Luzon Development Bank vs. Association of Luzon Development Bank Employees

The decision or award of a voluntary arbitrator or a panel of arbitrators in a labor dispute is a quasi-judicial adjudication subject to appellate review by the Court of Appeals via a petition for certiorari under Section 9 of B.P. Blg. 129, as amended.

The Association of Luzon Development Bank Employees (ALDBE) and Luzon Development Bank (LDB) submitted a labor dispute to voluntary arbitration. The issue was whether the bank violated the Collective Bargaining Agreement (CBA) and a related Memorandum of Agreement on promotion. The Voluntary Arbitrator, Atty. Ester S. Garcia, received the ALDBE's position paper but none from the LDB despite a reminder. On May 24, 1995, the arbitrator rendered a decision finding that the bank had not adhered to the agreements. LDB then filed a petition for certiorari and prohibition directly with the Supreme Court.

• Nature of the Dispute: A submission agreement between Luzon Development Bank (LDB) and the Association of Luzon Development Bank Employees (ALDBE) sought to resolve whether the bank violated the CBA and a Memorandum of Agreement dated April 1994 regarding promotions.
• Arbitration Proceedings: The Voluntary Arbitrator, Atty. Ester S. Garcia, scheduled the submission of position papers for December 1-15, 1994. ALDBE submitted its paper on January 18, 1995. LDB failed to submit its paper despite a reminder from the arbitrator.
• Arbitrator's Decision: On May 24, 1995, without LDB's position paper, the Voluntary Arbitrator rendered a decision finding that the Bank had not adhered to the CBA provision or the Memorandum of Agreement on promotion.
• Petition to the Supreme Court: LDB filed a petition for certiorari and prohibition directly with the Supreme Court, seeking to set aside the arbitrator's decision and prohibit its enforcement.

• Jurisdictional Error: Petitioner LDB argued, by implication through its petition for certiorari, that the Voluntary Arbitrator committed grave abuse of discretion amounting to lack or excess of jurisdiction in rendering the decision without its position paper.

• Finality of Award: Respondent ALDBE's position, as the prevailing party before the arbitrator, was that the arbitrator's award was final and binding, a premise underlying the arbitration process to which both parties had agreed.

• Proper Appellate Remedy: Whether the decision of a voluntary arbitrator may be appealed directly to the Supreme Court via a petition for certiorari.
• Jurisdictional Classification: Whether a voluntary arbitrator or a panel of arbitrators is a quasi-judicial agency or instrumentality whose decisions are appealable to the Court of Appeals.

• Proper Appellate Remedy: The petition was referred to the Court of Appeals. Direct resort to the Supreme Court from a voluntary arbitrator's award is improper. The proper remedy is a petition for certiorari filed with the Court of Appeals.
• Jurisdictional Classification: A voluntary arbitrator, by the nature of their functions, acts in a quasi-judicial capacity and is comprehended within the concept of a "quasi-judicial instrumentality" under Section 9 of B.P. Blg. 129, as amended. Consequently, the Court of Appeals has exclusive appellate jurisdiction over their final awards.

• Voluntary Arbitrator as Quasi-Judicial Instrumentality — A voluntary arbitrator or a panel of arbitrators, in performing their state-delegated function of resolving labor disputes, acts in a quasi-judicial capacity. They are considered a "quasi-judicial instrumentality" whose decisions are subject to the appellate review of the Court of Appeals via a petition for certiorari under Section 9 of B.P. Blg. 129, as amended by R.A. No. 7902. This places them on par with other quasi-judicial agencies for purposes of judicial review, ensuring a uniform procedure for appellate review.

• "The voluntary arbitrator no less performs a state function pursuant to a governmental power delegated to him under the provisions therefor in the Labor Code and he falls, therefore, within the contemplation of the term 'instrumentality' in the aforequoted Sec. 9 of B.P. 129." — This passage establishes the legal basis for classifying voluntary arbitrators as quasi-judicial instrumentalities.
• "As a matter of policy, this Court shall henceforth remand to the Court of Appeals petitions of this nature for proper disposition." — This declares the new procedural policy for handling appeals from voluntary arbitrators.

• Volkschel Labor Union, et al. v. NLRC, et al., 98 SCRA 314 (1980) — Cited for the ruling that awards of voluntary arbitrators determine the rights of parties and thus have the same legal effect as judgments of a court.
• Oceanic Bic Division (FFW), et al. v. Romero, et al., 130 SCRA 392 (1984) — Cited for the ruling that a voluntary arbitrator acts in a quasi-judicial capacity.
• First Lepanto Ceramics, Inc. v. CA, et al., 231 SCRA 30 (1994) — Cited in support of the policy to provide a uniform procedure for appellate review of quasi-judicial adjudications.

• Article 261, Labor Code — Grants voluntary arbitrators exclusive original jurisdiction over the interpretation or implementation of the CBA and the interpretation or enforcement of company personnel policies.
• Article 262-A, Labor Code — Provides that the award or decision of the voluntary arbitrator shall be final and executory after ten (10) calendar days from receipt.
• Section 9, B.P. Blg. 129 (as amended by R.A. No. 7902) — Grants the Court of Appeals exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of quasi-judicial agencies, instrumentalities, boards or commissions.
• Section 22, R.A. No. 876 (Arbitration Law) — Provides that an arbitration award may be confirmed by the Regional Trial Court, thereby equating the arbitrator's award with a court judgment.

Padilla, Regalado, Davide, Jr., Bellosillo, Puno, Vitug, Kapunan, Mendoza, Francisco, and Hermosisima, Jr., JJ., concur. Feliciano, J., concurs in the result. Narvasa, C.J. and Melo, J. are on leave.