Aguirre Pawnshop Co., Inc. v. Aquino

FIRST DIVISION

[G.R. No. 199985. November 21, 2018.]

AGUIRRE PAWNSHOP CO., INC., MICHELINA A. OLONDRIZ AND MARISSA A. PEÑA, petitioners, vs.REMEDIOS M. AQUINO, respondent.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, First Division, issued a Resolution datedNovember 21, 2018, which reads as follows:

"G.R. No. 199985 (AGUIRRE PAWNSHOP CO., INC., MICHELINA A. OLONDRIZ and MARISSA A. PEÑA, Petitioners, v. REMEDIOS M. AQUINO, Respondent.) — This appeal seeks to undo the decision promulgated on May 31, 2011, 1 whereby the Court of Appeals (CA) granted the petition for certiorari of the respondent and set aside the decision dated September 15, 2008 of the National Labor Relations Commission (NLRC) 2 reversing the March 29, 2007 decision of the Labor Arbiter (LA). 3

Antecedents

We adopt the CA's summary of the pertinent factual and procedural antecedents, as follows:

Private respondent Aguirre Pawnshop Co., Inc. is a domestic corporation engaged in the pawnshop business, private respondent Michelina A. Olondriz (Olondriz) is the General Manager of the company and one of its owners while private respondent Marissa A. Peña is also one of the owners of the company. CAIHTE

Petitioner Remedios M. Aquino (petitioner), on the other hand, is a former employee of private respondents occupying the position of Vice President and receiving a monthly salary of P52,000.00. Petitioner was hired by the company sometime in 1953 as a clerk and over time, she rose from the ranks until she reached the position of Vice President.

In 1995, upon reaching the age of sixty-five (65) and after forty-two (42) years of service, petitioner manifested to the company her desire to retire. However, she was prevailed by the latter to stay and continue working with it. Subsequently, in 1997, she was promoted from being a Branch Manager to Vice President and her salary was increased from P30,000.00 to P52,000.00. As such, she was directly responsible for the supervision of several of the company's branches including the Legarda Branch which was being managed by Arlene M. Tiozon (Tiozon).

Sometime in February 2006, with the impending transfer of Tiozon to another branch, petitioner conducted an audit on the Legarda Branch and after doing so, she reported that everything was accounted for in the said branch. Subsequently however, private respondent Olondriz ordered another audit which was done by Francisco and Balaos and it was discovered that several items were missing from the Legarda Branch's vault and that Tiozon, who had already gone into hiding, was most likely the one who took the said items. Upon further investigation, it was discovered that petitioner redeemed a pawned said item owned by a client, Ely Lorenzo.

Consequently, on March 23, 2006, the company sent a letter to petitioner placing her under preventive suspension and requiring her to explain the reasons for her failure to properly supervise the Legarda Branch and why she should not be held accountable for redeeming an item pawned by a client which is a clear case of conflict of interest.

On March 25, 2006, petitioner submitted her written explanation claiming that she conducted the proper audit of the Legarda Branch and the discrepancy in her findings and that of the second audit conducted by Francisco and Balaos was due to the fact that the latter used a different computer printout from the head office which was more recent than the one she used. She admitted having redeemed a pawned item of a client but explained that it was done as an accommodation to a valued client of the company.

Thereafter, on March 28, 2006, Olondriz notified petitioner, through a letter, that a fact-finding committee which will hear her case had been formed. In said letter, petitioner was requested to appear at Bernas Law Office on April 7, 2006 for the hearing of her case. In reply, the counsel of petitioner sent a letter to Olondriz stating therein that the accusations against his client are baseless and the company is subjecting petitioner to harassment.

On April 7, 2006, the counsel of private respondents wrote a letter to petitioner's counsel informing the latter that although his client failed to appear on the scheduled hearing, she was given another opportunity to attend the fact-finding hearing on April 10, 2006. However, instead of showing up on said hearing, petitioner through counsel, wrote a letter addressed to private respondents' counsel informing the latter that petitioner has decided to retire from the company and should therefore be paid her retirement benefits amounting to P2,369,807.55. Subsequently however, on April 22, 2006, private respondents notified petitioner that she was being terminated from service by reason of her gross negligence and dishonesty. DETACa

