FIRST DIVISION
[G.R. No. 210532. October 13, 2021.]
JEFFREY Y. ANG, petitioner,vs. EQUITABLE PCI BANK and LESMES GARATE, respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, First Division, issued a Resolution datedOctober 13, 2021which reads as follows:
"G.R. No. 210532 — JEFFREY Y. ANG,petitioner,versus EQUITABLE PCI BANK and LESMES GARATE,respondents.
Before the Court is a Petition for Review on Certiorari1 (Petition) under Rule 45 of the Rules of Court (Rules) assailing the Decision 2 dated March 15, 2013 (assailed Decision) and Resolution 3 dated December 2, 2013 (assailed Resolution) of the Court of Appeals 4 (CA), in CA-G.R. SP No. 04709, which affirmed the validity of petitioner Jeffrey Y. Ang's (Ang) suspension, as well as the deductions made from his salaries.
The facts of the case are as follows:
In 1992, Ang began working for respondent Equitable PCI Bank (respondent bank) as a Service Officer for its branch in Mandaue City, Cebu. 5 His duties included the inspection of the checks referred to him for disposition by the Clearing and Settlement Department (CSD). 6
From October 8, 2004 to November 11, 2004, respondent bank honored 65 checks drawn against the current account of its client, Viscal Development Corporation/Metro Gaisano, which were presented for deposit to the accounts of Zenaida L. Dy and Judith A. Calma with Asiatrust Bank and Bank of Commerce. 7 The checks, which turned out to be spurious, amounted to P3,027,249.80. 8
Respondent bank launched an investigation where it determined that Ang was one of those responsible for the erroneous honoring of the spurious checks. 9 It was discovered that, although the 60 checks referred by the CSD to Ang for disposition were tagged as "SD" (signature differs) (SD) in the Returnable Checks System (RTOS), these checks also bore the stamp "P.R." (prime reject) (PR). Yet, according to respondent bank, Ang failed to comply with the prescribed procedure for dealing with PR checks, which requires seeking the client's confirmation or decision. Thus, respondent bank sent Ang a Show Cause Letter 10 dated May 30, 2005, requiring him to explain within 72 hours why he should not be penalized for the following violations:
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Our investigation disclosed that as the Service Officer of North Mandaue-Cebu Branch from 10.09.04 to 10.20.04 and 10.23.04 to 11.12.04, you did not confirm 60 checks totaling to [P]2,786,215.21 with Viscal Dev't. Corporation/Metro Gaisano, client, although all 60 checks were clearly stamped "PR" (prime reject) by PCHC.
Your actions constitute violations of the following:
1. PPC No. 16-M dated 07/12/04 re: Revised Schedule of Work for Signature Verifiers of Clearing and Settlement Department-Binondo — General Guidelines:
"Branches shall confirm prime reject checks from client/authorized signatories as follows:
|
Amount of Check |
Method of Confirmation |
|
[P]10,000-[P]50,000 |
Verbal Confirmation |
|
Above [P]50,000 |
Verbal and Written Confirmation |
2. PPC No. 216-D dated 05/08/03 re: Implementation of Returnable Check System (Ver. 3.10) — Duties and Responsibilities:
Branch Operations Officer:
• Immediately refer to client items for decision; encode the disposition opposite the corresponding check item thru the Returnable Checks System before the 2:00 p.m. cut-off time.
3. PPC No. 373-B dated 03/19/03 re: Revised Duties and Responsibilities — Service Officer:
• Review prime rejects and technically defective inward checks referred by Clearing Settlement Dept. (CSD).
• Confirm returnable checks with client and tag these in the Returnable Checks System.
4. Section IV of the Bank's Code of Conduct:
a. OBEDIENCE AND COOPERATION, Class D.1 — "Failure to comply and/or enforce policies and procedures as defined resulting in damage and/or prejudice to the Bank/Company," commission of which warrants a penalty of DISMISSAL.
b. COMPETENCE, Class D.1 — "Gross or habitual negligence in the performance of one's work," commission of which warrants a penalty of DISMISSAL.
c. COMPETENCE, Class C.1 — "Failure to conduct proper research, investigation, or verification of facts and as a result of which, inaccurate or misleading data are furnished to employees/persons authorized to ask, receive or secure such information leading to loss or prejudice to the Bank/Company," commission of which warrants a penalty of SUSPENSION.
5. Labor Code — The Bank may terminate your employment for just cause in relation to Article 282(b) — "Gross and habitual neglect by the employee of his duties."11
In a Letter 12 dated June 9, 2005, Ang explained that the CSD is primarily responsible for verifying checks and determining any apparent defect. Should there be any, the CSD encodes the same in the RTOS, indicating therein the reason for the referral of the checks to the branch. The branch, in turn, will determine how the checks will be disposed — whether to return or honor them. Ang, thus, claimed that he cannot be faulted for honoring the spurious checks because, although the checks were stamped with "P.R.," they were referred to him for disposition by the CSD as SD and not as PR checks. Guided by said referral, he compared the signatures appearing on the scanned copies of the checks with the specimen signatures on the branch's file. After finding the signatures to be in order, he tagged the checks as "honored." Apart from the SD referral by the CSD, he also could not determine any dissimilarity in the color of the checks because he was only sent black-and-white scanned copies of the checks. Ang asserted that, since the CSD has physical possession of the checks, it could be presumed that the CSD already determined the checks to be genuine. Ang also alleged that neither the CSD, nor the client's representative, who supposedly does daily account reconciliation, alerted him of any other irregularity. Thus, there was allegedly no reason for him to suspect that something was amiss.
