Abejaron vs. Court of Appeals

A complaint for damages based on malicious prosecution of a criminal charge filed by an employer against an employee falls within the jurisdiction of the Regional Trial Court, not the Labor Arbiter, where the claim does not arise from the employer-employee relationship itself but from the alleged tortious act of filing the charge.

Tertuliano Abejaron was employed by Pepsi Cola Bottling Co., Inc. as a salesman beginning in 1978. The dispute arose from two separate estafa complaints filed by Pepsi against Abejaron during the course of his employment, the second of which resulted in a criminal information that was eventually dismissed by the trial court. Abejaron never lodged any complaint with the Department of Labor regarding his suspension or dismissal, choosing instead to pursue a civil action for damages premised on malicious prosecution.

Tertuliano Abejaron was employed by Pepsi Cola Bottling Co., Inc. as a salesman in 1978. In May 1980, Pepsi suspended him without pay for an alleged unremitted collection of ₱67,945.70 and filed a complaint for estafa against him with the Provincial Fiscal of General Santos. That complaint was subsequently dismissed for lack of sufficient evidence, and Abejaron was reinstated on November 11, 1980.

In November 1982, Abejaron was served a warning on a second charge — that he had incurred questionable route shortages and had repeatedly failed and refused to remit his daily collections. He was "grounded" pending investigation of the matter. In 1983, Pepsi filed another complaint for estafa against Abejaron with the City Fiscal of General Santos City, and the corresponding information was filed with the Regional Trial Court of General Santos City, docketed as Criminal Case No. 3067. On August 29, 1986, the trial court acquitted Abejaron of the crime charged. Abejaron was eventually separated from Pepsi on March 21, 1983.

Abejaron never filed any complaint with the Labor Department when he was suspended in 1980 or when he was dismissed in 1983. Instead, on November 24, 1986, he sued Pepsi for damages before the Regional Trial Court of General Santos City, docketed as Civil Case No. 3475, for what he characterized as the malicious filing of the estafa charge against him. On April 25, 1989, Judge Manuel Luis S. Gumban rendered a decision holding Pepsi liable for all the awards prayed for: ₱50,000 as actual damages, ₱65,317.87 as actual or compensatory damages, ₱35,000 as attorney's fees, ₱200,000 as moral damages, and litigation expenses. On appeal, Pepsi raised for the first time the sole issue of lack of jurisdiction of the trial court, contending that the complaint was essentially a monetary claim arising from an employer-employee relationship and thus fell within the Labor Arbiter's jurisdiction. The Court of Appeals rejected the jurisdictional challenge but reversed the damages award, finding no convincing and preponderant evidence of malice on Pepsi's part in filing the estafa charge.

• Jurisdictional Remedy: Petitioner contended that because Pepsi's appeal to the Court of Appeals was based solely on the issue of jurisdiction — a pure question of law — Pepsi sought the wrong remedy by going to the Court of Appeals instead of directly to the Supreme Court via a special civil action for certiorari under Rule 65, and that the Court of Appeals should have certified the case to the Supreme Court.
• Unassigned Error: Petitioner argued that the Court of Appeals could not rule on the propriety of the award of damages because Pepsi had not assigned it as an error, invoking Rule 51, Section 7 of the Rules of Court, which provides that no error will be considered unless stated in the assignment of errors and properly argued, save for plain or clerical errors.
• Estoppel on Jurisdiction: Petitioner asserted that Pepsi was estopped from raising the jurisdictional objection at this late hour, having willingly proceeded to trial without questioning jurisdiction and only raising it on appeal.

• Lack of Jurisdiction of Trial Court: Pepsi maintained that the complaint was essentially a monetary claim arising from an employer-employee relationship and that jurisdiction was therefore vested in the Labor Arbiter, not the Regional Trial Court.
• No Malice: The Court of Appeals found, and the Supreme Court agreed, that there was no convincing and preponderant evidence to prove malice on Pepsi's part when it charged Abejaron with estafa, warranting reversal of the damages award.

