Dayag vs. Canizares, Jr.

The NLRC rule fixing venue at the workplace of the complainant is permissive, not mandatory, and may yield to substantial justice and the constitutional protection to labor; technical rules of procedure in labor cases may likewise be relaxed absent prejudice to the opposing party.

Petitioners were tower crane operators employed by Alfredo Young, a building contractor doing business under the firm name Young's Construction, and were assigned to construction projects in San Juan, Metro Manila and Cebu City. The procedural backdrop is the NLRC's New Rules of Procedure, particularly Rule IV on venue, and Article 221 of the Labor Code, which directs labor arbiters and the Commission to ascertain facts speedily and objectively without regard to technicalities of law or procedure in the interest of due process.

On March 11, 1993, petitioners William Dayag, Edwin Dayag, Eduardo Corton, Edgardo Corton, Leopoldo Nagma, Aloy Flores, and Romeo Punay filed a complaint for illegal dismissal, non-payment of wages, overtime pay, premium pay, holiday pay, service incentive leave, 13th month pay, and actual, moral and exemplary damages against Alfredo Young, a building contractor doing business under the firm name Young's Construction. The complaint was filed with the National Capital Region Arbitration Branch of the NLRC and docketed as NLRC-NCR-Case No. 00-03-01891-93; it was assigned to Labor Arbiter Potenciano Canizares, Jr.

Petitioners alleged that they were hired in 1990 by Young as tower crane operators at his construction site at Platinum 2000 in San Juan, Metro Manila. In November 1991, they were transferred to Cebu City to work at the construction of his Shoemart Cebu project. They worked in Cebu until February 1993, except for Punay, who stayed only until September 29, 1992, and Nagma, who stayed until October 21, 1992.

On January 30, 1993, William Dayag asked permission to go to Manila to attend to family matters. He was allowed to do so but was not paid for the period January 23-30, 1993, allegedly because of his accountability for the loss of certain construction tools. Eduardo Corton had earlier left on January 16, 1993, purportedly due to harassment by Young. In February 1993, Edgardo Corton, Aloy Flores, and Edwin Dayag also left Cebu for Manila, allegedly for the same reason. Thereafter, petitioners banded together and filed the complaint.

Instead of attending the initial hearings set by the labor arbiter, Young filed on July 6, 1993 a motion to transfer the case to the Regional Arbitration Branch, Region VII of the NLRC. He claimed that the workplace where petitioners were regularly assigned was in Cebu City and that, under Section 1(a) of Rule IV of the New Rules of Procedure of the NLRC, the case should have been filed in Cebu City. In support, he submitted a certificate of registration of business name showing his company's address as "Corner Sudlon-España Streets, Pari-an, Cebu City"; a business permit issued by the Office of the Mayor of Cebu City; and a certification by the Philippine National Police-Cebu City Police Station 2 that petitioners had been booked therein for qualified theft upon the complaint of Young's Construction. Petitioners opposed the motion, arguing that all of them, except Punay, were by that time residents of Metro Manila and could not afford trips to Cebu City; they also claimed that respondent had its main office at Corinthian Gardens in Quezon City. Young replied that the Corinthian Gardens address was not his principal place of business but actually his residence, which he also used as a correspondent office for his construction firm.

Agreeing that petitioners' workplace when the cause of action accrued was Cebu City, the labor arbiter, on September 8, 1993, granted Young's motion and ordered the transmittal of the case to the Regional Arbitration Branch of Region VII. Petitioners promptly appealed to the NLRC, which dismissed the appeal on January 31, 1995 for lack of merit. Citing Nestle Philippines, Inc. vs. NLRC and Cruzvale, Inc. vs. Laguesma, petitioners moved for reconsideration. The Commission, on August 25, 1995, annulled and set aside its January 31, 1995 resolution and remanded the case to the original arbitration branch of the National Capital Region for further proceedings. Young then filed his own motion for reconsideration. Finding the two cited cases inapplicable, the Commission reconsidered its August 25, 1995 resolution, reinstated its January 31, 1995 resolution directing the transfer of the case to Cebu City, and ruled that no further motion of a similar nature would be entertained. The February 12, 1996 resolution embodying this action prompted petitioners' recourse to the Supreme Court.

