Casilda D. Tan and/or C & L Lending Investor vs. Luzvilla B. Dagpin

A final and executory judgment that has been fully executed and satisfied may no longer be altered, amended, or modified, and a party who has received full payment of a monetary award may not seek a recomputation or supplemental execution based on a subsequent resolution that did not modify the original judgment. Additionally, where a party has appeared by counsel, service of notices must be made upon the counsel of record, and service upon the party himself is not legally effective to commence the reglementary period.

Petitioners Casilda D. Tan and/or C & L Lending Investor were the employers of respondent Luzvilla B. Dagpin. The case arose from a labor dispute involving respondent's alleged illegal dismissal, which was litigated through the labor tribunals and appellate courts. The dispute involved the computation of monetary benefits, specifically backwages and separation pay, and the proper reckoning of the appeal period before the NLRC.

Petitioners Casilda D. Tan and/or C & L Lending Investor were the employers of respondent Luzvilla B. Dagpin. On September 12, 2003, the Labor Arbiter declared petitioners liable for respondent's illegal dismissal, awarding separation pay, backwages, service incentive leave pay, 13th month pay, moral and exemplary damages, and attorney's fees. Petitioners appealed to the NLRC, but the NLRC dismissed the appeal on July 29, 2004 for non-perfection due to failure to attach the required certification of non-forum shopping, and denied the subsequent motion for reconsideration.

Petitioners then filed a petition for certiorari before the Court of Appeals, docketed as CA-G.R. SP No. 00038. On January 11, 2005, the Court of Appeals issued a temporary restraining order against the enforcement of the Labor Arbiter's Decision. Meanwhile, Entry of Judgment dated January 17, 2005 was issued on the NLRC Resolution dated July 29, 2004. On March 29, 2005, respondent filed with the Executive Labor Arbiter a Motion to Admit Computation and Issuance of Writ of Execution, computing her separation pay, backwages, and other claims up to the finality of judgment on January 10, 2005 in the total sum of P1,080,566.66. Petitioners opposed.

On May 17, 2005, after the TRO expired, the ELA ordered the release of petitioners' cash bond of P449,665.90 in partial satisfaction of the judgment. In an Order dated May 19, 2005, the ELA granted respondent's motion and awarded her a total of P1,005,146.83. After deducting the cash bond, the ELA ordered the issuance of a writ of execution on the remaining amount of P555,480.93. The writ was fully enforced and satisfied as of October 12, 2005.

The Court of Appeals, by Decision dated October 18, 2007, dismissed the petition for certiorari for lack of merit. Petitioners further sought relief from the Court through a Petition for Review on Certiorari docketed as G.R. 182268, which the Court denied under Resolution dated June 23, 2008, becoming final and executory on August 21, 2008.

Respondent, on November 3, 2008, filed another Motion for Approval of Computation and Issuance of Writ of Execution, and later, on November 12, 2008, a Manifestation seeking additional increments to her monetary award, claiming that her backwages and separation pay should be computed up to August 21, 2008. Petitioners opposed. When the motion was heard on December 16, 2008, respondent appeared without her counsel Atty. Lawrence Carin, who had advised her to engage the services of Atty. Kenneth P. Rosal for the incident at hand. Atty. Carin was allegedly attending to personal matters in Dumaguete City and had "suspended" himself from the practice of law due to failure to comply with MCLE requirements. Atty. Rosal entered his appearance as counsel for respondent.

By Order dated February 19, 2009, the ELA denied respondent's motion, ruling that since respondent had already enforced and received full payment of the monetary award up until January 10, 2005, she was estopped from claiming increments. On April 13, 2009, Atty. Rosal filed respondent's appeal memorandum, but the NLRC dismissed it under Resolution dated August 27, 2009 for having been filed out of time. The NLRC ruled that the ten-day appeal period must be reckoned from respondent's receipt of the ELA's Order on March 19, 2009, not from Atty. Rosal's purported receipt on March 30, 2009, since Atty. Rosal was not respondent's counsel of record and Atty. Carin was no longer her counsel. Respondent's appeal was filed fifteen days late.