Thus, petitioner filed a complaint for illegal dismissal and payment of her retirement benefits. In her Position Paper, petitioner alleged that she was not guilty of gross negligence in the performance of her functions; that when she conducted the audit, she exercised reasonable precaution and adhered to the established and commonly practiced audit procedures of the company. She pointed out that the audit conducted by Francisco and Balaos was done using a different print out which was more recent than the one she used and that if only she had the opportunity to conduct an audit using the same updated print out, she may have come up with the same findings as those of Balaos and Francisco. Even assuming that she was negligent, the same was not gross and habitual and dismissal was simply too harsh a penalty for her infraction. Petitioner further averred that she committed no deception and/or misrepresentation when she redeemed the pawned items of one of the company's client as the same was done only to accommodate a valued customer of the company.

For their part, private respondent averred in their Position Paper that petitioner was guilty of deception, fraud and/or misrepresentation for having redeemed the items of Ms. Ely Lorenzo (Lorenzo) despite the clear fact that it is against Company policy; that by redeeming the pawned items, petitioner effectively limited the ability of the company to earn income on the sale of the foreclosed items to the detriment of the company; that petitioner, having been in the company for a long time, knew fully well the reasons why an employee cannot redeem the pawned items of its customers and that when petitioner redeemed the item of Lorenzo, she displayed her clear intent to defraud the company and that petitioner also falsified the company records by making it appear that it was Lorenzo who redeemed the item; that petitioner was also guilty of gross negligence in the performance of her duties when she failed to conduct a diligent and proper audit of the Legarda Branch immediately after Tiozon's failure to report for work on February 6, 2006; and that since the termination of petitioner was for just cause, she is not entitled to her retirement benefits, separation pay and other monetary benefits. 4

LA Teresita D. Castillon-Lora rendered her decision on March 29, 2007, disposing thusly:

WHEREFORE, premises considered, Respondents are hereby ordered to pay complainant:

 

1. her compulsory retirement pay in the amount of P1,090,388.25, with interest of 6% per annum from 1995 up to the finality of this decision, which is now computed at P785,070.54	-	P1,875,467.70
2. moral damages	-	20,000.00
3. exemplary damages	-	10,000.00
		––––––––––––
		P1,905,467.79
4. 10% attorney's fees of the total amount due	-	P190,546.78
		P2,096,014.57
		––––––––––––

 

The claim for illegal dismissal is hereby dismissed for lack of merit.

SO ORDERED. 5

The petitioners appealed, and alleged in their memorandum of appeal that the respondent was not entitled to retirement benefits considering that the company's Retirement Plan stipulated that any member separated from the service for cause automatically forfeited the benefits.

On September 15, 2008, the NLRC rendered its decision setting aside the decision of the LA, to wit: aDSIHc

WHEREFORE, prescinding from the foregoing considerations, the Decision appealed from is hereby SETASIDE and a NEW ONE ENTERED dismissing the complaint for lack of merit.

SO ORDERED. 6

On October 9, 2008, the respondent moved for reconsideration. 7

On October 28, 2009, the NLRC partly granted the respondent's motion for reconsideration, holding thusly:

WHEREFORE, the Motion for Reconsideration of herein Complainant is GRANTEDIN PART. Respondents are ORDERED to pay complainant ONE MILLION NINETY THOUSAND THREE HUNDRED EIGHTY EIGHT & 46/100 (P1,090,388.46) as retirement benefits.

All other dispositions REMAIN.

SO ORDERED. 8

The NLRC maintained that although the respondent had been legally dismissed, she had acquired a vested right in her retirement benefits upon reaching the age of 65 years; and that her subsequent infraction during the "extension" of her employment, albeit a valid ground for her dismissal, did not forfeit her vested right to the retirement benefits. 9

The petitioners moved for reconsideration, but the NLRC denied their motion on November 10, 2010. 10

On her part, the respondent brought a petition for certiorari in the CA.

On May 31, 2011, the CA promulgated its assailed decision, and disposed thusly:

WHEREFORE, the foregoing considered, the petition is hereby GRANTED and the assailed decision and resolution are hereby REVERSED and SET ASIDE. Accordingly, private respondents are hereby ordered to pay petitioner full back wages, separation pay and retirement benefits from 22 April 2006.

The case is hereby REMANDED to the NLRC for the computation of the said monetary awards.

