Affiliation and Disaffiliation Case

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Affiliation and Disaffiliation

G.R. No. 111836 February 1, 1996

PAMBANSANG KAPATIRAN NG MGA ANAK PAWIS SA FORMEY PLASTIC NATIONAL WORKERSBROTHERHOOD,petitioner,vs.SECRETARY OF LABOR, SECRETARY BIENVENIDO LAGUESMA, FORMEY PLASTIC, INC., KALIPUNAN NGMANGGAGAWANG PILIPINO (KAMAPI) and MED-ARBITER RASIDALI C. ABDULLAH, respondents.

D E C I S I O N

BELLOSILLO, J.:

The rank and file workers of Formey Plastic, Inc. (FORMEY), formed a local union known as Pambansang Kapatiranng mga Anak Pawis sa Formey Plastic(KAPATIRAN) under the auspices of the National Workers Brotherhood(NWB). They ratified their Constitution and By-Laws on 4 April 1993.

On 22 April 1993 KAPATIRAN filed a Petition for Certification Election1with the Department of Labor andEmployment Med-Arbiter Division alleging that there was no existing and effective Collective Bargaining Agreement

(CBA) between FORMEY and any union; neither was there any recognized union within the company.

FORMEY moved to dismiss the petition2while Kalipunan ng Manggagawang Pilipino(KAMAPI) intervened and

likewise moved to dismiss3on the ground that there was already a duly registered CBA covering the period 1 January

1992 to 31 December 1996 hence the "contract bar rule"4would apply. KAPATIRAN opposed both motions to

dismiss5with anAddendum

6thereto claiming that the CBA executed between FORMEY and KAMAPI was

fraudulently registered with the Department of Labor and Employment and that it was defective since what wascertified as bargaining agent was KAMAPI which, as a federation, only served as mere agent of the local union hencewithout any legal personality to sign in behalf of the latter.

Med-Arbiter Rasidali C. Abdullah found that a valid and existing CBA between FORMEY and KAMAPI effectivelybarred the filing of the petition for certification election.

7

KAPATIRAN appealed8imputing grave abuse of discretion to the Med-Arbiter in applying the "contract bar rule" and

in not adopting the case of Progressive Development Corporation v. Secretary, Department of Labor andEmployment,

9as authority to disregard the CBA between FORMEY and KAMAPI. The Secretary of Labor acting

through Undersecretary Bienvenido E. Laguesma upheld the decision of the Med-Arbiter.10

The Motion forReconsideration having been denied

11KAPATIRAN now files this Petition for Certiorari

12charging the Secretary of

Labor with grave abuse of discretion in applying the "contract bar rule" literally and in ruling that the ProgressiveDevelopment Corporation

13case could not be invoked.

Pending resolution of the petition KAMAPI filed an Urgent Motion to Dismiss14

the instant petition contending that ithad become moot and academic due to the cancellation of NWB's

15certificate of registration and its delisting from

the roll of labor federations.16

KAPATIRAN opposed the motion17

claiming that the cancellation and delisting werenot yet final and executory considering that it had filed a motion for reconsideration

18with the Bureau of Labor

Relations.

The rule is that findings of facts of quasi-judicialagencies will not be disturbed unless there is a showing of grave

abuse of discretion. We find none in the case at bench. We therefore affirm that there is a validly executed collectivebargaining agreement between FORMEY and KAMAPI.

Art. 253-A of the Labor Code provides that "(n)o petition questioning the majority status of the incumbent bargainingagent shall be entertained and no certification election shall be conducted by the Department of Labor andEmployment outside of the sixty (60) day period immediately before the date of expiry of such five-year term of thecollective bargaining agreement." Sec. 3, Rule V, Book V of the Omnibus Rules Implementing the Labor Codeprovides that ". . . (i)f a collective bargaining agreement has been duly registered in accordance with Article 231 of theCode, a petition for certification election or a motion for intervention can only be entertained within sixty (60) days

prior to the expiry date of such agreement."
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The subject agreement was made effective 1 January 1992 and is yet to expire on 31 December 1996. The petitionfor certification election having been filed on 22 April 1993 it is therefore clear that said petition must fail since it wasfiled before the so-called 60-day freedom' period. KAPATIRAN insists that the CBA was a fake it having beensurreptitiously registered with the Department of Labor and Employment..

The resolution of this issue hinges on the determination of factual matters which certainly is not within the ambit of thepresent petition for certiorari. Besides, the contention is without any legal basis at all; it is purely speculative and

bereft of any documentary support. Petitioner itself even admitted the existence of an agreement but argued that itsprovisions were not being implemented nor adhered to at all. Suffice it to mention that the filing of the petition forcertification election is not the panacea to this allegedly anomalous situation. Violations of collective bargainingagreements constitute unfair labor practice as provided for under Art. 248, par. (i), of the Labor Code. In consonancethereto, Art. 261 equips petitioner with the proper and appropriate recourse

Art. 261. The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have original and exclusivejurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation ofthe Collective Bargaining Agreement . . . . Accordingly, violations of a Collective Bargaining Agreement,except those which are gross in character, shall no longer be treated as unfair labor practice and shall beresolved under the Collective Bargaining Agreement. For purposes of this article, gross violations ofCollective Bargaining Agreement shall mean flagrant and/or malicious refusal to comply with the economicprovisions of such agreement.

The CBA entered into between FORMEY and KAMAPI stipulates among others

Article IX GRIEVANCE PROCEDURE

Sec. 1. Any complaint, grievance, difficulty, disagreement or dispute arising out of any section taken (sic) bythe Company and/or by the Union concerning the interpretation of the terms and conditions of theagreement and/or which may arise regarding (sic) the terms and conditions of employment shall be settledin the manner provided for under this Article.

Sec. 2. The Company and the Union agree to create and establish a Grievance Committee composed of two(2) representatives from the Company and two (2) from the Union to receive complaint, grievance or disputefrom the workers and/or from the Company with the view to settle it amicably.

Sec. 3. In case a complaint or grievance has been filed by either the Union or the Company, the grievancecommittee shall discuss the same and have (sic) to settle it. If after the meeting of the grievance committeeno satisfactory settlement is reached the matter shall be referred to the top officers of the Union and theCompany for the settlement of the said grievance or dispute.

Sec. 4. Within five (5) days from the time the top officers of the Union and the Company has (sic) failed toreach an amicable settlement of the grievance or dispute, the same shall be submitted for voluntaryarbitration. The arbitrator or arbitrators shall be chosen by lottery and the union and the Company shall avail(sic) the list of arbitrators of the Honorable Bureau of Labor Relations.