In her motion for reconsideration, respondent explained that the ELA Order, albeit addressed to "L. Dagpin c/o Atty. Kenneth P. Rosal," was directly delivered to her on March 19, 2009. Since Atty. Carin could not prepare her appeal as he had "suspended" himself from practice and was attending an IBP Convention in Bacolod City from March 26 to 29, 2009, he instructed her to refer the case to Atty. Rosal, who was also attending the convention. She was able to give the Order to Atty. Rosal only on March 30, 2009, and he filed the appeal on April 13, 2009. The NLRC denied reconsideration on October 30, 2009.

Respondent filed a petition for certiorari before the Court of Appeals, asserting that the ten-day appeal period should be reckoned from her counsel's receipt, not her own. The Court of Appeals reversed, ruling that service of the February 19, 2009 Order on respondent herself was not the legal service contemplated by law, and the NLRC gravely abused its discretion in dismissing the appeal. On the merits, the Court of Appeals decreed that recomputation of monetary consequences does not violate the principle of immutability of final judgments, and ordered the labor arbiter to recompute the monetary awards due respondent up to August 21, 2008, deducting the amount already received, with 12% legal interest from finality of judgment until fully paid. Petitioners' motion for reconsideration was denied on March 26, 2014.

• Timeliness of Appeal: Petitioners argued that the Court of Appeals erred in applying compassionate justice in allowing respondent's appeal to the NLRC despite the fact that it was filed beyond the ten-day reglementary period.
• Immutability of Final Judgment: Petitioners argued that a recomputation and payment of respondent's accrued benefits violates the principle of immutability of final judgment, since respondent had already executed in full the NLRC Resolution dated July 29, 2004 which became final and executory on January 10, 2005, and she is no longer entitled to additional benefits up until the finality of the Court's Resolution on August 21, 2008.

• Timeliness of Appeal: Respondent posited that the Court of Appeals correctly applied compassionate justice in considering her appeal to have been timely filed before the NLRC.
• Recomputation of Benefits: Respondent argued that a recomputation of her accrued benefits does not violate the principle of immutability of judgment, and the Court of Appeals properly awarded her additional benefits up until the finality of the Court's Resolution on August 21, 2008.

• Timeliness of Appeal: Whether the Court of Appeals erred in ruling that respondent's appeal to the NLRC was timely filed.
• Recomputation of Monetary Awards: Whether the Court of Appeals erred in ruling that respondent is entitled to a recomputation of and consequently an increase in the monetary awards already given and paid her during the execution of the labor arbiter's decision.

• Timeliness of Appeal: Yes, the Court of Appeals correctly ruled that respondent's appeal was timely filed. Where a party appears by counsel, all notices must be served on the attorney of record, and service on any person other than the counsel of record is not legally effective nor does it commence the reglementary period.
• Recomputation of Monetary Awards: No. Respondent is not entitled to recomputation of or increase of the monetary award already paid her. A final judgment that has been fully executed and satisfied may no longer be altered, amended, or modified, and granting a recomputation would violate the principle against unjust enrichment.

• Timeliness of Appeal: The Court ruled that where a party appears by attorney in an action or proceeding in a court of record, all notices must be served on the attorney of record, pursuant to Section 2 of Rule 13 of the Rules of Court. Service of the court's order on any person other than the counsel of record is not legally effective, nor binding on the party, nor may it start the corresponding reglementary period. This rule is founded on considerations of fair play, as a party engages counsel precisely because he or she does not feel competent to deal with the intricacies of law and procedure. In the absence of a notice of withdrawal or substitution of counsel, the court will rightly assume that the counsel of record continues to represent his client, and receipt of notice by the former is the reckoning point of the reglementary period. Here, respondent's counsel of record, Atty. Carin, merely instructed respondent to refer the case to Atty. Rosal, but there was no showing that he filed a notice of withdrawal or that respondent terminated his services. Notices should have been sent to Atty. Carin as counsel of record, or at least to Atty. Rosal, who had entered his appearance. The fact that the ELA Order was addressed to "L. Dagpin c/o Atty. Kenneth P. Rosal" indicated that the NLRC acknowledged Atty. Rosal as respondent's new counsel. However, the Order was served directly on respondent herself, which was not proper service. Consequently, the reglementary period for appeal did not commence from respondent's receipt. Even then, Atty. Rosal was deemed to have acknowledged the Order when he computed the ten-day period from March 30, 2009 to April 9, 2009. Since April 9, 2009 fell on a holiday (Day of Valor and Maundy Thursday), and April 10, 11, and 12, 2009 were also holidays (Good Friday, Black Saturday, and Easter Sunday), the filing of respondent's memorandum of appeal on April 13, 2009 was within the reglementary period. In any event, the Court has relaxed the observance of procedural rules to advance substantial justice, and the NLRC is not bound by the technical niceties of law and procedure.