Respondent bank issued a Decision Memo 13 dated September 13, 2005 finding Ang guilty as charged, dismissing him from employment, and holding him contingently liable for P2,786,215.21. Ang sought reconsideration of the Decision Memo, insisting that he had not violated any bank policies or rules, and arguing, among others, that he cannot be held liable for violating PPC No. 16-M because it was never circulated to respondent bank's branches in Cebu. 14
Respondent bank's Senior Vice President, respondent Lesmes Garate (respondent Garate), also interceded in behalf of Ang and another employee, Stewart Hipolito (Hipolito), through an internal memo 15 dated September 27, 2005 addressed to the officers of respondent bank. Respondent Garate urged respondent bank to impose a lighter penalty on Ang and Hipolito in view of the following circumstances, viz.:
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1. Checkings [(sic)] [r]evealed, that Branches in our Division are not provided with copies of PPC No. 16, as amended, as well as PPC [No.] 16-M.
2. Per checkings [(sic)] in BSO's library, PPC No. 16-M among others, covers objectives/general guidelines, to include handling of Prime Rejects by branches. As indicated in item 1, branches are not provided with copies thereof.
3. CSD Manila, referred to branch the questioned checks of clients, through RTOS, as part of technical defects, with the reasons "signature differs," and not "prime reject," though, the questioned checks were stamped with "PR."
4. CSD Manila should have referred the questioned checks to maintaining branch as "SPR," or spurious, and not "signature differs." Results from PNP Crime Lab in Camp Crame, through the assistance of SID, revealed that questioned checks are indeed not authentic.
5. Upon receipt by branch of questioned checks sent by CSD Manila, through scanned copies, maintaining branch did not confirm with clients on the cited technical defect of "signature differs," because they found the signatures in the scanned copies, no different from the signatures on file. Actions for non-referral to client, were based on concerned officers sound judgment under that particular circumstances [(sic)], not mentioning volume of transactions and non-receipt of PPC [No.] 16 and its amendments thereof. If checks in question were referred to maintaining branch as "prime reject," that could have triggered for the branch officers to immediately communicate with CSD Manila, what PR or "prime reject," is all about. In fact, it was cited by audit, that branch ignored the stamped PR on the questioned checks. This statement will support item No. 1 justification, that Branches are not provided with copies of PPC No. 16-M.
[6.] In my own perception, we cannot partly invoke PPC No. 16-M, since branches are not provided with copies thereof.
[7.] Present set of Branch Officers, were instrumental in improving the Operational Efficiency in the branch. This branch was twice rated as NI, and through their efforts, the Audit Rating improved to SAS.
[8.] Present Set of Branch Officers are performers. Officers' Performance Ratings were:
Stewart Hipolito — SAS-2004
[9.] This is their first offense, which was perpetuated by a syndicate. Though we advocate vigilance in all our branches, we may consider human factor, since officers are running a voluminous branch with the following deposit volume:
Total Funds of Branch as of June 2005 — [P]1.5B16
On October 28, 2005, respondent bank issued its Final Decision on Appeal, 17 reducing Ang's penalty to 30 days of suspension, but reiterating his contingent liability for P2,786,215.21. In reducing the penalty, respondent bank considered the fact that PPC No. 16-M was not properly disseminated and, therefore, cannot be enforced against Ang. Ang was able to immediately return to work since the time he was effectively dismissed was credited as service of his suspension. 18
In a Memo 19 dated April 11, 2007, respondent bank informed Ang that his contingent liability of P2,786,215.21 had been written off as actual loss, and demanded that he restitute to respondent bank the amount through deductions of P3,700.00 from his monthly salary, 25% of his mid-year and Christmas bonuses, and 50% of his performance bonus. Ang, through counsel, wrote a letter 20 dated May 3, 2007 to contest the intended deductions, stating that his salary is exempt from any execution, attachment, or deduction without his consent.
Still, respondent bank deducted from Ang's salary the amount of P9,505.00 in May 2007, and P18,212.50 in June 2007. 21 Thus, Ang filed a complaint 22 for illegal suspension, illegal salary deductions, damages, and attorney's fees.
LA Ruling
In a Decision 23 dated January 21, 2008 (LA Decision), the Labor Arbiter (LA) ruled in favor of Ang, and held that respondent bank illegally suspended him and illegally deducted amounts from his salaries.
