Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 100113 September 3, 1991

RENATO CAYETANO, petitioner,

vs.
CHRISTIAN MONSOD, HON. JOVITO R. SALONGA, COMMISSION ON APPOINTMENT, and HON. GUILLERMO
CARAGUE, in his capacity as Secretary of Budget and Management, respondents.

Renato L. Cayetano for and in his own behalf.

Sabina E. Acut, Jr. and Mylene Garcia-Albano co-counsel for petitioner.

PARAS, J.:p

We are faced here with a controversy of far-reaching proportions. While ostensibly only legal issues are involved, the
Court's decision in this case would indubitably have a profound effect on the political aspect of our national existence.

The 1987 Constitution provides in Section 1 (1), Article IX-C:

There shall be a Commission on Elections composed of a Chairman and six Commissioners who shall be natural-born
citizens of the Philippines and, at the time of their appointment, at least thirty-five years of age, holders of a college degree,
and must not have been candidates for any elective position in the immediately preceding -elections. However, a majority
thereof, including the Chairman, shall be members of the Philippine Bar who have been engaged in the practice of law for at
least ten years. (Emphasis supplied)

The aforequoted provision is patterned after Section l(l), Article XII-C of the 1973 Constitution which similarly provides:

There shall be an independent Commission on Elections composed of a Chairman and eight Commissioners who shall be
natural-born citizens of the Philippines and, at the time of their appointment, at least thirty-five years of age and holders of a
college degree. However, a majority thereof, including the Chairman, shall be members of the Philippine Bar who have been
engaged in the practice of law for at least ten years.' (Emphasis supplied)

Regrettably, however, there seems to be no jurisprudence as to what constitutes practice of law as a legal qualification to an
appointive office.

Black defines "practice of law" as:

The rendition of services requiring the knowledge and the application of legal principles and technique to serve the interest
of another with his consent. It is not limited to appearing in court, or advising and assisting in the conduct of litigation, but
embraces the preparation of pleadings, and other papers incident to actions and special proceedings, conveyancing, the
preparation of legal instruments of all kinds, and the giving of all legal advice to clients. It embraces all advice to clients and
all actions taken for them in matters connected with the law. An attorney engages in the practice of law by maintaining an
office where he is held out to be-an attorney, using a letterhead describing himself as an attorney, counseling clients in legal
matters, negotiating with opposing counsel about pending litigation, and fixing and collecting fees for services rendered by
his associate. (Black's Law Dictionary, 3rd ed.)

The practice of law is not limited to the conduct of cases in court. (Land Title Abstract and Trust Co. v. Dworken, 129 Ohio
St. 23, 193 N.E. 650) A person is also considered to be in the practice of law when he:

... for valuable consideration engages in the business of advising person, firms, associations or corporations as to their
rights under the law, or appears in a representative capacity as an advocate in proceedings pending or prospective, before
any court, commissioner, referee, board, body, committee, or commission constituted by law or authorized to settle
controversies and there, in such representative capacity performs any act or acts for the purpose of obtaining or defending
the rights of their clients under the law. Otherwise stated, one who, in a representative capacity, engages in the business of
advising clients as to their rights under the law, or while so engaged performs any act or acts either in court or outside of
court for that purpose, is engaged in the practice of law. (State ex. rel. Mckittrick v..C.S. Dudley and Co., 102 S.W. 2d 895,
340 Mo. 852)

This Court in the case of Philippine Lawyers Association v.Agrava, (105 Phil. 173,176-177) stated:
The practice of law is not limited to the conduct of cases or litigation in court; it embraces the preparation of pleadings and
other papers incident to actions and special proceedings, the management of such actions and proceedings on behalf of
clients before judges and courts, and in addition, conveying. In general, all advice to clients, and all action taken for them in
matters connected with the law incorporation services, assessment and condemnation services contemplating an
appearance before a judicial body, the foreclosure of a mortgage, enforcement of a creditor's claim in bankruptcy and
insolvency proceedings, and conducting proceedings in attachment, and in matters of estate and guardianship have been
held to constitute law practice, as do the preparation and drafting of legal instruments, where the work done involves the
determination by the trained legal mind of the legal effect of facts and conditions. (5 Am. Jr. p. 262, 263). (Emphasis
supplied)

Practice of law under modem conditions consists in no small part of work performed outside of any court and having no
immediate relation to proceedings in court. It embraces conveyancing, the giving of legal advice on a large variety of
subjects, and the preparation and execution of legal instruments covering an extensive field of business and trust relations
and other affairs. Although these transactions may have no direct connection with court proceedings, they are always
subject to become involved in litigation. They require in many aspects a high degree of legal skill, a wide experience with
men and affairs, and great capacity for adaptation to difficult and complex situations. These customary functions of an
attorney or counselor at law bear an intimate relation to the administration of justice by the courts. No valid distinction, so far
as concerns the question set forth in the order, can be drawn between that part of the work of the lawyer which involves
appearance in court and that part which involves advice and drafting of instruments in his office. It is of importance to the
welfare of the public that these manifold customary functions be performed by persons possessed of adequate learning and
skill, of sound moral character, and acting at all times under the heavy trust obligations to clients which rests upon all
attorneys. (Moran, Comments on the Rules of Court, Vol. 3 [1953 ed.] , p. 665-666, citing In re Opinion of the Justices
[Mass.], 194 N.E. 313, quoted in Rhode Is. Bar Assoc. v. Automobile Service Assoc. [R.I.] 179 A. 139,144). (Emphasis ours)

The University of the Philippines Law Center in conducting orientation briefing for new lawyers (1974-1975) listed the
dimensions of the practice of law in even broader terms as advocacy, counselling and public service.

One may be a practicing attorney in following any line of employment in the profession. If what he does exacts knowledge of
the law and is of a kind usual for attorneys engaging in the active practice of their profession, and he follows some one or
more lines of employment such as this he is a practicing attorney at law within the meaning of the statute. (Barr v. Cardell,
155 NW 312)

Practice of law means any activity, in or out of court, which requires the application of law, legal procedure, knowledge,
training and experience. "To engage in the practice of law is to perform those acts which are characteristics of the
profession. Generally, to practice law is to give notice or render any kind of service, which device or service requires the use
in any degree of legal knowledge or skill." (111 ALR 23)

The following records of the 1986 Constitutional Commission show that it has adopted a liberal interpretation of the term
"practice of law."

MR. FOZ. Before we suspend the session, may I make a manifestation which I forgot to do during our review of the
provisions on the Commission on Audit. May I be allowed to make a very brief statement?

THE PRESIDING OFFICER (Mr. Jamir).

The Commissioner will please proceed.

MR. FOZ. This has to do with the qualifications of the members of the Commission on Audit. Among others, the
qualifications provided for by Section I is that "They must be Members of the Philippine Bar" — I am quoting from the
provision — "who have been engaged in the practice of law for at least ten years".

To avoid any misunderstanding which would result in excluding members of the Bar who are now employed in the COA or
Commission on Audit, we would like to make the clarification that this provision on qualifications regarding members of the
Bar does not necessarily refer or involve actual practice of law outside the COA We have to interpret this to mean that as
long as the lawyers who are employed in the COA are using their legal knowledge or legal talent in their respective work
within COA, then they are qualified to be considered for appointment as members or commissioners, even chairman, of the
Commission on Audit.

This has been discussed by the Committee on Constitutional Commissions and Agencies and we deem it important to take
it up on the floor so that this interpretation may be made available whenever this provision on the qualifications as regards
members of the Philippine Bar engaging in the practice of law for at least ten years is taken up.

MR. OPLE. Will Commissioner Foz yield to just one question.

MR. FOZ. Yes, Mr. Presiding Officer.

MR. OPLE. Is he, in effect, saying that service in the COA by a lawyer is equivalent to the requirement of a law practice that
is set forth in the Article on the Commission on Audit?
MR. FOZ. We must consider the fact that the work of COA, although it is auditing, will necessarily involve legal work; it will
involve legal work. And, therefore, lawyers who are employed in COA now would have the necessary qualifications in
accordance with the Provision on qualifications under our provisions on the Commission on Audit. And, therefore, the
answer is yes.

MR. OPLE. Yes. So that the construction given to this is that this is equivalent to the practice of law.

MR. FOZ. Yes, Mr. Presiding Officer.

MR. OPLE. Thank you.

... ( Emphasis supplied)

Section 1(1), Article IX-D of the 1987 Constitution, provides, among others, that the Chairman and two Commissioners of
the Commission on Audit (COA) should either be certified public accountants with not less than ten years of auditing
practice, or members of the Philippine Bar who have been engaged in the practice of law for at least ten years. (emphasis
supplied)

Corollary to this is the term "private practitioner" and which is in many ways synonymous with the word "lawyer." Today,
although many lawyers do not engage in private practice, it is still a fact that the majority of lawyers are private practitioners.
(Gary Munneke, Opportunities in Law Careers [VGM Career Horizons: Illinois], [1986], p. 15).

At this point, it might be helpful to define private practice. The term, as commonly understood, means "an individual or
organization engaged in the business of delivering legal services." (Ibid.). Lawyers who practice alone are often called "sole
practitioners." Groups of lawyers are called "firms." The firm is usually a partnership and members of the firm are the
partners. Some firms may be organized as professional corporations and the members called shareholders. In either case,
the members of the firm are the experienced attorneys. In most firms, there are younger or more inexperienced salaried
attorneyscalled "associates." (Ibid.).

The test that defines law practice by looking to traditional areas of law practice is essentially tautologous, unhelpful defining
the practice of law as that which lawyers do. (Charles W. Wolfram, Modern Legal Ethics [West Publishing Co.: Minnesota,
1986], p. 593). The practice of law is defined as the performance of any acts . . . in or out of court, commonly understood to
be the practice of law. (State Bar Ass'n v. Connecticut Bank & Trust Co., 145 Conn. 222, 140 A.2d 863, 870 [1958] [quoting
Grievance Comm. v. Payne, 128 Conn. 325, 22 A.2d 623, 626 [1941]). Because lawyers perform almost every function
known in the commercial and governmental realm, such a definition would obviously be too global to be workable.(Wolfram,
op. cit.).

The appearance of a lawyer in litigation in behalf of a client is at once the most publicly familiar role for lawyers as well as
an uncommon role for the average lawyer. Most lawyers spend little time in courtrooms, and a large percentage spend their
entire practice without litigating a case. (Ibid., p. 593). Nonetheless, many lawyers do continue to litigate and the litigating
lawyer's role colors much of both the public image and the self perception of the legal profession. (Ibid.).