Sec. 5. The mutually agreed or chosen arbitrator shall proceed to try and hear the case and for (sic) thereception of evidence and to call witnesses to testify and after the submission of the case by both parties anaward or order shall be issued in accordance with the rules and guidelines promulgated by the HonorableDepartment of Labor and Employment based on the pertinent laws and established jurisprudence. The

expenses of the arbitration proceedings shall be borned (sic) equally by the Company and the Union.

19

By filing the petition for certification election it is clear that KAPATIRAN did not avail of the abovementioned grievanceprocedure.

It is further argued that the CBA has no binding force since it was entered into by KAMAPI as a federation and not bythe local union. Perusal of the agreement proves the contention flawed. The signatories for KAMAPI consisted of itsnational president and of the duly elected officers of the local union. Thus the fact that KAMAPI was particularlymentioned as the bargaining party without specifying the local union cannot strip it of its authority to participate in the
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bargaining process. The local union maintains its separate personality despite affiliation with a larger nationalfederation.

20

The doctrine laid down in Progressive Development Corporation21

is a mere clarification of the principle enunciatedin Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc.

22Both cases have provided that "the mother union

acting for and in behalf of its affiliate ha(s) the status of an agent while the local union remained the basic unit of theassociation free to serve the common interest of all its members subject only to the restraints imposed by the

Constitution and By-Laws of the association." Nonetheless, the facts and principles laid down in both cases do notjibe squarely with the case at bench. The controversy in Progressive Development Corporation

23centered on the

requirements before a local or chapter of a federation may file a petition for certification election and be certified asthe sole and exclusive bargaining agent, while in Liberty Cotton Mills Workers

24the issue involved was the

disaffiliation of the local union from the federation. The question of whether there was a valid and existing CBA, whichis the question being resolved in the case at bench, was never raised in the two cited cases since it was already anaccepted fact that the CBA was validly executed and existing.

Anent the Urgent Motion to Dismiss25

filed by KAMAPI on the ground that the instant petition had become moot andacademic due to the cancellation by the Bureau of Labor Relations of NWB's certificate of registration and itsconsequent delisting from the roll of labor federations, suffice it to state that at this juncture we cannot .properly ruleon the issue considering that KAMAPI has not proven that the decision of the Bureau of Labor Relations has becomefinal and executory taking into account KAPATIRAN's filing of a motion for reconsideration with the Bureau. Thisnotwithstanding, Sec. 9, Rule II, Book V of the Omnibus Rules Implementing the Labor Coderequires that an appeal

be filed with the Bureau, or in case of cancellation by the Bureau, with the Secretary of Labor and Employment whosedecision shall become final and no longer subject of appeal.

WHEREFORE, the petition is DENIED. The decision of the Secretary of Labor and Employment dated 15 August1993 sustaining the order of the Med-Arbiter dated 31 May 1993 is AFFIRMED.

SO ORDERED.

G.R. No. 115180 November 16, 1999

FILIPINO PIPE AND FOUNDRY CORPORATION, petitioner,

vs.NATIONAL LABOR RELATIONS COMMISSION, NATIONAL LABOR UNION TUCP, and EULOGIOLERUM,respondents.

PURISIMA, J .:

At bar is a Petition for Certiorariunder Rule 65 of the Revised Rules of Court seeking to annul and set aside theDecision

1of the National Labor Relations Commission,

2dated September 29, 1993, in NLRC NCR CA No. 003806-

92, which reversed the Decision3of the Labor Arbiter,

4dated August 31, 1992, in NLRC Case No. 4-1309-86,

disposing thus:

WHEREFORE, premises considered, the appeal of complainant corporation is hereby dismissed

for lack of merit; the appeal of Atty. Lerum and NLU is hereby granted, and the Decision datedAugust 31, 1992 is hereby annulled and set side, and a new judgment is hereby entered declaringthe complaint below dismissed for lack of merit insofar as respondent NLU and Atty. Lerum areconcerned.

SO ORDERED.5

The antecedent facts can be culled as follows:
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On February 10, 1986, respondent National Labor Union-Trade Union Trade Union Congress of the Philippines(NLU-TUCP), a national federation of labor unions, filed with the then Ministry of Labor and Employment, in behalf ofits local chapter, the Filipino Pipe Workers Union-National Labor Union (FPWU-NLU, hereinafter referred to asUnion), a notice of strike signed by its national president, Atty. Eulogio R. Lerum, against the petitioner, Filipino Pipeand Foundry Corporation, alleging as grounds therefor union busting and non-implementation of the CollectiveBargaining Agreement.

6

The initial conciliation conference was set on February 24, 1986 but due to lack of notice thereof to petitionercompany, as well as the failure of FPWU-NLU to furnish the latter a copy of the notice of strike, the initial conciliationconference was re-set to March 3, 1986.

In the early morning of March 3, 1986, however, without waiting for the outcome of the conciliation conferencescheduled on said date, the FPWU-NLU staged the strike in question which lasted until June 13, 1986, when a returnto work agreement was reached by the union and petitioner company.

7

On April 8, 1986, petitioner company interposed before the Arbitration Branch of the then Ministry of Labor andEmployment, a petition to declare the strike illegal with prayer for damages against FPWU-NLU, NLU-TUCP and itsnational president, Atty. Eulogio Lerum.

On December 23, 1988, petitioner company moved for the partial dismissal of the Complaint against forty-three (43)officers and members of FPWU-NLU, but maintained the action against the NLU-TUCP and Atty. Eulogio Lerum.

8

On August 31, 1992, the Labor Arbiter came out with a decision for petitioner company, ruling as follows:

WHEREFORE, judgment is hereby rendered declaring that the strike staged by respondents fromMarch 3, 1986 to June 13, 1986 was ILLEGAL. Accordingly and in conformity with the Return-to-Work Agreement, respondent National Labor Union-TUCP is hereby directed to pay thecomplainant company the following:

a) Actual damages in the form of loss of revenue during the duration of the strike which lasted for100 days or in the amount of ONE MILLION PESOS (P1,000, 000. 00);

b) Damages to the good business standing and commercial credit of the company in the amount ofTHREE HUNDRED FIFTY THOUSAND PESOS (P350,000.00); and

c) Exemplary damages to deter others similarly inclined from committing similar acts and to serveas an example for the public good, in the amount of TWO HUNDRED FIFTY THOUSAND PESOS(P250,000.00).

Further, respondent NLU is hereby directed to pay the attorney's fees equivalent to 10% of theactual damages, or the amount of ONE HUNDRED THOUSAND PESOS (P100,000.00).

For lack of showing that respondent Lerum acted in his personal capacity, he is herebyABSOLVED from any liability.

Pursuant to the Agreement, the complaint against all the other individual respondents are herebyDISMISSED.

