Ro-Ann Veterinary Manufacturing, Inc. vs. Bingbing

Satisfaction of a judgment award through enforcement of a writ of execution issued by the Labor Arbiter does not render a pending petition for certiorari before the Court of Appeals moot and academic, because a Rule 65 petition is an independent action distinct from the proceedings before the NLRC, and payment made in strict compliance with a writ of execution cannot be construed as voluntary settlement of claims.

Ro-Ann Veterinary Manufacturing, Inc. is a corporation engaged in the sale of veterinary products. Respondents Fernando A. Bingbing and Gilbert C. Villaseñor were employed by the corporation as technical sales representatives, tasked with selling and delivering veterinary products, collecting payments from customers, and remitting the same to the corporation. Petitioner Rafaelito Lagat, Jr. served as the corporation's Sales Team Leader in the Bicol region, doing business under the name "RJ2L Enterprise." Petitioner Ronilo Dela Cruz was also named in the petition. The dispute arose from the termination of respondents' employment and the subsequent illegal dismissal complaints filed before the NLRC.

Fernando A. Bingbing and Gilbert C. Villaseñor were employed by Ro-Ann Veterinary Manufacturing, Inc. as technical sales representatives. Bingbing was hired in 2013 through petitioner Rafaelito Lagat, Jr., the corporation's Sales Team Leader in the Bicol region, who conducted business under the name "RJ2L Enterprise." Villaseñor had been employed by the corporation as early as 2008. As sales representatives, the respondents were tasked with the sale and delivery of veterinary products, the collection of payments from customers, and the remittance of those payments to the corporation.

Sometime around March 1, 2014, respondents learned from several of their clients that the corporation had released an advisory informing customers that the two were no longer connected with the company. The advisory, sent by petitioner Lagat, read: "GUD DAY SIR/MADAM, I WOULD LIKE TO INFORM YOU THAT GILBERT VILLASEÑOR AND FERNANDO BINGBING ARE NOT CONNECTED IN ROAN VET. PRODUCT (RJ2L ENT.) ANY TRANSACTION REGARDING ROAN PRODUCTS CONTRACT TO RJ2L ROAN BIKOL DIRECTLY. THKS ND MORE POWER." Respondents immediately contacted Lagat, who admitted and confirmed that he sent the advisories upon instruction of the petitioner corporation. Petitioners, for their part, contended that respondents were involved in unexplained withdrawals of company items amounting to ₱84,521.57, had failed to remit customer payments, and were moonlighting. Petitioners further claimed that after confronting respondents about these infractions, the latter stopped reporting for work. Respondents maintained that Lagat's confirmation of the advisory operated as an express termination of their employment, which was illegal and without basis.

Respondents initially submitted their grievance to the Department of Labor and Employment through the Single Entry Approach, but settlement efforts failed. On October 1, 2014, respondents filed complaints with the NLRC Arbitration Branch against petitioners for illegal dismissal, non-payment of salaries, service incentive leave pay, 13th month pay, separation pay, and claims for damages and attorney's fees. The Labor Arbiter, in a Decision dated March 27, 2015, declared respondents illegally dismissed and ordered the petitioner corporation to pay a total of ₱493,276.64 representing separation pay, backwages, salary differentials, 13th month pay, and 10% attorney's fees. The NLRC affirmed the LA's Decision on appeal with the modification that Bingbing's monetary award was deleted for failure to append his position paper to the records. Bingbing's motion for reconsideration was granted, reinstating the LA's Decision, while petitioners' motion was denied on January 25, 2016.

Petitioners elevated the case to the CA on March 28, 2016 via a Petition for Certiorari under Rule 65. While that petition was pending, the LA issued a Writ of Execution on August 8, 2016, demanding full satisfaction of the judgment award plus an additional ₱270,608.24 representing recomputed separation pay and backwages. Petitioners opposed the additional awards through a petition under Rule XII of the 2011 NLRC Rules of Procedure, but the NLRC denied the petition on October 28, 2016. The writ was thereafter enforced: the judgment award and the additional monetary award were collected from the petitioner corporation's bank deposit with garnishee Metrobank in Alaminos City, Pangasinan, and from the cash bond filed with the NLRC upon appeal. The CA, acting on the still-pending petition for certiorari, referred the case to its Philippine Mediation Center unit on March 21, 2017. On June 14, 2017, respondents filed an ex-parte manifestation stating that the mediation had become moot and academic due to petitioners' payment and full satisfaction of the judgment award. The PMC unit terminated the mediation process, and on July 14, 2017, the CA issued a Resolution considering the petition for certiorari as withdrawn and the case closed and terminated. Petitioners' motion for reconsideration was denied on December 21, 2017, prompting the present petition.

