Gabriel vs Bilon | G.R. No. 146989 | Feb. 7, 2007 | Azcuna, J.

Petitioner: Melencio Gabriel, represented by surviving spouse Flordeliza Gabriel

Respondents: Nelson Bilon, Angel Brazil, Ernesto Pagaygay

SUMMARY: Petitioner dismissed respondents, workers under a boundary system. Pending the LA decision, petitioner
died. His wife and daughter refused to receive the decision by personal delivery, which was nonetheless received
subsequently by registered mail. The SC resolved the relevant disputes, finding for the timeliness of petitioner’s appeal,
affirming the existence of an EER and of illegal dismissal, and ruling that the money claims of respondents must be
filed against the deceased petitioner’s estate.

FACTS:

 Petitioner was the owner-operator of a public transport business, Gabriel Jeepney

 Respondents filed complaints for illegal dismissal, illegal deductions, and separation pay against petitioner
with the NLRC
- Amended to implead Bacoor Transport Service Cooperative, Inc. (BTSCI) since both parties are members
 Respondents alleged:
a. They were regular drivers of Gabriel Jeepney under a boundary system of P400/day.
b. They were required to pay an additional P55 per day (P20: police protection, P20: washing, P10: deposit,
P5: garage fees).
c. No law providing that the operator require drivers to pay such fees.
d. Petitioner told them not to drive anymore, and were not given a unit to drive upon reporting to work.
e. Boundary drivers of passenger jeepneys are considered regular employees entitled to security of tenure.
 Petitioner contended:
a. He never dismissed respondents nor any other driver; some of his former drivers just stopped reporting
for work and resurfaced only to fabricate complaints.
b. He ensured no jeepney would be idle in a day by establishing a pool of drivers; had respondents said
they wanted to drive, he would have let them.
c. While he was penalized in connection with similar complaints in the past, it was not because of his
culpability but on some procedural and technical shortcomings on his part; and
d. The amounts were not deducted from respondents’ pay, as deductions were installment payments for
several advances made by them.
 BTSCI declared that it should not be made a party
a. Nothing to do with member-drivers’ employment
b. Amounts allegedly deducted and supposed purpose were not within their knowledge
 Labor Arbiter: Illegal dismissal.
 [April 4, 1997] Petitioner passed away. 2 weeks later, the decision was delivered personally to the petitioner’s
house.
- After reading the decision, petitioner’s wife Flordeliza and their daughter refused to receive the same;
bailiff nonetheless left a copy of the decision but was not signed and acknowledged
- [May 28, 1997] Subsequently served by registered mail and received
 NLRC: LA reversed. No EER.
 CA: NLRC reversed.
a. Appeal by employer perfected only upon posting of a cash or surety bond.
b. EER exists in a boundary system.
c. NLRC did not resolve the matter definitively; merely suggested petitioners pursue their claim against the
proceedings for the settlement of the estate of the deceased Melencio Gabriel.

ISSUES

W/N petitioner’s appeal was filed out of time – NO

1. Service validly made by mail on May 28.

a. Could not have been validly effected on April 18, as petitioner passed away on April 4.
 b. NLRC Rules and ROC provisions which contemplate personal delivery apply to situations where the
party to the action is alive upon delivery.
c. In the case at bar, petitioner was not represented by counsel during the pendency of the case. The decision
of the LA only served on April 18, 1997 when he was no longer around to receive the same. His surviving
spouse and daughter cannot automatically substitute themselves as party respondents (in those
proceedings). Thus, when the bailiff tendered a copy of the decision to them, they were not in a position
to receive them.
2. The appeal filed on behalf of petitioner on June 5, 1997 after receipt of a copy of the decision via registered
mail on May 28, 1997 was within the ten-day reglementary period prescribed under Section 223 of the Labor
Code.

W/N petitioner’s surety bond was defective – NO

1. Petitioner was able to comply substantially with the rule.

a. It did not matter that by the terms of the bond he Liability of the surety herein shall expire on June 5,
1998 and this bond shall be automatically cancelled ten (10) days after the expiration. the bond is
accompanied by the joint declaration under oath of respondent-appellants surviving spouse and counsel
attesting that the surety bond is genuine and shall be in effect until the final disposition of the case.
b. while Article 223 of the Labor Code, as amended requiring a cash or surety bond in the amount equivalent
to the monetary award in the judgment appealed from for the appeal to be perfected, may be considered
a jurisdictional requirement, it should be given a liberal interpretation.

W/N an employer-employee relationship existed – YES

1. Citing jurisprudence: “[T]he relationship between jeepney owners/operators and jeepney drivers under the
boundary system is that of employer-employee and not of lessor-lessee because in the lease of chattels
the lessor loses complete control over the chattel leased although the lessee cannot be reckless in the use
thereof, otherwise he would be responsible for the damages to the lessor. In the case
of jeepney owners/operators and jeepney drivers, the former exercises supervision and control over the
latter. The fact that the drivers do not receive fixed wages but get only that in excess of the so-called boundary
[that] they pay to the owner/operator is not sufficient to withdraw the relationship between them from that
of employer and employee. Thus, private respondents were employees because they had been engaged to
perform activities which were usually necessary or desirable in the usual business or trade of the employer.”

W/N there was illegal dismissal – YES

1. No due process. No showing that grounds for termination was among those in the Labor Code.
2. Reinstatement is obtainable in this case because it has not been shown that there is an ensuing strained
relations between petitioner and respondents.

W/N respondents’ money claims must be filed against the estate of petitioner – YES

1. Rule 3, Sec. 20. Action on contractual money claims. When the action is for recovery of money arising from
contract, express or implied, and the defendant dies before entry of final judgment in the court in which the
action was pending at the time of such death, it shall not be dismissed but shall instead be allowed to continue
until entry of final judgment. A favorable judgment obtained by the plaintiff therein shall be enforced in the
manner provided in these Rules for prosecuting claims against the estate of a deceased person.
2. Rule 86, Sec. 5. Claims which must be filed under the notice. If not filed, barred ; exceptions. All claims for
money against the decedent arising from contract, express or implied, whether the same be due, not due, or
contingent, ... and judgment for money against the decedent, must be filed within the time limited in the
notice; otherwise they are barred forever, except that they may be set forth as counterclaims in any action that
the executor or administrator may bring against the claimants.

DISPOSITIVE: Petition DENIED.