SO ORDERED.9

Therefrom, both parties appealed to the NLRC which on September 29, 1993, rendered the assailed decision.Dissatisfied therewith, the petitioner company found its way to this Court via the present petition; theorizing that:

I


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PUBLIC RESPONDENT NATIONAL LABOR RELATIONS COMMISSIONERRED IN LAW, CAPRICIOUSLY AND WHIMSICALLY DISREGARDED THEEVIDENCE SUBMITTED IN THE CASE AND GRAVELY ABUSED ITSDISCRETION AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTIONWHEN IT HELD THAT PRIVATE RESPONDENTS NATIONAL LABOR UNION(NLU)-TUCP AND ATTY. EULOGIO LERUM ARE NOT PRIMARILYRESPONSIBLE AND, THEREFORE, NOT LIABLE FOR DAMAGES SUFFERED

BY PETITIONER ON ACCOUNT OF THE ILLEGAL STRIKE THEY HADDIRECTLY AIDED, ASSISTED, ABETTED AND PARTICIPATED IN.

II

PUBLIC RESPONDENT NATIONAL LABOR RELATIONS COMMISSIONGRAVELY ABUSED ITS DISCRETION AMOUNTING TO LACK AND/OREXCESS OF JURISDICTION AND ACTED CAPRICIOUSLY ANDWHIMSICALLY IN TOTAL DISREGARD OF THE EVIDENCE PRESENTED INTHE CASE WHEN IT HELD THAT PRIVATE RESPONDENTS MERELY

ASSISTED THE LOCAL CHAPTER AND ITS MEMBERS IN STAGING ASTRIKE AGAINST PETITIONER AND THAT SUCH ASSISTANCE WAS NOTTHE CAUSE NOR WAS IT AN INDESPENSABLE ELEMENT OF THE STRIKE.

III

PUBLIC RESPONDENT NATIONAL LABOR RELATIONS COMMISSIONGRAVELY ERRED IN LAW AND GRAVELY ABUSED ITS DISCRETION

AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION WHEN ITCONCLUDED THAT PETITIONER LOST ITS CAUSE OF ACTION AGAINSTPRIVATE RESPONDENTS AFTER THE LOCAL UNION HIRED A NEWCOUNSEL AND PETITIONER MOVED FOR PARTIAL DISMISSAL OF ITSCOMPLAINT AGAINST THE STRIKING WORKERS INASMUCH AS PRIVATERESPONDENTS ARE MERE THIRD PARTIES.

10

Rule XXII, Book V, of the Rules Implementing the Labor Code, provides:

Sec. 1. Grounds for strike and lockout. A strike or lockout may be declared in cases of

bargaining deadlocks and unfair labor practices. Violations of collective bargaining agreements,except flagrant and/or malicious refusal to comply with its economic provisions, shall not beconsidered unfair labor practice and shall not be strikeable. No strike or lockout may be declaredon grounds involving inter-union and intra-union disputes or on issues brought to voluntary orcompulsory arbitration.

xxx xxx xxx

Sec. 3. Notice of strike or lockout. In cases of bargaining deadlocks, a notice of strike orlockout shall be filed with the regional branch of the Board at least thirty (30) days before theintended date thereof, a copy of said notice having been served on the other party concerned. . . .

xxx xxx xxx

Sec. 6. Conciliation. Upon receipt of the notice, the regional branch of the Board shall exert allefforts at mediation and conciliation to enable the parties to settle the dispute amicably. Theregional branch of the Board may, upon consultation, recommend to the parties that the notice betreated as a preventive mediation case. It shall also encourage the parties to submit the dispute tovoluntary arbitration.

During the proceedings, the parties shall not do any act which may disrupt or impede the earlysettlement of the dispute. They are obliged as part of the duty to bargain collectively in good faith,to participate fully and promptly in the conciliation meetings called by the regional branch of the


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board. The regional branch of the Board shall have the power to issue subpoenasrequiring theattendance of the parties to the meetings. . . .

Applying the aforecited provision of law in point to the case under consideration, the Court is of the finding andconclusion that the strike staged by FPWU-NLU was illegal for want of any legal basis. Contrary to the groundsadvanced by the union in the notice of strike, it turned out during the March 3, 1986 conciliation conference that thepurpose of the strike was to pressure the petitioner company to:

1) include in the salary of the strikers the P3.00 wage increase11

effective March 1, 1986.

2) compute their backwages covering the period from December 1, 1980 to February 28, 1986,including vacation leave and sick leave.

A thorough sifting of the pertinent records discloses that the alleged union busting was not substantiated andthe supposed non-implementation of the collective bargaining agreement was groundless because thedemands of FPWU-NLU, at the time the notice of strike was filed and at the time the by the union actuallystruck, were the subject of a pending application for a writ of execution filed by the union in Case No. AB-7933-80 (NCR-CA-8-674-80), which application was granted on April 4, 1986 by the Labor Arbiter.

12Verily,

the strike staged by FPWU-NLU was baseless since it was still pre-mature then for the union to insist on theimplementation of the adverted provision of the collective bargaining agreement, which was the subject of apending writ of execution.

Then too, the failure of the union to serve petitioner company a copy of the notice of strike is a clear violation ofSection 3 of the aforestated Rules. The constitutional precepts of due process mandate that the other party benotified of the adverse action of the opposing party. So also, the same Section provides for a mandatory thirty (30)day cooling-off period which the union ignored when it struck on March 3, 1986, before the 30th day from the time thenotice of strike was filed on February 10, 1986.

What is more, the same strike blatantly disregarded the prohibition on the doing of any act which may impede ordisrupt the conciliation proceedings, when the union staged the strike in the early morning of March 3, 1986, the verysame day the conciliation conference was scheduled by the former Ministry of Labor.

In light of the foregoing, it is beyond cavil that subject strike staged by the union was illegal.

Anent the responsibility for the damages allegedly sustained by petitioner company on account of the illegal strike,the latter theorized that the liability therefor should be borne by NLU-TUCP and its national president, Atty. EulogioLerum, for having directly participated in aiding and abetting the illegal strike. It is argued that FPWU-NLU is a mereagent of respondent NLU-TUCP, because FPWU-NLU, which was formed by respondent NLU-TUCP is notregistered as a local unit or chapter but directly affiliated with the latter and therefore, could not have acted on itsown. Otherwise stated, petitioner is of the view that FPWU-NLU, a local union, cannot act as the principal ofrespondent NLU-TUCP, a mother federation, because it is not a legitimate labor organization.