In this regard thus, the dominance of litigation in the public mind reflects history, not reality. (Ibid.). Why is this so? Recall
that the late Alexander SyCip, a corporate lawyer, once articulated on the importance of a lawyer as a business counselor in
this wise: "Even today, there are still uninformed laymen whose concept of an attorney is one who principally tries cases
before the courts. The members of the bench and bar and the informed laymen such as businessmen, know that in most
developed societies today, substantially more legal work is transacted in law offices than in the courtrooms. General
practitioners of law who do both litigation and non-litigation work also know that in most cases they find themselves
spending more time doing what [is] loosely desccribe[d] as business counseling than in trying cases. The business lawyer
has been described as the planner, the diagnostician and the trial lawyer, the surgeon. I[t] need not [be] stress[ed] that in
law, as in medicine, surgery should be avoided where internal medicine can be effective." (Business Star, "Corporate
Finance Law," Jan. 11, 1989, p. 4).

In the course of a working day the average general practitioner wig engage in a number of legal tasks, each involving
different legal doctrines, legal skills, legal processes, legal institutions, clients, and other interested parties. Even the
increasing numbers of lawyers in specialized practice wig usually perform at least some legal services outside their
specialty. And even within a narrow specialty such as tax practice, a lawyer will shift from one legal task or role such as
advice-giving to an importantly different one such as representing a client before an administrative agency. (Wolfram, supra,
p. 687).

By no means will most of this work involve litigation, unless the lawyer is one of the relatively rare types — a litigator who
specializes in this work to the exclusion of much else. Instead, the work will require the lawyer to have mastered the full
range of traditional lawyer skills of client counselling, advice-giving, document drafting, and negotiation. And increasingly
lawyers find that the new skills of evaluation and mediation are both effective for many clients and a source of employment.
(Ibid.).

Most lawyers will engage in non-litigation legal work or in litigation work that is constrained in very important ways, at least
theoretically, so as to remove from it some of the salient features of adversarial litigation. Of these special roles, the most
prominent is that of prosecutor. In some lawyers' work the constraints are imposed both by the nature of the client and by
the way in which the lawyer is organized into a social unit to perform that work. The most common of these roles are those
of corporate practice and government legal service. (Ibid.).

In several issues of the Business Star, a business daily, herein below quoted are emerging trends in corporate law practice,
a departure from the traditional concept of practice of law.

We are experiencing today what truly may be called a revolutionary transformation in corporate law practice. Lawyers and
other professional groups, in particular those members participating in various legal-policy decisional contexts, are finding
that understanding the major emerging trends in corporation law is indispensable to intelligent decision-making.

Constructive adjustment to major corporate problems of today requires an accurate understanding of the nature and
implications of the corporate law research function accompanied by an accelerating rate of information accumulation. The
recognition of the need for such improved corporate legal policy formulation, particularly "model-making" and "contingency
planning," has impressed upon us the inadequacy of traditional procedures in many decisional contexts.

In a complex legal problem the mass of information to be processed, the sorting and weighing of significant conditional
factors, the appraisal of major trends, the necessity of estimating the consequences of given courses of action, and the
need for fast decision and response in situations of acute danger have prompted the use of sophisticated concepts of
information flow theory, operational analysis, automatic data processing, and electronic computing equipment.
Understandably, an improved decisional structure must stress the predictive component of the policy-making process,
wherein a "model", of the decisional context or a segment thereof is developed to test projected alternative courses of action
in terms of futuristic effects flowing therefrom.

Although members of the legal profession are regularly engaged in predicting and projecting the trends of the law, the
subject of corporate finance law has received relatively little organized and formalized attention in the philosophy of
advancing corporate legal education. Nonetheless, a cross-disciplinary approach to legal research has become a vital
necessity.

Certainly, the general orientation for productive contributions by those trained primarily in the law can be improved through
an early introduction to multi-variable decisional context and the various approaches for handling such problems. Lawyers,
particularly with either a master's or doctorate degree in business administration or management, functioning at the legal
policy level of decision-making now have some appreciation for the concepts and analytical techniques of other professions
which are currently engaged in similar types of complex decision-making.

Truth to tell, many situations involving corporate finance problems would require the services of an astute attorney because
of the complex legal implications that arise from each and every necessary step in securing and maintaining the business
issue raised. (Business Star, "Corporate Finance Law," Jan. 11, 1989, p. 4).

In our litigation-prone country, a corporate lawyer is assiduously referred to as the "abogado de campanilla." He is the "big-
time" lawyer, earning big money and with a clientele composed of the tycoons and magnates of business and industry.

Despite the growing number of corporate lawyers, many people could not explain what it is that a corporate lawyer does.
For one, the number of attorneys employed by a single corporation will vary with the size and type of the corporation. Many
smaller and some large corporations farm out all their legal problems to private law firms. Many others have in-house
counsel only for certain matters. Other corporation have a staff large enough to handle most legal problems in-house.

A corporate lawyer, for all intents and purposes, is a lawyer who handles the legal affairs of a corporation. His areas of
concern or jurisdiction may include, inter alia: corporate legal research, tax laws research, acting out as corporate secretary
(in board meetings), appearances in both courts and other adjudicatory agencies (including the Securities and Exchange
Commission), and in other capacities which require an ability to deal with the law.

At any rate, a corporate lawyer may assume responsibilities other than the legal affairs of the business of the corporation he
is representing. These include such matters as determining policy and becoming involved in management. ( Emphasis
supplied.)

In a big company, for example, one may have a feeling of being isolated from the action, or not understanding how one's
work actually fits into the work of the orgarnization. This can be frustrating to someone who needs to see the results of his
work first hand. In short, a corporate lawyer is sometimes offered this fortune to be more closely involved in the running of
the business.

Moreover, a corporate lawyer's services may sometimes be engaged by a multinational corporation (MNC). Some large
MNCs provide one of the few opportunities available to corporate lawyers to enter the international law field. After all,
international law is practiced in a relatively small number of companies and law firms. Because working in a foreign country
is perceived by many as glamorous, tills is an area coveted by corporate lawyers. In most cases, however, the overseas
jobs go to experienced attorneys while the younger attorneys do their "international practice" in law libraries. (Business Star,
"Corporate Law Practice," May 25,1990, p. 4).
This brings us to the inevitable, i.e., the role of the lawyer in the realm of finance. To borrow the lines of Harvard-educated
lawyer Bruce Wassertein, to wit: "A bad lawyer is one who fails to spot problems, a good lawyer is one who perceives the
difficulties, and the excellent lawyer is one who surmounts them." (Business Star, "Corporate Finance Law," Jan. 11, 1989,
p. 4).

Today, the study of corporate law practice direly needs a "shot in the arm," so to speak. No longer are we talking of the
traditional law teaching method of confining the subject study to the Corporation Code and the Securities Code but an
incursion as well into the intertwining modern management issues.

Such corporate legal management issues deal primarily with three (3) types of learning: (1) acquisition of insights into
current advances which are of particular significance to the corporate counsel; (2) an introduction to usable disciplinary
skins applicable to a corporate counsel's management responsibilities; and (3) a devotion to the organization and
management of the legal function itself.

These three subject areas may be thought of as intersecting circles, with a shared area linking them. Otherwise known as
"intersecting managerial jurisprudence," it forms a unifying theme for the corporate counsel's total learning.

Some current advances in behavior and policy sciences affect the counsel's role. For that matter, the corporate lawyer
reviews the globalization process, including the resulting strategic repositioning that the firms he provides counsel for are
required to make, and the need to think about a corporation's; strategy at multiple levels. The salience of the nation-state is
being reduced as firms deal both with global multinational entities and simultaneously with sub-national governmental units.
Firms increasingly collaborate not only with public entities but with each other — often with those who are competitors in
other arenas.

Also, the nature of the lawyer's participation in decision-making within the corporation is rapidly changing. The modem
corporate lawyer has gained a new role as a stakeholder — in some cases participating in the organization and operations
of governance through participation on boards and other decision-making roles. Often these new patterns develop
alongside existing legal institutions and laws are perceived as barriers. These trends are complicated as corporations
organize for global operations. ( Emphasis supplied)

The practising lawyer of today is familiar as well with governmental policies toward the promotion and management of
technology. New collaborative arrangements for promoting specific technologies or competitiveness more generally require
approaches from industry that differ from older, more adversarial relationships and traditional forms of seeking to influence
governmental policies. And there are lessons to be learned from other countries. In Europe, Esprit, Eureka and Race are
examples of collaborative efforts between governmental and business Japan's MITI is world famous. (Emphasis supplied)

Following the concept of boundary spanning, the office of the Corporate Counsel comprises a distinct group within the
managerial structure of all kinds of organizations. Effectiveness of both long-term and temporary groups within
organizations has been found to be related to indentifiable factors in the group-context interaction such as the groups
actively revising their knowledge of the environment coordinating work with outsiders, promoting team achievements within
the organization. In general, such external activities are better predictors of team performance than internal group
processes.

In a crisis situation, the legal managerial capabilities of the corporate lawyer vis-a-vis the managerial mettle of corporations
are challenged. Current research is seeking ways both to anticipate effective managerial procedures and to understand
relationships of financial liability and insurance considerations. (Emphasis supplied)

Regarding the skills to apply by the corporate counsel, three factors are apropos:

First System Dynamics. The field of systems dynamics has been found an effective tool for new managerial thinking
regarding both planning and pressing immediate problems. An understanding of the role of feedback loops, inventory levels,
and rates of flow, enable users to simulate all sorts of systematic problems — physical, economic, managerial, social, and
psychological. New programming techniques now make the system dynamics principles more accessible to managers —
including corporate counsels. (Emphasis supplied)

Second Decision Analysis. This enables users to make better decisions involving complexity and uncertainty. In the context
of a law department, it can be used to appraise the settlement value of litigation, aid in negotiation settlement, and minimize
the cost and risk involved in managing a portfolio of cases. (Emphasis supplied)

Third Modeling for Negotiation Management. Computer-based models can be used directly by parties and mediators in all
lands of negotiations. All integrated set of such tools provide coherent and effective negotiation support, including hands-on
on instruction in these techniques. A simulation case of an international joint venture may be used to illustrate the point.

[Be this as it may,] the organization and management of the legal function, concern three pointed areas of consideration,
thus:

Preventive Lawyering. Planning by lawyers requires special skills that comprise a major part of the general counsel's
responsibilities. They differ from those of remedial law. Preventive lawyering is concerned with minimizing the risks of legal
trouble and maximizing legal rights for such legal entities at that time when transactional or similar facts are being
considered and made.

Managerial Jurisprudence. This is the framework within which are undertaken those activities of the firm to which legal
consequences attach. It needs to be directly supportive of this nation's evolving economic and organizational fabric as firms
change to stay competitive in a global, interdependent environment. The practice and theory of "law" is not adequate today
to facilitate the relationships needed in trying to make a global economy work.

Organization and Functioning of the Corporate Counsel's Office. The general counsel has emerged in the last decade as
one of the most vibrant subsets of the legal profession. The corporate counsel hear responsibility for key aspects of the
firm's strategic issues, including structuring its global operations, managing improved relationships with an increasingly
diversified body of employees, managing expanded liability exposure, creating new and varied interactions with public
decision-makers, coping internally with more complex make or by decisions.