• Defective Motion to Transfer Venue: Petitioners argued that the labor arbiter acted with grave abuse of discretion in entertaining Young's motion to transfer venue because the motion did not specify the time and date when it would be heard, in violation of Sections 4 and 5 of Rule 15 of the Revised Rules of Court, which they claimed applied suppletorily through Section 3 of Rule I of the New Rules of Procedure of the NLRC.
• Waiver of Venue: Petitioners maintained that Young waived his right to question venue because his motion to transfer venue was actually a position paper and, by filing it, he admitted and denied certain allegations in the complaint; they argued that he was estopped from questioning venue.
• Improper Venue: Petitioners contended that the public respondents erred in concluding that their workplace was in Cebu City and that the proper venue was Cebu City; they asserted that all of them, except Punay, were residents of Metro Manila and could not afford trips to Cebu City, and that respondent had its main office at Corinthian Gardens in Quezon City.
• Reliance on Nestle and Cruzvale: Petitioners cited Nestle Philippines, Inc. vs. NLRC and Cruzvale, Inc. vs. Laguesma in support of their motion for reconsideration, arguing that the NLRC Rules on venue were not complete and that the Rules of Court on venue had suppletory effect.

• Workplace in Cebu: Young claimed that the workplace where petitioners were regularly assigned was Cebu City and that, under Section 1(a) of Rule IV of the New Rules of Procedure of the NLRC, the case should have been filed in Cebu City.
• Evidence of Cebu Business: Young submitted a certificate of registration of business name showing his company's address as "Corner Sudlon-España Streets, Pari-an, Cebu City"; a business permit issued by the Office of the Mayor of Cebu City; and a PNP-Cebu City Police Station 2 certification that petitioners had been booked for qualified theft upon the complaint of Young's Construction.
• Corinthian Gardens Address: Young declared that the Corinthian Gardens address in Quezon City was not his principal place of business but his residence, which he also used as a correspondent office for his construction firm.
• Motion to Transfer: Young seasonably filed a motion to transfer venue to the Regional Arbitration Branch, Region VII, Cebu City.

• Technical Defect in Motion to Transfer Venue: Whether the labor arbiter acted with grave abuse of discretion in entertaining Young's motion to transfer venue despite its alleged failure to comply with Sections 4 and 5 of Rule 15 of the Revised Rules of Court.
• Waiver of Venue: Whether Young waived his right to question venue by filing a motion to transfer venue that was allegedly also a position paper, and whether he was estopped from questioning venue.
• Proper Venue: Whether the public respondents erred in concluding that petitioners' workplace was in Cebu City and that the proper venue was Cebu City, or whether the National Capital Region Arbitration Branch could retain venue under the permissive NLRC rule and the constitutional protection to labor.

• Technical Defect in Motion to Transfer Venue: No. The labor arbiter did not commit grave abuse of discretion; technical rules of procedure may be relaxed in labor cases under Article 221 of the Labor Code, and petitioners filed an opposition that was considered, so no prejudice was shown.
• Waiver of Venue: No. Under Section 1(c), Rule IV of the NLRC Rules, improper venue is waived only if not objected to before or at the time of filing position papers; a party does not waive venue by questioning it simultaneously with the filing of a position paper, and Section 1(d) allows transfer upon motion by the proper party in meritorious cases.
• Proper Venue: No. Section 1(a), Rule IV of the NLRC Rules is merely permissive; the NLRC resolution transferring the case to Cebu City was set aside, and the resolution remanding it to the National Capital Region Arbitration Branch was reinstated and affirmed because Manila was not oppressive to Young and would expedite the proceedings.