13In support of this

stance, petitioner cited the following letter of Atty. Lerum to the company, to wit:

NATIONAL LABOR UNION

An Affiliate of the Trade Union of the Philippines

3199 RAMON MAGSAYSAY BLVD., MANILA, PHILIPPINES

Tel. 61-42-65

March 29, 1983

Dear Sirs:

Please be informed that we have formed a local union in your company and the officers thereof arethe following:


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President Virgilio Bernal

Vice-Pres. Ramon Alborte

Secretary Ernesto Ballesteros

Treasure Arsenio Agustin

Auditor Genaro Gabule

Board Members:

1. Eduardo Cenina 4. Felimon Simborio

2. Dante Canete 5. Joseph Olazo

3. Reynaldo Adelante 6. Virgilio Elnar

Shop Stewards:

1. Pablito Fajardo

2. Ruperto Manlangit

3. Ruben Bongaos

We have given them full authority to deal with you on all matters covered by our authority as solecollective bargaining representative of your rank and file workers.

In Progressive Development Corporation vs. Secretary,Department of Labor and Employment,15

the Court explainedthe nature of the relationship between a mother union/federation and a local union, thus:

At this juncture, it is important to clarify the relationship between the mother union and the localunion. In the case of Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., 66 SCRA 512[1975], the Court held that the mother union, acting for and in behalf of its affiliate, had the status ofan agent while the local union remained the basic unit of the association free to serve the commoninterest of all its members subject only to the restraints imposed by the constitution and by-laws ofthe association. . . .

16

The same is true even if the local union is not a legitimate labor organization. Conformably, in theabovecited case the Court ruled that the mother federation was a mere agent and the local chapter/unionwas the principal, notwithstanding the failure of the local union to comply with the procedural requirementsthat would make it a legitimate labor organization.

Evidently, in the case under scrutiny, whether or not FPWU, the local chapter, complied with the proceduralrequirements that would make it a legitimate labor organization is immaterial. It would not affect its status as theprincipal and basic unit of the association. The requirement laid down in the Progressive Development case, that thelocal union must be a legitimate labor organization, pertains to the conditions before a union may file a petition forcertification election and to be certified as sole and exclusive bargaining agent. In the present case, there is nodispute that FPWU-NLU is the sole and exclusive bargaining representative of the rank and file employees ofpetitioner company. The union's status as a legitimate labor organization is therefore of no moment in the resolutionof the controversy here. As the local union, it is considered as the principal; the entity which staged the illegal strikeand the one responsible for the resulting damages allegedly sustained by petitioner company.

Furthermore, the petitioner company is now estopped from reneging on the recognition it extended to the FPUW-NLUas the bargaining representative of its rank and file workers, by belatedly attacking its status which petitioner


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company had voluntarily recognized. It should be noted that even as early as 1981, when the collective bargainingagreement sought to be implemented by the union was entered into, the latter was already the bargainingrepresentative of the employees concerned. It is not, therefore, true that it was respondent NLU-TUCP which formedFPWU. At most, the entry into the picture of the private respondent on March 23, 1983, merely affirmed the status ofFPWU as the recognized bargaining representative of the rank and file employees of petitioner company.

Evidently, direct and primary responsibility for the damages allegedly caused by the illegal strike sued upon fall on the

local union FPWU, being the principal, and not on respondent NLU-TUCP, a mere agent of FPWU-NLU whichassisted the latter in filing the notice of strike. Being just an agent, the notice of strike filed by Atty. Eulogio Lerum, thenational president of NLU-TUCP, is deemed to have been filed by its principal, the FPWU-NLU. Having thusdismissed the claim for damages against the principal, FPWU-NLU, the action for damages against its agent,respondent NLU-TUCP, and Atty. Lerum, has no more leg to stand on and should also be dismissed.

Premises studiedly considered, the Court is of the ineluctable conclusion, and so holds, that the National LaborRelations Commission did not act with grave abuse of discretion in reversing the Decision of the Labor Arbiter inNLRC CASE No. 4-1309-86.

WHEREFORE, for lack of merit, the Petition is DISMISSED, and the Decision of the National Labor RelationsCommission in NLRC NCR CA No. 003806-92 AFFIRMED. No pronouncement as to costs.

SO ORDERED.

G.R. No. 157117 November 20, 2006

COASTAL SUBIC BAY TERMINAL, INC., Petitioner,

vs.DEPARTMENT OF LABOR and EMPLOYMENTOFFICE OF THE SECRETARY, COASTAL SUBIC BAYTERMINAL, INC. SUPERVISORY UNION-APSOTEU, and COASTAL SUBIC BAY TERMINAL, INC. RANK-AND-FILE UNION-ALU-TUCP,Respondents.

D E C I S I O N

QUISUMBING, J .:

For review on certiorariis the Court of Appeals Decision1dated August 31, 2001, in CA-G.R. SP No. 54128 and the

Resolution2dated February 5, 2003, denying petitioners motion for reconsideration. The Court of Appeals had

affirmed the Decision3dated March 15, 1999 of the Secretary of the Department of Labor and Employment (DOLE)

reversing the Mediator Arbiters dismissal of private respondents petitions for certification election.

The facts are as follows:

On July 8, 1998, private respondents Coastal Subic Bay Terminal, Inc. Rank-and-File Union (CSBTI-RFU) andCoastal Subic Bay Terminal, Inc. Supervisory Union (CSBTI-SU) filed separate petitions for certification electionbefore Med-Arbiter Eladio de Jesus of the Regional Office No. III. The rank-and-file union insists that it is a legitimatelabor organization having been issued a charter certificate by the Associated Labor Union (ALU), and the supervisory

union by the Associated Professional, Supervisory, Office and Technical Employees Union (APSOTEU). Privaterespondents also alleged that the establishment in which they sought to operate was unorganized.

Petitioner Coastal Subic Bay Terminal, Inc. (CSBTI) opposed both petitions for certification election alleging that therank-and-file union and supervisory union were not legitimate labor organizations, and that the proposed bargainingunits were not particularly described.

Without ruling on the legitimacy of the respondent unions, the Med-Arbiter dismissed, without prejudice to refiling,both petitions which had been consolidated. The Med-Arbiter held that the ALU and APSOTEU are one and the same
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federation having a common set of officers. Thus, the supervisory and the rank-and-file unions were in effect affiliatedwith only one federation.

4

The Med-Arbiter ruled as follows:

Viewed in the light of all the foregoing, this Office finds the simultaneous filing of the instant petitions to be invalid andunwarranted. Consequently, this Office has no recourse but to dismiss both petitions without prejudice to the refilingof either.

WHEREFORE, PREMISES CONSIDERED, let the instant petitions be, as they are hereby DISMISSED.