This whole exercise drives home the thesis that knowing corporate law is not enough to make one a good general corporate
counsel nor to give him a full sense of how the legal system shapes corporate activities. And even if the corporate lawyer's
aim is not the understand all of the law's effects on corporate activities, he must, at the very least, also gain a working
knowledge of the management issues if only to be able to grasp not only the basic legal "constitution' or makeup of the
modem corporation. "Business Star", "The Corporate Counsel," April 10, 1991, p. 4).

The challenge for lawyers (both of the bar and the bench) is to have more than a passing knowledge of financial law
affecting each aspect of their work. Yet, many would admit to ignorance of vast tracts of the financial law territory. What
transpires next is a dilemma of professional security: Will the lawyer admit ignorance and risk opprobrium?; or will he feign
understanding and risk exposure? (Business Star, "Corporate Finance law," Jan. 11, 1989, p. 4).

Respondent Christian Monsod was nominated by President Corazon C. Aquino to the position of Chairman of the
COMELEC in a letter received by the Secretariat of the Commission on Appointments on April 25, 1991. Petitioner opposed
the nomination because allegedly Monsod does not possess the required qualification of having been engaged in the
practice of law for at least ten years.

On June 5, 1991, the Commission on Appointments confirmed the nomination of Monsod as Chairman of the COMELEC.
On June 18, 1991, he took his oath of office. On the same day, he assumed office as Chairman of the COMELEC.

Challenging the validity of the confirmation by the Commission on Appointments of Monsod's nomination, petitioner as a
citizen and taxpayer, filed the instant petition for certiorari and Prohibition praying that said confirmation and the consequent
appointment of Monsod as Chairman of the Commission on Elections be declared null and void.

Atty. Christian Monsod is a member of the Philippine Bar, having passed the bar examinations of 1960 with a grade of 86-
55%. He has been a dues paying member of the Integrated Bar of the Philippines since its inception in 1972-73. He has
also been paying his professional license fees as lawyer for more than ten years. (p. 124, Rollo)

After graduating from the College of Law (U.P.) and having hurdled the bar, Atty. Monsod worked in the law office of his
father. During his stint in the World Bank Group (1963-1970), Monsod worked as an operations officer for about two years in
Costa Rica and Panama, which involved getting acquainted with the laws of member-countries negotiating loans and
coordinating legal, economic, and project work of the Bank. Upon returning to the Philippines in 1970, he worked with the
Meralco Group, served as chief executive officer of an investment bank and subsequently of a business conglomerate, and
since 1986, has rendered services to various companies as a legal and economic consultant or chief executive officer. As
former Secretary-General (1986) and National Chairman (1987) of NAMFREL. Monsod's work involved being
knowledgeable in election law. He appeared for NAMFREL in its accreditation hearings before the Comelec. In the field of
advocacy, Monsod, in his personal capacity and as former Co-Chairman of the Bishops Businessmen's Conference for
Human Development, has worked with the under privileged sectors, such as the farmer and urban poor groups, in initiating,
lobbying for and engaging in affirmative action for the agrarian reform law and lately the urban land reform bill. Monsod also
made use of his legal knowledge as a member of the Davide Commission, a quast judicial body, which conducted
numerous hearings (1990) and as a member of the Constitutional Commission (1986-1987), and Chairman of its Committee
on Accountability of Public Officers, for which he was cited by the President of the Commission, Justice Cecilia Muñoz-
Palma for "innumerable amendments to reconcile government functions with individual freedoms and public accountability
and the party-list system for the House of Representative. (pp. 128-129 Rollo) ( Emphasis supplied)

Just a word about the work of a negotiating team of which Atty. Monsod used to be a member.

In a loan agreement, for instance, a negotiating panel acts as a team, and which is adequately constituted to meet the
various contingencies that arise during a negotiation. Besides top officials of the Borrower concerned, there are the legal
officer (such as the legal counsel), the finance manager, and an operations officer (such as an official involved in negotiating
the contracts) who comprise the members of the team. (Guillermo V. Soliven, "Loan Negotiating Strategies for Developing
Country Borrowers," Staff Paper No. 2, Central Bank of the Philippines, Manila, 1982, p. 11). (Emphasis supplied)

After a fashion, the loan agreement is like a country's Constitution; it lays down the law as far as the loan transaction is
concerned. Thus, the meat of any Loan Agreement can be compartmentalized into five (5) fundamental parts: (1) business
terms; (2) borrower's representation; (3) conditions of closing; (4) covenants; and (5) events of default. (Ibid., p. 13).
In the same vein, lawyers play an important role in any debt restructuring program. For aside from performing the tasks of
legislative drafting and legal advising, they score national development policies as key factors in maintaining their countries'
sovereignty. (Condensed from the work paper, entitled "Wanted: Development Lawyers for Developing Nations," submitted
by L. Michael Hager, regional legal adviser of the United States Agency for International Development, during the Session
on Law for the Development of Nations at the Abidjan World Conference in Ivory Coast, sponsored by the World Peace
Through Law Center on August 26-31, 1973). ( Emphasis supplied)

Loan concessions and compromises, perhaps even more so than purely renegotiation policies, demand expertise in the law
of contracts, in legislation and agreement drafting and in renegotiation. Necessarily, a sovereign lawyer may work with an
international business specialist or an economist in the formulation of a model loan agreement. Debt restructuring contract
agreements contain such a mixture of technical language that they should be carefully drafted and signed only with the
advise of competent counsel in conjunction with the guidance of adequate technical support personnel. (See International
Law Aspects of the Philippine External Debts, an unpublished dissertation, U.S.T. Graduate School of Law, 1987, p. 321). (
Emphasis supplied)

A critical aspect of sovereign debt restructuring/contract construction is the set of terms and conditions which determines
the contractual remedies for a failure to perform one or more elements of the contract. A good agreement must not only
define the responsibilities of both parties, but must also state the recourse open to either party when the other fails to
discharge an obligation. For a compleat debt restructuring represents a devotion to that principle which in the ultimate
analysis is sine qua non for foreign loan agreements-an adherence to the rule of law in domestic and international affairs of
whose kind U.S. Supreme Court Justice Oliver Wendell Holmes, Jr. once said: "They carry no banners, they beat no drums;
but where they are, men learn that bustle and bush are not the equal of quiet genius and serene mastery." (See Ricardo J.
Romulo, "The Role of Lawyers in Foreign Investments," Integrated Bar of the Philippine Journal, Vol. 15, Nos. 3 and 4, Third
and Fourth Quarters, 1977, p. 265).

Interpreted in the light of the various definitions of the term Practice of law". particularly the modern concept of law practice,
and taking into consideration the liberal construction intended by the framers of the Constitution, Atty. Monsod's past work
experiences as a lawyer-economist, a lawyer-manager, a lawyer-entrepreneur of industry, a lawyer-negotiator of contracts,
and a lawyer-legislator of both the rich and the poor — verily more than satisfy the constitutional requirement — that he has
been engaged in the practice of law for at least ten years.

Besides in the leading case of Luego v. Civil Service Commission, 143 SCRA 327, the Court said:

Appointment is an essentially discretionary power and must be performed by the officer in which it is vested according to his
best lights, the only condition being that the appointee should possess the qualifications required by law. If he does, then
the appointment cannot be faulted on the ground that there are others better qualified who should have been preferred. This
is a political question involving considerations of wisdom which only the appointing authority can decide. (emphasis
supplied)

No less emphatic was the Court in the case of (Central Bank v. Civil Service Commission, 171 SCRA 744) where it stated:

It is well-settled that when the appointee is qualified, as in this case, and all the other legal requirements are satisfied, the
Commission has no alternative but to attest to the appointment in accordance with the Civil Service Law. The Commission
has no authority to revoke an appointment on the ground that another person is more qualified for a particular position. It
also has no authority to direct the appointment of a substitute of its choice. To do so would be an encroachment on the
discretion vested upon the appointing authority. An appointment is essentially within the discretionary power of whomsoever
it is vested, subject to the only condition that the appointee should possess the qualifications required by law. ( Emphasis
supplied)

The appointing process in a regular appointment as in the case at bar, consists of four (4) stages: (1) nomination; (2)
confirmation by the Commission on Appointments; (3) issuance of a commission (in the Philippines, upon submission by the
Commission on Appointments of its certificate of confirmation, the President issues the permanent appointment; and (4)
acceptance e.g., oath-taking, posting of bond, etc. . . . (Lacson v. Romero, No. L-3081, October 14, 1949; Gonzales, Law on
Public Officers, p. 200)

The power of the Commission on Appointments to give its consent to the nomination of Monsod as Chairman of the
Commission on Elections is mandated by Section 1(2) Sub-Article C, Article IX of the Constitution which provides:

The Chairman and the Commisioners shall be appointed by the President with the consent of the Commission on
Appointments for a term of seven years without reappointment. Of those first appointed, three Members shall hold office for
seven years, two Members for five years, and the last Members for three years, without reappointment. Appointment to any
vacancy shall be only for the unexpired term of the predecessor. In no case shall any Member be appointed or designated
in a temporary or acting capacity.

Anent Justice Teodoro Padilla's separate opinion, suffice it to say that his definition of the practice of law is the traditional or
stereotyped notion of law practice, as distinguished from the modern concept of the practice of law, which modern
connotation is exactly what was intended by the eminent framers of the 1987 Constitution. Moreover, Justice Padilla's
definition would require generally a habitual law practice, perhaps practised two or three times a week and would outlaw
say, law practice once or twice a year for ten consecutive years. Clearly, this is far from the constitutional intent.
Upon the other hand, the separate opinion of Justice Isagani Cruz states that in my written opinion, I made use of a
definition of law practice which really means nothing because the definition says that law practice " . . . is what people
ordinarily mean by the practice of law." True I cited the definition but only by way of sarcasm as evident from my statement
that the definition of law practice by "traditional areas of law practice is essentially tautologous" or defining a phrase by
means of the phrase itself that is being defined.

Justice Cruz goes on to say in substance that since the law covers almost all situations, most individuals, in making use of
the law, or in advising others on what the law means, are actually practicing law. In that sense, perhaps, but we should not
lose sight of the fact that Mr. Monsod is a lawyer, a member of the Philippine Bar, who has been practising law for over ten
years. This is different from the acts of persons practising law, without first becoming lawyers.

Justice Cruz also says that the Supreme Court can even disqualify an elected President of the Philippines, say, on the
ground that he lacks one or more qualifications. This matter, I greatly doubt. For one thing, how can an action or petition be
brought against the President? And even assuming that he is indeed disqualified, how can the action be entertained since
he is the incumbent President?

