blood circulation and respiratory system and brain damage. There were no external injuries. Likely poisoning by taking poisonous substance, yet not determined. There was a bad smell in the mouth and unknown to us.[5] (Emphasis supplied)

Jasmins body was repatriated to Manila on Sept ember 3, 1998. The following day, the City Health Officer of Cabanatuan City conducted an autopsy and the resulting medical report indicated that Jasmin died under violent circumstances, and not poisoning as originally found by the KSA examining physician. The City Health Officer found that Jasmin had abrasions at her inner lip and gums; lacerated wounds and abrasions on her left and right ears; lacerated wounds and hematoma (contusions) on her elbows; abrasions and hematoma on her thigh and legs; intra-muscular hemorrhage at the anterior chest; rib fracture; puncture wounds; and abrasions on the labia minora of the vaginal area.[6] On March 11, 1999, Jasmins remains were exhumed and examined by the National Bureau of Investigation (NBI). The toxicology report of the NBI, however, tested negative for non-volatile, metallic poison and insecticides.[7] Simplicio and Mila Cuaresma (the Cuaresmas), Jasmins parents and her surviving heirs, received from the Overseas Workers Welfare Administration (OWWA) the following amounts: P50,000.00 for death benefits; P50,000.00 for loss of life; P20,000.00 for funeral expenses; and P10,000.00 for medical reimbursement. On November 22, 1999, the Cuaresmas filed a complaint against Becmen and its principal in the KSA, Rajab & Silsilah Company (Rajab), claiming death and insurance benefits, as well as moral and exemplary damages for Jasmins death.[8] In their complaint, the Cuaresmas claim that Jasmins death was work-related, having occurred at the employers premises;[9] that under Jasmins contract with Becmen, she is entitled to iqama insurance coverage; that Jasmin is entitled to compensatory damages in the amount of US$103,740.00, which is the sum total of her monthly salary of US$247.00 per month under her employment contract, multiplied by 35 years (or the remaining years of her productive life had death not supervened at age 25, assuming that she lived and would have retired at age 60).

The Cuaresmas assert that as a result of Jasmins death under mysterious circumstances, they suffered sleepless nights and mental anguish. The situation, they claim, was aggravated by findings in the autopsy and exhumation reports which evidently show that a grave injustice has been committed against them and their daughter, for which those responsible should likewise be made to pay moral and exemplary damages and attorneys fees. In their position paper, Becmen and Rajab insist that Jasmin committed suicide, citing a prior unsuccessful suicide attempt sometime in March or April 1998 and relying on the medical report of the examining physician of the Al-Birk Hospital. They likewise deny liability because the Cuaresmas already recovered death and other benefits totaling P130,000.00 from the OWWA. They insist that the Cuaresmas are not entitled to iqama insurance because this refers to the issuance not insurance of iqama, or residency/work permit required in the KSA. On the issue of moral and exemplary damages, they claim that the Cuaresmas are not entitled to the same because they have not acted with fraud, nor have they been in bad faith in handling Jasmins case. While the case was pending, Becmen filed a manifestation and motion for substitution alleging that Rajab terminated their agency relationship and had appointed White Falcon Services, Inc. (White Falcon) as its new recruitment agent in the Philippines. Thus, White Falcon was impleaded as respondent as well, and it adopted and reiterated Becmens arguments in the position paper it subsequently filed. On February 28, 2001, the Labor Arbiter rendered a Decision[10] dismissing the complaint for lack of merit. Giving weight to the medical report of the Al-Birk Hospital finding that Jasmin died of poisoning, the Labor Arbiter concluded that Jasmin committed suicide. In any case, Jasmins death was not service-connected, nor was it shown that it occurred while she was on duty; besides, her parents have received all corresponding benefits they were entitled to under the law. In regard to damages, the Labor Arbiter found no legal basis to warrant a grant thereof. On appeal, the National Labor Relations Commission (Commission) reversed the decision of the Labor Arbiter. Relying on the findings of the City Health Officer of Cabanatuan City and the NBI as contained in their autopsy and toxicology report, respectively, the Commission, via its November 22, 2002 Resolution[11] declared that, based on substantial evidence adduced, Jasmin was the victim of compensable work-connected criminal aggression. It disregarded the Al-Birk Hospital attending physicians report as well as the KSA police report, finding the same to be inconclusive. It declared that Jasmins death was the result of an accident occurring within the employers premises that is attributable to her employment, or to the conditions under which she lived, and thus arose out of and in the course of her employment as nurse. Thus, the Cuaresmas are entitled to actual damages in the form of

Jasmins lost earnings, including future earnings, in the total amount of US$113,000.00. The Commission, however, dismissed all other claims in the complaint. Becmen, Rajab and White Falcon moved for reconsideration, whereupon the Commission issued its October 9, 2003 Resolution[12] reducing the award of US$113,000.00 as actual damages to US$80,000.00.[13] The NLRC likewise declared Becmen and White Falcon as solidarily liable for payment of the award. Becmen and White Falcon brought separate petitions for certiorari to the Court of Appeals.[14] On June 28, 2006, the appellate court rendered its Decision,[15] the dispositive portion of which reads, as follows:
WHEREFORE, the subject petitions are DENIED but in the execution of the decision, it should first be enforced against White Falcon Services and then against Becmen Services when it is already impossible, impractical and futile to go against it (White Falcon). SO ORDERED.[16]

The appellate court affirmed the NLRCs findings that Jasmins death was compensable, the same having occurred at the dormitory, which was contractually provided by the employer. Thus her death should be considered to have occurred within the employers premises, arising out of and in the course of her employment. Becmen and White Falcon moved for reconsideration. On May 14, 2008, the appellate court rendered the assailed Amended Decision, the dispositive portion of which reads, as follows:
WHEREFORE, the motions for reconsideration are GRANTED. Accordingly, the award of US$80,000.00 in actual damages is hereby reduced to US$4,686.73 plus interest at the legal rate computed from the time it became due until fully paid. Petitioners are hereby adjudged jointly and solidarily liable with the employer for the monetary awards with Becmen Service Exporter and Promotions, Inc. having a right of reimbursement from White Falcon Services, Inc. SO ORDERED.[17]

In the Amended Decision, the Court of Appeals found that although Jasmins death was compensable, however, there is no evidentiary basis to support an award of actual damages in the amount of US$80,000.00. Nor may lost earnings be collected, because the same may be charged only against the perpetrator of the crime or quasi-delict. Instead, the appellate court held that Jasmins beneficiaries should be en titled only to the sum equivalent of the remainder of her 36-month employment contract, or her monthly salary of US$247.00 multiplied by nineteen (19) months, with legal interest.

Becmen filed the instant petition for review on certiorari (G.R. Nos. 182978-79). The Cuaresmas, on the other hand, moved for a reconsideration of the amended decision, but it was denied. They are now before us via G.R. Nos. 184298-99. On October 6, 2008, the Court resolved to consolidate G.R. Nos. 184298-99 with G.R. Nos. 182978-79. In G.R. Nos. 182978-79, Becmen raises the following issues for our resolution:
(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT GAVE MORE CREDENCE AND WEIGHT TO THE AUTOPSY REPORT CONDUCTED BY THE CABANATUAN CITY HEALTH OFFICE THAN THE MEDICAL AND POLICE REPORTS ISSUED BY THE MINISTRY OF HEALTH OF KINGDOM OF SAUDI ARABIA AND ALBIRK HOSPITAL. (THE COURT OF APPEALS) GRAVELY ERRED WHEN ON THE BASIS OF THE POSITION PAPERS AND ANNEXES THERETO INCLUDING THE AUTOPSY REPORT, IT CONCLUDED THAT THE DEATH OF JASMIN CUARESMA WAS CAUSED BY CRIMINAL AGGRESSION. (THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD THAT THE DEATH OF JASMIN CUARESMA WAS COMPENSABLE PURSUANT TO THE RULING OF THE SUPREME COURT IN TALLER VS. YNCHAUSTI, G.R. NO. 35741, DECEMBER 20, 1932, WHICH IT FOUND TO BE STILL GOOD LAW. (THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE FOR THE DEATH OF JASMIN CUARESMA NOTWITHSTANDING ITS ADMISSIONS THAT IQAMA INSURANCE WAS A TYPOGRAPHICAL ERROR SINCE IQAMA IS NOT AN INSURANCE. (THE COURT OF APPEALS) GRAVELY ERRED WHEN IT CONCLUDED THAT THE DEATH OF JASMIN WAS WORK RELATED. (THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE TO JASMINS BENEFICIARIES FOR THE REMAINDER OF HER 36-MONTH CONTRACT COMPUTED IN THIS MANNER: MONTHLY SALARY OF US$246.67 MULTIPLIED BY 19 MONTHS, THE REMAINDER OF THE TERM OF JASMINS EMPLOYMENT CONTRACT, IS EQUAL TO US$4,686.73. (THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE TO PAY INTEREST AT THE LEGAL RATE FROM THE TIME IT WAS DUE UNTIL FULLY PAID. (THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN AND WHITE FALCON JOINTLY AND SEVERALLY LIABLE WITH THE EMPLOYER NOTWITHSTANDING THE ASSUMPTION OF LIABILITY EXECUTED BY WHITE FALCON IN FAVOR OF BECMEN.

On the other hand, in G.R. Nos. 184298-99, the Cuaresmas raise the following issues:
(THE COURT OF APPEALS) GRAVELY ERRED IN APPLYING THE PROVISIONS OF THE CIVIL CODE CONSIDERED GENERAL LAW DESPITE THE CASE BEING COVERED BY E.O. 247, R.A. 8042 AND LABOR CODE CONSIDERED AS SPECIAL LAWS. (THE COURT OF APPEALS) GRAVELY ERRED IN NOT APPLYING THE DECEASEDS FUTURE EARNINGS WHICH IS (AN) INHERENT FACTOR IN THE COMPUTATION OF DEATH BENEFITS OF OVERSEAS FILIPINO CONTRACT WORKERS. (THE COURT OF APPEALS) GRAVELY ERRED IN REDUCING THE DEATH BENEFITS AWARDED BY NLRC CONSIDERED FINDINGS OF FACT THAT CANNOT BE DISTURBED THROUGH CERTIORARI UNDER RULE 65 OF THE RULES OF COURT.

The issue for resolution is whether the Cuaresmas are entitled to monetary claims, by way of benefits and damages, for the death of their daughter Jasmin. The terms and conditions of Jasmins 1996 Employment Agreement which she and her employer Rajab freely entered into constitute the law between them. As a rule, stipulations in an employment contract not contrary to statutes, public policy, public order or morals have the force of law between the contracting parties.[18] An examination of said employment agreement shows that it provides for no other monetary or other benefits/privileges than the following:
1. 2. 1,300 rials (or US$247.00) monthly salary; Free air tickets to KSA at the start of her contract and to the Philippines at the end thereof, as well as for her vacation at the end of each twenty four-month service; Transportation to and from work; Free living accommodations; Free medical treatment, except for optical and dental operations, plastic surgery charges and lenses, and medical treatment obtained outside of KSA; Entry visa fees will be shared equally between her and her employer, but the exit/reentry visa fees, fees for Iqama issuance, renewal, replacement, passport renewal, sponsorship transfer and other liabilities shall be borne by her; Thirty days paid vacation leave with round trip tickets to Manila after twenty fourmonths of continuous service; Eight days public holidays per year;

3. 4. 5.

6.

7.

8.

9.

The indemnity benefit due her at the end of her service will be calculated as per labor laws of KSA.

Thus, the agreement does not include provisions for insurance, or for accident, death or other benefits that the Cuaresmas seek to recover, and which the labor tribunals and appellate court granted variably in the guise of compensatory damages. However, the absence of provisions for social security and other benefits does not make Jasmins employment contract infirm. Under KSA law, her foreign employer is not obliged to provide her these benefits; and neither is Jasmin entitled to minimum wage unless of course the KSA labor laws have been amended to the opposite effect, or that a bilateral wage agreement has been entered into. Our next inquiry is, should Jasmins death be considered as work -connected and thus compensable? The evidence indicates that it is not. At the time of her death, she was not on duty, or else evidence to the contrary would have been adduced. Neither was she within hospital premises at the time. Instead, she was at her dormitory room on personal time when she died. Neither has it been shown, nor does the evidence suggest, that at the time she died, Jasmin was performing an act reasonably necessary or incidental to her employment as nurse, because she was at her dormitory room. It is reasonable to suppose that all her work is performed at the Al-birk Hospital, and not at her dormitory room. We cannot expect that the foreign employer should ensure her safety even while she is not on duty. It is not fair to require employers to answer even for their employees personal time away from work, which the latter are free to spend of their own choosing. Whether they choose to spend their free time in the pursuit of safe or perilous undertakings, in the company of friends or strangers, lovers or enemies, this is not one area which their employers should be made accountable for. While we have emphasized the need to observe official work time strictly,[19] what an employee does on free time is beyond the employers sphere of inquiry. While the employers premises may be defined very broadly not only to include premises owned by it, but also premises it leases, hires, supplies or uses, [20] we are not prepared to rule that the dormitory wherein Jasmin stayed should constitute employers premises as would allow a finding that death or injury therein is considered to have been incurred or sustained in the course of or arose out of her employment. There are certainly exceptions,[21] but they do not appear to apply here. Moreover, a complete determination would have to depend on the unique circumstances obtaining and the overall factual environment of the case, which are here lacking.