• Technical Defect in Motion to Transfer Venue: The application of technical rules of procedure in labor cases may be relaxed to serve substantial justice. Article 221 of the Labor Code provides that rules of evidence prevailing in courts of law or equity shall not be controlling and that the Commission, its members, and labor arbiters shall use every and all reasonable means to ascertain the facts speedily and objectively without regard to technicalities of law or procedure in the interest of due process. Although a motion that does not comply with Rule 15 should not ordinarily be accepted for filing, a rigid application of the rule may be disregarded where it would result in manifest failure or miscarriage of justice. Petitioners filed an opposition to the motion to transfer venue, and the labor arbiter considered it when issuing the September 8, 1993 order; no undue prejudice was shown. Nullifying Young's motion on a mere technicality was therefore improper.
• Waiver of Venue: The claim that Young waived venue was rejected. Section 1(c), Rule IV of the NLRC Rules provides that improper venue is waived if not objected to before or at the time of filing position papers. Consequently, there is no waiver of improper venue if a party questions venue simultaneously with the filing of a position paper. The NLRC Rules do not require a party to object solely to venue on penalty of waiver. Section 1(d) allows venue to be changed or transferred upon motion by the proper party in meritorious cases, and Young seasonably made representations to transfer venue. Objections to venue are deemed waived if the respondent, through conduct, manifests satisfaction with venue until after trial or abides by it until the matter has proceeded to a hearing; no such waiver by estoppel could be attributed to Young, who consistently and persistently contested venue even before trial.
• Proper Venue: Although the procedural objections failed, the petition was overtaken by events because of Sulpicio Lines, Inc. vs. NLRC. In Sulpicio Lines, the question of venue was held to pertain essentially to the trial and to relate more to the convenience of the parties than to the substance and merits of the case. The permissive rules on venue are intended to assure convenience for the plaintiff and his witnesses and to promote the ends of justice. This principle applies with more reason in labor and management cases because of the well-entrenched doctrine that the State shall afford full protection to labor. Section 1(a), Rule IV of the NLRC Rules is obviously permissive, using the word "may," allowing a different venue when the interests of substantial justice demand it, provided the venue chosen is not altogether oppressive to the employer. The worker, as the economically disadvantaged party, must have the nearest governmental machinery placed at his immediate disposal, and the other party should not be given the choice of another competent agency in another place if that would unduly burden the worker. Even where venue has been stipulated, the Court has set it aside if it would be grossly inconvenient to one party as to virtually negate his claim. In this case, the National Capital Region Arbitration Branch was not oppressive to Young because his residence in Corinthian Gardens also served as his correspondent office. Filing the suit in Manila would not cause him as much inconvenience as it would the petitioners, who were then residents of Metro Manila, if the case were heard in Cebu. Hearing the case in Manila would expedite proceedings and bring about a speedy resolution. Nestle and Cruzvale were distinguished: Nestle's suppletory application of the Rules of Court on venue applies only where petitioners are labor unions or where a single act of an employer gives rise to a common cause of action for many employees working in different branches or workplaces, and petitioners here were not a union and were not assigned to different workplaces; Cruzvale involved a certification election and the DOLE Region IV Office, not a labor complaint of this kind.