• Independence of Certiorari from Execution Proceedings: Petitioners argued that the payment of the judgment award by reason of the enforcement of the writ of execution issued by the LA should have no effect on the petition for certiorari pending before the CA, because the payment was done purely in compliance with the orders of the LA and should not be interpreted as a voluntary settlement of respondents' claims.
• Palpable Mistake by the CA: Petitioners contended that the CA committed a palpable mistake when it allowed the execution proceedings before the LA to prejudice the petition for certiorari filed before it, instead of resolving the same on the merits.
• No Voluntary Agreement to Withdrawal: Petitioners maintained that they did not voluntarily agree to the termination of the mediation proceedings before the CA, and that the confirmation noted by their counsel merely attested to the fact that the judgment award had been executed, not that they consented to the withdrawal of their petition.

• Mootness Due to Full Satisfaction: Respondents argued that the withdrawal of the petition for certiorari was correct because the illegal dismissal case before the NLRC had been closed and terminated, and having received the judgment award, petitioners voluntarily settled the monetary claims, rendering the petition pending before the CA moot and academic.
• Justification for Withdrawal: Respondents insisted that the satisfaction of the judgment award justified the withdrawal of the petition, as the case had already been considered closed and terminated as of May 17, 2017, as evidenced by the Order issued by the NLRC.

• Mootness of Certiorari Petition: Whether the CA committed a reversible error in ordering the withdrawal of the petition for certiorari due to the satisfaction of the judgment award in compliance with the Writ of Execution issued by the Labor Arbiter.

• Mootness of Certiorari Petition: Yes, the CA committed reversible error. A petition for certiorari under Rule 65 is an independent action separate from the proceedings before the NLRC, and satisfaction of a judgment award through enforcement of a writ of execution does not render the petition moot and academic, nor does it constitute voluntary settlement of claims.

• Mootness of Certiorari Petition: The Court grounded its reasoning on the fundamental distinction between a petition for certiorari under Rule 65 and an appeal. A petition for certiorari is a special original action whose primary concern is whether a tribunal exercising judicial or quasi-judicial functions has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction. It is not a substitute for an appeal and is entirely independent from the proceedings initiated with the court of origin — it is neither a part nor a continuation of the original suit. Because of this independent character, the proceedings before the NLRC, even upon reaching finality and even after execution, should not influence the petition for certiorari pending before the CA. The Court cited Sections 1 to 4 of Rule XI of the 2011 Revised Rules of Procedure of the NLRC, which provide that a petition for certiorari with the CA or the Supreme Court shall not stay the execution of the assailed decision unless a restraining order is issued. This underscores the rule that although the CA may review NLRC decisions on jurisdictional issues, such review does not interfere with the decisions becoming final and executory. Sections 17 and 18 of the same Rule further provide that an executed judgment by the NLRC can be reversed or annulled by the CA, and that restitution may be ordered upon such reversal — demonstrating that execution does not foreclose judicial review. Applying these principles, the Court found that petitioners did not voluntarily pay or settle respondents' monetary claims; the full satisfaction of the judgment award resulted from the enforcement of the LA's Writ of Execution dated August 8, 2016, through which the cash bond posted by petitioners was executed against and their Metrobank account was garnished. The Court distinguished Career Philippines Shipmanagement, Inc. vs. Madjus, where the employer's payment was accompanied by an affidavit from the employee undertaking not to pursue further claims — constituting a conditional settlement — from the present case, where no form of settlement was executed between the parties. The Court also clarified that the hand-written note by petitioners' counsel confirming execution of the monetary award was a mere attestation to the fact of execution, not an indication of voluntary agreement to withdraw the petition. This was bolstered by the Motion for Reconsideration wherein petitioners categorically declared they did not voluntarily pay or settle the monetary awards. The Court accordingly concluded that the CA committed a palpable mistake in considering the petition as withdrawn and moot.

• Independence of Certiorari from Original Proceedings — A petition for certiorari under Rule 65 is an entirely independent action from the proceedings initiated with the court of origin; it is neither a part nor a continuation of the original suit. The proceedings before the NLRC, even upon reaching finality and even after execution, should not influence a petition for certiorari pending before the CA. The Court applied this doctrine to hold that the CA erred in treating the satisfaction of the judgment award through execution proceedings as rendering the certiorari petition moot.
• Effect of Execution on Certiorari under NLRC Rules — Under Sections 1 to 4 of Rule XI of the 2011 Revised NLRC Rules of Procedure, a petition for certiorari with the CA or the Supreme Court shall not stay the execution of the assailed NLRC decision unless a restraining order is issued. Conversely, execution proceedings before the NLRC are not affected by a petition for certiorari duly filed with the CA. The Court relied on this framework to demonstrate the mutual exclusivity of the two proceedings and to establish that payment through execution does not prejudice the certiorari petition.
• Restitution Upon Reversal of Executed Judgment — Under Sections 17 and 18 of Rule XI of the 2011 Revised NLRC Rules of Procedure, an executed judgment by the NLRC can be reversed or annulled by the CA, and where restitution is so ordered, the Labor Arbiter shall issue an order of restitution of the executed award. The Court cited these provisions to show that the NLRC Rules themselves contemplate the possibility of reversal after execution, negating any notion that execution renders certiorari review moot.
• Involuntary Payment Through Execution Does Not Constitute Settlement — Satisfaction of a judgment award made in strict compliance with a duly issued writ of execution cannot be taken as a voluntary settlement of monetary claims. The Court distinguished cases where the employer's payment was accompanied by a conditional settlement agreement (e.g., Career Philippines Shipmanagement, Inc. vs. Madjus) from cases where payment was effected purely through garnishment and execution against a cash bond, as in the present case.