SO ORDERED.5

Both parties appealed to the Secretary of Labor and Employment, who reversed the decision of the Med-Arbiter. TheSecretary thru Undersecretary R. Baldoz, ruled that CSBTI-SU and CSBTI-RFU have separate legal personalities tofile their separate petitions for certification election. The Secretary held that APSOTEU is a legitimate labororganization because it was properly registered pursuant to the 1989 Revised Rules and Regulations implementingRepublic Act No. 6715, the rule applicable at the time of its registration. It further ruled that ALU and APSOTEU areseparate and distinct labor unions having separate certificates of registration from the DOLE. They also have differentsets of locals. The Secretary declared CSBTI-RFU and CSBTI-SU as legitimate labor organizations having been

chartered respectively by ALU and APSOTEU after submitting all the requirements with the Bureau of LaborRelations (BLR). Accordingly, the Secretary ordered the holding of separate certification election, viz:

WHEREFORE, the decision of the Med-Arbiter, Regional Office No. III is hereby REVERSED. Let separatecertification elections be conducted immediately among the appropriate employees of CSBTI, after the usual pre-election conference, with the following choices:

I. For all rank and file employees of CSBTI:

1. COASTAL SUBIC BAY TERMINAL, INC. RANK-AND-FILE UNION-ALU-TUCP; and

2. NO UNION.

II. For all supervisory employees of CSBTI:

1. COASTAL SUBIC BAY TERMINAL, INC. SUPERVISORY EMPLOYEES UNION-APSOTEU;and

2. NO UNION.

The latest payroll of the employer, including its payrolls for the last three months immediately preceding the issuanceof this decision, shall be the basis for determining the qualified list of voters.

SO DECIDED.6

The motion for reconsideration was also denied.7

On appeal, the Court of Appeals affirmed the decision of the Secretary.8It held that there was no grave abuse of

discretion on the part of the Secretary; its findings are supported by evidence on record; and thus should be accordedwith respect and finality.

9

The motion for reconsideration was likewise denied.10

Hence, the instant petition by the company anchored on thefollowing grounds:

I
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THE HONORABLE COURT OF APPEALS ERRED IN RELYING ON THE "1989 REVISED RULES ANDREGULATIONS IMPLEMENTING RA 6715" AS BASIS TO RECOGNIZE PRIVATE RESPONDENT

APSOTEUS REGISTRATION BY THE DOLE REGIONAL DIRECTOR.

II

THE HONORABLE COURT OF APPEALS ERRED WHEN IT AFFIRMED PUBLIC RESPONDENTSAPPLICATION OF THE PRINCIPLE OF STARE DECISIS TO HASTILY DISPOSE OF THE LEGALPERSONALITY ISSUE OF APSOTEU.

III

THE HONORABLE COURT OF APPEALS DID NOT DECIDE IN ACCORD WITH LAW ANDJURISPRUDENCE WHEN IT AFFIRMED PUBLIC RESPONDENTSAPPLICATION OF THE "UNION

AUTONOMY" THEORY.

IV

IN AFFIRMING PUBLIC RESPONDENTS FINDING THAT PRIVATE RESPONDENTS ARE "SEPARATEFEDERATIONS," THE HONORABLE COURT OF APPEALS:

(1) IGNORED JURISPRUDENCE RECOGNIZING THE BINDING NATURE OF A MED-ARBITERS FACTUAL FINDINGS; AND

(2) DISREGARDED EVIDENCE ON RECORD OF "ILLEGAL COMMINGLING."11

Plainly, the issues are (1) Can the supervisory and the rank-and-file unions file separate petitions for certificationelection?; (2) Was the Secretarys decision based onstare decisiscorrect?; and (3) Were private respondentsengaged in commingling?

The issue on the status of the supervisory union CSBTI-SU depends on the status of APSOTEU, its motherfederation.

Petitioner argues that APSOTEU improperly secured its registration from the DOLE Regional Director and not fromthe BLR; that it is the BLR that is authorized to process applications and issue certificates of registration inaccordance with our ruling in Phil. Association of Free Labor Unions v. Secretary of Labor;

12that the certificates of

registration issued by the DOLE Regional Director pursuant to the rules are questionable, and possibly even void abinitiofor being ultra vires; and that the Court of Appeals erred when it ruled that the law applicable at the time of

APSOTEUs registration was the 1989 Revised Implementing Rulesand Regulations of Rep. Act No. 6715.

Petitioner insists that APSOTEU lacks legal personality, and its chartered affiliate CSBTI-SU cannot attain the statusof a legitimate labor organization to file a petition for certification election. It relies on Villar v. Inciong,

13where we held

therein that Amigo Employees Union was not a duly registered independent union absent any record of itsregistration with the Bureau.

Pertinent is Article 23514

of the Labor Code which provides that applications for registration shall be acted upon bythe Bureau. "Bureau" as defined under the Labor Code means the BLR and/or the Labor Relations Division in the

Regional Offices of the Department of Labor.15

Further, Section 2, Rule II, Book V of the 1989 Revised ImplementingRules of the Labor Code (Implementing Rules) provides that:

Section 2. Where to file application; procedureAny national labor organization or labor federation or local unionmay file an application for registration with the Bureau or the Regional Office where the applicants principal offices islocated. The Bureau or the Regional Office shall immediately process and approve or deny the application. In case ofapproval, the Bureau or the Regional Office shall issue the registration certificate within thirty (30) calendar days fromreceipt of the application, together with all the requirements for registration as hereinafter provided.

16

The Implementing Rules specifically Section 1, Rule III of Book V, as amended by Department Order No. 9, thus:
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SECTION 1. Where to file applications.The application for registration of any federation, national or industryunion or trade union center shall be filed with the Bureau. Where the application is filed with the Regional Office, thesame shall be immediately forwarded to the Bureau within forty-eight (48) hours from filing thereof, together with allthe documents supporting the registration.

The applications for registration of an independent union shall be filed with and acted upon by the Regional Officewhere the applicants principal office is located .

x x x x

The DOLE issued Department Order No. 40-03, which took effect on March 15, 2003, further amending Book V of theabove implementing rules. The new implementing rules explicitly provide that applications for registration of labororganizations shall be filed either with the Regional Office or with the BLR.

17

Even after the amendments, the rules did not divest the Regional Office and the BLR of their jurisdiction overapplications for registration by labor organizations. The amendments to the implementing rules merely specified thatwhen the application was filed with the Regional Office, the application would be acted upon by the BLR.

The records in this case showed that APSOTEU was registered on March 1, 1991. Accordingly, the law applicable atthat time was Section 2, Rule II, Book V of the Implementing Rules, and not Department Order No. 9 which took

effect only on June 21, 1997. Thus, considering further that APSOTEUs principal office is located in Diliman, QuezonCity, and its registration was filed with the NCR Regional Office, the certificate of registration is valid.

The petitioner misapplied Villar v. Inciong.18

In said case, there was no record in the BLR that Amigo EmployeesUnion was registered.