• Jurisdiction: Whether the Regional Trial Court or the Labor Arbiter had jurisdiction over Abejaron's complaint for damages for malicious prosecution.
• Procedural Remedy: Whether Pepsi sought the wrong remedy by appealing to the Court of Appeals instead of directly to the Supreme Court via certiorari, and whether Abejaron was estopped from raising this procedural objection.
• Unassigned Errors: Whether the Court of Appeals could rule on the award of damages despite Pepsi not having assigned it as an error.
• Liability for Damages: Whether Pepsi acted with malice in filing the estafa charge against Abejaron, thereby warranting the award of damages.

• Jurisdiction: Yes. The Regional Trial Court had jurisdiction. The complaint was anchored on malicious prosecution under the Civil Code, not on the termination of employment under the Labor Code, and could have arisen independently of any employer-employee relationship.
• Procedural Remedy: Petitioner is estopped. Although Pepsi arguably sought the wrong remedy, Abejaron actively participated in the Court of Appeals proceedings without objecting to the procedural flaw and is now barred from raising it. At any rate, the result would have been the same.
• Unassigned Errors: Yes. The Court of Appeals was justified in ruling on the award of damages even though not assigned as error, as the appellate court has discretion to consider unassigned errors necessary for a just and complete resolution of the case.
• Liability for Damages: No. Pepsi filed the estafa charge in good faith and without malice; the case is one of damnum absque injuria, precluding recovery of damages.

• Jurisdiction: The Court examined the allegations in Abejaron's complaint and found no trace of any fact tending to establish that the claim was based on illegal termination. The complaint was filed to recover damages on the basis of alleged malicious prosecution and its consequences. Relying on Honiron Philippines, Inc. vs. Intermediate Appellate Court and Pepsi Cola Distributor of the Philippines, Inc. vs. Gal-lang, the Court held that where a complaint is founded on alleged violations of Civil Code provisions rather than the Labor Code, and where there is no reasonable causal connection between the complaint and the employer-employee relationship, the action is a civil dispute cognizable by the regular courts. The labor arbiter has no competence to resolve such a claim because the applicable law is not the Labor Code but the Civil Code and Revised Penal Code.

• Procedural Remedy: While it was true that jurisdiction may be raised at any time, Pepsi did not invoke the issue earlier and instead willingly proceeded to trial. When the trial court ruled against it, Pepsi went to the Court of Appeals in an ordinary appeal under Rule 41 rather than directly to the Supreme Court under Rule 65. Abejaron, for his part, did not interpose serious opposition when the Court of Appeals entertained the appeal, did not ask the appellate court to certify the case to the Supreme Court, and actively debated the jurisdictional issue before the Court of Appeals. By this omission and active participation, Abejaron was estopped from raising the procedural objection. Moreover, the result would have been the same had the case been referred to the Supreme Court, as the Court would likewise have held that the claim was within the RTC's jurisdiction.

• Unassigned Errors: Petitioner invoked Rule 51, Section 7, which limits appellate review to assigned errors save for plain or clerical errors. The Court held that this provision should not be read restrictively. Citing Vda. de Javellana vs. Court of Appeals, Baquiran vs. Court of Appeals, and Hernandez vs. Andal, the Court affirmed that appellate courts possess broad discretionary power to consider unassigned errors, especially where the error is patent, where the unassigned error is closely related to an assigned error, or where consideration is necessary for a just decision. The Court of Appeals was therefore justified in ruling on the damages award because there was sufficient record evidence to enable it to reach its own conclusion, and such consideration was necessary to the just and complete resolution of the case.

• Liability for Damages: The Court examined the evidence and agreed with the Court of Appeals that the filing of the estafa charge was not made maliciously. Pepsi could not be faulted for suing on what it believed to be an actionable wrong, even though the suit was eventually dismissed. Its good faith not having been successfully assailed, Pepsi could not be held liable for the damages claimed. Even if Abejaron had sustained injury, he still could not recover for lack of a legal basis. The case was thus one of damnum absque injuria.