• "A special civil action for certiorari under Rule 65 is not the same as an appeal. In an appeal, the appellate court reviews errors of judgment. On the other hand, a petition for certiorari under Rule 65 is not an appeal but a special civil action, where the reviewing court has jurisdiction only over errors of jurisdiction." — This passage, quoted from Philippine National Bank vs. Gregorio, articulates the fundamental distinction between certiorari and appeal that underpins the Court's reasoning.
• "Definitely, a petition for certiorari under Rule 65 is an entirely independent action from the proceedings initiated with the court of origin. It is neither a part nor a continuation of the original suit." — This statement establishes the doctrinal basis for the ruling: the independence of certiorari means execution proceedings cannot prejudice the pending petition.
• "The petition for certiorari filed by respondents with the CA was not rendered moot and academic by their satisfaction of the judgment award in compliance with the writ of execution issued by the LA." — Quoted from Espere vs. NFD International Manning Agents, Inc., this formulation directly states the controlling rule applied in the present case.
• "Respondents' payment of the judgment award, without prejudice, required no obligations whatsoever on the part of petitioner. The satisfaction of the judgment award may not be considered as an amicable settlement between the parties as it was simply made in strict compliance with or wholly by virtue of satisfying a duly issued writ of execution." — This passage distinguishes involuntary payment through execution from voluntary settlement, the critical factual distinction that determined the outcome.

• Philippine National Bank vs. Gregorio, G.R. No. 194944, September 18, 2017, 840 SCRA 37 — Followed. Cited for the proposition that a special civil action for certiorari under Rule 65 is not the same as an appeal and that the two remedies are mutually exclusive and not alternative or successive.
• Seacrest Maritime Management, Inc. vs. Picar, Jr., 755 Phil. 901 (2015) — Followed. Cited as squarely applicable: the Court held that satisfaction of a monetary award by an employer through execution does not render a petition for certiorari moot before the CA, and ordered remand for decision on the merits.
• Espere vs. NFD International Manning Agents, Inc., G.R. No. 212098, July 26, 2017, 833 SCRA 156 — Followed. Cited for the explicit ruling that a petition for certiorari is not rendered moot and academic by satisfaction of a judgment award in compliance with a writ of execution issued by the LA.
• Leonis Navigation Co., Inc. vs. Villamater, 628 Phil. 81 (2010) — Followed. Cited for the rule that although the CA may review NLRC decisions on jurisdictional issues, such review does not interfere with the decisions becoming final and executory, the only exception being when execution is restrained by the proper court.
• Career Philippines Shipmanagement, Inc. vs. Madjus — Distinguished. In that case, the employer's satisfaction of judgment was accompanied by an affidavit from the employee undertaking not to pursue further claims, constituting a conditional settlement. The equitable ruling there could not apply in the present case because no form of settlement was executed between the parties.
• St. Martin Funeral Home vs. NLRC, 356 Phil. 811 (1998) — Cited. Referenced for the proposition that a special civil action under Rule 65 is the proper mode of review for NLRC decisions.
• China Banking Corp. vs. Cebu Printing and Packaging Corp., 642 Phil. 308 (2010) — Cited. Referenced for the principle that certiorari is an independent action, neither a part nor a continuation of the original suit.

• Rule 65, Rules of Court — Governs the special civil action for certiorari, the proper mode of judicial review over decisions of the NLRC. The Court applied this provision to establish that the petition before the CA was an independent action focused on jurisdictional errors, not an appeal on the merits.
• Rule 45, Rules of Court — Governs the petition for review on certiorari filed before the Supreme Court, the mode by which petitioners challenged the CA's Resolutions.
• Sections 1–4, Rule XI, 2011 Revised Rules of Procedure of the NLRC (as amended) — Govern execution proceedings before the NLRC. Section 4 specifically provides that a petition for certiorari with the CA or the Supreme Court shall not stay execution of the assailed decision unless a restraining order is issued. The Court relied on these provisions to demonstrate the mutual exclusivity of certiorari and execution proceedings.
• Sections 17–18, Rule XI, 2011 Revised Rules of Procedure of the NLRC (as amended) — Provide for the effect of reversal during execution proceedings and restitution. Section 17 states that in case of total or partial reversal of judgment by the CA, execution proceedings shall be suspended insofar as the reversal is concerned. Section 18 provides for restitution where an executed judgment is reversed or annulled. The Court cited these to show that the NLRC Rules themselves contemplate reversal after execution.
• Article 224, Labor Code — Referenced in Section 2 of Rule XI of the NLRC Rules, providing that a decision or order may be executed on motion within five years from the date it becomes final and executory.

Justices Peralta (Chairperson), Leonen, Hernando, and Carandang concurred. Justice Carandang was designated additional Member per Special Order No. 2624, dated November 29, 2018. No separate concurring opinions were issued.