19

Did the Court of Appeals err in its application of stare decisiswhen it upheld the Secretarys ruling that APSOTEU is alegitimate labor organization and its personality cannot be assailed unless in an independent action for cancellation ofregistration certificate?

20

We think not.

Section 5, Rule V, Book V of the Implementing Rules states:

Section 5. Effect of registrationThe labor organization or workers association shall be deemed registered andvested with legal personality on the date of issuance of its certificate of registration. Such legal personality cannotthereafter be subject to collateral attack, but maybe questioned only in an independent petition for cancellation inaccordance with these Rules.

21

Thus, APSOTEU is a legitimate labor organization and has authority to issue charter to its affiliates.22

It may issue alocal charter certificate to CSBTI-SU and correspondingly, CSBTI-SU is legitimate.

Are ALU, a rank-and-file union and APSOTEU, a supervisory union one and the same because of the commonalitiesbetween them? Are they commingled?

The petitioner contends that applying by analogy, the doctrine of piercing the veil of corporate fiction, APSOTEU andALU are the same federation. Private respondents disagree.

First, as earlier discoursed, once a labor union attains the status of a legitimate labor organization, it continues assuch until its certificate of registration is cancelled or revoked in an independent action for cancellation.

23In addition,

the legal personality of a labor organization cannot be collaterally attacked.24

Thus, when the personality of the labororganization is questioned in the same manner the veil of corporate fiction is pierced, the action partakes the natureof a collateral attack. Hence, in the absence of any independent action for cancellation of registration against either

APSOTEU or ALU, and unless and until their registrations are cancelled, each continues to possess a separate legalpersonality. The CSBTI-RFU and CSBTI-SU are therefore affiliated with distinct and separate federations, despite thecommonalities of APSOTEU and ALU.
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Under the rules implementing the Labor Code, a chartered local union acquires legal personality through the chartercertificate issued by a duly registered federation or national union, and reported to the Regional Office in accordancewith the rules implementing the Labor Code.

25A local union does not owe its existence to the federation with which it

is affiliated. It is a separate and distinct voluntary association owing its creation to the will of its members. Mereaffiliation does not divest the local union of its own personality, neither does it give the mother federation the licenseto act independently of the local union. It only gives rise to a contract of agency, where the former acts inrepresentation of the latter.

26Hence, local unions are considered principals while the federation is deemed to be

merely their agent.

27

As such principals, the unions are entitled to exercise the rights and privileges of a legitimatelabor organization, including the right to seek certification as the sole and exclusive bargaining agent in theappropriate employer unit.1wphi1

A word of caution though, under Article 245 of the Labor Code,28

supervisory employees are not eligible formembership in a labor union of rank-and-file employees. The supervisory employees are allowed to form their ownunion but they are not allowed to join the rank-and-file union because of potential conflicts of interest.

29Further, to

avoid a situation where supervisors would merge with the rank-and-file or where the supervisors labor union wouldrepresent conflicting interests, a local supervisors union should not be allowed to affiliate with the national federationof unions of rank-and-file employees where that federation actively participates in the union activity within thecompany.

30Thus, the limitation is not confined to a case of supervisors wanting to join a rank-and-file union. The

prohibition extends to a supervisors local union applying for membership in a national federation the members ofwhich include local unions of rank-and-file employees.

31In De La Salle University Medical Center and College of

Medicine v. Laguesma,we reiterated the rule that for the prohibition to apply, it is not enough that the supervisoryunion and the rank-and-file union are affiliated with a single federation. In addition, the supervisors must have direct

authority over the rank-and-file employees.32

In the instant case, the national federations that exist as separate entities to which the rank-and-file and supervisoryunions are separately affiliated with, do have a common set of officers. In addition, APSOTEU, the supervisoryfederation, actively participates in the CSBTI-SU while ALU, the rank-and-file federation, actively participates in theCSBTI-RFU, giving occasion to possible conflicts of interest among the common officers of the federation of rank-and-file and the federation of supervisory unions. For as long as they are affiliated with the APSOTEU and ALU, thesupervisory and rank-and-file unions both do not meet the criteria to attain the status of legitimate labor organizations,and thus could not separately petition for certification elections.1wphi1

The purpose of affiliation of the local unions into a common enterprise is to increase the collective bargaining powerin respect of the terms and conditions of labor.

33When there is commingling of officers of a rank-and-file union with a

supervisory union, the constitutional policy on labor is circumvented. Labor organizations should ensure the freedomof employees to organize themselves for the purpose of leveling the bargaining process but also to ensure the

freedom of workingmen and to keep open the corridor of opportunity to enable them to do it for themselves.

WHEREFORE, the petition is GRANTED. The Court of Appeals Decision dated August 31, 2001, in CA-G.R. SP No.54128 and the Resolution dated February 5, 2003 are SET ASIDE. The decision of the Med-Arbiter isherebyAFFIRMED.

SO ORDERED.

G.R. Nos. 174040-41 September 22, 2010

INSULAR HOTEL EMPLOYEES UNION-NFL,Petitioner,

vs.WATERFRONT INSULAR HOTEL DAVAO,Respondent.

D E C I S I O N

PERALTA, J .:

Before this Court is a petition for review on certiorari,1under Rule 45 of the Rules of Court, seeking to set aside the

Decision2dated October 11, 2005, and the Resolution

3dated July 13, 2006 of the Court of Appeals (CA) in
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consolidated labor cases docketed as CA-G.R. SP No. 83831 and CA-G.R. SP No. 83657. Said Decision reversedthe Decision

4dated the April 5, 2004 of the Accredited Voluntary Arbitrator Rosalina L. Montejo (AVA Montejo).

The facts of the case, as culled from the records, are as follows:

On November 6, 2000, respondent Waterfront Insular Hotel Davao (respondent) sent the Department of Labor andEmployment (DOLE), Region XI, Davao City, a Notice of Suspension of Operations

5notifying the same that it will

suspend its operations for a period of six months due to severe and serious business losses. In said notice,respondent assured the DOLE that if the company could not resume its operations within the six-month period, thecompany would pay the affected employees all the benefits legally due to them.

During the period of the suspension, Domy R. Rojas (Rojas), the President of Davao Insular Hotel Free EmployeesUnion (DIHFEU-NFL), the recognized labor organization in Waterfront Davao, sent respondent a number of lettersasking management to reconsider its decision.

In a letter6dated November 8, 2000, Rojas intimated that the members of the Union were determined to keep their

jobs and that they believed they too had to help respondent, thus:

x x x x

Sir, we are determined to keep our jobs and push the Hotel up from sinking. We believe that we have to help in this(sic) critical times. Initially, we intend to suspend the re-negotiations of our CBA. We could talk further on possibleadjustments on economic benefits, the details of which we are hoping to discuss with you or any of your emissaries. xx x

7

In another letter8dated November 10, 2000, Rojas reiterated the Union's desire to help respondent, to wit:

We would like to thank you for giving us the opportunity to meet [with] your representatives in order for us to air oursentiments and extend our helping hands for a possible reconsideration of the company's decision.