• Relaxation of Technical Rules in Labor Cases — In labor proceedings, the application of technical rules of procedure may be relaxed to serve the demands of substantial justice. Article 221 of the Labor Code provides that rules of evidence prevailing in courts of law or equity shall not be controlling and that the Commission, its members, and labor arbiters shall use every and all reasonable means to ascertain the facts speedily and objectively without regard to technicalities of law or procedure in the interest of due process. The Court applied this doctrine to excuse the failure of Young's motion to transfer venue to comply strictly with the notice-of-hearing requirements of Rule 15, especially because petitioners filed an opposition that was considered and showed no prejudice.
• Permissive Nature of Venue in Labor Cases — Section 1(a), Rule IV of the NLRC New Rules of Procedure, which fixes venue at the Regional Arbitration Branch having jurisdiction over the workplace of the complainant, is merely permissive because it uses the word "may." A different venue may be allowed when the interests of substantial justice demand it, provided the venue chosen is not altogether oppressive to the employer. The constitutional protection accorded to labor is a paramount and compelling factor. The Court applied this doctrine by retaining venue in the National Capital Region Arbitration Branch because Young's Corinthian Gardens residence also served as his correspondent office, while petitioners were residents of Metro Manila, so Manila was not oppressive and would expedite the case.
• No Waiver of Venue by Simultaneous Objection and Position Paper — Under Section 1(c), Rule IV of the NLRC Rules, improper venue is waived if not objected to before or at the time of filing position papers. A party does not waive improper venue by questioning it simultaneously with the filing of a position paper, and the rules do not require a party to object solely to venue on penalty of waiver. The Court applied this doctrine to hold that Young did not waive venue.
• Waiver of Venue by Estoppel or Conduct — Objections to venue are deemed waived if the respondent, through conduct, manifests satisfaction with the venue until after trial, or abides by it until the matter has proceeded to a hearing. No waiver by estoppel can be attributed to a respondent who consistently and persistently contests venue even before trial. The Court applied this doctrine to Young, who contested venue from the outset.
• Suppletory Application of Rules of Court on Venue in Labor Cases — The suppletory application of Section 2, Rule 4 of the Rules of Court under Nestle Philippines, Inc. vs. NLRC applies only where the petitioners are labor unions or where a single act of an employer gives rise to a cause of action common to many employees working in different branches or workplaces. It does not apply where the employees are not a union and are not assigned to different workplaces. The Court applied this limitation to reject petitioners' reliance on Nestle.

• "This provision is obviously permissive, for the said section uses the word “may,” allowing a different venue when the interests of substantial justice demand a different one. In any case, as stated earlier, the Constitutional protection accorded to labor is a paramount and compelling factor, provided the venue chosen is not altogether oppressive to the employer." — This is the Court's canonical formulation of the permissive venue rule in labor cases, explaining why Section 1(a), Rule IV of the NLRC Rules does not mandatorily confine the case to the workplace.
• "The worker, being the economically-disadvantaged party—whether as complainant/petitioner or as respondent, as the case may be, the nearest governmental machinery to settle the dispute must be placed at his immediate disposal, and the other party is not to be given the choice of another competent agency sitting in another place as this will unduly burden the former." — This passage states the rationale for favoring the worker's convenience in venue determinations and supports the Court's retention of the NCR venue.
• "As provided by Article 221 of the Labor Code “rules of evidence prevailing in courts of law or equity shall not be controlling and it is the spirit and intention of this Code that the Commission and its members and the Labor Arbiters shall use every and all reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of law or procedure, all in the interest of due process.”" — This quotation supplies the statutory basis for relaxing technical rules in labor proceedings, which the Court applied to Young's defective motion.
• "Consequently, there is no waiver of improper venue if a party questions venue simultaneously with the filing of a position paper." — This is the Court's direct holding on the waiver issue, construing Section 1(c), Rule IV of the NLRC Rules.