We now proceed:

The Commission on the basis of evidence submitted doling the public hearings on Monsod's confirmation, implicitly
determined that he possessed the necessary qualifications as required by law. The judgment rendered by the Commission
in the exercise of such an acknowledged power is beyond judicial interference except only upon a clear showing of a grave
abuse of discretion amounting to lack or excess of jurisdiction. (Art. VIII, Sec. 1 Constitution). Thus, only where such grave
abuse of discretion is clearly shown shall the Court interfere with the Commission's judgment. In the instant case, there is no
occasion for the exercise of the Court's corrective power, since no abuse, much less a grave abuse of discretion, that would
amount to lack or excess of jurisdiction and would warrant the issuance of the writs prayed, for has been clearly shown.

Additionally, consider the following:

(1) If the Commission on Appointments rejects a nominee by the President, may the Supreme Court reverse the
Commission, and thus in effect confirm the appointment? Clearly, the answer is in the negative.

(2) In the same vein, may the Court reject the nominee, whom the Commission has confirmed? The answer is likewise
clear.

(3) If the United States Senate (which is the confirming body in the U.S. Congress) decides to confirm a Presidential
nominee, it would be incredible that the U.S. Supreme Court would still reverse the U.S. Senate.

Finally, one significant legal maxim is:

We must interpret not by the letter that killeth, but by the spirit that giveth life.

Take this hypothetical case of Samson and Delilah. Once, the procurator of Judea asked Delilah (who was Samson's
beloved) for help in capturing Samson. Delilah agreed on condition that —

No blade shall touch his skin;

No blood shall flow from his veins.

When Samson (his long hair cut by Delilah) was captured, the procurator placed an iron rod burning white-hot two or three
inches away from in front of Samson's eyes. This blinded the man. Upon hearing of what had happened to her beloved,
Delilah was beside herself with anger, and fuming with righteous fury, accused the procurator of reneging on his word. The
procurator calmly replied: "Did any blade touch his skin? Did any blood flow from his veins?" The procurator was clearly
relying on the letter, not the spirit of the agreement.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC

G.R. No. L-25291 January 30, 1971

THE INSULAR LIFE ASSURANCE CO., LTD., EMPLOYEES ASSOCIATION-NATU, FGU INSURANCE GROUP
WORKERS and EMPLOYEES ASSOCIATION-NATU, and INSULAR LIFE BUILDING EMPLOYEES ASSOCIATION-NATU,
petitioners,
vs.
THE INSULAR LIFE ASSURANCE CO., LTD., FGU INSURANCE GROUP, JOSE M. OLBES and COURT OF INDUSTRIAL
RELATIONS, respondents.
Lacsina, Lontok and Perez and Luis F. Aquino for petitioners.

Francisco de los Reyes for respondent Court of Industrial Relations.

Araneta, Mendoza and Papa for other respondents.

CASTRO, J.:

Appeal, by certiorari to review a decision and a resolution en banc of the Court of Industrial Relations dated August 17,
1965 and October 20, 1965, respectively, in Case 1698-ULP.

The Insular Life Assurance Co., Ltd., Employees Association-NATU, FGU Insurance Group Workers & Employees
Association-NATU, and Insular Life Building Employees Association-NATU (hereinafter referred to as the Unions), while still
members of the Federation of Free Workers (FFW), entered into separate collective bargaining agreements with the Insular
Life Assurance Co., Ltd. and the FGU Insurance Group (hereinafter referred to as the Companies).

Two of the lawyers of the Unions then were Felipe Enaje and Ramon Garcia; the latter was formerly the secretary-treasurer
of the FFW and acting president of the Insular Life/FGU unions and the Insular Life Building Employees Association. Garcia,
as such acting president, in a circular issued in his name and signed by him, tried to dissuade the members of the Unions
from disaffiliating with the FFW and joining the National Association of Trade Unions (NATU), to no avail.

Enaje and Garcia soon left the FFW and secured employment with the Anti-Dummy Board of the Department of Justice.
Thereafter, the Companies hired Garcia in the latter part of 1956 as assistant corporate secretary and legal assistant in their
Legal Department, and he was soon receiving P900 a month, or P600 more than he was receiving from the FFW. Enaje
was hired on or about February 19, 1957 as personnel manager of the Companies, and was likewise made chairman of the
negotiating panel for the Companies in the collective bargaining with the Unions.

In a letter dated September 16, 1957, the Unions jointly submitted proposals to the Companies for a modified renewal of
their respective collective bargaining contracts which were then due to expire on September 30, 1957. The parties mutually
agreed and to make whatever benefits could be agreed upon retroactively effective October 1, 1957.

Thereafter, in the months of September and October 1957 negotiations were conducted on the Union's proposals, but these
were snagged by a deadlock on the issue of union shop, as a result of which the Unions filed on January 27, 1958 a notice
of strike for "deadlock on collective bargaining." Several conciliation conferences were held under the auspices of the
Department of Labor wherein the conciliators urged the Companies to make reply to the Unions' proposals en toto so that
the said Unions might consider the feasibility of dropping their demand for union security in exchange for other benefits.
However, the Companies did not make any counter-proposals but, instead, insisted that the Unions first drop their demand
for union security, promising money benefits if this was done. Thereupon, and prior to April 15, 1958, the petitioner Insular
Life Building Employees Association-NATU dropped this particular demand, and requested the Companies to answer its
demands, point by point, en toto. But the respondent Insular Life Assurance Co. still refused to make any counter-proposals.
In a letter addressed to the two other Unions by the joint management of the Companies, the former were also asked to
drop their union security demand, otherwise the Companies "would no longer consider themselves bound by the
commitment to make money benefits retroactive to October 1, 1957." By a letter dated April 17, 1958, the remaining two
petitioner unions likewise dropped their demand for union shop. April 25, 1958 then was set by the parties to meet and
discuss the remaining demands.

From April 25 to May 6, 1958, the parties negotiated on the labor demands but with no satisfactory result due to a stalemate
on the matter of salary increases. On May 13, 1958 the Unions demanded from the Companies final counter-proposals on
their economic demands, particularly on salary increases. Instead of giving counter-proposals, the Companies on May 15,
1958 presented facts and figures and requested the Unions to submit a workable formula which would justify their own
proposals, taking into account the financial position of the former. Forthwith the Unions voted to declare a strike in protest
against what they considered the Companies' unfair labor practices.

Meanwhile, eighty-seven (87) unionists were reclassified as supervisors without increase in salary nor in responsibility while
negotiations were going on in the Department of Labor after the notice to strike was served on the Companies. These
employees resigned from the Unions.

On May 20, 1958 the Unions went on strike and picketed the offices of the Insular Life Building at Plaza Moraga.

On May 21, 1958 the Companies through their acting manager and president, the respondent Jose M. Olbes (hereinafter
referred to as the respondent Olbes), sent to each of the strikers a letter (exhibit A) quoted verbatim as follows:

We recognize it is your privilege both to strike and to conduct picketing.

However, if any of you would like to come back to work voluntarily, you may:
1. Advise the nearest police officer or security guard of your intention to do so.

2. Take your meals within the office.

3. Make a choice whether to go home at the end of the day or to sleep nights at the office where comfortable cots have
been prepared.

4. Enjoy free coffee and occasional movies.

5. Be paid overtime for work performed in excess of eight hours.

6. Be sure arrangements will be made for your families.

The decision to make is yours — whether you still believe in the motives of the strike or in the fairness of the Management.

The Unions, however, continued on strike, with the exception of a few unionists who were convinced to desist by the
aforesaid letter of May 21, 1958.

From the date the strike was called on May 21, 1958, until it was called off on May 31, 1958, some management men tried
to break thru the Unions' picket lines. Thus, on May 21, 1958 Garcia, assistant corporate secretary, and Vicente Abella,
chief of the personnel records section, respectively of the Companies, tried to penetrate the picket lines in front of the
Insular Life Building. Garcia, upon approaching the picket line, tossed aside the placard of a picketer, one Paulino Bugay; a
fight ensued between them, in which both suffered injuries. The Companies organized three bus-loads of employees,
including a photographer, who with the said respondent Olbes, succeeded in penetrating the picket lines in front of the
Insular Life Building, thus causing injuries to the picketers and also to the strike-breakers due to the resistance offered by
some picketers.

Alleging that some non-strikers were injured and with the use of photographs as evidence, the Companies then filed
criminal charges against the strikers with the City Fiscal's Office of Manila. During the pendency of the said cases in the
fiscal's office, the Companies likewise filed a petition for injunction with damages with the Court of First Instance of Manila
which, on the basis of the pendency of the various criminal cases against striking members of the Unions, issued on May
31, 1958 an order restraining the strikers, until further orders of the said court, from stopping, impeding, obstructing, etc. the
free and peaceful use of the Companies' gates, entrance and driveway and the free movement of persons and vehicles to
and from, out and in, of the Companies' building.

On the same date, the Companies, again through the respondent Olbes, sent individually to the strikers a letter (exhibit B),
quoted hereunder in its entirety:

The first day of the strike was last 21 May 1958.

Our position remains unchanged and the strike has made us even more convinced of our decision.

We do not know how long you intend to stay out, but we cannot hold your positions open for long. We have continued to
operate and will continue to do so with or without you.

If you are still interested in continuing in the employ of the Group Companies, and if there are no criminal charges pending
against you, we are giving you until 2 June 1958 to report for work at the home office. If by this date you have not yet
reported, we may be forced to obtain your replacement.

Before, the decisions was yours to make.

So it is now.

Incidentally, all of the more than 120 criminal charges filed against the members of the Unions, except three (3), were
dismissed by the fiscal's office and by the courts. These three cases involved "slight physical injuries" against one striker
and "light coercion" against two others.

At any rate, because of the issuance of the writ of preliminary injunction against them as well as the ultimatum of the
Companies giving them until June 2, 1958 to return to their jobs or else be replaced, the striking employees decided to call
off their strike and to report back to work on June 2, 1958.

However, before readmitting the strikers, the Companies required them not only to secure clearances from the City Fiscal's
Office of Manila but also to be screened by a management committee among the members of which were Enage and
Garcia. The screening committee initially rejected 83 strikers with pending criminal charges. However, all non-strikers with
pending criminal charges which arose from the breakthrough incident were readmitted immediately by the Companies
without being required to secure clearances from the fiscal's office. Subsequently, when practically all the strikers had
secured clearances from the fiscal's office, the Companies readmitted only some but adamantly refused readmission to 34
officials and members of the Unions who were most active in the strike, on the ground that they committed "acts inimical to
the interest of the respondents," without however stating the specific acts allegedly committed. Among those who were
refused readmission are Emiliano Tabasondra, vice president of the Insular Life Building Employees' Association-NATU;
Florencio Ibarra, president of the FGU Insurance Group Workers & Employees Association-NATU; and Isagani Du Timbol,
acting president of the Insular Life Assurance Co., Ltd. Employees Association-NATU. Some 24 of the above number were
ultimately notified months later that they were being dismissed retroactively as of June 2, 1958 and given separation pay
checks computed under Rep. Act 1787, while others (ten in number) up to now have not been readmitted although there
have been no formal dismissal notices given to them.