• Recomputation of Monetary Awards: The Court ruled that execution is the final stage of litigation, the end of the suit. Labor laws dictate that backwages must be computed from the time the employee was unjustly dismissed until his or her actual reinstatement or upon payment of his or her separation pay if reinstatement is no longer feasible. The employer's obligation to the employee continues to accumulate until he actually implements the reinstatement aspect of the final judgment or fully satisfies the monetary award in case reinstatement is no longer possible. It is undisputed that the NLRC Resolution dated July 29, 2004 became final and executory on January 10, 2005, and the corresponding writ of execution was implemented and satisfied in full. Although petitioners continued to fight the case before the Court of Appeals and the Court, they yielded to the execution of judgment sought by respondent way back in 2005. The Court's Resolution dated June 23, 2008 did not modify, let alone alter, the long executed judgment of the NLRC. Since petitioners had already satisfied the final monetary benefits awarded to respondent, the latter may not ask for another round of execution, lest it violates the principle against unjust enrichment. The Court of Appeals' application of Javellana, Jr. vs. Belen and Session Delights Ice Cream & Fast Foods vs. Hon. Court of Appeals was misplaced, as there was no prior execution in those cases, unlike here where the NLRC judgment had long been executed and satisfied. A final judgment may no longer be altered, amended, or modified, even if the alteration is meant to correct a perceived error in conclusions of fact and law, and more so when such final judgment had already been executed and fully satisfied. Respondent's receipt of the full separation pay and other benefits effectively severed the employer-employee relationship, and she has no more right to demand further benefits as such.

• Service of Notices Upon Counsel of Record — Where a party appears by attorney in an action or proceeding in a court of record, all notices must be served on the attorney of record. Service of the court's order on any person other than the counsel of record is not legally effective, nor binding on the party, nor may it start the corresponding reglementary period for subsequent procedural steps. In the absence of a notice of withdrawal or substitution of counsel, the court will rightly assume that the counsel of record continues to represent his client, and receipt of notice by the former is the reckoning point of the reglementary period. The Court applied this rule to hold that the ELA's service of its Order directly on respondent, rather than on her counsel of record, was not proper service, and thus the appeal period did not commence from her receipt.

• Immutability of Final Judgments — A final judgment may no longer be altered, amended, or modified, even if the alteration, amendment, or modification is meant to correct a perceived error in conclusions of fact and law, regardless of what court renders it. This is especially true when such final judgment had already been executed and fully satisfied. The Court applied this doctrine to bar respondent's claim for recomputation of monetary awards, as the NLRC judgment had been fully executed and satisfied in 2005, and the subsequent Supreme Court Resolution did not modify that judgment.

• Unjust Enrichment — A party who has received full payment of a monetary award may not seek another round of execution, as it would violate the principle against unjust enrichment. The Court applied this principle to hold that respondent, having already received full separation pay and other benefits, effectively severed the employer-employee relationship and had no more right to demand further benefits.

• "Where a party appears by attorney in an action or proceeding in a court of record, all notices must be served on the attorney of record." — This states the foundational rule on service of notices, which the Court applied to determine the timeliness of respondent's appeal to the NLRC.

