Case Digest: Atienza vs. Saluta, G.R. No. 233413, June 17 2019

  Labor Law | Appeal 

• Respondent Noel Sacramento Saluta claimed he was hired as a company driver by CRV Corporation and was assigned to drive for the petitioner Celia R. Atienza, receiving a monthly salary of ₱9,000.
• A vehicular accident occurred on December 11, 2014, and the respondent was required to pay ₱15,000.00 for the damages. His driver's license was confiscated, and he was issued a Temporary Operator's Permit (TOP).
• On December 23, 2014, the respondent requested time off to renew his expired license, but the petitioner allegedly refused, leading to a misunderstanding. The respondent believed he had been verbally terminated when the petitioner said that "kung hindi ka makakapag-drive ngayon, mabuti pa maghiwalay na tayo." 
• Respondent filed a complaint against CRV Corporation and the petitioner, claiming illegal dismissal and other labor-related issues.
• The petitioner argued that the respondent abandoned his job and was not an employee of CRV Corporation but her personal/family driver. She contended that he left work without notice.
• Labor Arbiter: Ruled that the respondent, a personal driver, was considered an employee of the petitioner since the employer-employee relationship with CRV Corporation was not established. The Labor Arbiter dismissed the complaint for illegal dismissal, stating that the respondent left employment without justifiable reason and forfeited unpaid salary.
• NLRC: Reversed the decision, finding that the petitioner failed to prove the absence of an employer-employee relationship and ordered payment of various benefits to the respondent.
• CA: Ruled that the respondent failed to prove he was a company driver but found insufficient evidence from the petitioner to disprove the employment relationship.

WoN the reversal of the judgment rendered by the appellate court will inure to the benefit of CRV Corporation. NO

It is not lost on this Court that only the petitioner appealed the CA Decision which found the respondent to have been illegally dismissed and ordered both the CRV Corporation and the petitioner liable to the respondent for the payment of backwages, separation pay, wage differentials, holiday pay, 13th month pay and service incentive leave pay. Considering that CRV Corporation did not appeal the decision of the appellate court, the same stands insofar as the corporation is concerned.

At this juncture, this Court takes this opportune time to emphasize that a reversal of a judgment on appeal is binding on the parties to the suit, but shall not benefit the parties against whom the judgment was rendered in the court a quo, but who did not join in the appeal, unless their rights and liabilities and those of the parties appealing are so interwoven and dependent as to be inseparable, in which case a reversal as to one operates as a reversal as to all.

It is basic that under the general doctrine of separate juridical personality* stockholders of a corporation enjoy the principle of limited liability: the corporate debt is not the debt of the stockholder. This is because a corporation has a separate and distinct personality from those who represent it.

Here, it was not disputed that CRV Corporation had been impleaded, duly notified of the suit, and properly served with legal processes, but it never participated in the case by sending an authorized representative or filing a single pleading. The Securities and Exchange Commission i-Report dated May 14, 2015 which showed that the company status of CRV Corporation as revoked can hardly mean that the NLRC did not acquire jurisdiction over it inasmuch as the i-Report did not indicate when the CRV Corporation ceased to exist. Besides, the complaint had already been filed on April 7, 2015. Moreover, under Section 122 of Batas Pambansa Bilang 68 or "The Corporation Code of the Philippines," a corporation whose registration had been revoked has three years from dissolution to continue to be a body corporate for purposes of winding up its affairs which includes prosecuting and defending suits by or against it.

Although a reversal of the judgment as to one would operate as a reversal as to all where the rights and liabilities of those who did not appeal and those of the party appealing are so interwoven and dependent on each other as to be inseparable, CRV Corporation and petitioner have no commonality of interest because each bears the injury of an adverse judgment. CRV Corporation will not be harmed had petitioner been held liable to pay the respondent his unpaid wages. Conversely, petitioner did not suffer any monetary injury when CRV Corporation was made liable to pay the respondent his unpaid wages.

Even if petitioner is allegedly one of CRV Corporation's top officials, such hypothetical fact does not translate, or even imply that she will be financially injured by an adverse money-claim judgment against the latter. Much like stockholders, corporate officers and employees only have an inchoate right (only to the extent of their valid collectibles in the form of salaries and benefits) to the assets of the corporation which, in turn, is the real owner of the assets by virtue of its separate juridical personality.

Moreover, no evidence was offered by both parties that petitioner was equipped with a board resolution (even if belatedly submitted) or, at least, authorized by corporate by-laws49 to represent CRV Corporation in the instant suit. Therefore, petitioner's appeal cannot benefit CRV Corporation

Respondent is the personal/family driver of the petitioner.

The respondent failed to provide competent evidence to prove his employment with the company. He did not present documents such as an employment contract, company identification, or pay slip that would demonstrate his inclusion in the company's payroll. The respondent also failed to show how the company exercised control over his work.

Respondent was not dismissed from employment.

Respondent's bare claim of having been dismissed from employment by the petitioner, unsubstantiated by impartial and independent evidence, is insufficient to establish such fact of dismissal. Bare and unsubstantiated allegations do not constitute substantial evidence and have no probative value.

The Civil Code shall govern the rights of family drivers.

Labor Code provides that family drivers are covered in the term domestic or household service. But due to the express repeal of the Labor Code provisions pertaining to househelpers, which includes family drivers, by the Kasambahay Law; and the non-applicability of the Kasambahay Law to family drivers, there is a need to revert back to the Civil Code provisions, particularly Articles 1689, 1697 and 1699, Section 1, Chapter 3, Title VIII, Book IV thereof. 

Given that there is neither dismissal nor abandonment in this case, none of the party is entitled to claim any indemnity from the other. Verily, in a case where the employee's failure to work was occasioned neither by his abandonment nor by a termination, the burden of economic loss is not rightfully shifted to the employer; each party must bear his own loss.

Petitioner is not liable for wage differentials, holiday pay, 13th month pay and service incentive leave pay.

As found by the Labor Arbiter, the ₱9,000.00 salary respondent receives a month is reasonable and in accordance with Article 1689 of the Civil Code. Hence, petitioner may not be made to pay the respondent wage differentials.