On July 29, 1958 the CIR prosecutor filed a complaint for unfair labor practice against the Companies under Republic Act
875. The complaint specifically charged the Companies with (1) interfering with the members of the Unions in the exercise
of their right to concerted action, by sending out individual letters to them urging them to abandon their strike and return to
work, with a promise of comfortable cots, free coffee and movies, and paid overtime, and, subsequently, by warning them
that if they did not return to work on or before June 2, 1958, they might be replaced; and (2) discriminating against the
members of the Unions as regards readmission to work after the strike on the basis of their union membership and degree
of participation in the strike.

On August 4, 1958 the Companies filed their answer denying all the material allegations of the complaint, stating special
defenses therein, and asking for the dismissal of the complaint.

After trial on the merits, the Court of Industrial Relations, through Presiding Judge Arsenio Martinez, rendered on August 17,
1965 a decision dismissing the Unions' complaint for lack of merit. On August 31, 1965 the Unions seasonably filed their
motion for reconsideration of the said decision, and their supporting memorandum on September 10, 1965. This was denied
by the Court of Industrial Relations en banc in a resolution promulgated on October 20, 1965.

Hence, this petition for review, the Unions contending that the lower court erred:

1. In not finding the Companies guilty of unfair labor practice in sending out individually to the strikers the letters marked
Exhibits A and B;

2. In not finding the Companies guilty of unfair labor practice for discriminating against the striking members of the Unions in
the matter of readmission of employees after the strike;

3. In not finding the Companies guilty of unfair labor practice for dismissing officials and members of the Unions without
giving them the benefit of investigation and the opportunity to present their side in regard to activities undertaken by them in
the legitimate exercise of their right to strike; and

4. In not ordering the reinstatement of officials and members of the Unions, with full back wages, from June 2, 1958 to the
date of their actual reinstatement to their usual employment.

I. The respondents contend that the sending of the letters, exhibits A and B, constituted a legitimate exercise of their
freedom of speech. We do not agree. The said letters were directed to the striking employees individually — by registered
special delivery mail at that — without being coursed through the Unions which were representing the employees in the
collective bargaining.

The act of an employer in notifying absent employees individually during a strike following unproductive efforts at collective
bargaining that the plant would be operated the next day and that their jobs were open for them should they want to come in
has been held to be an unfair labor practice, as an active interference with the right of collective bargaining through dealing
with the employees individually instead of through their collective bargaining representatives. (31 Am. Jur. 563, citing NLRB
v. Montgomery Ward & Co. [CA 9th] 133 F2d 676, 146 ALR 1045)

Indeed, it is an unfair labor practice for an employer operating under a collective bargaining agreement to negotiate or to
attempt to negotiate with his employees individually in connection with changes in the agreement. And the basis of the
prohibition regarding individual bargaining with the strikers is that although the union is on strike, the employer is still under
obligation to bargain with the union as the employees' bargaining representative (Melo Photo Supply Corporation vs.
National Labor Relations Board, 321 U.S. 332).

Indeed, some such similar actions are illegal as constituting unwarranted acts of interference. Thus, the act of a company
president in writing letters to the strikers, urging their return to work on terms inconsistent with their union membership, was
adjudged as constituting interference with the exercise of his employees' right to collective bargaining (Lighter Publishing,
CCA 7th, 133 F2d 621). It is likewise an act of interference for the employer to send a letter to all employees notifying them
to return to work at a time specified therein, otherwise new employees would be engaged to perform their jobs. Individual
solicitation of the employees or visiting their homes, with the employer or his representative urging the employees to cease
union activity or cease striking, constitutes unfair labor practice. All the above-detailed activities are unfair labor practices
because they tend to undermine the concerted activity of the employees, an activity to which they are entitled free from the
employer's molestation.1

Moreover, since exhibit A is a letter containing promises of benefits to the employees in order to entice them to return to
work, it is not protected by the free speech provisions of the Constitution (NLRB v. Clearfield Cheese Co., Inc., 213 F2d 70).
The same is true with exhibit B since it contained threats to obtain replacements for the striking employees in the event they
did not report for work on June 2, 1958. The free speech protection under the Constitution is inapplicable where the
expression of opinion by the employer or his agent contains a promise of benefit, or threats, or reprisal (31 Am. Jur. 544;
NLRB vs. Clearfield Cheese Co., Inc., 213 F2d 70; NLRB vs. Goigy Co., 211 F2d 533, 35 ALR 2d 422).

Indeed, when the respondents offered reinstatement and attempted to "bribe" the strikers with "comfortable cots," "free
coffee and occasional movies," "overtime" pay for "work performed in excess of eight hours," and "arrangements" for their
families, so they would abandon the strike and return to work, they were guilty of strike-breaking and/or union-busting and,
consequently, of unfair labor practice. It is equivalent to an attempt to break a strike for an employer to offer reinstatement to
striking employees individually, when they are represented by a union, since the employees thus offered reinstatement are
unable to determine what the consequences of returning to work would be.

Likewise violative of the right to organize, form and join labor organizations are the following acts: the offer of a Christmas
bonus to all "loyal" employees of a company shortly after the making of a request by the union to bargain; wage increases
given for the purpose of mollifying employees after the employer has refused to bargain with the union, or for the purpose of
inducing striking employees to return to work; the employer's promises of benefits in return for the strikers' abandonment of
their strike in support of their union; and the employer's statement, made about 6 weeks after the strike started, to a group of
strikers in a restaurant to the effect that if the strikers returned to work, they would receive new benefits in the form of
hospitalization, accident insurance, profit-sharing, and a new building to work in.2

Citing paragraph 5 of the complaint filed by the acting prosecutor of the lower court which states that "the officers and
members of the complainant unions decided to call off the strike and return to work on June 2, 1958 by reason of the
injunction issued by the Manila Court of First Instance," the respondents contend that this was the main cause why the
strikers returned to work and not the letters, exhibits A and B. This assertion is without merit. The circumstance that the
strikers later decided to return to work ostensibly on account of the injunctive writ issued by the Court of First Instance of
Manila cannot alter the intrinsic quality of the letters, which were calculated, or which tended, to interfere with the
employees' right to engage in lawful concerted activity in the form of a strike. Interference constituting unfair labor practice
will not cease to be such simply because it was susceptible of being thwarted or resisted, or that it did not proximately cause
the result intended. For success of purpose is not, and should not, be the criterion in determining whether or not a prohibited
act constitutes unfair labor practice.

The test of whether an employer has interfered with and coerced employees within the meaning of subsection (a) (1) is
whether the employer has engaged in conduct which it may reasonably be said tends to interfere with the free exercise of
employees' rights under section 3 of the Act, and it is not necessary that there be direct evidence that any employee was in
fact intimidated or coerced by statements of threats of the employer if there is a reasonable inference that anti-union
conduct of the employer does have an adverse effect on self-organization and collective bargaining. (Francisco, Labor Laws
1956, Vol. II, p. 323, citing NLRB v. Ford, C.A., 1948, 170 F2d 735).

Besides, the letters, exhibits A and B, should not be considered by themselves alone but should be read in the light of the
preceding and subsequent circumstances surrounding them. The letters should be interpreted according to the "totality of
conduct doctrine,"

... whereby the culpability of an employer's remarks were to be evaluated not only on the basis of their implicit implications,
but were to be appraised against the background of and in conjunction with collateral circumstances. Under this "doctrine"
expressions of opinion by an employer which, though innocent in themselves, frequently were held to be culpable because
of the circumstances under which they were uttered, the history of the particular employer's labor relations or anti-union bias
or because of their connection with an established collateral plan of coercion or interference. (Rothenberg on Relations, p.
374, and cases cited therein.)

It must be recalled that previous to the petitioners' submission of proposals for an amended renewal of their respective
collective bargaining agreements to the respondents, the latter hired Felipe Enage and Ramon Garcia, former legal
counsels of the petitioners, as personnel manager and assistant corporate secretary, respectively, with attractive
compensations. After the notice to strike was served on the Companies and negotiations were in progress in the
Department of Labor, the respondents reclassified 87 employees as supervisors without increase in salary or in
responsibility, in effect compelling these employees to resign from their unions. And during the negotiations in the
Department of Labor, despite the fact that the petitioners granted the respondents' demand that the former drop their
demand for union shop and in spite of urgings by the conciliators of the Department of Labor, the respondents adamantly
refused to answer the Unions' demands en toto. Incidentally, Enage was the chairman of the negotiating panel for the
Companies in the collective bargaining between the former and the Unions. After the petitioners went to strike, the strikers
were individually sent copies of exhibit A, enticing them to abandon their strike by inducing them to return to work upon
promise of special privileges. Two days later, the respondents, thru their president and manager, respondent Jose M.
Olbes, brought three truckloads of non-strikers and others, escorted by armed men, who, despite the presence of eight
entrances to the three buildings occupied by the Companies, entered thru only one gate less than two meters wide and in
the process, crashed thru the picket line posted in front of the premises of the Insular Life Building. This resulted in injuries
on the part of the picketers and the strike-breakers.lâwphî1.ñèt Then the respondents brought against the picketers
criminal charges, only three of which were not dismissed, and these three only for slight misdemeanors. As a result of these
criminal actions, the respondents were able to obtain an injunction from the court of first instance restraining the strikers
from stopping, impeding, obstructing, etc. the free and peaceful use of the Companies' gates, entrance and driveway and
the free movement of persons and vehicles to and from, out and in, of the Companies' buildings. On the same day that the
injunction was issued, the letter, Exhibit B, was sent — again individually and by registered special delivery mail — to the
strikers, threatening them with dismissal if they did not report for work on or before June 2, 1958. But when most of the
petitioners reported for work, the respondents thru a screening committee — of which Ramon Garcia was a member —
refused to admit 63 members of the Unions on the ground of "pending criminal charges." However, when almost all were
cleared of criminal charges by the fiscal's office, the respondents adamantly refused admission to 34 officials and union
members. It is not, however, disputed that all-non-strikers with pending criminal charges which arose from the breakthrough
incident of May 23, 1958 were readmitted immediately by the respondents. Among the non-strikers with pending criminal
charges who were readmitted were Generoso Abella, Enrique Guidote, Emilio Carreon, Antonio Castillo, Federico Barretto,
Manuel Chuidian and Nestor Cipriano. And despite the fact that the fiscal's office found no probable cause against the
petitioning strikers, the Companies adamantly refused admission to them on the pretext that they committed "acts inimical to
the interest of the respondents," without stating specifically the inimical acts allegedly committed. They were soon to admit,
however, that these alleged inimical acts were the same criminal charges which were dismissed by the fiscal and by the
courts..

Verily, the above actuations of the respondents before and after the issuance of the letters, exhibit A and B, yield the clear
inference that the said letters formed of the respondents scheme to preclude if not destroy unionism within them.