• Jurisdiction over claims arising from employer-employee relationships — Where a complaint for damages is based on alleged malicious prosecution and violations of the Civil Code, rather than on the termination of employment or any unfair labor practice under the Labor Code, and where there is no reasonable causal connection between the complaint and the employer-employee relationship, jurisdiction lies with the Regional Trial Court, not the Labor Arbiter. The test is whether the claim could have arisen independently of the employment relationship.

• Estoppel from raising procedural objections — A party who actively participates in appellate proceedings without objecting to a procedural flaw — such as the wrong mode of appeal — and who does not seek certification of the case to the proper tribunal is estopped from raising the procedural objection at a later stage.

• Appellate court's discretion to consider unassigned errors — Under Rule 51, Section 7 of the Rules of Court, an appellate court may, at its option, notice plain errors not specified in the assignment of errors. Unassigned errors closely related to assigned errors, or upon which the determination of the assigned errors is dependent, may also be considered. The court has ample authority to review matters not assigned as errors if their consideration is necessary for a just decision.

• Damnum absque injuria — Damage suffered without legal injury — that is, without violation of a legal right — does not entitle the sufferer to recovery. A party who files a criminal charge in good faith, even if the charge is eventually dismissed, cannot be held liable for damages arising from that filing.

• "The complaint was not anchored on the termination of Mendiola's services per se, but rather on the manner and consequent effects of such termination. Mendiola's complaint being based on alleged violations of Civil Code provisions instead of the Labor Code, his action is basically a civil dispute cognizable by the regular courts." — This passage, quoted from Honiron Philippines, Inc. vs. Intermediate Appellate Court, articulates the test for distinguishing labor disputes from civil claims cognizable by regular courts, central to the jurisdictional ruling.

• "The simple fact is that even if he did sustain them, he still could not be allowed to recover thereon for lack of a legal basis. In short, this is a case of damnum absque injuria." — This statement encapsulates the Court's conclusion on the damages issue, applying the doctrine of damage without legal injury to bar recovery.

• "Under Sec. 7, Rule 51 of the Revised Rules of Court, the Court of Appeals is given an option to consider and pass upon a proven error notwithstanding the fact that it was not specifically assigned and argued in the brief." — This passage, quoted from Vda. de Javellana vs. Court of Appeals, defines the scope of the appellate court's discretionary power to review unassigned errors.

• Honiron Philippines, Inc. vs. Intermediate Appellate Court, G.R. No. 66929, August 13, 1990 — Controlling precedent followed for the proposition that a complaint based on Civil Code violations rather than the Labor Code is a civil dispute cognizable by regular courts.
• Pepsi Cola Distributor of the Philippines, Inc. vs. Gal-lang, 201 SCRA 695 — Followed for the rule that where there is no reasonable causal connection between the complaint and the employer-employee relationship, the labor arbiter has no competence and the regular courts have jurisdiction.
• Vda. de Javellana vs. Court of Appeals, 123 SCRA 799 — Followed for the principle that the Court of Appeals has discretion to consider unassigned errors, especially plain errors and those closely related to assigned errors.
• Baquiran vs. Court of Appeals, 2 SCRA 873 — Followed for the rule that issues not specifically raised may be considered in the interest of justice if they are matters of record bearing on the issues submitted.
• Hernandez vs. Andal, 78 Phil. 96 — Followed for the proposition that appellate courts have broad discretionary power to waive lack of proper assignment of errors and consider errors not assigned.

• Rule 51, Section 7, Rules of Court — Provides that no error which does not affect jurisdiction over the subject matter will be considered unless stated in the assignment of errors and properly argued, save as the court may notice plain errors not specified and clerical errors. The Court interpreted this provision expansively, holding that it grants the appellate court an option to consider proven errors even if not specifically assigned.
• Civil Code provisions — The complaint was based on alleged violations of Civil Code provisions governing damages, distinguishing the claim from one arising under the Labor Code and establishing jurisdiction in the regular courts.

Narvasa, C.J., Griño-Aquino, Medialdea, and Bellosillo, JJ., concurred.