But, did Jasmin commit suicide? Rajab, Becmen and White Falcon vehemently insist that she did; thus, her heirs may not claim benefits or damages based on criminal aggression. On the other hand, the Cuaresmas do not believe so. The Court cannot subscribe to the idea that Jasmin committed suicide while halfway into her employment contract. It is beyond human comprehension that a 25-year old Filipina, in the prime of her life and working abroad with a chance at making a decent living with a highpaying job which she could not find in her own country, would simply commit suicide for no compelling reason. The Saudi police and autopsy reports which state that Jasmin is a likely/or apparent victim of poisoning are patently inconclusive. They are thus unreliable as evidence. On the contrary, the autopsy report of the Cabanatuan City Health Officer and the exhumation report of the NBI categorically and unqualifiedly show that Jasmin sustained external and internal injuries, specifically abrasions at her inner lip and gums; lacerated wounds and abrasions on her left and right ears; lacerated wounds and hematoma (contusions) on her elbows; abrasions and hematoma on her thigh and legs; intramuscular hemorrhage at the anterior chest; a fractured rib; puncture wounds; and abrasions on the labia minora of the vaginal area . The NBI toxicology report came up negative on the presence of poison. All these show that Jasmin was manhandled and possibly raped prior to her death. Even if we were to agree with the Saudi police and autopsy reports that indicate Jasmin was poisoned to death, we do not believe that it was self-induced. If ever Jasmin was poisoned, the assailants who beat her up and possibly raped her are certainly responsible therefor. We are not exactly ignorant of what goes on with our OFWs. Nor is the rest of the world blind to the realities of life being suffered by migrant workers in the hands of some foreign employers. It is inconceivable that our Filipina women would seek employment abroad and face uncertainty in a foreign land, only to commit suicide for unexplained reasons. Deciding to leave their family, loved ones, and the comfort and safety of home, to work in a strange land requires unrivaled strength and courage. Indeed, many of our women OFWs who are unfortunate to end up with undesirable employers have been there more times than they care to, beaten up and broken in body yet they have remained strong in mind, refusing to give up the will to live. Raped, burned with cigarettes, kicked in the chest with sharp high-heeled shoes, starved for days or even weeks, stabbed, slaved with incessant work, locked in their rooms, forced to serve their masters naked, grossly debased, dehumanized and insulted, their spirits

fought on and they lived for the day that they would once again be reunited with their families and loved ones. Their bodies surrendered, but their will to survive remained strong. It is surprising, therefore, that Rajab, Becmen and White Falcon should insist on suicide, without even lifting a finger to help solve the mystery of Jasmins death. Being in the business of sending OFWs to work abroad, Becmen and White Falcon should know what happens to some of our OFWs. It is impossible for them to be completely unaware that cruelties and inhumanities are inflicted on OFWs who are unfortunate to be employed by vicious employers, or upon those who work in communities or environments where they are liable to become victims of crime. By now they should know that our women OFWs do not readily succumb to the temptation of killing themselves even when assaulted, abused, starved, debased and, worst, raped. Indeed, what we have seen is Rajab and Becmens revolting scheme of conveniently avoiding responsibility by clinging to the absurd theory that Jasmin took her own life. Abandoning their legal, moral and social obligation (as employer and recruiter) to assist Jasmins family in obtaining justice for her death, they immediately gave up on Jasmins case, which has remained under investigation as the autopsy and police reports themselves indicate. Instead of taking the cudgels for Jasmin, who had no relative or representative in the KSA who would naturally demand and seek an investigation of her case, Rajab and Becmen chose to take the most convenient route to avoiding and denying liability, by casting Jasmins fate to oblivion. It appears from the record that to this date, no follow up of Jasmins cas e was ever made at all by them, and they seem to have expediently treated Jasmins death as a closed case. Despite being given the lead via the autopsy and toxicology reports of the Philippine authorities, they failed and refused to act and pursue justice for Jasmins sake and to restore honor to her name. Indeed, their nonchalant and uncaring attitude may be seen from how Jasmins remains were repatriated. No official representative from Rajab or Becmen was kind enough to make personal representations with Jasmins parents, if only to extend their condolences or sympathies; instead, a mere colleague, nurse Jessie Fajardo, was designated to accompany Jasmins body home. Of all lifes tragedies, the death of ones own child must be the most painful for a parent. Not knowing why or how Jasmins life was snuffed out makes the pain doubly unbearable for Jasmins parents, and further aggravated by Rajab, Becmen, and White Falcons baseless insistence and accusation that it was a self-inflicted death, a mortal sin by any religious standard.

Thus we categorically hold, based on the evidence; the actual experiences of our OFWs; and the resilient and courageous spirit of the Filipina that transcends the vilest desecration of her physical self, that Jasmin did not commit suicide but a victim of murderous aggression. Rajab, Becmen, and White Falcons indifference to Jasmins case has caused unfathomable pain and suffering upon her parents. They have turned away from their moral obligation, as employer and recruiter and as entities laden with social and civic obligations in society, to pursue justice for and in behalf of Jasmin, her parents and those she left behind. Possessed with the resources to determine the truth and to pursue justice, they chose to stand idly for the sake of convenience and in order that they may avoid pecuniary liability, turning a blind eye to the Philippine authorities autopsy and toxicology reports instead of taking action upon them as leads in pursuing justice for Jasmins death. They have placed their own financial and corporate interests above their moral and social obligations, and chose to secure and insulate themselves from the perceived responsibility of having to answer for and indemnify Jasmins heirs for her death. Under Republic Act No. 8042 (R.A. 8042), or the Migrant Workers and Overseas Filipinos Act of 1995,[22] the State shall, at all times, uphold the dignity of its citizens whether in country or overseas, in general, and Filipino migrant workers, in particular. [23] The State shall provide adequate and timely social, economic and legal services to Filipino migrant workers.[24] The rights and interest of distressed[25] overseas Filipinos, in general, and Filipino migrant workers, in particular, documented or undocumented, are adequately protected and safeguarded.[26] Becmen and White Falcon, as licensed local recruitment agencies, miserably failed to abide by the provisions of R.A. 8042. Recruitment agencies are expected to extend assistance to their deployed OFWs, especially those in distress. Instead, they abandoned Jasmins case and allowed it to remain unsolved to further their interests and avoid anticipated liability which parents or relatives of Jasmin would certainly exact from them. They willfully refused to protect and tend to the welfare of the deceased Jasmin, treating her case as just one of those unsolved crimes that is not worth wasting their time and resources on. The evidence does not even show that Becmen and Rajab lifted a finger to provide legal representation and seek an investigation of Jasmins case. Worst of all, they unnecessarily trampled upon the person and dignity of Jasmin by standing pat on the argument that Jasmin committed suicide, which is a grave accusation given its un-Christian nature. We cannot reasonably expect that Jasmins parents should be the ones to actively pursue a just resolution of her case in the KSA, unless they are provided with the finances to undertake this herculean task. Sadly, Becmen and Rajab did not lend any assistance at all in this respect. The most Jasmins parents can do is to coordinate with Philippine authorities as

mandated under R.A. 8042, obtain free legal assistance and secure the aid of the Department of Foreign Affairs, the Department of Labor and Employment, the POEA and the OWWA in trying to solve the case or obtain relief, in accordance with Section 23 [27] of R.A. 8042. To our mind, the Cuaresmas did all that was within their power, short of actually flying to the KSA. Indeed, the Cuaresmas went even further. To the best of their abilities and capacities, they ventured to investigate Jasmins case on their own: they caused another autopsy on Jasmins remains as soon as it arrived to inquire into the true cause of her death. Beyond that, they subjected themselves to the painful and distressful experience of exhuming Jasmins remains in order to obtain another autopsy for the sole purpose of determining whether or not their daughter was poisoned. Their quest for the truth and justice is equally to be expected of all loving parents. All this time, Rajab and Becmen instead of extending their full cooperation to the Cuaresma family merely sat on their laurels in seeming unconcern. In Interorient Maritime Enterprises, Inc. v. NLRC,[28] a seaman who was being repatriated after his employment contract expired, failed to make his Bangkok to Manila connecting flight as he began to wander the streets of Bangkok aimlessly. He was shot to death by Thai police four days after, on account of running amuck with a knife in hand and threatening to harm anybody within sight. The employer, sued for death and other benefits as well as damages, interposed as defense the provision in the seafarer agreement which provides that no compensation shall be payable in respect of any injury, incapacity, disability or death resulting from a willful act on his own life by the seaman. The Court rejected the defense on the view, among others, that the recruitment agency should have observed some precautionary measures and should not have allowed the seaman, who was later on found to be mentally ill, to travel home alone, and its failure to do so rendered it liable for the seamans death. We ruled therein that
The foreign employer may not have been obligated by its contract to provide a companion for a returning employee, but it cannot deny that it was expressly tasked by its agreement to assure the safe return of said worker. The uncaring attitude displayed by petitioners who, knowing fully well that its employee had been suffering from some mental disorder, nevertheless still allowed him to travel home alone, is appalling to say the least. Such attitude harks back to another time when the landed gentry practically owned the serfs, and disposed of them when the latter had grown old, sick or otherwise lost their usefulness.[29] (Emphasis supplied)

Thus, more than just recruiting and deploying OFWs to their foreign principals, recruitment agencies have equally significant responsibilities. In a foreign land where OFWs are likely to encounter uneven if not discriminatory treatment from the foreign government, and certainly a delayed access to language interpretation, legal aid, and the Philippine consulate, the recruitment agencies should be the first to come to the rescue of our distressed OFWs since they know the employers and the addresses where they are deployed or stationed. Upon them

lies the primary obligation to protect the rights and ensure the welfare of our OFWs, whether distressed or not. Who else is in a better position, if not these recruitment agencies, to render immediate aid to their deployed OFWs abroad? Article 19 of the Civil Code provides that every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith. Article 21 of the Code states that any person who wilfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage. And, lastly, Article 24 requires that in all contractual, property or other relations, when one of the parties is at a disadvantage on account of his moral dependence, ignorance, indigence, mental weakness, tender age or other handicap, the courts must be vigilant for his protection. Clearly, Rajab, Becmen and White Falcons acts and omissions are against public policy because they undermine and subvert the interest and general welfare of our OFWs abroad, who are entitled to full protection under the law. They set an awful example of how foreign employers and recruitment agencies should treat and act with respect to their distressed employees and workers abroad. Their shabby and callous treatment of Jasmins case; the ir uncaring attitude; their unjustified failure and refusal to assist in the determination of the true circumstances surrounding her mysterious death, and instead finding satisfaction in the unreasonable insistence that she committed suicide just so they can conveniently avoid pecuniary liability; placing their own corporate interests above of the welfare of their employees all these are contrary to morals, good customs and public policy, and constitute taking advantage of the poor employee and her famil ys ignorance, helplessness, indigence and lack of power and resources to seek the truth and obtain justice for the death of a loved one. Giving in handily to the idea that Jasmin committed suicide, and adamantly insisting on it just to protect Rajab and Becmens material interest despite evidence to the contrary is against the moral law and runs contrary to the good custom of not denouncing ones fellowmen for alleged grave wrongdoings that undermine their good name and honor.[30] Whether employed locally or overseas, all Filipino workers enjoy the protective mantle of Philippine labor and social legislation, contract stipulations to the contrary notwithstanding. This pronouncement is in keeping with the basic public policy of the State to afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed, and regulate the relations between workers and employers. This ruling is likewise rendered imperative by Article 17 of the Civil Code which states that laws which have for their object public order, public policy and good customs shall not be rendered ineffective by laws or judgments promulgated, or by determinations or conventions agreed upon in a foreign country.[31]

The relations between capital and labor are so impressed with public interest,[32] and neither shall act oppressively against the other, or impair the interest or convenience of the public.[33] In case of doubt, all labor legislation and all labor contracts shall be construed in favor of the safety and decent living for the laborer.[34] The grant of moral damages to the employee by reason of misconduct on the part of the employer is sanctioned by Article 2219 (10)[35] of the Civil Code, which allows recovery of such damages in actions referred to in Article 21.[36] Thus, in view of the foregoing, the Court holds that the Cuaresmas are entitled to moral damages, which Becmen and White Falcon are jointly and solidarily liable to pay, together with exemplary damages for wanton and oppressive behavior, and by way of example for the public good. Private employment agencies are held jointly and severally liable with the foreign-based employer for any violation of the recruitment agreement or contract of employment. This joint and solidary liability imposed by law against recruitment agencies and foreign employers is meant to assure the aggrieved worker of immediate and sufficient payment of what is due him.[37] If the recruitment/placement agency is a juridical being, the corporate officers and directors and partners as the case may be, shall themselves be jointly and solidarily liable with the corporation or partnership for the aforesaid claims and damages.[38] White Falcons assumption of Becmens liability does not automatically result in Becmens freedom or release from liability. This has been ruled in ABD Overseas Manpower Corporation v. NLRC.[39] Instead, both Becmen and White Falcon should be held liable solidarily, without prejudice to each having the right to be reimbursed under the provision of the Civil Code that whoever pays for another may demand from the debtor what he has paid.[40] WHEREFORE, the Amended Decision of the Court of Appeals dated May 14, 2008 in CA-G.R. SP No. 80619 and CA-G.R. SP No. 81030 is SET ASIDE. Rajab & Silsilah Company, White Falcon Services, Inc., Becmen Service Exporter and Promotion, Inc., and their corporate directors and officers are found jointly and solidarily liable and ORDERED to indemnify the heirs of Jasmin Cuaresma, spouses Simplicio and Mila Cuaresma, the following amounts: 1) TWO MILLION FIVE HUNDRED THOUSAND PESOS (P2,500,000.00) as moral damages;

2)

TWO MILLION FIVE HUNDRED THOUSAND PESOS (P2,500,000.00) as exemplary damages; Attorneys fees equivalent to ten percent (10%) of the total monetary award; and, Costs of suit.