The talks have enabled us to initially come up with a suggestion of solving the high cost on payroll.

We propose that 25 years and above be paid their due retirement benefits and put their length of service to zero

without loss of status of employment with a minimum hiring rate.

Thru this scheme, the company would be able to save a substantial amount and reduce greatly the payroll costswithout affecting the finance of the families of the employees because they will still have a job from where they couldget their income.

Moreover, we are also open to a possible reduction of some economic benefits as our gesture of sincere desire tohelp.

We are looking forward to a more fruitful round of talks in order to save the hotel.9

In another letter10

dated November 20, 2000, Rojas sent respondent more proposals as a form of the Union's gestureof their intention to help the company, thus:

1) Suspension of [the] CBA for ten years, No strike no lock-out shall be enforced.

2) Pay all the employees their benefits due, and put the length of service to zero with a minimum hiring rate.Payment of benefits may be on a staggered basis or as available.

3) Night premium and holiday pays shall be according to law. Overtime hours rendered shall be offsetted aspracticed.

4) Reduce the sick leaves and vacation leaves to 15 days/15days.
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5) Emergency leave and birthday off are hereby waived.

6) Duty meal allowance is fixed at P30.00 only. No more midnight snacks and double meal allowance. Thecook drinks be stopped as practiced.

7) We will shoulder 50% of the group health insurance and family medical allowance be reduced to 1,500.00instead of 3,000.00.

8) The practice of bringing home our uniforms for laundry be continued.

9) Fixed manning shall be implemented, the rest of manpower requirements maybe sourced thru WAP andcasual hiring. Manpower for fixed manning shall be 145 rank-and-file union members.

10) Union will cooperate fully on strict implementation of house rules in order to attain desired productivityand discipline. The union will not tolerate problem members.

11) The union in its desire to be of utmost service would adopt multi-tasking for the hotel to be morecompetitive.

It is understood that with the suspension of the CBA renegotiations, the same existing CBA shall be adopted and thatall provisions therein shall remain enforced except for those mentioned in this proposal.

These proposals shall automatically supersede the affected provisions of the CBA.11

In a handwritten letter12

dated November 25, 2000, Rojas once again appealed to respondent for it to consider theirproposals and to re-open the hotel. In said letter, Rojas stated that manpower for fixed manning shall be one hundred(100) rank-and-file Union members instead of the one hundred forty-five (145) originally proposed.

Finally, sometime in January 2001, DIHFEU-NFL, through Rojas, submitted to respondent a Manifesto13

concretizingtheir earlier proposals.

After series of negotiations, respondent and DIHFEU-NFL, represented by its President, Rojas, and Vice-Presidents,Exequiel J. Varela Jr. and Avelino C. Bation, Jr., signed a Memorandum of Agreement

14(MOA) wherein respondent

agreed to re-open the hotel subject to certain concessions offered by DIHFEU-NFL in its Manifesto.

Accordingly, respondent downsized its manpower structure to 100 rank-and-file employees as set forth in the terms ofthe MOA. Moreover, as agreed upon in the MOA, a new pay scale was also prepared by respondent.

The retained employees individually signed a "Reconfirmation of Employment"15

which embodied the new terms andconditions of their continued employment. Each employee was assisted by Rojas who also signed the document.

On June 15, 2001, respondent resumed its business operations.

On August 22, 2002, Darius Joves (Joves) and Debbie Planas, claiming to be local officers of the National Federationof Labor (NFL), filed a Notice of Mediation

16before the National Conciliation and Mediation Board (NCMB), Region

XI, Davao City. In said Notice, it was stated that the Union involved was "DARIUS JOVES/DEBBIE PLANAS ET. AL,

National Federation of Labor." The issue raised in said Notice was the "Diminution of wages and other benefitsthrough unlawful Memorandum of Agreement."

On August 29, 2002, the NCMB called Joves and respondent to a conference to explore the possibility of settling theconflict. In the said conference, respondent and petitioner Insular Hotel Employees Union-NFL (IHEU-NFL),represented by Joves, signed a Submission Agreement

17wherein they chose AVA Alfredo C. Olvida (AVA Olvida) to

act as voluntary arbitrator. Submitted for the resolution of AVA Olvida was the determination of whether or not therewas a diminution of wages and other benefits through an unlawful MOA. In support of his authority to file thecomplaint, Joves, assisted by Atty. Danilo Cullo (Cullo), presented several Special Powers of Attorney (SPA) whichwere, however, undated and unnotarized.
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On September 2, 2002, respondent filed with the NCMB a Manifestation with Motion for a Second PreliminaryConference,

18raising the following grounds:

1) The persons who filed the instant complaint in the name of the Insular Hotel Employees Union-NFL haveno authority to represent the Union;

2) The individuals who executed the special powers of attorney in favor of the person who filed the instantcomplaint have no standing to cause the filing of the instant complaint; and

3) The existence of an intra-union dispute renders the filing of the instant case premature.19

On September 16, 2002, a second preliminary conference was conducted in the NCMB, where Cullo denied anyexistence of an intra-union dispute among the members of the union. Cullo, however, confirmed that the case wasfiled not by the IHEU-NFL but by the NFL. When asked to present his authority from NFL, Cullo admitted that thecase was, in fact, filed by individual employees named in the SPAs. The hearing officer directed both parties toelevate the aforementioned issues to AVA Olvida.

20

The case was docketed as Case No. AC-220-RB-11-09-022-02 and referred to AVA Olvida. Respondent again raisedits objections, specifically arguing that the persons who signed the complaint were not the authorized representativesof the Union indicated in the Submission Agreement nor were they parties to the MOA. AVA Olvida directed

respondent to file a formal motion to withdraw its submission to voluntary arbitration.

On October 16, 2002, respondent filed its Motion to Withdraw.21

Cullo then filed an Opposition22

where the same wascaptioned:

NATIONAL FEDERATION OF LABORAnd 79 Individual Employees, Union Members,Complainants,

-versus-

Waterfront Insular Hotel Davao,Respondent.

In said Opposition, Cullo reiterated that the complainants were not representing IHEU-NFL, to wit:

x x x x

2. Respondent must have been lost when it said that the individuals who executed the SPA have no standingto represent the union nor to assail the validity of Memorandum of Agreement (MOA). What is correct isthat the individual complainants are not representing the unionbut filing the complaint through theirappointed attorneys-in-fact to assert their individual rights as workers who are entitled to the benefitsgranted by law and stipulated in the collective bargaining agreement.