• "Service of the court's order on any person other than the counsel of record is not legally effective, nay, binding on the party; nor may it start the corresponding reglementary period for the subsequent procedural steps which may be taken by the attorney." — This articulates the consequence of improper service, which was the basis for ruling that respondent's appeal was timely filed.

• "It is settled that a final judgment may no longer be altered, amended, or modified, even if the alteration, amendment or modification is meant to correct a perceived error in conclusions of fact and law and regardless of what court renders it." — This states the doctrine of immutability of final judgments, which the Court applied to bar respondent's claim for recomputation of monetary awards.

• "To repeat, granting a recomputation and, consequently, another round of execution would indubitably alter the original decision which had been completely satisfied, nay, unjust enrichment would certainly result." — This summarizes the Court's reasoning for denying respondent's claim for additional monetary benefits.

• Cervantes vs. City Service Corporation and Valentin Prieto, Jr., 784 Phil. 694, 698 (2016) — Cited as authority for the rule that service of a court's order on any person other than the counsel of record is not legally effective and does not commence the reglementary period.
• Zoleta vs. Hon. Drilon, 248 Phil. 777, 783 (1988) — Cited for the rationale behind the rule on service of notices upon counsel, founded on considerations of fair play.
• Manaya vs. Alabang Country Club Incorporated, 552 Phil. 226, 233 (2007) — Cited for the rule that in the absence of a notice of withdrawal or substitution of counsel, the counsel of record continues to represent the client, and receipt of notice by the former is the reckoning point of the reglementary period.
• Malixi vs. Baltazar, G.R. No. 208224, November 22, 2017, 846 SCRA 244, 260 — Cited for the principle that the Court has relaxed the observance of procedural rules to advance substantial justice.
• La Sallian Educational Innovators Foundation, Inc. vs. Commissioner of Internal Revenue, G.R. No. 202792, February 27, 2019 — Cited for the principle that legal technicalities may be excused when strict adherence will impede the achievement of justice.
• Diamond Taxi vs. Llamas, Jr., 729 Phil. 364, 380 (2014) — Cited for the principle that a party should be given the fullest opportunity to establish the merits of his or her action rather than lose on mere technicalities.
• Malixi vs. Mexicali Philippines, et al., 786 Phil. 672, 684-685 (2016) — Cited for the principle that the NLRC is not bound by the technical niceties of law and procedure.
• Mt. Carmel College vs. Resuena, et al., 561 Phil. 620, 645 (2007) — Cited for the rule that execution is the final stage of litigation, and that backwages must be computed from the time of unjust dismissal until actual reinstatement or payment of separation pay.
• Javellana, Jr. vs. Belen, 628 Phil. 241 (2010) — Distinguished by the Court, as there was no prior execution in that case, unlike in the present case.
• Session Delights Ice Cream & Fast Foods vs. Hon. Court of Appeals, 625 Phil. 612 (2010) — Distinguished by the Court, as there was no prior execution in that case, unlike in the present case.
• Mercury Drug Corporation, et al. vs. Spouses Huang, et al., 817 Phil. 434, 445 (2017) — Cited for the doctrine of immutability of final judgments.
• National Housing Authority vs. Court of Appeals, et al., 731 Phil. 400, 405 (2014) — Cited in support of the doctrine of immutability of final judgments.
• Sarona vs. NLRC, 679 Phil. 394, 423 (2012) — Cited for the principle that receipt of full separation pay effectively severs the employer-employee relationship.
• Triad Security & Allied Services, Inc. vs. Ortega, 517 Phil. 133, 149 (2006) — Cited for the principle that receipt of full separation pay effectively severs the employer-employee relationship.

• Section 2, Rule 13 of the Rules of Court — Provides that if any party has appeared by counsel, service upon him shall be made upon his counsel or one of them, unless service upon the party himself is ordered by the court. The Court applied this provision to determine that the ELA's service of its Order directly on respondent, rather than on her counsel of record, was not proper service.

Peralta, C.J. (Chairperson-First Division), Caguioa, J. Reyes, Jr., and Lopez, JJ., concurred.