3) 4)

SO ORDERED.

CONSUELO YNARES-SANTIAGO Associate Justice

WE CONCUR:

CONCHITA CARPIO MORALES Associate Justice

MINITA V. CHICO-NAZARIO Associate Justice

ANTONIO EDUARDO B. NACHURA Associate Justice

DIOSDADO M. PERALTA Associate Justice

ATTESTATION
I attest that the conclusions in the above decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

CONSUELO YNARES-SANTIAGO Associate Justice Chairperson, Third Division

CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairpersons Attestation, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

REYNATO S. PUNO Chief Justice

In lieu of Associate Justice Ma. Alicia Austria-Martinez, per Special Order No. 602 dated March 20, 2009. Rollo, pp. 53-68; penned by Associate Justice Jose Catral Mendoza and concurred in by Associate Justices Amelita G. Tolentino and Arturo G. Tayag. [2] A Philippine corporation engaged in the business of recruitment of workers for overseas employment. [3] Rollo, p. 70. [4] CA rollo, CA-G.R. SP No. 80619, pp. 344-345. [5] Id. at 345. [6] Id. at 68-69; Autopsy Report of the Cabanatuan City Health Office dated September 4, 1998. [7] Id. at 70; NBI Toxicology Report No. T-99-220 (Gx) dated April 8, 1999. [8] The case was docketed as NLRC NCR OFW (L)99-11-00088-99. [9] Jasmin was staying at a dormitory provided and paid for by her employer Rajab Silsilah Co. [10] Rollo, pp. 69-80. [11] Id. at 103-115; penned by Commissioner Tito F. Genilo and concurred in by Commissioners Lourdes C. Javier and Ireneo B. Bernardo. [12] Id. at 116-125. [13] Id. at 124. [14] Entitled White Falcon Services, Inc. v. NLRC, Becmen Service Exporter, Inc. and Spouses Simplicio and Mila Cuaresma and Becmen Service Exporter and Promotions, Inc. v. NLRC, Mila Cuaresma, White Falcon Services, Inc., and Jaime Ortiz (President of White Falcon Services, Inc.) and docketed as CA-G.R. SP No. 80619 and CA-G.R. SP No. 81030, respectively. [15] Rollo, pp. 126-139; Rollo, pp. 53-68; penned by Associate Justice Jose Catral Mendoza and concurred in by Associate Justices Elvi John Asuncion and Arturo G. Tayag. [16] Id. at 138. [17] Id. at 67. [18] Delos Santos v. Jebsen Maritime, Inc., G.R. No. 154185, November 22, 2005, 475 SCRA 656. [19] Aquino-Simbulan v. Zabat, A.M. No. P-05-1993, April 26, 2005, 457 SCRA 23. [20] Iloilo Dock & Engineering Co. v. Work mens Compensation Commission, G.R. No. L-26341, November 27, 1968, 26 SCRA 102, citing Samuel B. Horovitz Injury and Death under Workmens Compensation Laws (1944). [21] Id. at 109-110, stating that The narrow rule that a worker is not in the course of his employment until he crosses the employment threshold is itself subject to many exceptions. off-premises injuries to or from work, in both liberal and narrow states, are compensable (1) if the employee is on the way to or from work in a vehicle owned or supplied by the employer, whether in a public (e.g., the employer's street car) or private conveyance; (2) if the employee is subject to call at all hours or at the moment of injury; (3) if the employee is traveling for the employer, i.e. traveling workers; (4) if the employer pays for the employee's time from the moment he leaves his home to his return home; (5) if the employee is on his way to do further work at home, even though on a fixed salary; (6) where the employee is required to bring his automobile to his place of business for use there. Other exceptions undoubtedly are equally justified, dependent on their own peculiar circumstances. [22] The law took effect on July 15, 1995. [23] R.A. 8042, Sec. 2a. [24] Id. Sec. 2b. [25] As defined under the Rules and Regulations Implementing R.A. 8042: (c) Overseas Filipino in distress - Overseas Filipinos as defined in Sec.3(c) of the Act shall be deemed in distress in cases where they have valid medical, psychological or legal assistance problems requiring treatment, hospitalization, counseling, legal representation as specified in Sections 24 and 26 or any other kind of intervention with the authorities in the country where they are found. [26] R.A. 8042, Sec. 2e. [27] SEC. 23. ROLE OF GOVERNMENT AGENCIES. - The following government agencies shall perform the following to promote the welfare and protect the rights of migrant workers and, as far as applicable, all overseas Filipinos: (a) Department of Foreign Affairs. - The Department, through its home office or foreign posts, shall take priority action its home office or foreign posts, shall take priority action or make representation with the foreign authority concerned to protect the rights of migrant workers and other overseas Filipinos and extend immediate assistance including the repatriation of distressed or beleaguered migrant workers and other overseas Filipinos; (b) Department of Labor and Employment - The Department of Labor and Employment shall see to it that labor and social welfare laws in the foreign countries are fairly applied to migrant workers and whenever
[1]

applicable, to other overseas Filipinos including the grant of legal assistance and the referral to proper medical centers or hospitals: (b.1) Philippine Overseas Employment Administration - Subject to deregulation and phase out as provided under Sections 29 and 30 herein, the Administration shall regulate private sector participation in the recruitment and overseas placement of workers by setting up a licensing and registration system. It shall also formulate and implement, in coordination with appropriate entities concerned, when necessary employment of Filipino workers taking into consideration their welfare and the domestic manpower requirements. (b.2) Overseas Workers Welfare Administration - The Welfare Officer or in his absence, the coordinating officer shall provide the Filipino migrant worker and his family all the assistance they may need in the enforcement of contractual obligations by agencies or entities and/or by their principals. In the performance of this functions, he shall make representation and may call on the agencies or entities concerned to conferences or conciliation meetings for the purpose of settling the complaints or problems brought to his attention. [28] G.R. No. 115497, September 16, 1996, 261 SCRA 757. [29] Id. at 772. [30] See Tiongco v. Deguma, G.R. No. 133619, October 26, 1999, 317 SCRA 527. [31] Royal Crown Internationale v. NLRC, G.R. No. 78085, October 16, 1989, 178 SCRA 569, 580-581, cited in Philippine National Bank v. Cabansag, G.R. No. 157010, June 21, 2005, 460 SCRA 514. [32] Civil Code, Article 1700. [33] Id., Article 1701. [34] Id., Article 1702. [35] Art. 2219. Moral damages may be recovered in the following and analogous cases: (1) A criminal offense resulting in physical injuries; (2) Quasi-delicts causing physical injuries; (3) Seduction, abduction, rape, or other lascivious acts; (4) Adultery or concubinage; (5) Illegal or arbitrary detention or arrest; (6) Illegal search; (7) Libel, slander or any other form of defamation; (8) Malicious prosecution; (9) Acts mentioned in Article 309; (10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35. [36] Maneja v. National Labor Relations Commission, G.R. No. 124013, June 5, 1998, 290 SCRA 603. [37] Sevillana v. I.T. (International) Corp ., G.R. No. 99047, April 16, 2001, 356 SCRA 451. [38] R.A. 8042, Section 10. [39] G.R. No. 117056, February 24, 1998, 286 SCRA 454. [40] Civil Code, Article 1236.

THIRD DIVISION

[G.R. No. 117056. February 24, 1998]

ABD OVERSEAS MANPOWER CORPORATION, Petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, MARS INTERNATIONAL MANPOWER, INC. and MOHMINA MACARAYA, Respondents. DECISION
ROMERO, J.:

Can an accredited transferee recruitment agent of a foreign employer/recruitment office be held liable under POEA Rules and Regulations (POEA Rules) for the illegal dismissal of an overseas worker who filed the case prior to the transferee agents accreditation? In December 1989, respondent Mohmina Macaraya applied for employment as a dressmaker with respondent Mars International Manpower, Inc. (MARS). After paying MARS the amount of P12,000.00 as processing or recruitment fee, she signed a two-year employment contract whereby she would earn a monthly salary of US$250.00. Without her knowledge, however, MARS submitted to the POEA an overseas contract worker information sheet stating that she would be employed as a domestic helper for two years with a monthly salary of US$200.00. On January 30, 1990, Macaraya was deployed to Riyadh, Saudi Arabia. Her employer took the only copy of her employment contract and never returned it to her. She was made to work as a domestic helper over her objections and in violation of the contract she signed in Manila. After working for three months and thirteen days, Macaraya was dismissed by her employer, paid merely 700.00 Saudi riyals, and repatriated to the Philippines on May 13, 1990. Immediately upon her arrival in the Philippines, Macaraya filed with the POEA a complaint [1] for illegal dismissal and salary underpayment/ nonpayment against MARS, M.S. Al Babtain Recruitment Office and Times Surety and Insurance Co. Later, in her position paper, she included claims for overtime pay and attorneys fees. MARS filed an answer to the complaint on July 5, 1990, through its president and general manager, Adelaida Manabat. After several hearings, with hopes of an amicable settlement getting more remote, the case was submitted for decision. On January 9, 1992, MARS filed a manifestation and motion praying that petitioner ABD Overseas Manpower Corporation be impleaded in the case, because the latter apparently became the accredited recruitment agency in this country of M.S. Al Babtain Recruitment Office on September 8, 1990. Thus, after being summoned, petitioner filed an answer alleging affirmative and special defenses, notably, that MARS had no cause of action against it. Petitioner also filed a cross-claim against MARS which the latter never answered. On January 12, 1993, the POEA, ruling that Macaraya had been illegally dismissed as both her foreign employer and recruitment agency failed to prove that the dismissal was for a just and valid cause, rendered a decision,[2] the dispositive portion of which reads as follows:

WHEREFORE, judgment is hereby rendered in favor of the complainant Mohmina Macaraya and against respondents ABD Overseas Manpower Corporation and M.S. Al

Babtain Recruitment Office, ordering the latter to pay, jointly and severally, to complainant the following amounts: 1. FOUR THOUSAND ONE HUNDRED THIRTEEN & 39/100 US DOLLARS (US$4,113.39) or its equivalent in Philippine Currency at the time of payment, representing the salaries corresponding to the unexpired portion of complainants contract; and 2. SIX HUNDRED EIGHTY SIX & 71/100 US DOLLARS (US$686.71) less SEVEN HUNDRED SAUDI RIYALS (SR 700.00), or its equivalent in Philippine Currency, at the time of actual payment, representing the salary differentials. All other claims are dismissed for lack of merit. The Complaint and the Cross-claim against Mars International Manpower Inc. is (sic) likewise dismissed for lack of merit. SO ORDERED.
On the issue of whether or not petitioner should be liable with her foreign employer for the monetary awards, the POEA, relying on Section 6, Rule I, Book III, of the POEA Rules, declared that:

(The r)ecords undisputably show that the foreign principal and now co-respondent M.S. Al Babtain Recruitment Office of Saudi Arabia is presently accredited to ABD which is valid up to 06 August 1992. This fact was established by a Certification dated 07 November 1991 issued by the Accreditation Branch, this Administration. The Office is convinced that respondent ABD was not fully aware of the import and consequences of transfer of accreditation it entered into and between the other respondents, which transfer was duly registered with and approved by the Accreditation Branch. But ignorance of the same does not serve as a valid excuse in defeating its liability or obligation to the complainant. As a consequence, the transferee agency, ABD, now assumes full and complete responsibility to the contractual obligation of the principal, M.S. Al Babtain Recruitment Office(,) to herein complainant originally recruited and processed by the former agency, MARS.
[3]

On appeal to the National Labor Relations Commission, petitioner prayed for the reversal of the POEAs decision and the invalidation of Section 6, Rule I, Book III of the POEA Rules, citing the rule against unjust enrichment. Thus, it alleged:

14.1 Macaraya was deployed January 30, 1990 by MARS; she stayed and worked in Riyadh only for three (3) months and 13 days and was repatriated on May 13, 1990. She filed the complaint against MARS on May 14, 1990. Hence, her cause of action ripened and/or accrued as of that early date as against MARS, her placement agency. Further, it is significant to state here that MARS filed its answer to the complaint on July 5, 1990 wherein it made admissions and averred its affirmative defenses by way of

confession and avoidance of liability. How then could ABD be made to `assume full and complete responsibility to all contractual obligations under the aforecited Rule when the accreditation of M.S. Al Babtain in its favor was made only on September 3, 1990 per POEA records, and was only `impleaded in this case by motion of MARS on January 9, 1992? 14.2 When MARS filed its answer on July 5, 1990, long before ABD was made a party respondent, it caused a joinder of issues in the case. Under the well-settled principle of estoppel, it cannot (after filing such answer) now be heard to say one and a half years later (on January 9, 1992 when it impleaded ABD in the case) that ABD must `be summoned to answer for the claims of herein Complainant. x x x. That late, and in filing its answer to the complaint, MARS is certainly estopped from shifting to ABD whatever liability it had under the contract it entered into with Macaraya, or for any violations thereof by its principal, or any POEA rules/regulations - - which all accrued/occurred when accreditation was NOT yet transferred to ABD. Ignoring these facts/ circumstances constitute a clear case of grave abuse of discretion on the part of the Hon. Administrator. (Underscoring supplied)
[4]

By resolution dated March 21, 1994,[5] the NLRC dismissed the appeal. Petitioners motion for reconsideration met the same fate on August 10, 1994.[6] Hence, this petition for certiorari. Petitioner alleges that in the assailed resolution of March 21, 1994, the NLRC merely quoted the findings of the POEA Administrator and concluded that it should assume full an d complete responsibility to the contractual obligation of the foreign principal to Macaraya. Petitioner questions the failure of the NLRC to make categorical rulings on the issues it had raised in its memorandum on appeal and, therefore, the NLRC should be charged with evasion of positive duty or a virtual refusal to perform the duty enjoined by law. MARS had allegedly already answered the complaint when petitioner became the transferee recruitment agency. Petitioner was impleaded in the case one-and-a-half years after the filing of MARS answer to the complaint. Hence, the failure of MARS to prove the legality of Macarayas dismissal from employment should not mean that the same burden should fall upon petitioner who was not even privy to Macaraya s employment contract. If it were to be held liable for the monetary awards in favor of Macaraya, then it would result in undue enrichment on the part of MARS. It must be noted that none of these allegations was mentioned in the March 21, 1994, resolution. Thus, after stating the facts that are clearly culled from the POEA decision, the questioned resolution of March 21, 1994, quotes the discussion of the POEA on the liabilities for monetary awards of petitioner and its foreign principal. Consequently, in the nine-page resolution, the NLRC merely contributed two pages, including its conclusions, viz.:

After a careful perusal of the records of the case, We agree with the POEA Administrator findings and conclusion th(a)t the transferee agency, ABD must assume full and complete responsibility to the contractual obligation of the principal, M.S. Al Babtain Recruitment Office to the complainant who was recruited by MARS.
Section 6, Rule I, Book III of the POEA Rules and Regulation provides: [7] x x x

It is clear from the aforementioned provision of the POEA Rules and Regulation that the transferee agency shall assume full and complete responsibility to all contractual

obligations of the principals to its workers originally recruited and processed by its former agency. In the case at bar, respondent ABD Overseas Manpower Corporation(,) being the transferee agency(,) must assume (the) full liability of the principal, M.S. Al Babtain(,) to the complainant originally recruited and process(ed) by its former agency(,) Mars International Manpower Inc. We find no grave abuse of discretion on the part of the POEA Administrator. WHEREFORE, in view of the foregoing considerations, the Motion for Reconsideration is dismissed for lack of merit.
[8]

SO ORDERED.
Section 13, Rule VII of the New Rules of Procedure of the NLRC provides as follows:

SEC. 13. Form of Decision/Resolution/Order. The Decision/ Resolution shall state clearly and distinctly the findings of facts, issues and conclusions of law on which it is based and the relief granted, if any. If the decision or resolution involves monetary awards, the same shall contain the specific amount awarded as of the date the decision is rendered.
This provision of the Rules is obviously in consonance with Section 14, Article VIII of the Constitution providing that (n)o decision shall be rendered by any court without expressing therein clearly and distinctly the facts and the law on which it is based. Interpreting this constitutional provision, in Nicos Industrial Corporation v. Court of Appeals,[9] the Court said:

It is a requirement of due process that the parties to a litigation be informed of how it was decided, with an explanation of the factual and legal reasons that led to the conclusions of the court. The court cannot simply say that judgment is rendered in favor of X and against Y and just leave it at that without any justification whatsoever for its action. The losing party is entitled to know why he lost, so he may appeal to a higher court, if permitted, should he believe that the decision should be reversed. A decision that does not clearly and distinctly state the facts and the law on which it is based leaves the parties in the dark as to how it was reached and is especially prejudicial to the losing party, who is unable to pinpoint the possible errors of the court for review by a higher tribunal.
In this case, the NLRC left petitioner in the dark by its failure to discuss why the facts it pointed out in its memorandum on appeal would not affect the unqualified application of Section 6, Rule I, Book III of the POEA Rules. It is possible that the NLRC fully believed that said rule should be applied literally. This should not, however, have given premium to brevity in its resolution [10] to the point that the very underpinnings for a partys appeal to it would be completely disregarded and left unresolved. As this Court declared, (b)revity is doubtless an admirable trait, but it should not and cannot be substituted for substance.[11] The need for a clear dissertation on the issues raised on appeal was underscored in Francisco v. Permskul.[12] In said case, although the Court upheld the validity of Section 40 of Batas Pambansa Blg. 120, allowing the rendition of memorandum decisions, especially in appealed cases, it nevertheless stated that:

Despite the convenience afforded by the memorandum decision, it is still desirable that the appellate judge exert some effort in restating in his own words the findings of fact of the lower court and presenting his own interpretation of the law instead of merely parroting the language of the court a quo as if he cannot do any better. There must be less intellectual indolence and more pride of authorship in the writing of a decision, especially if it comes from an appellate court. It ill becomes an appellate judge to write his rulings with a pair of scissors and a pot of paste as if he were a mere researcher. He is an innovator, not an echo. The case usually becomes progressively simpler as it passes through the various levels of appeal and many issues become unimportant or moot and drop along the way. The appellate judge should prune the cluttered record to make the issues clearer. He cannot usually do this by simply mimicking the lower court. He must use his own perceptiveness in unraveling the rollo and his own discernment in discovering the law. No less importantly, he must use his own language in laying down his judgment. And in doing so, he should also guard against torpidity lest his pronouncements excite no more fascination than a technical tract on the values of horse manure as a fertilizer. A little style will help liven the opinion trapped in the tortuous lexicon of the law with all its whereases and wherefores. A judicial decision does not have to be a bore.
We should add that much more than being stylish, a decision or resolution, especially one resolving an appeal, should directly meet the issues for resolution; otherwise, the appeal would be pointless. It is immaterial that the NLRC is a quasi-judicial body and not a regular court. In any controversy, the appellant needs enlightenment on the issues that befuddle him. Accordingly, assuming that petitioner should indeed be liable to Macaraya, the NLRC should have discussed why Section 6, Rule I, Book III of the POEA Rules should be applied notwithstanding the factual circumstances pointed out by petitioner. As it was, petitioners theory that the case does not merit the application of Section 6, Rule I, Book III of the POEA Rules was merely glossed over, such that it was left with no other recourse but to file a motion for reconsideration and, after its denial, the instant petition. Worth stressing is the fact that petitioner does not question the validity of the monetary awards to Macaraya. The basic issue here is: As between petitioner and MARS, who should be held liable for such awards? This can only be resolved by interpreting Section 6, Rule I, Book III of the POEA Rules which states as follows:

SEC. 6. Transfer of Accreditation. The accreditation of a principal or a project may be transferred to another agency provided that transfer shall not involve any diminution of wages and benefits of workers. The transferee agency in these instances shall comply with the requirements for accreditation and shall assume full and complete responsibility for all contractual obligations of the principals to its workers originally recruited and processed by the former agency. Prior to the transfer of accreditation, the Administration shall notify the previous agency and principal of such application.
A cursory reading of this provision lends the impression that an accreditation transferee assumes the contractual responsibility of the transferor under all circumstances, without qualification. We find, however, that a strict application of said proviso in this case may result in a grave injustice to

petitioner which became liable only when it stepped into the shoes, as it were, of its predecessor after the issues had been met in the illegal dismissal case filed against the latter, and after the POEA had failed to discharge its duty of deciding the simple illegal dismissal case with dispatch. The rule on transfer of accreditation was prescribed under the general policies of the POEA to establish the environment conducive to the continued operations of legitimate, responsible and professional private agencies and to afford protection to Filipino workers and their families, promote their interests and safeguard their welfare.[13] In line with these policies, Book III of the same rules provides for the accreditation of a principal or any foreign person, partnership o r corporation hiring Filipino workers through an agency.[14] Principals may be accredited in this country only through licensed local agencies.[15] A land-based principal shall be accredited to only one agency but the POEA may grant accreditation to a second agent as may be deemed necessary. [16] In the same manner, the accreditation of a principal may be transferred to another agency under the aforequoted Section 6, Rule I, Book III of the POEA Rules. In the case at bar, petitioner became the accredited recruitment agency of the principal, M.S. Al Babtain Recruitment Office, on September 3, 1990, after MARS had filed on July 5, 1990, its answer to Macarayas complaint for illegal dismissal. Petitioner got involved only on January 9, 1992, when it was impleaded in the case upon MARS motion. The case having been submitted for decision long before it became a party, petitioner naturally filed an answer alleging its own claims against MARS. Under the Rules of Court which were then in effect and applicable to the case at bar, when MARS failed to file an answer to petitioners cross-claim, it should have been declared in default with respect to such claim.[17] In labor cases, however, technical rules of procedure are not applicable, [18] but may apply only by analogy or in a suppletory character, for instance, when there is a need to attain substantial justice and an expeditious, practical and convenient solution to a labor problem. [19] Hence, when the POEA opted to overlook petitioners cross-claim against MARS, petitioner was denied substantial justice. MARS impleaded petitioner in the case after it had been submitted for decision and one-and-ahalf years after it had filed its answer. During this hiatus, the case lay dormant in the POEA. It should be noted that petitioner became the accredited recruitment agency on September 3, 1990, two months after MARS had filed its answer to the complaint. The POEAs inaction ad interimprovided MARS with an opportunity to escape liability. Basic principles of justice and equity, however, dictate that MARS should not be totally cleared of its liability to Macaraya under the peculiar circumstances of this case. Section 6, Rule II, Book III of the POEA Rules may not be used as a shield against liability by a recruitment agency that has been substituted by a foreign principal as its local recruitment agency after it has clearly incurred liability in favor of an overseas worker. After all, the POEA is presumed by law to have intended right and justice to prevail[20] in promulgating its rules. Consequently, considering that it was MARS with whom Macaraya entered into a contract and that it had been accorded due process at the proceedings before the POEA, it is but meet and just that MARS be the one to be held accountable for her claims. In so ruling, the Court is not in any way invalidating Section 6, Rule II, Book III of the POEA Rules. The presumption of its validity remains. Its application in this case should, however, be an exception to the rule. Petitioner shall pay Macaraya the amount due her under the assailed POEA decision, without prejudice to its right to be reimbursed by MARS under the provision of the Civil Code that (w)hoever pays for another may demand from the debtor what he has paid. [21] WHEREFORE, the resolutions of the NLRC dated March 21, 1994, and August 10, 1994, are hereby AFFIRMED, subject to the modification that respondent Mars International Manpower, Inc. shall reimburse petitioner ABD Overseas Manpower Corporation the amount awarded therein to respondent Mohmina Macaraya. This Decision is immediately executory. No costs.

SO ORDERED. Narvasa, C.J., (Chairman), Kapunan, and Purisima, JJ., concur.

[1]

Rollo, pp. 40-47. Docketted as POEA Case No. (L) 90-05-551. Rollo, pp. 46-47. Ibid., pp. 54-55. Id., pp. 24-32. Id., p. 33. Infra.