To justify the respondents' threat to dismiss the strikers and secure replacements for them in order to protect and continue
their business, the CIR held the petitioners' strike to be an economic strike on the basis of exhibit 4 (Notice of Strike) which
states that there was a "deadlock in collective bargaining" and on the strength of the supposed testimonies of some union
men who did not actually know the very reason for the strike. It should be noted that exhibit 4, which was filed on January
27, 1958, states, inter alia:

TO: BUREAU OF LABOR RELATIONS

DEPARTMENT OF LABOR
MANILA

Thirty (30) days from receipt of this notice by the Office, this [sic] unions intends to go on strike against

THE INSULAR LIFE ASSURANCE CO., LTD.

Plaza Moraga, Manila

THE FGU INSURANCE GROUP

Plaza Moraga, Manila

INSULAR LIFE BUILDING ADMINISTRATION

Plaza Moraga, Manila .

for the following reason: DEADLOCK IN COLLECTIVE BARGAINING...

However, the employees did not stage the strike after the thirty-day period, reckoned from January 27, 1958. This simply
proves that the reason for the strike was not the deadlock on collective bargaining nor any lack of economic concessions.
By letter dated April 15, 1958, the respondents categorically stated what they thought was the cause of the "Notice of
Strike," which so far as material, reads:

3. Because you did not see fit to agree with our position on the union shop, you filed a notice of strike with the Bureau of
Labor Relations on 27 January 1958, citing `deadlock in collective bargaining' which could have been for no other issue than
the union shop." (exhibit 8, letter dated April 15, 1958.)

The strike took place nearly four months from the date the said notice of strike was filed. And the actual and main reason for
the strike was, "When it became crystal clear the management double crossed or will not negotiate in good faith, it is
tantamount to refusal collectively and considering the unfair labor practice in the meantime being committed by the
management such as the sudden resignation of some unionists and [who] became supervisors without increase in salary or
change in responsibility, such as the coercion of employees, decided to declare the strike." (tsn., Oct. 14, 1958, p. 14.) The
truth of this assertion is amply proved by the following circumstances: (1) it took the respondents six (6) months to consider
the petitioners' proposals, their only excuse being that they could not go on with the negotiations if the petitioners did not
drop the demand for union shop (exh. 7, respondents' letter dated April 7, 1958); (2) when the petitioners dropped the
demand for union shop, the respondents did not have a counter-offer to the petitioners' demands. Sec. 14 of Rep. Act 875
required the respondents to make a reply to the petitioners' demands within ten days from receipt thereof, but instead they
asked the petitioners to give a "well reasoned, workable formula which takes into account the financial position of the group
companies." (tsn., Sept. 8, 1958, p. 62; tsn., Feb. 26, 1969, p. 49.)

II. Exhibit H imposed three conditions for readmission of the strikers, namely: (1) the employee must be interested in
continuing his work with the group companies; (2) there must be no criminal charges against him; and (3) he must report for
work on June 2, 1958, otherwise he would be replaced. Since the evidence shows that all the employees reported back to
work at the respondents' head office on June 2, 1953, they must be considered as having complied with the first and third
conditions.

Our point of inquiry should therefore be directed at whether they also complied with the second condition. It is not denied
that when the strikers reported for work on June 2, 1958, 63 members of the Unions were refused readmission because
they had pending criminal charges. However, despite the fact that they were able to secure their respective clearances 34
officials and union members were still refused readmission on the alleged ground that they committed acts inimical to the
Companies. It is beyond dispute, however, that non-strikers who also had criminal charges pending against them in the
fiscal's office, arising from the same incidents whence the criminal charges against the strikers evolved, were readily
readmitted and were not required to secure clearances. This is a clear act of discrimination practiced by the Companies in
the process of rehiring and is therefore a violation of sec. 4(a) (4) of the Industrial Peace Act.

The respondents did not merely discriminate against all the strikers in general. They separated the active from the less
active unionists on the basis of their militancy, or lack of it, on the picket lines. Unionists belonging to the first category were
refused readmission even after they were able to secure clearances from the competent authorities with respect to the
criminal charges filed against them. It is significant to note in this connection that except for one union official who deserted
his union on the second day of the strike and who later participated in crashing through the picket lines, not a single union
officer was taken back to work. Discrimination undoubtedly exists where the record shows that the union activity of the
rehired strikers has been less prominent than that of the strikers who were denied reinstatement.

So is there an unfair labor practice where the employer, although authorized by the Court of Industrial Relations to dismiss
the employees who participated in an illegal strike, dismissed only the leaders of the strikers, such dismissal being evidence
of discrimination against those dismissed and constituting a waiver of the employer's right to dismiss the striking employees
and a condonation of the fault committed by them." (Carlos and Fernando, Labor and Social Legislation, p. 62, citing Phil.
Air Lines, Inc. v. Phil. Air Lines Emloyees Association, L-8197, Oct. 31, 1958.)

It is noteworthy that — perhaps in an anticipatory effort to exculpate themselves from charges of discrimination in the
readmission of strikers returning to work — the respondents delegated the power to readmit to a committee. But the
respondent Olbes had chosen Vicente Abella, chief of the personnel records section, and Ramon Garcia, assistant
corporate secretary, to screen the unionists reporting back to work. It is not difficult to imagine that these two employees —
having been involved in unpleasant incidents with the picketers during the strike — were hostile to the strikers. Needless to
say, the mere act of placing in the hands of employees hostile to the strikers the power of reinstatement, is a form of
discrimination in rehiring.

Delayed reinstatement is a form of discrimination in rehiring, as is having the machinery of reinstatement in the hands of
employees hostile to the strikers, and reinstating a union official who formerly worked in a unionized plant, to a job in
another mill, which was imperfectly organized. (Morabe, The Law on Strikes, p. 473, citing Sunshine Mining Co., 7 NLRB
1252; Cleveland Worsted Mills, 43 NLRB 545; emphasis supplied.)

Equally significant is the fact that while the management and the members of the screening committee admitted the
discrimination committed against the strikers, they tossed back and around to each other the responsibility for the
discrimination. Thus, Garcia admitted that in exercising for the management the authority to screen the returning
employees, the committee admitted the non-strikers but refused readmission to the strikers (tsn., Feb. 6, 1962, pp. 15-19,
23-29). Vicente Abella, chairman of the management's screening committee, while admitting the discrimination, placed the
blame therefor squarely on the management (tsn., Sept. 20, 1960, pp. 7-8, 14-18). But the management, speaking through
the respondent Olbes, head of the Companies, disclaimed responsibility for the discrimination. He testified that "The
decision whether to accept or not an employee was left in the hands of that committee that had been empowered to look
into all cases of the strikers." (tsn., Sept. 6, 1962, p. 19.)

Of course, the respondents — through Ramon Garcia — tried to explain the basis for such discrimination by testifying that
strikers whose participation in any alleged misconduct during the picketing was not serious in nature were readmissible,
while those whose participation was serious were not. (tsn., Aug. 4, 1961, pp. 48-49, 56). But even this distinction between
acts of slight misconduct and acts of serious misconduct which the respondents contend was the basis for either
reinstatement or discharge, is completely shattered upon a cursory examination of the evidence on record. For with the
exception of Pascual Esquillo whose dismissal sent to the other strikers cited the alleged commission by them of simple
"acts of misconduct."

III. Anent the third assignment of error, the record shows that not a single dismissed striker was given the opportunity to
defend himself against the supposed charges against him. As earlier mentioned, when the striking employees reported back
for work on June 2, 1958, the respondents refused to readmit them unless they first secured the necessary clearances; but
when all, except three, were able to secure and subsequently present the required clearances, the respondents still refused
to take them back. Instead, several of them later received letters from the respondents in the following stereotyped tenor:

This will confirm the termination of your employment with the Insular Life-FGU Insurance Group as of 2 June 1958.

The termination of your employment was due to the fact that you committed acts of misconduct while picketing during the
last strike. Because this may not constitute sufficient cause under the law to terminate your employment without pay, we are
giving you the amount of P1,930.32 corresponding to one-half month pay for every year of your service in the Group
Company.

Kindly acknowledge receipt of the check we are sending herewith.

Very truly yours,

(Sgd.) JOSE M. OLBES
President, Insurance Life
Acting President, FGU.

The respondents, however, admitted that the alleged "acts of misconduct" attributed to the dismissed strikers were the
same acts with which the said strikers were charged before the fiscal's office and the courts. But all these charges except
three were dropped or dismissed.

Indeed, the individual cases of dismissed officers and members of the striking unions do not indicate sufficient basis for
dismissal.

Emiliano Tabasondra, vice-president of the petitioner FGU Insurance Group Workers & Employees Association-NATU, was
refused reinstatement allegedly because he did not report for duty on June 2, 1958 and, hence, had abandoned his office.
But the overwhelming evidence adduced at the trial and which the respondents failed to rebut, negates the respondents'
charge that he had abandoned his job. In his testimony, corroborated by many others, Tabasondra particularly identified the
management men to whom he and his group presented themselves on June 2, 1958. He mentioned the respondent Olbes'
secretary, De Asis, as the one who received them and later directed them — when Olbes refused them an audience — to
Felipe Enage, the Companies' personnel manager. He likewise categorically stated that he and his group went to see
Enage as directed by Olbes' secretary. If Tabasondra were not telling the truth, it would have been an easy matter for the
respondents to produce De Asis and Enage — who testified anyway as witnesses for the respondents on several occasions
— to rebut his testimony. The respondents did nothing of the kind. Moreover, Tabasondra called on June 21, 1958 the
respondents' attention to his non-admission and asked them to inform him of the reasons therefor, but instead of doing so,
the respondents dismissed him by their letter dated July 10, 1958. Elementary fairness required that before being dismissed
for cause, Tabasondra be given "his day in court."

At any rate, it has been held that mere failure to report for work after notice to return, does not constitute abandonment nor
bar reinstatement. In one case, the U.S. Supreme Court held that the taking back of six of eleven men constituted
discrimination although the five strikers who were not reinstated, all of whom were prominent in the union and in the strike,
reported for work at various times during the next three days, but were told that there were no openings. Said the Court:

... The Board found, and we cannot say that its finding is unsupported, that, in taking back six union men, the respondent's
officials discriminated against the latter on account of their union activities and that the excuse given that they did not apply
until after the quota was full was an afterthought and not the true reason for the discrimination against them. (NLRB v.
Mackay Radio & Telegraph Co., 304 U.S. 333, 58 Sup. Ct. 904, 82 L. Ed. 1381) (Mathews, Labor Relations and the Law, p.
725, 728)

The respondents' allegation that Tabasondra should have returned after being refused readmission on June 2, 1958, is not
persuasive. When the employer puts off reinstatement when an employee reports for work at the time agreed, we consider
the employee relieved from the duty of returning further.