SO ORDERED. 11 ETHIDa

The CA denied the petitioners' motion for reconsideration on January 5, 2012. 12 Hence, this appeal.

Issues

The petitioners submit for consideration and resolution the following errors committed by the CA, namely:

I

THE COURT OF APPEALS DID NOT RULE IN ACCORD WITH LAW WHEN IT RESOLVED MRS. AQUINO'S PETITION FOR CERTIORARI BECAUSE IT WAS PREMATURELY FILED.

II

THE COURT OF APPEALS DID NOT RULE IN ACCORD WITH LAW WHEN IT VIOLATED THE DOCTRINE OF CONCLUSIVE FINALITY EVEN IN THE ABSENCE OF EVIDENCE OR AN EXPLANATION THAT THE NLRC ACTED WITH GRAVE ABUSE OF DISCRETION IN ARRIVING AT ITS DECISION.

III

THE COURT OF APPEALS IGNORED THE FACT THAT MRS. AQUINO WAS AN OFFICER OF AGUIRRE PAWNSHOP AND AS SUCH, MERE LOSS OF CONFIDENCE IS A SUFFICIENT GROUND FOR HER DISMISSAL. THUS, THE COURT OF APPEALS DID NOT RULE IN ACCORD WITH LAW WHEN IT ONLY CONSIDERED GROSS NEGLIGENCE AS THE GROUND FOR DISMISSING MRS. AQUINO, DISREGARDING THE OTHER JUST CAUSES FOR TERMINATION (i.e., DISHONESTY AND CHEATING; DECEPTION, FRAUD, OR MISREPRESENTATION; FALSIFYING ADMINISTRATION AND COMPANY RECORDS; AND LOSS OF CONFIDENCE) RAISED BY THE PETITIONERS, WHICH ARE ALL AFFIRMED BY THE NLRC IN ITS DECISION.

IV

THE COURT OF APPEALS DID NOT RULE IN ACCORD WITH LAW WHEN IT RULED THAT MRS. AQUINO MERELY COMMITTED A "MISTAKE" WHEN SHE REDEEMED THE PAWNED ITEMS BECAUSE MRS. AQUINO HAD "NO INTENT" TO DEFRAUD THE PETITIONERS. THE FACTUAL FINDING OF THE COURT OF APPEALS IS NOT ONLY BASELESS, BUT MORE IMPORTANTLY, CONTROVERTED BY THE EVIDENCE ON RECORD.

V

THE COURT OF APPEALS DID NOT RULE IN ACCORD WITH LAW WHEN IT RULED THAT PETITIONERS "DID NOT SUFFER LOSSES" WHEN MRS. AQUINO REDEEMED THE PAWNED ITEMS BECAUSE THE EVIDENCE ON RECORD DOES NOT SUPPORT THIS RULING.

VI

THE DECISION OF THE COURT OF APPEALS AWARDING BACKWAGES, SEPARATION PAY AND RETIREMENT BENEFITS TO MRS. AQUINO IS CONTRARY TO LAW.13 cSEDTC

In short, the Court shall resolve: (1) whether or not the respondent was illegally dismissed; and (2) whether or not she was entitled to the retirement benefits.

Ruling of the Court

We DENY the petition for review on certiorari for its lack of merit.

The petitioners contend that they had just causes to dismiss the respondent based on grounds of dishonesty and cheating, gross negligence in the performance of duty and loss of confidence. 14

The burden of proof in every case of illegal dismissal rests on the employer to prove the ground for the dismissal. This has been made clear in jurisprudence, including Prudential Guarantee and Assurance Employee Labor Union v. National Labor Relations Commission, 15 where the Court pronounced:

x x x [T]he burden of proof is upon the employer to show that the employees termination from service is for a just and valid cause. The employers case succeeds or fails on the strength of its evidence and not the weakness of that adduced by the employee, in keeping with the principle that the scales of justice should be tilted in favor of the latter in case of doubt in the evidence presented by them. Often described as more than a mere scintilla, the quantum of proof is substantial evidence which is understood as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion, even if other equally reasonable minds might conceivably opine otherwise. Failure of the employer to discharge the foregoing onus would mean that the dismissal is not justified and, therefore, illegal.