[2]

[3]

[4]

[5]

[6]

[7]

Petitioners appeal was originally dismised for late-filing by the NLRC on September 14, 1993, but was reconsidered upon a finding that the appeal was filed by registered mail.
[8] [9]

206 SCRA 127 (1992).

[10]

In Icasiano v. Office of the President, 209 SCRA 25 (1992), the Court held that the NLRC could not have a clear-cut basis for its ruling that the petitioner should be dismissed from employment as it did not set out its findings of facts upon which it could base its decision.
[11]

Nicos, supra., at p. 134. 173 SCRA 324 (1989). Rule I (b) and (c), Book I. Rule II (gg), Book I, Sec. 1, Rule I, Book III. Ibid., Sec. 5. Sec. 10, Rule 6 provides as follows:

[12]

[13]

[14]

[15]

[16]

[17]

Answer to counterclaim or cross-claim required.- A counterclaim or cross-claim must be answered, and failure to do so will constitute a default under Rule 18. The party filing such answer may plead therein a counterclaim or crossclaim. (N.B. This provision is no longer found in the 1997 Rules of Civil Procedure, as amended.) Sec. 9, Rule II, Book VI of the POEA Rules provides that technicalities of law and procedure and the rules obtaining in the courts of law shall not strictly apply to proceedings before the POEA. [19] General Baptist Bible College v. NLRC, 219 SCRA 549 (1993).
[18] [20]

Art. 10, Civil Code. Art. 1236, Civil Code.

[21]

FIRST DIVISION
SANTOSA B. DATUMAN, Petitioner, G.R. No. 156029

Present: versus PUNO, C.J.,* CARPIO,** AUSTRIA-MARTINEZ,*** CORONA, CARPIO MORALES,*** and LEONARDO-DE CASTRO, JJ.

FIRST COSMOPOLITAN MANPOWER AND PROMOTION SERVICES, INC., Respondent.

Promulgated: November 14, 2008

x-----------------------------------------------------------------------------------------x

DECISION
LEONARDO-DE CASTRO, J.:

Before us is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended, assailing the Court of Appeals (CA) Decision[1] datedAugust 7, 2002, in CA-G.R. SP No. 59825, setting aside the Decision of the National Labor Relations Commission (NLRC). The facts are as follows: Sometime in 1989, respondent First Cosmopolitan Manpower & Promotion Services, Inc. recruited petitioner Santosa B. Datuman to work abroad under the following terms and conditions:
Site of employment Employees Classification/Position/Grade Basic Monthly Salary Bahrain Saleslady US$370.00

Duration of Contract Foreign Employer

One (1) year Mohammed Sharif Abbas

Ghulam Hussain[2]

On April 17, 1989, petitioner was deployed to Bahrain after paying the required placement fee. However, her employer Mohammed Hussain took her passport when she arrived there; and instead of working as a saleslady, she was forced to work as a domestic helper with a salary of Forty Bahrain Dinar (BD40.00), equivalent only to One Hundred US Dollars (US$100.00). This was contrary to the agreed salary of US$370.00 indicated in her Contract of Employment signed in the Philippines and approved by the Philippine Overseas Employment Administration (POEA).[3] On September 1, 1989, her employer compelled her to sign another contract, transferring her to another employer as housemaid with a salary of BD40.00 for the duration of two (2) years.[4] She pleaded with him to give her a release paper and to return her passport but her pleas were unheeded. Left with no choice, she continued working against her will. Worse, she even worked without compensation from September 1991 to April 1993 because of her employers continued failure and refusal to pay her salary despite demand. In May 1993, she was able to finally return to the Philippines through the help of the Bahrain Passport and Immigration Department.[5] In May 1995, petitioner filed a complaint before the POEA Adjudication Office against respondent for underpayment and nonpayment of salary, vacation leave pay and refund of her plane fare, docketed as Case No. POEA ADJ. (L) 95-05-1586.[6] While the case was pending, she filed the instant case before the NLRC for underpayment of salary for a period of one year and six months, nonpayment of vacation pay and reimbursement of return airfare. When the parties failed to arrive at an amicable settlement before the Labor Arbiter, they were required to file their respective position papers, subsequent pleadings and documentary exhibits. In its Position Paper,[7] respondent in Bahrain as a housemaid for one (1) then. However, since such position was mutually agreed to submit the contract countered that petitioner actually agreed to work year because it was the only position available not yet allowed by the POEA at that time, they to the POEA indicating petitioners position as

saleslady. Respondent added that it was actually petitioner herself who violated the terms of their contract when she allegedly transferred to another employer without respondents knowledge and approval. Lastly, respondent raised the defense of prescription of cause of action since the claim was filed beyond the three (3)-year period from the time the right accrued, reckoned from either 1990 or 1991.[8] On April 29, 1998, Labor Arbiter Jovencio Mayor, Jr. rendered a Decision finding respondent liable for violating the terms of the Employment Contract and ordering it to pay petitioner: (a) the amount of US$4,050.00, or its equivalent rate prevailing at the time of payment, representing her salary differentials for fifteen (15) months; and, (b) the amount of BD 180.00 or its equivalent rate prevailing at the time of payment, representing the refund of plane ticket, thus:
From the foregoing factual backdrop, the only crucial issue for us to resolve in this case is whether or not complainant is entitled to her monetary claims. xxx In the instant case, from the facts and circumstances laid down, it is thus self-evident that the relationship of the complainant and respondent agency is governed by the Contract of Employment, the basic terms a covenants of which provided for the position of saleslady, monthly compensation of US$370.00 and duration of contract for one (1) year. As it is, when the parties complainant and respondent Agency signed and executed the POEA approved Contract of Employment, this agreement is the law that governs them. Thus, when respondent agency deviated from the terms of the contract by assigning the position of a housemaid to complainant instead of a saleslady as agreed upon in the POEA-approved Contract of Employment, respondent Agency committed a breach of said Employment Contract. Worthy of mention is the fact that respondent agency in their Position Paper paragraph 2, Brief Statement of the Facts and of the Case admitted that it had entered into an illegal contract with complainant by proposing the position of a housemaid which said position was then not allowed by the POEA, by making it appear in the Employment Contract that the position being applied for is the position of a saleslady. As it is, we find indubitably clear that the foreign employer had took advantage to the herein hopeless complainant and because of this ordeal, the same obviously rendered complainants continuous employment unreasonable if not downright impossible. The facts and surrounding circumstances of her ordeal was convincingly laid down by the complainant in her Position Paper, from which we find no flaws material enough to disregard the same. Complainant had clearly made out her case and no amount of persuasion can convince us to tilt the scales of justice in favor of respondents whose defense was anchored solely on the flimsy allegations that for a period of more than five (5) years from 1989 until 1995 nothing was heard from her or from her relatives, presuming then that complainant had no problem with her employment abroad. We also find that the pleadings and the annexes filed by the parties reveal a total lapse on the part of respondent First Cosmopolitan Manpower and Promotions their failure to support with substantial evidence their contention that complainant transferred from one employer to another without knowledge and approval of respondent agency in contravention of the terms of the POEA approved Employment Contract. Obviously, respondent Agency anchored its disquisition on the alleged

contracts signed by the complainant that she agreed with the terms of said contracts one (1) year duration only and as a housemaid to support its contention that complainant violated the contract agreement by transferring from one employer to another on her own volition without the knowledge and consent of respondent agency. To us, this posture of respondent agency is unavailing. These documents are self-serving. We could not but rule that the same were fabricated to tailor-fit their defense that complainant was guilty of violating the terms of the Employment Contract. Consequently, we could not avoid the inference of a more logical conclusion that complainant was forced against her will to continue with her employment notwithstanding the fact that it was in violation of the original Employment Contract including the illegal withholding of her passport. With the foregoing, we find and so rule that respondent Agency failed to discharge the burden of proving with substantial evidence that complainant violated the terms of the Employment Contract, thus negating respondent Agencys liability for complainants money claims. All the more, the record is bereft of any evidence to show that complainant Datuman is either not entitled to her wage differentials or have already received the same from respondent. As such, we are perforce constrained to grant complainants prayer for payment of salary differentials computed as follows: January 1992 April 1993 (15 months) US$370.00 agreed salary US$100.00 actual paid salary US$270.00 balance

US$270.00 x 15 months = US$4050.00 We are also inclined to grant complainants entitlement to a refund of her plane ticket in the amount of BD 180 Bahrain Dinar or the equivalent in Philippine Currency at the rate of exchange prevailing at the time of payment. Anent complainants claim for vacation leave pay and overtime pay, we cannot, however, grant the same for failure on the part of complainant to prove with particularity the months that she was not granted vacation leave and the day wherein she did render overtime work. Also, we could not grant complainants prayer for award of damages and attorneys fees for lack of factual and legal basis. WHEREFORE, premises considered, judgment is hereby rendered, finding respondent Agency liable for violating the term of Employment Contract and respondent First Cosmopolitan Manpower and Promotions is hereby ordered: To pay complainant the amount of US$ FOUR THOUSAND AND FIFTY (US$4,050.00), or its equivalent rate prevailing at the time of payment, representing her salary differentials for fifteen (15) months; To pay complainant the amount of BD 180.00 or its equivalent rate prevailing at the time of payment, representing the refund of plane ticket; All other claims are hereby dismissed for lack of merit. SO ORDERED.[9] (emphasis supplied)

On appeal, the NLRC, Second Division, issued a Decision[10] affirming with modification the Decision of Labor Arbiter Mayor, Jr., by reducing the award of salary differentials from US$4,050.00 to US$2,970.00 ratiocinating as follows:
Accordingly, we find that the claims for salary differentials accruing earlier than April of 1993 had indeed prescribed. This is so as complainant had filed her complaint on May 31, 1995 when she arrived from the jobsite in April 1993. Since the cause of action for salary differential accrues at the time when it falls due, it is clear that only the claims for the months of May 1993 to April 1994 have not yet prescribed. With an approved salary rate of US$370.00 vis--vis the amount of salary received which was $100.00, complainant is entitled to the salary differential for the said period in the amount of $2,970.00. xxx WHEREFORE, premises considered, judgment is hereby rendered MODIFYING the assailed Decision by reducing the award of salary differentials to $2,970.00 to the complainant. The rest of the disposition is AFFIRMED. SO ORDERED.[11]

On July 21, 2000, respondent elevated the matter to the CA through a petition for certiorari under Rule 65. On August 2, 2000,[12] the CA dismissed the petition for being insufficient in form pursuant to the last paragraph of Section 3, Rule 42 of the 1997 Rules of Civil Procedure, as amended. On October 20, 2000,[13] however, the CA reinstated the petition upon respondents motion for reconsideration.[14] On August 7, 2002, the CA issued the assailed Decision[15] granting the petition and reversing the NLRC and the Labor Arbiter, thus:
Under Section 1 (f), Rule II, Book II of the 1991 POEA Rules and Regulations, the local agency shall assume joint and solidary liability with the employer for all claims and liabilities which may arise in connection with the implementation of the contract, including but not limited to payment of wages, health and disability compensation and repatriation. Respondent Commission was correct in declaring that claims of private respondent for salary differentials accruing earlier than April of 1993 had indeed prescribed. It must be noted that petitioner company is privy only to the first contract. Granting arguendo that its liability

extends to the acts of its foreign principal, the Towering Recruiting Services, which appears to have a hand in the execution of the second contract, it is Our considered opinion that the same would, at the most, extend only up to the expiration of the second contract or until 01 September 1991. Clearly, the money claims subject of the complaint filed in 1995 had prescribed. However, this Court declares respondent Commission as not only having abused its discretion, but as being without jurisdiction at all, in declaring private respondent entitled to salary differentials. After decreeing the money claims accruing before April 1993 as having prescribed, it has no more jurisdiction to hold petitioner company for salary differentials after that period. To reiterate, the local agency shall assume joint and solidary liability with the employer for all claims and liabilities which may arise in connection with the implementation of the contract. Which contract? Upon a judicious consideration, we so hold that it is only in connection with the first contract. The provisions in number 2, Section 10 (a), Rule V, Book I of the Omnibus Rules Implementing the Labor Code Section 1 (f), Rule II, Book II of the 1991 POEA Rules and Regulations were not made to make the local agency a perpetual insurer against all untoward acts that may be done by the foreign principal or the direct employer abroad. It is only as regards the principal contract to which it is privy shall its liability extend. In Catan v. National Labor Relations Commission, 160 SCRA 691 (1988), it was held that the responsibilities of the local agent and the foreign principal towards the contracted employees under the recruitment agreement extends up to and until the expiration of the employment contracts of the employees recruited and employed pursuant to the said recruitment agreement. xxx Foregoing considered, the assailed Decision dated 24 February 2000 and the Resolution dated 23 June 2000 of respondent Commission in NLRC NCR CA 016354-98 are hereby SET ASIDE. SO ORDERED.[16]

Petitioners Motion for Reconsideration[17] thereon was denied in the assailed Resolution[18] dated November 14, 2002. Hence, the present petition based on the following grounds:
I. THE HONORABLE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR WHEN IT ABANDONED THE FACTUAL FINDINGS OF THE LABOR ARBITER AS AFFIRMED BY THE NATIONAL LABOR RELATIONS COMMISSION. II. THE HONORABLE COURT OF APPEALS PATENTLY ERRED IN HOLDING THAT THE RESPONDENT AGENCY IS ONLY A [sic] PRIVY AND LIABLE TO THE PRINCIPAL CONTRACT.

III. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT THE CAUSE OF ACTION OF THE PETITIONER ALREADY PRESCRIBED.