Sixto Tongos was dismissed allegedly because he revealed that despite the fact that the Companies spent more than
P80,000 for the vacation trips of officials, they refused to grant union demands; hence, he betrayed his trust as an auditor of
the Companies. We do not find this allegation convincing. First, this accusation was emphatically denied by Tongos on the
witness stand. Gonzales, president of one of the respondent Companies and one of the officials referred to, took a trip
abroad in 1958. Exchange controls were then in force, and an outgoing traveller on a combined business and vacation trip
was allowed by the Central Bank, per its Circular 52 (Notification to Authorized Agent Banks) dated May 9, 1952, an
allocation of $1,000 or only P2,000, at the official rate of two pesos to the dollar, as pocket money; hence, this was the only
amount that would appear on the books of the Companies. It was only on January 21, 1962, per its Circular 133 (Notification
to Authorized Agent Banks), that the Central Bank lifted the exchange controls. Tongos could not therefore have revealed
an amount bigger than the above sum. And his competence in figures could not be doubted considering that he had passed
the board examinations for certified public accountants. But assuming arguendo that Tongos indeed revealed the true
expenses of Gonzales' trip — which the respondents never denied or tried to
disprove — his statements clearly fall within the sphere of a unionist's right to discuss and advertise the facts involved in a
labor dispute, in accordance with section 9(a)(5) of Republic Act 875 which guarantees the untramelled exercise by striking
employees of the right to give "publicity to the existence of, or the fact involved in any labor dispute, whether by advertising,
speaking, patrolling or by any method not involving fraud or violence." Indeed, it is not only the right, it is as well the duty, of
every unionist to advertise the facts of a dispute for the purpose of informing all those affected thereby. In labor disputes,
the combatants are expected to expose the truth before the public to justify their respective demands. Being a union man
and one of the strikers, Tongos was expected to reveal the whole truth on whether or not the respondent Companies were
justified in refusing to accede to union demands. After all, not being one of the supervisors, he was not a part of
management. And his statement, if indeed made, is but an expression of free speech protected by the Constitution.

Free speech on both sides and for every faction on any side of the labor relation is to me a constitutional and useful right.
Labor is free ... to turn its publicity on any labor oppression, substandard wages, employer unfairness, or objectionable
working conditions. The employer, too, should be free to answer and to turn publicity on the records of the leaders of the
unions which seek the confidence of his men ... (Concurring opinion of Justice Jackson in Thomas v. Collins, 323 U.S. 516,
547, 65 Sup. Ct. 315, 89 L. Ed. 430.) (Mathews, Labor Relations and the Law, p. 591.)

The respondents also allege that in revealing certain confidential information, Tongos committed not only a betrayal of trust
but also a violation of the moral principles and ethics of accountancy. But nowhere in the Code of Ethics for Certified Public
Accountants under the Revised Rules and Regulations of the Board of Accountancy formulated in 1954, is this stated.
Moreover, the relationship of the Companies with Tongos was that of an employer and not a client. And with regard to the
testimonies of Juan Raymundo and Antolin Carillo, both vice-presidents of the Trust Insurance Agencies, Inc. about the
alleged utterances made by Tongos, the lower court should not have given them much weight. The firm of these witnesses
was newly established at that time and was still a "general agency" of the Companies. It is not therefore amiss to conclude
that they were more inclined to favor the respondents rather than Tongos.

Pacifico Ner, Paulino Bugay, Jose Garcia, Narciso Daño, Vicente Alsol and Hermenigildo Ramirez, opined the lower court,
were constructively dismissed by non-readmission allegedly because they not only prevented Ramon Garcia, assistant
corporate secretary, and Vicente Abella, chief of the personnel records section of the Companies, from entering the
Companies' premises on May 21, 1958, but they also caused bruises and abrasions on Garcia's chest and forehead — acts
considered inimical to the interest of the respondents. The Unions, upon the other hand, insist that there is complete lack of
evidence that Ner took part in pushing Garcia; that it was Garcia who elbowed his way through the picket lines and therefore
Ner shouted "Close up," which the picketers did; and that Garcia tossed Paulino Bugay's placard and a fight ensued
between them in which both suffered injuries. But despite these conflicting versions of what actually happened on May 21,
1958, there are grounds to believe that the picketers are not responsible for what happened. lâwphî1.ñèt The picketing on
May 21, 1958, as reported in the police blotter, was peaceful (see Police blotter report, exh. 3 in CA-G.R. No. 25991-R of
the Court of Appeals, where Ner was acquitted). Moreover, although the Companies during the strike were holding offices at
the Botica Boie building at Escolta, Manila; Tuason Building at San Vicente Street, Manila; and Ayala, Inc. offices at Makati,
Rizal, Garcia, the assistant corporate secretary, and Abella, the chief of the personnel records section, reported for work at
the Insular Life Building. There is therefore a reasonable suggestion that they were sent to work at the latter building to
create such an incident and have a basis for filing criminal charges against the petitioners in the fiscal's office and applying
for injunction from the court of first instance. Besides, under the circumstances the picketers were not legally bound to yield
their grounds and withdraw from the picket lines. Being where the law expects them to be in the legitimate exercise of their
rights, they had every reason to defend themselves and their rights from any assault or unlawful transgression. Yet the
police blotter, about adverted to, attests that they did not resort to violence.

The heated altercations and occasional blows exchanged on the picket line do not affect or diminish the right to strike.
Persuasive on this point is the following commentary: .

We think it must be conceded that some disorder is unfortunately quite usual in any extensive or long drawn out strike. A
strike is essentially a battle waged with economic weapons. Engaged in it are human beings whose feelings are stirred to
the depths. Rising passions call forth hot words. Hot words lead to blows on the picket line. The transformation from
economic to physical combat by those engaged in the contest is difficult to prevent even when cool heads direct the fight.
Violence of this nature, however much it is to be regretted, must have been in the contemplation of the Congress when it
provided in Sec. 13 of Act 29 USCA Sec. 163, that nothing therein should be construed so as to interfere with or impede or
diminish in any way the right to strike. If this were not so, the rights afforded to employees by the Act would indeed be
illusory. We accordingly recently held that it was not intended by the Act that minor disorders of this nature would deprive a
striker of the possibility of reinstatement. (Republic Steel Corp. v. N. L. R. B., 107 F2d 472, cited in Mathews, Labor
Relations and the Law, p. 378)

Hence the incident that occurred between Ner, et al. and Ramon Garcia was but a necessary incident of the strike and
should not be considered as a bar to reinstatement. Thus it has been held that:

Fist-fighting between union and non-union employees in the midst of a strike is no bar to reinstatement. (Teller, Labor
Disputes and Collective Bargaining, Vol. II, p. 855 citing Stackpole Carbon, Co. 6 NLRB 171, enforced 105 F2d 167.)

Furthermore, assuming that the acts committed by the strikers were transgressions of law, they amount only to mere
ordinary misdemeanors and are not a bar to reinstatement.

In cases involving misdemeanors the board has generally held that unlawful acts are not bar to reinstatement. (Teller, Labor
Disputes and Collective Bargaining, Id., p. 854, citing Ford Motor Company, 23 NLRB No. 28.)

Finally, it is not disputed that despite the pendency of criminal charges against non-striking employees before the fiscal's
office, they were readily admitted, but those strikers who had pending charges in the same office were refused readmission.
The reinstatement of the strikers is thus in order.

[W]here the misconduct, whether in reinstating persons equally guilty with those whose reinstatement is opposed, or in
other ways, gives rise to the inference that union activities rather than misconduct is the basis of his [employer] objection,
the Board has usually required reinstatement." (Teller, supra, p. 853, citing the Third Annual Report of NLRB [1938], p. 211.)

Lastly, the lower Court justified the constructive dismissal of Florencio Ibarra allegedly because he committed acts inimical
to the interest of the respondents when, as president of the FGU Workers and Employees Association-NATU, he advised
the strikers that they could use force and violence to have a successful picket and that picketing was precisely intended to
prevent the non-strikers and company clients and customers from entering the Companies' buildings. Even if this were true,
the record discloses that the picket line had been generally peaceful, and that incidents happened only when management
men made incursions into and tried to break the picket line. At any rate, with or without the advice of Ibarra, picketing is
inherently explosive. For, as pointed out by one author, "The picket line is an explosive front, charged with the emotions and
fierce loyalties of the union-management dispute. It may be marked by colorful name-calling, intimidating threats or sporadic
fights between the pickets and those who pass the line." (Mathews, Labor Relations and the Law, p. 752). The picket line
being the natural result of the respondents' unfair labor practice, Ibarra's misconduct is at most a misdemeanor which is not
a bar to reinstatement. Besides, the only evidence presented by the Companies regarding Ibarra's participation in the strike
was the testimony of one Rodolfo Encarnacion, a former member of the board of directors of the petitioner FGU Insurance
Group Workers and Employees Union-NATU, who became a "turncoat" and who likewise testified as to the union activities
of Atty. Lacsina, Ricardo Villaruel and others (annex C, Decision, p. 27) — another matter which emphasizes the
respondents' unfair labor practice. For under the circumstances, there is good ground to believe that Encarnacion was made
to spy on the actvities of the union members. This act of the respondents is considered unjustifiable interference in the
union activities of the petitioners and is unfair labor practice.

It has been held in a great number of decisions at espionage by an employer of union activities, or surveillance thereof, are
such instances of interference, restraint or coercion of employees in connection with their right to organize, form and join
unions as to constitute unfair labor practice.

... "Nothing is more calculated to interfere with, restrain and coerce employees in the exercise of their right to self-
organization than such activity even where no discharges result. The information obtained by means of espionage is in
valuable to the employer and can be used in a variety of cases to break a union." The unfair labor practice is committed
whether the espionage is carried on by a professional labor spy or detective, by officials or supervisory employees of the
employer, or by fellow employees acting at the request or direction of the employer, or an ex-employee..." (Teller, Labor
Disputes and Collective Bargaining, Vol. II, pp. 765-766, and cases cited.) .

IV. The lower court should have ordered the reinstatement of the officials and members of the Unions, with full back wages
from June 2, 1958 to the date of their actual reinstatement to their usual employment. Because all too clear from the factual
and environmental milieu of this case, coupled with settled decisional law, is that the Unions went on strike because of the
unfair labor practices committed by the respondents, and that when the strikers reported back for work — upon the invitation
of the respondents — they were discriminatorily dismissed. The members and officials of the Unions therefore are entitled to
reinstatement with back pay.

[W]here the strike was induced and provoked by improper conduct on the part of an employer amounting to an 'unfair labor
practice,' the strikers are entitled to reinstatement with back pay. (Rothenberg on Labor Relations, p. 418.)

[A]n employee who has been dismissed in violation of the provisions of the Act is entitled to reinstatement with back pay
upon an adjudication that the discharge was illegal." (Id., citing Waterman S. S. Corp. v. N. L. R. B., 119 F2d 760; N. L. R.
B. v. Richter's Bakery, 140 F2d 870; N. L. R. B. v. Southern Wood Preserving Co., 135 F. 2d 606; C. G. Conn, Ltd. v. N. L.
R. B., 108 F2d 390; N. L. R. B. v. American Mfg. Co., 106 F2d 61; N. L. R. B. v. Kentucky Fire Brick Co., 99 F2d 99.)