The CA concluded that gross negligence in the performance of her duties could not be considered as a just cause for the dismissal of the respondent. It observed the following in this regard:

First off, gross negligence implies a want or absence of or failure to exercise slight care or diligence, or the entire absence of care. It evinces a thoughtless disregard of consequences without exerting any effort to avoid them. Further, the negligence, to warrant removal from service, should not merely be gross but also habitual. A single and isolated act of negligence on the part of an employee does not amount to "gross and habitual neglect" warranting his dismissal. SDAaTC

In the case at bench, there was no concrete evidence to show that petitioner failed to exercise slight care or diligence in performing her duties. While indeed she made an error in her audit by using the records which were not updated when she could have secured the more recent ones and consequently made an error in reporting that there were no missing items in the vault, We believe that such a mistake does not amount to gross negligence. At any rate, the fact that she recommended to private respondents that an audit be conducted on the Legarda Branch because of the impending transfer of Tiozon in another branch and in fact made an audit on the said branch after Tiozon failed to report for work, shows that she exercised a certain degree of care in the performance of her duties. Further, there was no record to show that petitioner had been repeatedly negligent in her work. As it appears, in her long years of service with private respondents, she had never been accused of neglecting her duties. Apparently, the incident which led to her termination was an isolated one. Further, while admittedly, the petitioner, in redeeming a pawned item of Lorenzo, violated a company policy, it appears that there was no intent on her part to defraud her employers. The fact that petitioner candidly disclosed said transaction to Olondriz negates any intent on her part to defraud the company. In any case, there appears to be no damage done to the company by reason of the transaction.

The petitioners further claim that the respondent breached their trust and confidence when she admitted in her March 25, 2006 letter that Arlene Tiozon had stolen an item from the vault and pawned it, but she (respondent) had later redeemed with her personal funds; and that she did not report the theft to the management or to law enforcement authorities. 16

Loss of trust and confidence, to be a valid ground for dismissal, must be clearly shown to rest on a willful breach of trust. A breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. The act must rest on substantial grounds, not on the employer's arbitrariness, whims, caprices or suspicions; otherwise, the employee would remain eternally at the mercy of the employer. Moreover, the act complained of, to suffice as a just cause for dismissal, must be established to be work-related as to manifest that the employee concerned is unfit to continue working for the employer. Such ground for dismissal has never been intended to afford an occasion for abuse because of its subjective nature. 17

Accordingly, the respondent's letter alone was insufficient to substantiate the petitioners' claim of her having willfully breached the trust and confidence reposed in her by the petitioners. Indeed, her following explanation indicated why, to wit:

8. It should be noted that even before the February 2006, Ms. Tioson already left the Company. The respondents cannot claim that because of the "negligent acts" of the Complainant, Ms. Tioson was able to abscond. In the first place, the audit of the Complainant was interrupted, hence, there was as yet no finding on the missing items when Ms. Tiozon left. In the second place, it is apparent that Ms. Tiozon anticipated the discovery, for which reason she hurriedly left the Company. The truth is, regardless even if the audit was unfinished because she knew that her wrongdoings would be discovered. The Complainant, therefore, could not be faulted why "the Company (lost) precious time and have unwittingly allowed (Ms.) Tiozon to abscond." acEHCD

9. Even if the respondents are referring to the audit that was conducted before Ms. Tiozon left, the respondents could not have done any better in terms of recovering the lost items from Ms. Tiozon because necessarily they have to file a case against her; they could not just put the law into their hands, so to speak. Parenthetically, this audit was conducted using a different print-out of the list of items, and with the participation of Ms. Tiozon.

10. The Complainant cannot comprehend why she is being blamed by the Company for its failure to recover from Ms. Tiozon the lost items. Complainant had nothing to do with the theft; it was Ms. Tiozon who solely committed the theft, and the respondents even admitted this in their Position Paper."18

Considering that the petitioners did not clearly and convincingly establish the factual bases for the supposed loss of trust and confidence, we cannot but rule that her dismissal, being without just cause, was illegal. The consequences of the illegal dismissal should follow. We affirm the CA thereon, particularly the CA's following disquisition of such consequences, viz.:

x x x [S]he is entitled to reinstatement without loss of seniority rights and payment of full back wages. As provided under Article 279 of the Labor Code, an employee who is unjustly dismissed is entitled to reinstatement, without loss of seniority rights and other privileges, and to the payment of his full backwages, inclusive of allowances, and other benefits or their monetary equivalent, computed from the time his compensation was withheld up to the time of his actual reinstatement. Considering however that the working relations between petitioner and private respondents had already been strained, the payment of separation pay should be awarded in lieu of reinstatement. Established is the rule that an employer shall pay the employee separation pay in lieu of reinstatement if reinstatement is no longer feasible or the dismissed employee decides not to be reinstated. 19