The respondent counters in its Comment that the CA is correct in ruling that it is not liable for the monetary claims of petitioner as the claim had already prescribed and had no factual basis. Simply put, the issues boil down to whether the CA erred in not holding respondent liable for petitioners money claims pursuant to their Contract of Employment. We grant the petition. On whether respondent is solidarily liable for petitioners monetary claims Section 1 of Rule II of the POEA Rules and Regulations states that:
Section 1. Requirements for Issuance of License. Every applicant for license to operate a private employment agency or manning agency shall submit a written application together with the following requirements: xxx f. A verified undertaking stating that the applicant: xxx (3) Shall assume joint and solidary liability with the employer for all claims and liabilities which may arise in connection with the implementation of the contract ; including but not limited to payment of wages, death and disability compensation and repatriation. (emphasis supplied)

The above provisions are clear that the private employment agency shall assume joint and solidary liability with the employer.[19] This Court has, time and again, ruled that private employment agencies are held jointly and severally liable with the foreign-based employer for any violation of the recruitment agreement or contract of employment.[20] This joint and solidary liability imposed by law against recruitment agencies and foreign employers is meant to assure the aggrieved worker of immediate and sufficient payment of what is due him.[21] This is in line with the policy of the state to protect and alleviate the plight of the working class. In the assailed Decision, the CA disregarded the aforecited provision of the law and the policy of the state when it reversed the findings of the NLRC and the Labor Arbiter. As the

agency which recruited petitioner, respondent is jointly and solidarily liable with the latters principal employer abroad for her (petitioners) money claims. Respondent cannot, therefore, exempt itself from all the claims and liabilities arising from the implementation of their POEAapproved Contract of Employment. We cannot agree with the view of the CA that the solidary liability of respondent extends only to the first contract (i.e. the original, POEA-approved contract which had a term of until April 1990). The signing of the substitute contracts with the foreign employer/principal before the expiration of the POEA-approved contract and any continuation of petitioners employment beyond the original one-year term, against the will of petitioner, are continuing breaches of the original POEA-approved contract. To accept the CAs reasoning will open the floodgates to even more abuse of our overseas workers at the hands of their foreign employers and local recruiters, since the recruitment agency could easily escape its mandated solidary liability for breaches of the POEA-approved contract by colluding with their foreign principals in substituting the approved contract with another upon the workers arrival in the country of employment. Such outcome is certainly contrary to the States policy of extending protection and support to our overseas workers. To be sure, Republic Act No. 8042 explicitly prohibits the substitution or alteration to the prejudice of the worker of employment contracts already approved and verified by the Department of Labor and Employment (DOLE) from the time of actual signing thereof by the parties up to and including the period of the expiration of the same without the approval of the DOLE.[22] Respondents contention that it was petitioner herself who violated their Contract of Employment when she signed another contract in Bahrain deserves scant consideration. It is the finding of both the Labor Arbiter and the NLRC which, significantly, the CA did not disturb that petitioner was forced to work long after the term of her original POEA-approved contract, through the illegal acts of the foreign employer. In Placewell International Services Corporation v. Camote ,[23] we held that the subsequently executed side agreement of an overseas contract worker with her foreign employer which reduced his salary below the amount approved by the POEA is void because it is against our existing laws, morals and public policy. The said side agreement cannot supersede the terms of the standard employment contract approved by the POEA.

Hence, in the present case, the diminution in the salary of petitioner from US$370.00 to US$100 (BD 40.00) per month is void for violating the POEA-approved contract which set the minimum standards, terms, and conditions of her employment. Consequently, the solidary liability of respondent with petitioners foreign employer for petitioners money claims continues although she was forced to sign another contract in Bahrain. It is the terms of the original POEA-approved employment contract that shall govern the relationship of petitioner with the respondent recruitment agency and the foreign employer. We agree with the Labor Arbiter and the NLRC that the precepts of justice and fairness dictate that petitioner must be compensated for all months worked regardless of the supposed termination of the original contract in April 1990. It is undisputed that petitioner was compelled to render service until April 1993 and for the entire period that she worked for the foreign employer or his unilaterally appointed successor, she should have been paid US$370/month for every month worked in accordance with her original contract. Respondent cannot disclaim liability for the acts of the foreign employer which forced petitioner to remain employed in violation of our laws and under the most oppressive conditions on the allegation that it purportedly had no knowledge of, or participation in, the contract unwillingly signed by petitioner abroad. We cannot give credence to this claim considering that respondent by its own allegations knew from the outset that the contract submitted to the POEA for approval was not to be the real contract. Respondent blithely admitted to submitting to the POEA a contract stating that the position to be filled by petitioner is that of Saleslady although she was to be employed as a domestic helper since the latter position was not approved for deployment by the POEA at that time. Respondents evident bad faith and admitted circumvention of the laws and regulations on migrant workers belie its protestations of innocence and put petitioner in a position where she could be exploited and taken advantage of overseas, as what indeed happened to her in this case. We look upon with great disfavor the unsubstantiated actuations of innocence or ignorance on the part of local recruitment agencies of acts of their foreign principals, as if the agencies responsibility ends with the deployment of the worker. In the light of the recruitment agencys legally mandated joint and several liability with the foreign employer for all claims in connection with the implementation of the contract, it is the recruitment agencys responsibility to ensure that the terms and conditions of the employment contract, as approved by the POEA, are faithfully complied with and implemented properly by its foreign

client/principal. Indeed, it is in its best interest to do so to avoid being haled to the courts or labor tribunals and defend itself from suits for acts of its foreign principal. On whether petitioners claims for underpaid salaries have prescribed

It should be recalled that the Labor Arbiter and the NLRC similarly found that petitioner is entitled to underpaid salaries, albeit they differed in the number of months for which salary differentials should be paid. The CA, on the other hand, held that all of petitioners monetary claims have prescribed pursuant to Article 291 of the Labor Code which provides that:
Art. 291. Money Claims. All money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three years from the time that cause of action accrued; otherwise, they shall be forever barred. (emphasis supplied)

We do not agree with the CA when it held that the cause of action of petitioner had already prescribed as the three-year prescriptive period should be reckoned fromSeptember 1, 1989 when petitioner was forced to sign another contract against her will. As stated in the complaint, one of petitioners causes of action was for underpayment of salaries. The NLRC correctly ruled the right to claim unpaid salaries (or in this case, unpaid salary differentials) accrue as they fall due.[24] Thus, petitioners cause of action to claim salary differential for October 1989 only accrued after she had rendered service for that month (or at the end of October 1989). Her right to claim salary differential for November 1989 only accrued at the end of November 1989, and so on and so forth. Both the Labor Arbiter and the NLRC found that petitioner was forced to work until April 1993. Interestingly, the CA did not disturb this finding but held only that the extent of respondents liability was limited to the term under the original contract or, at most, to the term of the subsequent contract entered into with the participation of respondents foreign principal, i.e. 1991. We have discussed previously the reasons why (a) the CAs theory of limited liability on the part of respondent is untenable and (b) the petitioner has a right to be compensated for all months she, in fact, was forced to work. To determine for which months petitioners right to claim salary differentials has not prescribed, we must count three years prior to the filing of the complaint on May 31, 1995. Thus, only claims accruing prior to May 31, 1992 have prescribed when the complaint was filed on May 31, 1995. Petitioner is entitled to her claims for salary

differentials for the period May 31, 1992 to April 1993, or approximately eleven (11) months.[25] We find that the NLRC correctly computed the salary differential due to petitioner at US$2,970.00 (US$370.00 as approved salary rate US$100.00 as salary received = US$290 as underpaid salary per month x 11 months). However, it should be for the period May 31, 1992 to April 1993 and not May 1993 to April 1994 as erroneously stated in the NLRCs Decision. A final note This Court reminds local recruitment agencies that it is their bounden duty to guarantee our overseas workers that they are being recruited for bona fide jobs with bona fideemployers. Local agencies should never allow themselves to be instruments of exploitation or oppression of their compatriots at the hands of foreign employers. Indeed, being the ones who profit most from the exodus of Filipino workers to find greener pastures abroad, recruiters should be first to ensure the welfare of the very people that keep their industry alive. WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals dated August 7, 2002 and Resolution dated November 14, 2002 in CA-G.R. SP No. 59825 are REVERSED AND SET ASIDE. The Decision of the National Labor Relations Commission dated February 24, 2000 is REINSTATED with a qualification with respect to the award of salary differentials, which should be granted for the period May 31, 1992 to April 1993 and not May 1993 to April 1994. SO ORDERED.

TERESITA J. LEONARDO-DE CASTRO Associate Justice

WE CONCUR:

ANTONIO T. CARPIO Acting Chairperson

MA. ALICIA AUSTRIA-MARTINEZ Associate Justice

RENATO C. CORONA Associate Justice

CONCHITA CARPIO MORALES Associate Justice

ATTESTATION I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division

ANTONIO T. CARPIO Associate Justice Acting Chairperson, First Division

CERTIFICATION Pursuant to Section 13, Article VIII of the Constitution and the Acting Division Chairpersons Attestation, I certify that the conclusions in the above decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

LEONARDO A. QUISUMBING Acting Chief Justice

* ** *** [1]

On Official Leave. Acting Chairperson of the First Division as per Special Order No. 534. Additional Member as per Special Order No. 535. Penned by then Associate Justice Romeo A. Brawner and concurred in by Associate Justices Jose L. Sabio, Jr. and Mario L. Guarina III. Annexes B B-2, Court of Appeals (CA) Rollo at 79-81. Id. Annex A, CA Rollo at 77. Petition for Review in the CA, CA Rollo. Rollo at 86. CA Petition-Annex H, CA Rollo. Id., at 97-98. Rollo at 108-113. Promulgated on February 24, 2000, penned by Commissioner Victoriano R. Calaycay and concurred in by Presiding Commissioner Raul Aquino and Commissioner Angelita Gacutan. Rollo at 161. CA Rollo at 45. Id., at 91. Id., at 91-92. Id., at 37-43. Rollo at 41-42. CA Rollo at 121-133. Id., at 46-47.

[2] [3] [4] [5] [6] [7] [8] [9] [10]

[11] [12] [13] [14] [15] [16] [17] [18] [19]

Skippers United Pacific, Inc. and J.P. Samartzsis Maritime Enterprises Co., S.A. v. Jerry Maguad and Porferio Ceudadano, G.R. No. 166363, August 15, 2006, 498 SCRA 639, 668. [20] Hellenic Philippine Shipping, Inc. v. Siete, G.R. No. 84082, March 13, 1991, 195 SCRA 179, 186; Empire Insurance Company v. NLRC, G.R. 121879, August 14, 1998, 294 SCRA 263, 271-272. [21] P.I. Manpower Placements, Inc. v. NLRC (Second Division), G.R. No. 97369, July 31, 1997, 276 SCRA 451, 461.
[22] [23]

Placewell International Services Corporation v. Camote, G.R. No. 169973, June 26, 2006, 492 SCRA 761. Id., citing Chavez v. Bonto-Perez, G.R. No. 109808, March 1, 1995, 242 SCRA 73. [24] NLRC Decision, Rollo at 160. [25] As an aside, this Court notes that in petitioners complaint filed with the Labor Arbiter, she only claims underpayment of salaries and did not include nonpayment of salaries as one of her causes of action. Subsequently, in her position paper and other pleadings, petitioner asserts that she was not paid any salary at all from September 1991 to April 1993. However, under the NLRC Rules of Procedure, parties are barred from alleging or proving causes of action in the position paper that are not found/alleged in the complaint. Thus, the Labor Arbiter and the NLRC only granted petitioner salary differentials as she herself prayed for in her complaint.

FIRST DIVISION

EQUI-ASIA PLACEMENT, INC., Petitioner,

G.R. No. 152214 Present:

- versus -

DEPARTMENT OF FOREIGN AFFAIRS (DFA) represented by the HON.

PANGANIBAN, C.J. Chairperson, YNARES-SANTIAGO, AUSTRIA-MARTINEZ, CALLEJO, SR., and CHICO-NAZARIO, JJ.

DOMINGO L. SIAZON, JR., SECRETARY, DEPARTMENT OF LABOR AND Promulgated:

EMPLOYMENT (DOLE), represented by HON. BIENVENIDO LAGUESMA, Respondents.

September 19, 2006

x----------------- ---------------------------------x

DECISION

CHICO-NAZARIO, J.:

This is a Petition for Review on Certiorari of the Decision dated 4 October 2001[1] and Resolution dated 18 February 2002 of the Court of Appeals in CA-G.R. SP No. 61904. The Decision denied petitioners petition for certiorari while the Resolution denied its Motion for Reconsideration.

The Court of Appeals summarized the facts of this case in this wise:

On September 16, 2000, Manny dela Rosa Razon, a native of Lemery, Batangas and an overseas Filipino worker, died of acute cardiac arrest while asleep at the dormitory of the Samsong Textile Processing Factory in South Korea. Informed thereof, the Philippine Overseas Labor Office (POLO) at South Korea immediately relayed the incident to the Philippine Embassy in South Korea. Forthwith, the [Labor] Attach of the Philippine Embassy dispatched a letter to Eleuterio N. Gardiner, administrator of the Overseas Workers Welfare Administration (OWWA). The letter reads:

VERY URGENT, POLO has recently received a report that OFW Manny dela Rosa RAZON, an undocumented worker, died last Saturday, 16 September, from an apparent pancreatic attack or bangungot.