And it is not a defense to reinstatement for the respondents to allege that the positions of these union members have
already been filled by replacements.

[W]here the employers' "unfair labor practice" caused or contributed to the strike or where the 'lock-out' by the employer
constitutes an "unfair labor practice," the employer cannot successfully urge as a defense that the striking or lock-out
employees position has been filled by replacement. Under such circumstances, if no job sufficiently and satisfactorily
comparable to that previously held by the aggrieved employee can be found, the employer must discharge the replacement
employee, if necessary, to restore the striking or locked-out worker to his old or comparable position ... If the employer's
improper conduct was an initial cause of the strike, all the strikers are entitled to reinstatement and the dismissal of
replacement employees wherever necessary; ... . (Id., p. 422 and cases cited.)

A corollary issue to which we now address ourselves is, from what date should the backpay payable to the unionists be
computed? It is now a settled doctrine that strikers who are entitled to reinstatement are not entitled to back pay during the
period of the strike, even though it is caused by an unfair labor practice. However, if they offer to return to work under the
same conditions just before the strike, the refusal to re-employ or the imposition of conditions amounting to unfair labor
practice is a violation of section 4(a) (4) of the Industrial Peace Act and the employer is liable for backpay from the date of
the offer (Cromwell Commercial Employees and Laborers Union vs. Court of Industrial Relations, L-19778, Decision, Sept.
30, 1964, 12 SCRA 124; Id., Resolution on motion for reconsideration, 13 SCRA 258; see also Mathews, Labor Relations
and the Law, p. 730 and the cited cases). We have likewise ruled that discriminatorily dismissed employees must receive
backpay from the date of the act of discrimination, that is, from the date of their discharge (Cromwell Commercial
Employees and Laborers Union vs. Court of Industrial Relations, supra).

The respondents notified the petitioner strikers to report back for work on June 2, 1958, which the latter did. A great number
of them, however, were refused readmission because they had criminal charges against them pending before the fiscal's
office, although non-strikers who were also facing criminal indictments were readily readmitted. These strikers who were
refused readmission on June 2, 1958 can thus be categorized as discriminatorily dismissed employees and are entitled to
backpay from said date. This is true even with respect to the petitioners Jose Pilapil, Paulino Bugay, Jr. and Jose Garcia, Jr.
who were found guilty only of misdemeanors which are not considered sufficient to bar reinstatement (Teller, Labor
Disputes and Collective Bargaining, p. 854), especially so because their unlawful acts arose during incidents which were
provoked by the respondents' men. However, since the employees who were denied readmission have been out of the
service of the Companies (for more than ten years) during which they may have found other employment or other means of
livelihood, it is only just and equitable that whatever they may have earned during that period should be deducted from their
back wages to mitigate somewhat the liability of the company, pursuant to the equitable principle that no one is allowed to
enrich himself at the expense of another (Macleod & Co. of the Philippines v. Progressive Federation of Labor, 97 Phil. 205
[1955]).

The lower court gave inordinate significance to the payment to and acceptance by the dismissed employees of separation
pay. This Court has ruled that while employers may be authorized under Republic Act 1052 to terminate employment of
employees by serving the required notice, or, in the absence thereof, by paying the required compensation, the said Act
may not be invoked to justify a dismissal prohibited by law, e.g., dismissal for union activities.

... While Republic Act No. 1052 authorizes a commercial establishment to terminate the employment of its employee by
serving notice on him one month in advance, or, in the absence thereof, by paying him one month compensation from the
date of the termination of his employment, such Act does not give to the employer a blanket authority to terminate the
employment regardless of the cause or purpose behind such termination. Certainly, it cannot be made use of as a cloak to
circumvent a final order of the court or a scheme to trample upon the right of an employee who has been the victim of an
unfair labor practice. (Yu Ki Lam, et al. v. Nena Micaller, et al., 99 Phil. 904 [1956].)

Finally, we do not share the respondents' view that the findings of fact of the Court of Industrial Relations are supported by
substantial and credible proof. This Court is not therefore precluded from digging deeper into the factual milieu of the case
(Union of Philippine Education Employees v. Philippine Education Company, 91 Phil. 93; Lu Do & Lu Ym Corporation v.
Philippine-Land-Air-Sea Labor Union, 11 SCRA 134 [1964]).

V. The petitioners (15 of them) ask this Court to cite for contempt the respondent Presiding Judge Arsenio Martinez of the
Court of Industrial Relations and the counsels for the private respondents, on the ground that the former wrote the following
in his decision subject of the instant petition for certiorari, while the latter quoted the same on pages 90-91 of the
respondents' brief: .

... Says the Supreme Court in the following decisions:

In a proceeding for unfair labor practice, involving a determination as to whether or not the acts of the employees concerned
justified the adoption of the employer of disciplinary measures against them, the mere fact that the employees may be able
to put up a valid defense in a criminal prosecution for the same acts, does not erase or neutralize the employer's right to
impose discipline on said employees. For it is settled that not even the acquittal of an employee of the criminal charge
against him is a bar to the employer's right to impose discipline on its employees, should the act upon which the criminal
charged was based constitute nevertheless an activity inimical to the employer's interest... The act of the employees now
under consideration may be considered as a misconduct which is a just cause for dismissal. (Lopez, Sr., et al. vs. Chronicle
Publication Employees Ass'n. et al., G.R. No. L-20179-81, December 28, 1964.) (emphasis supplied)

The two pertinent paragraphs in the above-cited decision * which contained the underscored portions of the above citation
read however as follows:

Differently as regard the dismissal of Orlando Aquino and Carmelito Vicente, we are inclined to uphold the action taken by
the employer as proper disciplinary measure. A reading of the article which allegedly caused their dismissal reveals that it
really contains an insinuation albeit subtly of the supposed exertion of political pressure by the Manila Chronicle
management upon the City Fiscal's Office, resulting in the non-filing of the case against the employer. In rejecting the
employer's theory that the dismissal of Vicente and Aquino was justified, the lower court considered the article as "a report
of some acts and omissions of an Assistant Fiscal in the exercise of his official functions" and, therefore, does away with the
presumption of malice. This being a proceeding for unfair labor practice, the matter should not have been viewed or gauged
in the light of the doctrine on a publisher's culpability under the Penal Code. We are not here to determine whether the
employees' act could stand criminal prosecution, but only to find out whether the aforesaid act justifies the adoption by the
employer of disciplinary measure against them. This is not sustaining the ruling that the publication in question is qualified
privileged, but even on the assumption that this is so, the exempting character thereof under the Penal Code does not
necessarily erase or neutralize its effect on the employer's interest which may warrant employment of disciplinary measure.
For it must be remembered that not even the acquittal of an employee, of the criminal charges against him, is a bar to the
employer's right to impose discipline on its employees, should the act upon which the criminal charges was based constitute
nevertheless an activity inimical to the employer's interest.

In the herein case, it appears to us that for an employee to publish his "suspicion," which actually amounts to a public
accusation, that his employer is exerting political pressure on a public official to thwart some legitimate activities on the
employees, which charge, in the least, would sully the employer's reputation, can be nothing but an act inimical to the said
employer's interest. And the fact that the same was made in the union newspaper does not alter its deleterious character
nor shield or protect a reprehensible act on the ground that it is a union activity, because such end can be achieved without
resort to improper conduct or behavior. The act of the employees now under consideration may be considered as a
misconduct which is a just cause for dismissal.** (Emphasis ours)

It is plain to the naked eye that the 60 un-underscored words of the paragraph quoted by the respondent Judge do not
appear in the pertinent paragraph of this Court's decision in L-20179-81. Moreover, the first underscored sentence in the
quoted paragraph starts with "For it is settled ..." whereas it reads, "For it must be remembered ...," in this Court's decision.
Finally, the second and last underlined sentence in the quoted paragraph of the respondent Judge's decision, appears not in
the same paragraph of this Court's decision where the other sentence is, but in the immediately succeeding paragraph.
This apparent error, however, does not seem to warrant an indictment for contempt against the respondent Judge and the
respondents' counsels. We are inclined to believe that the misquotation is more a result of clerical ineptitude than a
deliberate attempt on the part of the respondent Judge to mislead. We fully realize how saddled with many pending cases
are the courts of the land, and it is not difficult to imagine that because of the pressure of their varied and multifarious work,
clerical errors may escape their notice. Upon the other hand, the respondents' counsels have the prima facie right to rely on
the quotation as it appears in the respondent Judge's decision, to copy it verbatim, and to incorporate it in their brief.
Anyway, the import of the underscored sentences of the quotation in the respondent Judge's decision is substantially the
same as, and faithfully reflects, the particular ruling in this Court's decision, i.e., that "[N]ot even the acquittal of an
employee, of the criminal charges against him, is a bar to the employer's right to impose discipline on its employees, should
the act upon which the criminal charges were based constitute nevertheless an activity inimical to the employer's interest."

Be that as it may, we must articulate our firm view that in citing this Court's decisions and rulings, it is the bounden duty of
courts, judges and lawyers to reproduce or copy the same word-for-word and punctuation mark-for-punctuation mark.
Indeed, there is a salient and salutary reason why they should do this. Only from this Tribunal's decisions and rulings do all
other courts, as well as lawyers and litigants, take their bearings. This is because the decisions referred to in article 8 of the
Civil Code which reads, "Judicial decisions applying or interpreting the laws or the Constitution shall form a part of the legal
system of the Philippines," are only those enunciated by this Court of last resort. We said in no uncertain terms in Miranda,
et al. vs. Imperial, et al. (77 Phil. 1066) that "[O]nly the decisions of this Honorable Court establish jurisprudence or
doctrines in this jurisdiction." Thus, ever present is the danger that if not faithfully and exactly quoted, the decisions and
rulings of this Court may lose their proper and correct meaning, to the detriment of other courts, lawyers and the public who
may thereby be misled. But if inferior courts and members of the bar meticulously discharge their duty to check and recheck
their citations of authorities culled not only from this Court's decisions but from other sources and make certain that they are
verbatim reproductions down to the last word and punctuation mark, appellate courts will be precluded from acting on
misinformation, as well as be saved precious time in finding out whether the citations are correct.

Happily for the respondent Judge and the respondents' counsels, there was no substantial change in the thrust of this
Court's particular ruling which they cited. It is our view, nonetheless, that for their mistake, they should be, as they are
hereby, admonished to be more careful when citing jurisprudence in the future. ACCORDINGLY, the decision of the Court
of Industrial Relations dated August 17, 1965 is reversed and set aside, and another is entered, ordering the respondents to
reinstate the dismissed members of the petitioning Unions to their former or comparatively similar positions, with backwages
from June 2, 1958 up to the dates of their actual reinstatements. Costs against the respondents.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Fernando, Teehankee, Barredo, Villamor and Makasiar, JJ., concur.

Zaldivar, J., took no part.