We likewise affirm the granting of the retirement benefits because the CA correctly applied the law and jurisprudence, as borne out by its following holding:

Anent the petitioner's retirement benefits, We find and so hold that she is entitled to the same. The rule on retirement is provided for under Article 287 of the Labor Code, as amended by Republic Act No. 7641, viz.:

"Art. 287. Retirement. — Any employee may be retired upon reaching the retirement age established in the collective bargaining agreement or other applicable employment contract. SDHTEC

In case of retirement, the employee shall be entitled to receive such retirement benefits as he may have earned under existing laws and any collective bargaining agreement and other agreements: Provided, however, That an employee's retirement benefits under any collective bargaining and other agreements shall not be less than those provided herein.

In the absence of a retirement plan or agreement providing for retirement benefits of employees in the establishment, an employee upon reaching the age of sixty (60) years or more, but not beyond sixty-five (65) years which is hereby declared the compulsory retirement age, who has served at least five (5) years in the said establishment, may retire and shall be entitled to retirement pay equivalent to at least one-half (1/2) month salary for every year of service, a fraction of at least six (6) months being considered as one whole year.

Unless the parties provide for broader inclusions, the term one-half (1/2) month salary shall mean fifteen (15) days plus one-twelfth (1/12) of the 13th month pay and the cash equivalent of not more than five (5) days of service incentive leaves. x x x"

From the foregoing, an employee may retire and shall be entitled to her retirement benefits upon reaching the age of sixty (60). However, upon agreement between the employee and employer, the former may continue working for the company even though she is already sixty (60) years of age or more but not beyond sixty-five (65) years. Otherwise stated, when an employee reaches the age of sixty (60) years, she has the option whether or not to retire, subject to an existing company plan on retirement. However, upon reaching the age of sixty-five (65), the retirement of the employee becomes compulsory and it is mandatory that she be allowed to retire and granted her retirement benefits.

In the case of petitioner, We note that years prior to the incident or in 1995, when she was already 65 years old, she manifested her desire to retire and at that time she was already qualified to do so. However, she was requested by the company to continue on with her employment. Moreover, on April 10, 2006, before private respondents rendered the decision to terminate her, petitioner again manifested that she was retiring but private respondents did not act upon her request. Thus, for all intents and purposes, petitioner was already entitled to her retirement benefits even before she was illegally terminated by private respondents. 20 AScHCD

WHEREFORE, the Court DENIES the petition for review on certiorari; and AFFIRMS the decision promulgated on May 31, 2011 without pronouncement on costs of suit.

The respondent's: (a) third motion for early resolution, praying that the petition be resolved at the soonest possible time for reason stated therein; and (b) manifestation and motion to admit verified declaration of the second motion for early resolution, in compliance with the Resolution dated April 12, 2016, are both NOTED.

SO ORDERED." Bersamin, J., designated as Acting Chairperson per Special Order No. 2606 dated October 10, 2018; Gesmundo, J., designated as Additional Member per Special Order No. 2607 dated October 10, 2018.

Very truly yours,

(SGD.) LIBRADA C. BUENADivision Clerk of Court

 

Footnotes

1.Rollo, pp. 52-67; penned by Associate Justice Josefina Guevarra-Salonga, with Associate Justice Mariflor P. Punzalan Castillo and Associate Justice Franchito N. Diamante concurring.

2.Id. at 121-144.

3.Id. at 92-119.

4.Id. at 53-56.

5.Id. at 118-119.

6.Id. at 143.

7.Id. at 146.

8.Id. at 156.

9.Id. at 154.

10.Id. at 159-162.

11.Id. at 66.

12.Id. at 69-73.

13.Id. at 22-24.

14.Id. at 105-106.

15. G.R. No. 185335, June 13, 2012, 672 SCRA 375, 394.

16.Rollo, p. 106.

17.Supra note 15, at 393.

18.Rollo, pp. 109-110.

19.Id. at 64.

20.Id. at 64-66.