According to the verbal reports of Moises and Ronald Recarde, Mannys coworkers, he was found already lifeless inside their quarters at around 11:00 in the morning of the above date. They rushed him to Uri Hospital where the Doctor declared him dead on arrival.

Per information gathered, the deceased is single, 29 years old, from Bukal, Lemery, Batangas. His next-of-kins are Mrs. Rowena Razon (Auntie) and Mr. Razon (Uncle) with telephone number (043)411-2308.

POLO is awaiting signed statements from the aforementioned workers who promised to send it by fax this afternoon.

We are also coordinating with the deceaseds employer for documentation requirements and financial assistance for the repatriation of the remains.

We will highly appreciate if Home Office could advise the next-of-kins of the urgent need to issue a Special Power of Attorney (SPA) to facilitate the repatriation requirements of the subject.

In anticipation of the next-of-kins likely move to seek financial assistance from OWWA for the repatriation of their loved [one], please be advised in advance that we

will need about US$4,000.00 to repatriate the cadaver (to include hospital and morgue costs) to Manila. xxx

In turn, the OWWA, through Atty. Cesar L. Chavez, indorsed the matter, for appropriate action, to Director R. Casco of the Welfare Employment Office of the Philippine Overseas Employment Administration (WEO-POEA).

Upon verification by the WEO-POEA on its data base, it was discovered that Manny Razon was recruited and deployed by petitioner Equi-Asia Placement, Inc., and was sent to South Korea on April 3, 2000 to work-train at Yeongjin Machinery, Inc. Thereupon, POEA addressed the herein first assailed telegram-directive dated September 22, 2000 to the President/General Manager of the petitioner. We quote the telegram:

PLEASE PROVIDE PTA *Prepaid Ticket Advice+ FOR THE REPATRIATION OF REMAINS AND BELONGINGS OF OFW MANNY DELA ROSA RAZON AS PER REQUEST OF PHILIPPINE EMBASSY, KOREA, YOU CAN COORDINATE WITH YOUR FOREIGN EMPLOYER AND TO WAD/OWWA (MLA) AS REGARDS TO THIS MATTER. YOU ARE GIVEN TWO (2) DAYS FROM RECEIPT HEREOF WITHIN WHICH TO PROVIDE SAID TICKET AND ASSISTANCE, KINDLY SUBMIT YOUR REPORT TO ASSISTANCE AND WELFARE DIVISION (AWD), 2/F POEA, FAILURE TO DO SO WILL CONSTRAIN US TO IMPOSE APPROPRIATE SANCTION UNDER OUR RULES

Responding thereto, petitioner, thru its President Daniel Morga, Jr., faxed on September 26, 2000 the following message to the Assistance and Welfare Division of the POEA:

In connection with your telegram, dated 09/22/2000, requiring us to report the circumstances surrounding the death of OFW MANNY DELA ROSA RAZON in Korea and requesting us to issue a PTA, etc., for the repatriation of the remains of said OFW, this is to report to your good office the following:

1. The deceased was deployed by 2000 to Yeongjin Machine Company in South Korea;

our

agency

on April

3,

2. He violated his employment/training/dispatching contracts on June 25, 2000 by unlawfully escaping/running away (TNT) from his company assignment without prior KFSMB authorization and working/staying in unknown company/place;

3.

He allegedly died of bangungot thereafter;

In view thereof, we cannot heed your requests as embodied in your telegram. However, his relatives can avail of the benefits provided for by OWWA in cases involving undocumented/illegal Filipino workers abroad.

Trusting for your kind understanding

On the same date September 26, 2000 Director Ricardo R. Casco of the WEO-POEA sent to the petitioner the herein second assailed letter-directive, which pertinently reads:

We have received a copy of your fax message dated 26 September 2000 as regards to your response to our request for PTA for aforesaid deceased OFW. Nevertheless, may we remind you that pursuant to Sections 52, 53, 54 and 55 of the Implementing Rules Governing RA 8042, otherwise known as the Migrant Workers and Overseas Filipino Act of 1995, the repatriation of OFW, his/her remains and transport of his personal effects is the primary responsibility of the principal or agency and to immediately advance the cost of plane fare without prior determination of the cause of workers repatriation. The Rules further provide for the procedure to be followed in cases when the foreign employer/agency fails to provide for the cost of the repatriation, compliance of which is punishable by suspension of the license of the agency or such sanction as the Administration shall deem proper. Hence, you are required to provide the PTA for the deceased OFW in compliance with the requirement in accordance with R.A. 8042. You are given forty-eight (48) hours upon receipt hereof within which to provide said ticket. Failure in this regard will constrain us to impose the appropriate sanction under our rules.

On September 27, 2000, petitioner wrote back Director Ricardo R. Casco, thus:

In connection with your fax letter dated September 26, 2000, re: the repatriation of the remains of the deceased, ex-trainee (OFW) MANNY DELA ROSA RAZON, please be informed that the provisions of Section 53 as well as, and in relation to, Section 55 of the Omnibus Rules and Regulations Implementing the Migrant Workers and Overseas Filipinos Act of 1995 on the matters covering the following:

1. The responsibility of the agency to advance the cost of plane fare without prior determination of the cause of the deceased workers termination.

2. The recovery of the same costs from the estate of the dead worker before the NLRC.

3.

The action to be imposed by POEA for non-compliance therewith within 48 hours are violative of due process and/or the principle on due delegation of power.

This is so because Sec. 15 of R.A. 8042 clearly contemplates prior notice and hearing before responsibility thereunder could be established against the agency that sets up the defense of sole fault in avoidance of said responsibility -. Besides, the sections in question unduly grant the powers to require advance payment of the plane fare, to impose the corresponding penalty of suspension in case of non-compliance therewith, within 48 hours and to recover said advance payment from the dead workers estate upon the return of his remains to the country before the NLRC, when the law itself does not expressly provide for the grant of such powers.

xxx

xxx

x x x.

Please provide us immediately with the death certificate/post mortem report/police report pertinent to above as proof of death and cause thereof.

Nonetheless, and apprehensive of the adverse repercussions which may ensue on account of its non-compliance with the directive, petitioner, on September 29, 2000, advanced under protest the costs for the repatriation of the remains of the late Manny dela Rosa Razon.

Thereafter, petitioner went to this Court via the instant petition for certiorari, posing, for Our consideration, the sole issue of

WHETHER OR NOT SECTIONS 52, 53, 54 AND 55 OF THE OMNIBUS RULES AND REGULATIONS IMPLEMENTING THE MIGRANT WORKERS AND OVERSEAS FILIPINOS ACT OF 1995 (R.A. 8042), ISSUED BY DFA AND POEA, WHICH POEA SUMMARILY ORDERED THE HEREIN PETITIONER TO COMPLY VIZ-

A-VIZ THE PAYMENT IN ADVANCE OF THE EXPENSES FOR THE REPATRIATION OF THE REMAINS OF A DECEASED WORKER-TRAINEE WHO, AT THE TIME OF HIS DEATH, HAS NO EXISTING EMPLOYMENT (DISPATCHING) CONTRACT WITH EITHER SAID PETITIONER OR HIS FOREIGN PRINCIPAL AND NO VALID VISA OR IS NOT WORKING WITH THE FOREIGN PRINCIPAL TO WHICH PETITIONER DEPLOYED HIM, IS ILLEGAL AND/OR VIOLATIVE OF DUE PROCESS SUCH THAT POEA ACTED WITHOUT [OR IN] EXCESS OF ITS JURISDICTION AND/OR IN GRAVE ABUSE OF DISCRETION IN ISSUING SAID ORDER TO PAY SAID EXPENSES.[2]

On 4 October 2001, the Court of Appeals rendered the Decision which is now the subject of the present petition. The dispositive portion of the Court of Appeals Decision states:

WHEREFORE, for lack of merit, the instant petition is DENIED and is accordingly DISMISSED.[3]

In dismissing the petition for certiorari, the Court of Appeals stated that petitioner was mainly accusing the Philippine Overseas Employment Administration (POEA) of grave abuse of discretion when it ordered petitioner to pay, in advance, the costs for the repatriation of the remains of the deceased Manny dela Rosa Razon.

The Court of Appeals ruled that the POEA did not commit any grave abuse of discretion as its directives to petitioner were issued pursuant to existing laws and regulations.[4] It likewise held that a petition for certiorari, which was the remedy availed of by petitioner, is not the proper remedy as the same is only available when there is no appeal, or any plain, speedy, and adequate remedy in the ordinary course of law.[5] Section 62 of the Omnibus Rules and Regulations Implementing the Migrant Workers and Overseas Filipinos Act of 1995 or Republic Act 8042 (Omnibus Rules) states that the Labor Arbiters of NLRC shall have the original and exclusive jurisdiction to hear and decide all claims arising out of employeremployee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages, subject to the rules and procedures of the NLRC. There is, therefore, an adequate remedy available to petitioner.

Lastly, the Court of Appeals declared that it could not strike down as unconstitutional Sections 52, 53, 54, and 55 of the Omnibus Rules as the unconstitutionality of a statute or rules may not be passed upon unless the issue is directly raised in an appropriate proceeding.[6]

In the present recourse, petitioner submits the following issues for our consideration:

1. The Court of Appeals erred in the appreciation of the issue as it mistakenly considered, in dismissing the petition before it, that petitioner is contesting the compliance and conformity of the POEA directives with Sections 52, 53, 54, and 55 of the Omnibus Rules and Regulations implementing in particular Section 15 of RA 8042;

2. The Court of Appeals, in dismissing the petition, again erred in ruling that constitutional questions cannot be passed upon and adjudged in a special civil action for certiorari under Rule 65 of the 1997 Rules of Civil Procedure;

3. The Court of Appeals erred in not holding that, under the facts of the case that gave rise to the petition before it, the same sections of the said rules and regulations are illegal, invalid and/or violative of the right of petitioner to due process of law and, therefore, the POEA directives issued pursuant thereto constitute acts committed without, or in excess of, jurisdiction and/or in grave abuse of discretion.[7]

In Our Resolution of 20 November 2002, we gave due course to the present petition and directed the parties to submit their respective memoranda.[8] On 28 August 2006, we resolved to dispense with the memorandum of the estate/heirs of deceased Manny dela Rosa Razon.

At the center of this petition are the following provisions of the omnibus rules:

Section 52. Primary Responsibility for Repatriation. The repatriation of the worker, or his/her remains, and the transport of his/her personal effects shall be the primary responsibility of the principal or agency which recruited or deployed him/her abroad. All costs attendant thereto shall be borne by the principal or the agency concerned.

Section 53. Repatriation of Workers. The primary responsibility to repatriate entails the obligation on the part of principal or agency to advance the cost of plane fare and to immediately repatriate the worker should the need for it arise, without a prior determination of the cause of the termination of the workers employment. However, after the worker has returned to the country, the principal or agency may recover the cost of repatriation from the worker if the termination of employment was due solely to his/her fault.

Every contract for overseas employment shall provide for the primary responsibility of agency to advance the cost of plane fare, and the obligation of the worker to refund the cost thereof in case his/her fault is determined by the Labor Arbiter.

Section 54. Repatriation Procedure. When a need for repatriation arises and the foreign employer fails to provide for it cost, the responsible personnel at site shall simultaneously notify OWWA and the POEA of such need. The POEA shall notify the agency concerned of the need for repatriation. The agency shall provide the plane ticket or the prepaid ticket advice (PTA) to the Filipinos ResourceCenter or to the appropriate Philippine Embassy; and notify POEA of such compliance. The POEA shall inform OWWA of the action of the agency.

Section 55. Action on Non-Compliance. If the employment agency fails to provide the ticket or PTA within 48 hours from receipt of the notice, the POEA shall suspend the license of the agency or impose such sanctions as it may deem necessary. Upon notice from the POEA, OWWA shall advance the costs of repatriation with recourse to the agency or principal. The administrative sanction shall not be lifted until the agency reimburses the OWWA of the cost of repatriation with legal interest.

Said provisions, on the other hand, are supposed to implement Section 15 of Republic Act No. 8042[9] which provides:

SEC. 15. Repatriation of Workers; Emergency Repatriation Fund. The repatriation of the worker and the transport of his personal belongings shall be the primary responsibility of the agency which, recruited or deployed the worker overseas. All costs attendant to repatriation shall be borne by or charged to the agency concerned and/or its principal. Likewise, the repatriation of remains and transport of the personal belongings of a deceased worker and all costs attendant thereto shall be borne by the principal and/or the local agency. However, in cases where the termination of employment is due solely to the fault of the worker, the principal/employer or agency shall not in any manner be responsible for the repatriation of the former and/or his belongings.