23

On November 11, 2002, AVA Olvida issued a Resolution24

denying respondent's Motion to Withdraw. On December16, 2002, respondent filed a Motion for Reconsideration

25where it stressed that the Submission Agreement was void

because the Union did not consent thereto. Respondent pointed out that the Union had not issued any resolution duly

authorizing the individual employees or NFL to file the notice of mediation with the NCMB.

Cullo filed a Comment/Opposition26

to respondent's Motion for Reconsideration. Again, Cullo admitted that the casewas not initiated by the IHEU-NFL, to wit:

The case was initiated by complainants by filling up Revised Form No. 1 of the NCMB duly furnishing respondent,copy of which is hereto attached as Annex "A" for reference and consideration of the Honorable Voluntary Arbitrator.There is no mention there of Insular Hotel Employees Union, but only National Federation of Labor (NFL). The oneappearing at the Submission Agreement was only a matter of filling up the blanks particularly on the question there ofUnion; which was filled up with Insular Hotel Employees Union-NFL. There is nothing there that indicates that it is a
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complainant as the case is initiated by the individual workers and National Federation of Labor, not by the local union.The local union was not included as party-complainant considering that it was a party to the assailed MOA.

27

On March 18, 2003, AVA Olvida issued a Resolution28

denying respondent's Motion for Reconsideration. He,however, ruled that respondent was correct when it raised its objection to NFL as proper party-complainant, thus:

Anent to the real complainant in this instant voluntary arbitration case, the respondent is correct when it raisedobjection to the National Federation of Labor (NFL) and as proper party-complainants.

The proper party-complainant is INSULAR HOTEL EMPLOYEES UNION-NFL, the recognized and incumbentbargaining agent of the rank-and-file employees of the respondent hotel. In the submission agreement of the partiesdated August 29, 2002, the party complainant written is INSULAR HOTEL EMPLOYEES UNION-NFL and not theNATIONAL FEDERATION OF LABOR and 79 other members.

However, since the NFL is the mother federation of the local union, and signatory to the existing CBA, it canrepresent the union, the officers, the members or union and officers or members, as the case may be, in all stages ofproceedings in courts or administrative bodies provided that the issue of the case will involve labor-managementrelationship like in the case at bar.

The dispositive portion of the March 18, 2003 Resolution of AVA Olvida reads:

WHEREFORE, premises considered, the motion for reconsideration filed by respondent is DENIED. The resolutiondated November 11, 2002 is modified in so far as the party-complainant is concerned; thus, instead of "NationalFederation of Labor and 79 individual employees, union members," shall be "Insular Hotel Employees Union-NFL et.al., as stated in the joint submission agreement dated August 29, 2002. Respondent is directed to comply with thedecision of this Arbitrator dated November 11, 2002,

No further motion of the same nature shall be entertained.29

On May 9, 2003, respondent filed its Position Paper Ad Cautelam,30

where it declared, among others, that the samewas without prejudice to its earlier objections against the jurisdiction of the NCMB and AVA Olvida and the standingof the persons who filed the notice of mediation.

Cullo, now using the caption "Insular Hotel Employees Union-NFL, Complainant," filed a Comment31

dated June 5,2003. On June 23, 2003, respondent filed its Reply.32

Later, respondent filed a Motion for Inhibition33

alleging AVA Olvida's bias and prejudice towards the cause of theemployees. In an Order

34dated July 25, 2003, AVA Olvida voluntarily inhibited himself out of "delicadeza" and

ordered the remand of the case to the NCMB.

On August 12, 2003, the NCMB issued a Notice requiring the parties to appear before the conciliator for the selectionof a new voluntary arbitrator.

In a letter35

dated August 19, 2003 addressed to the NCMB, respondent reiterated its position that the individualunion members have no standing to file the notice of mediation before the NCMB. Respondent stressed that thecomplaint should have been filed by the Union.

On September 12, 2003, the NCMB sent both parties a Notice36

asking them to appear before it for the selection ofthe new voluntary arbitrator. Respondent, however, maintained its stand that the NCMB had no jurisdiction over thecase. Consequently, at the instance of Cullo, the NCMB approved ex partethe selection of AVA Montejo as the newvoluntary arbitrator.

On April 5, 2004, AVA Montejo rendered a Decision37

ruling in favor of Cullo, the dispositive portion of which reads:

WHEREOF, in view of the all the foregoing, judgment is hereby rendered:
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17/57

1. Declaring the Memorandum of Agreement in question as invalid as it is contrary to law and public policy;

2. Declaring that there is a diminution of the wages and other benefits of the Union members and officersunder the said invalid MOA.

3. Ordering respondent management to immediately reinstate the workers wage rates and other benefitsthat they were receiving and enjoying before the signing of the invalid MOA;

4. Ordering the management respondent to pay attorneys fees in an amount equivalent to ten percent(10%) of whatever total amount that the workers union may receive representing individual wagedifferentials.

As to the other claims of the Union regarding diminution of other benefits, this accredited voluntary arbitrator is of theopinion that she has no authority to entertain, particularly as to the computation thereof.

SO ORDERED.38

Both parties appealed the Decision of AVA Montejo to the CA. Cullo only assailed the Decision in so far as it did notcategorically order respondent to pay the covered workers their differentials in wages reckoned from the effectivity ofthe MOA up to the actual reinstatement of the reduced wages and benefits. Cullos' petition was docketed as CA-G.R.

SP No. 83831. Respondent, for its part, questioned among others the jurisdiction of the NCMB. Respondentmaintained that the MOA it had entered into with the officers of the Union was valid. Respondent's petition wasdocketed as CA-G.R. SP No. 83657. Both cases were consolidated by the CA.

On October 11, 2005, the CA rendered a Decision39

ruling in favor of respondent, the dispositive portion of whichreads:

WHEREFORE, premises considered, the petition for review in CA-G.R. SP No. 83657 is hereby GRANTED, while thepetition in CA-G.R. SP No. 83831 is DENIED. Consequently, the assailed Decision dated April 5, 2004 rendered by

AVA Rosalina L. Montejo is hereby REVERSED and a new one entered declaring the Memorandum of Agreementdated May 8, 2001 VALID and ENFORCEABLE. Parties are DIRECTED to comply with the terms and conditionsthereof.

SO ORDERED.40

Aggrieved, Cullo filed a Motion for Reconsideration, which was, however, denied by the CA in a Resolution41

datedJuly 13, 2006.

Hence, herein petition, with Cullo raising the following issues for this Court's resolution, to wit:

I.

WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERRORS IN FINDINGTHAT THE AC

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Affiliation and Disaffiliation Case