• Sulpicio Lines, Inc. vs. NLRC, 254 SCRA 506 (1996) — The controlling precedent relied upon by the Court. It held that the question of venue essentially pertains to the trial and relates more to the convenience of the parties than to the substance and merits of the case; Section 1(a), Rule IV of the NLRC Rules is merely permissive; and the constitutional protection to labor is a paramount and compelling factor, provided the venue chosen is not altogether oppressive to the employer. The Court used it to set aside the transfer to Cebu City and reinstate the NCR venue.
• Sweet Lines vs. Teves, 83 SCRA 361 (1978) — Cited in Sulpicio Lines and relied upon by the Court for the principle that an agreement on venue will not be held valid where it practically negates the action of the claimant, because the philosophy underlying transfer of venue is the convenience of the plaintiff and his witnesses and the promotion of the ends of justice. The Court applied this rationale to the labor dispute.
• Nestle Philippines, Inc. vs. NLRC, 209 SCRA 834 (1992) — Cited by petitioners but distinguished. It ruled that Rule IV of the NLRC Rules does not constitute a complete rule on venue and that Section 2, Rule 4 of the Rules of Court has suppletory effect, but the Court held that this applies only where petitioners are labor unions or where a single act of an employer gives rise to a common cause of action for many employees working in different branches or workplaces. It did not apply because petitioners were not a union and were not assigned to different workplaces.
• Cruzvale, Inc. vs. Laguesma, 238 SCRA 389 (1994) — Cited by petitioners but distinguished. It involved the propriety of the DOLE Region IV Office taking cognizance of a certification election petition when the company's place of business was in Cubao, Quezon City and the petitioning union's workplace was elsewhere. The Court found it inapplicable because the instant case did not involve a certification election and the workplace of the employees and place of business of the employer were not different.
• People vs. Leviste, 255 SCRA 238 (1996) — Cited for the principle that where a rigid application of procedural rules will result in a manifest failure or miscarriage of justice, technicalities may be disregarded in order to resolve the case on the merits. The Court used this to justify relaxing the Rule 15 notice requirement for Young's motion.
• El Toro Security Agency, Inc. vs. NLRC, 256 SCRA 363 (1996) — Cited for the principle that rules of procedure must be interpreted in a manner that will help secure and not defeat justice. The Court relied on this in rejecting petitioners' technical objection to the motion to transfer venue.
• Lopez, Jr. vs. NLRC, 245 SCRA 644 (1995); Philippine-Singapore Ports Corp. vs. NLRC, 218 SCRA 77 (1993); Sadol vs. Pilipinas Kao, Inc., 186 SCRA 491 (1990); PT&T Corporation vs. NLRC, 183 SCRA 451 (1990); Ford Philippines Salaried Employees Association vs. NLRC, 156 SCRA 284 (1987) — Cited as the long line of decisions holding that technical rules of procedure in labor cases may be relaxed to serve substantial justice. The Court invoked them to support its refusal to nullify Young's motion on a technicality.

• Article 221, Labor Code — Provides that rules of evidence prevailing in courts of law or equity shall not be controlling and that the Commission, its members, and labor arbiters shall use every and all reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of law or procedure, all in the interest of due process. The Court applied this to relax the technical requirements for Young's motion to transfer venue.
• Section 1(a), Rule IV, New Rules of Procedure of the NLRC — Provides that all cases which labor arbiters have authority to hear and decide may be filed in the Regional Arbitration Branch having jurisdiction over the workplace of the complainant/petitioner; for venue, workplace is the place or locality where the employee is regularly assigned when the cause of action arose. The Court held this provision merely permissive because it uses "may."
• Section 1(c), Rule IV, New Rules of Procedure of the NLRC — Provides that when improper venue is not objected to before or at the time of filing position papers, the question is deemed waived. The Court applied this to hold that Young did not waive venue by questioning it simultaneously with the filing of a position paper.
• Section 1(d), Rule IV, New Rules of Procedure of the NLRC — Provides that venue may be changed or transferred to a different Regional Arbitration Branch by written agreement of the parties or when the Commission or Labor Arbiter before whom the case is pending so orders, upon motion by the proper party in meritorious cases. The Court applied this to uphold Young's motion as seasonably made.
• Sections 4 and 5, Rule 15, Revised Rules of Court — Require that every written motion be set for hearing by the applicant and that the notice of hearing specify the time and date of the hearing and be served at least three days before the hearing. Petitioners invoked these provisions, but the Court declined to apply them rigidly in the labor case because no prejudice was shown.
• Section 3, Rule I, New Rules of Procedure of the NLRC — Petitioners invoked this provision for the suppletory application of the Rules of Court. The Court did not apply the Rules of Court rigidly and instead relaxed the technical requirement.
• Section 2, Rule 4, Rules of Court — Provides that all other personal actions may be commenced and tried where the plaintiffs or any of the principal plaintiffs resides, or where the defendant or any of the principal defendants resides, or in the case of a non-resident defendant where he may be found, at the election of the plaintiff. The Court discussed this in relation to Nestle but found its suppletory application limited and inapplicable to the case.
• Constitutional protection to labor — The Court cited the constitutional protection accorded to labor as a paramount and compelling factor in allowing a different venue, provided the venue chosen is not altogether oppressive to the employer.

Narvasa, C.J., Kapunan and Purisima, JJ., concurred.