Petitioner contends that the Court of Appeals misappreciated the issue it presented in its petition for certiorari when, instead of resolving whether Sections 52, 53, 54, and 55 of the Omnibus Rules are illegal and violative of due process, it merely confined itself to the question of whether or not the POEA committed grave abuse of discretion in issuing its directives of 22 September 2000 and 27 September 2000.

Petitioner also contends that, contrary to the finding of the Court of Appeals, a special civil action for certiorari is the appropriate remedy to raise constitutional issues.

Also, petitioner insists that the subject portions of the omnibus rules are invalid on the ground that Section 15 of Republic Act No. 8042 does not impose on a recruitment agency the primary responsibility for the repatriation of a deceased Overseas Filipino Worker (OFW), while Section 52 of the Omnibus Rules unduly imposes such burden on a placement agency.

Moreover, petitioner argues that the word likewise at the start of the third sentence of Section 15 of Republic Act No. 8042 is used merely as a connective word indicating the similarity between a recruitment agencys financial obligation in the repatriation of living and a deceased OFW. It does not, however, necessarily make a placement agency primarily responsible for the repatriation of a deceased OFW unlike in the case of an OFW who is alive.

As for Section 53 of the Omnibus Rules, petitioner submits that the same is invalid as Section 15 of Republic Act No. 8042 clearly states that a placement agency shall not in any manner be responsible for the repatriation of the deceased OFW and his or her belongings should the termination of the OFWs employment be due to his or her fault. However, as Section 53 of the Omnibus Rules stipulates that a placement agency or principal shall bear the primary responsibility of repatriating an OFW and of advancing the payment for his or her plane fare, the omibus rules, as far as this section is concerned, is an invalid exercise of legislative power by an administrative agency.

In addition, petitioner claims Section 53 of the Omnibus Rules violates the due process clause of the constitution as it deprives the deploying agency of the right to prior notice and hearing through which it can prove that it should not bear the burden of repatriating an OFW.

Finally, petitioner points out that it should be the Overseas Workers Welfare Administration which should advance the costs of repatriation of the deceased Razon with the resources coming out of the emergency repatriation fund of said agency.

The Solicitor General for its part counters that Sections 52, 53, 54, and 55 of the Omnibus Rules are valid quasi-legislative acts of respondents Department of Foreign Affairs and Department of Labor and Employment.[10] Because of this, the requirements of prior notice and hearing are not essential. Besides, there are cases where even in the exercise of quasi-judicial power, administrative agencies are allowed, sans prior notice and hearing, to effectuate measures affecting private property, such as:

1) [F]or the summary abatement of nuisance per se which affects the immediate safety of persons and property, or 2) in summary proceedings of distraint and levy upon the property of delinquent taxpayers in the collection of internal revenue taxes, fees or charges or any increment thereto, or 3) in the preventive suspension of a public officer pending investigation. x x x.[11]

The Solicitor General also adds that since petitioner is engaged in the recruitment of Filipino workers for work abroad, the nature of its business calls for the exercise of the states police power in order to safeguard the rights and welfare of the Filipino laborers. One such measure is the primary responsibility imposed upon placement agencies with regard to the repatriation of an OFW or of his remains.

The Solicitor General also argues that the wording of Section 15 of Republic Act No. 8042 leaves no doubt that a recruitment agency shall bear the primary responsibility for the repatriation of an OFW whether the latter is dead or alive.

Lastly, the Solicitor General insists that actions assailing the validity of implementing rules and regulations are within the original jurisdiction of the regional trial courts.

We shall first address the procedural question involved in the present petition.

There is no denying that regular courts have jurisdiction over cases involving the validity or constitutionality of a rule or regulation issued by administrative agencies. Such jurisdiction, however, is not limited to the Court of Appeals or to this Court alone for even the regional trial courts can take cognizance of actions assailing a specific rule or set of rules promulgated by administrative bodies. Indeed, the Constitution vests the power of judicial review or the power to declare a law, treaty, international or executive agreement, presidential decree, order, instruction, ordinance, or regulation in the courts, including the regional trial courts.[12]

Section 1, Rule 65 of the 1997 Rules of Civil Procedure states:

SECTION 1. Petition for Certiorari. When any tribunal, board or officer exercising judicial or quasi-judicial functions has acted without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered annulling or modifying the proceedings of such tribunal, board or officer, and granting such incidental reliefsas law and justice may require.

The petition shall be accompanied by a certified true copy of the judgment, order or resolution subject thereof, copies of all pleadings and documents relevant and pertinent thereto, and a sworn certification of non-forum shopping as provided in the third paragraph of Section 3, Rule 46.

From this, it is clear that in order for a petition for certiorari to prosper, the following requisites must be present: (1) the writ is directed against a tribunal, a board or an officer exercising judicial or quasi-judicial functions; (2) such tribunal, board or officer has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal or any plain, speedy and adequate remedy in the ordinary course of law.

It bears emphasizing that administrative bodies are vested with two basic powers, the quasi-legislative and the quasi-judicial.[13] In Abella, Jr. v. Civil Service Commission,[14] we discussed the nature of these powers to be

In exercising its quasi-judicial function, an administrative body adjudicates the rights of persons before it, in accordance with the standards laid down by the law. The determination of facts and the applicable law, as basis for official action and the exercise of judicial discretion, are essential for the performance of this function. On these considerations, it is elementary that due process requirements, as enumerated in Ang Tibay, must be observed. These requirements include prior notice and hearing.

On the other hand, quasi-legislative power is exercised by administrative agencies through the promulgation of rules and regulations within the confines of the granting statute and the doctrine of non-delegation of certain powers flowing from the separation of the great branches of the government. Prior notice to and hearing of every affected party, as elements of due process, are not required since there is no determination of past events or facts that have to be established or ascertained. As a general rule, prior notice and hearing are not essential to the validity of rules or regulations promulgated to govern future conduct.

In this case, petitioner assails certain provisions of the Omnibus Rules. However, these rules were clearly promulgated by respondents Department of Foreign Affairs and Department of Labor and Employment in the exercise of their quasi-legislative powers or the authority to promulgate rules and regulations. Because of this, petitioner was, thus, mistaken in availing himself of the remedy of an original action for certiorari as obviously, only judicial or quasijudicial acts are proper subjects thereof. If only for these, the petition deserves outright dismissal. Be that as it may, we shall proceed to resolve the substantive issues raised in this petition for review in order to finally remove the doubt over the validity of Sections 52, 53, 54, and 55 of the Omnibus Rules.

It is now well-settled that delegation of legislative power to various specialized administrative agencies is allowed in the face of increasing complexity of modern life. Given the volume and variety of interactions involving the members of todays society, it is doubtful if the legislature can promulgate laws dealing with the minutiae aspects of everyday life. Hence, the need to delegate to administrative bodies, as the principal agencies tasked to execute laws with respect to their specialized fields, the authority to promulgate rules and regulations to implement a given statute and effectuate its policies.[15] All that is required for the valid exercise of this power of subordinate legislation is that the regulation must be germane to the objects and purposes of the law; and that the regulation be not in contradiction to, but in conformity with, the standards prescribed by the law.[16] Under the first test or the so-called completeness test, the law must be complete in all its terms and conditions when it leaves the legislature such that when it reaches the delegate, the only thing he will have to do is to enforce it.[17] The second test or the sufficient standard test, mandates

that there should be adequate guidelines or limitations in the law to determine the boundaries of the delegates authority and prevent the delegation from running riot.[18]

We resolve that the questioned provisions of the Omnibus Rules meet these requirements.

Basically, petitioner is impugning the subject provisions of the Omnibus Rules for allegedly expanding the scope of Section 15 of Republic Act No. 8042 by: first, imposing upon it the primary obligation to repatriate the remains of the deceased Razon including the duty to advance the cost of the plane fare for the transport of Razons remains; andsecond, by ordering it to do so without prior determination of the existence of employer-employee relationship between itself and Razon.

Petitioners argument that Section 15 does not provide that it shall be primarily responsible for the repatriation of a deceased OFW is specious and plain nitpicking. While Republic Act No. 8042 does not expressly state that petitioner shall be primarily obligated to transport back here to the Philippines the remains of the deceased Razon, nevertheless, such duty is imposed upon him as the statute clearly dictates that the repatriation of remains and transport of the personal belongings of a deceased worker and all costs attendant thereto shall be borne by the principal and/or the local agency. The mandatory nature of said obligation is characterized by the legislatures use of the word shall. That the concerned government agencies opted to demand the performance of said responsibility solely upon petitioner does not make said directives invalid as the law plainly obliges a local placement agency such as herein petitioner to bear the burden of repatriating the remains of a deceased OFW with or without recourse to the principal abroad. In this regard, we see no reason to invalidate Section 52 of the omnibus rules as Republic Act No. 8042 itself permits the situation wherein a local recruitment agency can be held exclusively responsible for the repatriation of a deceased OFW.

Nor do we see any reason to stamp Section 53 of the Omnibus Rules as invalid for allegedly contravening Section 15 of the law which states that a placement agency shall not be responsible for a workers repatriation should the termination of the employer-employee relationship be due to the fault of the OFW. To our mind, the statute merely states the general principle that in case the severance of the employment was because of the OFWs own undoing, it is only fair that he or she should shoulder the costs of his or her

homecoming. Section 15 of Republic Act No. 8042, however, certainly does not preclude a placement agency from establishing the circumstances surrounding an OFWsdismissal from service in an appropriate proceeding. As such determination would most likely take some time, it is only proper that an OFW be brought back here in our country at the soonest possible time lest he remains stranded in a foreign land during the whole time that recruitment agency contests its liability for repatriation. As aptly pointed out by the Solicitor General

Such a situation is unacceptable.

24. This is the same reason why repatriation is made by law an obligation of the agency and/or its principal without the need of first determining the cause of the termination of the workers employment. Repatriation is in effect an unconditional responsibility of the agency and/or its principal that cannot be delayed by an investigation of why the worker was terminated from employment. To be left stranded in a foreign land without the financial means to return home and being at the mercy of unscrupulous individuals is a violation of the OFWs dignity and his human rights. These are the same rights R.A. No. 8042 seeks to protect.[19]

As for the sufficiency of standard test, this Court had, in the past, accepted as sufficient standards the following: public interest, justice and equity, public convenience and welfare, and simplicity, economy and welfare.[20]

In this case, we hold that the legislatures pronouncements that Republic Act No. 8042 was enacted with the thought of upholding the dignity of the Filipinos may they be here or abroad and that the State shall at all times afford full protection to labor, both here and abroad, meet the requirement and provide enough guidance for the formulation of the omnibus rules.

WHEREFORE, the Petition for Review is DENIED. The Court of Appeals Decision dated 4 October 2001 and Resolution dated 18 February 2002 are herebyAFFIRMED. With costs.

SO ORDERED.

MINITA V. CHICO-NAZARIO Associate Justice

WE CONCUR:

ARTEMIO V. PANGANIBAN Chief Justice Chairperson

CONSUELO YNARES-SANTIAGO Associate Justice

MA. ALICIA AUSTRIA-MARTINEZ Associate Justice

ROMEO J. CALLEJO, SR.

Associate Justice

CERTIFICATION

Pursuant to Article VIII, Section 13 of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

ARTEMIO V. PANGANIBAN Chief Justice

[1]

[2] [3] [4] [5] [6] [7] [8] [9]

[10]

[11] [12]

[13]

[14] [15] [16] [17] [18] [19] [20]

Penned by Associate Justice Cancio C. Garcia (now a member of this Court) and Associate Justices Hilarion L. Aquino and Edgardo P. Cruz, concurring; rollo, pp. 44-55. Rollo, pp. 45-50. Id. at 55. Id. at 53. Id. at 11. Id. at 12. Id. at 267-268. Id. at 241-242. AN ACT TO INSTITUTE THE POLICIES OF OVERSEAS EMPLOYMENT AND ESTABLISH A HIGHER STANDARD OF PROTECTION AND PROMOTION OF THE WELFARE OF MIGRANT WORKERS, THEIR FAMILIES AND OVERSEAS FILIPINOS IN DISTRESS, AND FOR OTHER PURPOSES. Signed by Secretary Domingo L. Siazon, Jr. for the Department of Foreign Affairs and Secretary Leonardo A. Quisumbing for the Department of Labor and Employment. Rollo, p. 294. Smart Communications, Inc. (SMART) v. National Telecommunications Commission (NTC) , G.R. No. 151908, 12 August 2003, 408 SCRA 678, 689. Eastern Shipping Lines, Inc. v. Philippine Overseas Employment Agency , G.R. No. L-76633, 18 October 1988, 166 SCRA 533, 546-547. G.R. No. 152574, 17 November 2004, 442 SCRA 507, 529-530. Beltran v. Secretary of Health, G.R. No. 133640, 25 November 2005, 476 SCRA 168, 191. The Conference of Maritime Manning Agencies v. Philippine Overseas Employment Agency , 313 Phil. 592, 606 (1995). Eastern Shipping Lines, Inc. v. Philippine Overseas Employment Agency, supra note 13 at 543. Id. Rollo, p. 300. Supra note 13 at 537.