The dispositive portion of the LA Decision reads as follows:
WHEREFORE, the foregoing premises considered, judgment is hereby rendered directing respondent Equitable PCI Bank to RETURN forthwith all the amounts it has illegally deducted from the salary of the complainant in relation to the complainant's alleged contingent liability.
The respondent Bank is also ordered to immediately CEASE and DESIST from making any further deductions on the complainant's salary in relation to the said contingent liability. The respondent Bank is ordered to COMPENSATE the complainant for ONE (1) MONTH worth of salary and Benefits and the corresponding fraction in 13th month pay he would have received had he not been illegally suspended for thirty (30) days. The respondent Bank is further assessed with Moral Damages in the amount of [P]2,786,215.21, Exemplary Damages of [P]200,000.00, Attorney's Fees equivalent to ten (10%) percent of the total monetary awards. Interest at the rate of TWELVE PERCENT (12%) [per annum] shall be assessed on the illegally deducted amounts owing from the Illegal Suspension.
SO ORDERED. 24
According to the LA, Ang's duty in verifying the checks is limited to the instructions given to him by the CSD and to the details that can be observed by him from the scanned copies of the checks. Thus, he cannot be faulted for not treating the spurious checks as PRs because they were not referred to him by the CSD as such. Consequently, he cannot be held guilty of violating PPC No. 216-D and PPC No. 373-B. Considering that Ang did not violate these bank policies or procedures, he also cannot be held liable under Section IV of the Bank's Code of Conduct. The LA also found that Ang did not commit gross and habitual neglect of duties. Hence, there is no basis to terminate or suspend him from employment. If there was any negligence in the clearing of the checks, it occurred at the CSD. As regards the salary deductions, the LA held that these were in contravention of Article 113 of the Labor Code, especially since the supposed liability is unclear, contested, and unauthorized by Ang.
Aggrieved, respondent bank appealed the LA Decision with the National Labor Relations Commission (NLRC).
NLRC Ruling
In its Decision 25 dated August 12, 2009 (NLRC Decision), the NLRC reversed the LA Decision, and upheld the validity of Ang's suspension, his liability amounting to P2,786,215.21, as well as the legality of the deductions made from his salaries.
The dispositive portion of the NLRC Decision reads:
WHEREFORE, finding the suspension of complainant to be valid, the Decision of the Labor Arbiter is hereby VACATED and SET ASIDE and a NEW ONE ENTERED. Complainant is ordered to restitute respondent the amount of Two Million Seven Hundred Fifty Eight Thousand, Four Hundred Ninety Seven Pesos and 71/100 ([P]2,758,497.71) [(sic)].
SO ORDERED.26
In reversing the LA Decision, the NLRC held that respondent bank had discharged its burden of proving the infractions committed by Ang. The NLRC found Ang negligent in his handling of the checks. He should have exercised more caution considering that he was verifying mere scanned copies of the checks which were all stamped with "P.R." This, coupled with the fact that a total of 65 checks are involved, should have alerted him of the irregularity. The NLRC also pointed out that Ang did not immediately contest the legality of his suspension, and only did so after his receipt of the April 11, 2007 Memo. The NLRC likewise found Ang liable for the loss suffered by respondent bank due to his negligence, and the corresponding deductions from his salaries to be proper.
Meanwhile, in his Dissenting Opinion, 27 NLRC Commissioner Aurelio D. Menzon (Commissioner Menzon) voted to affirm the LA Decision in toto. According to Commissioner Menzon, respondents' appeal should not have been given due course in the first place because it was fatally infirm. At any rate, the appeal also lacked merit. Ang should not be faulted for the erroneous honoring of the spurious checks considering that respondent bank failed to properly orient its employees of the new check clearing system, which now involves the CSD based in Makati City in verifying the authenticity of the checks and identifying defects. The labor tribunals also had no jurisdiction to determine Ang's civil liability and to order him to pay respondent bank. Even so, respondent bank's claim for civil liability is already barred by prescription under Article 1146 28 of the Civil Code.
Ang sought reconsideration of the NLRC Decision, but this was denied in a Resolution 29 dated September 29, 2009. This prompted him to file a petition for certiorari with the CA.
CA Ruling
In the assailed Decision, the CA denied the petition for certiorari and affirmed the NLRC's ruling:
WHEREFORE, the petition is DENIED, the Decision of the National Labor Relations Commission dated 12 August 2009 and its Resolution dated 29 September 2009, in NLRC Case No. VAC-08-000493-08 are AFFIRMED in toto. The complaint filed in RAB Case No. VII-05-1014-07 is DISMISSED.
SO ORDERED.30
The CA held that PPC No. 16-M cannot be enforced against Ang because it was not circulated to the branch to which he belongs. Nonetheless, the CA agreed with the findings of the NLRC that Ang violated PPC No. 373-B and PPC No. 216-D. As a bank employee, he should have exercised extra care and diligence in safeguarding the interest of respondent bank's client, especially in light of the attending circumstances. Ang's acts, which amounted to gross and habitual negligence, justify the imposition of the penalty of suspension. The CA also held that respondent bank has the right to recover the loss it suffered through salary deduction in accordance with Article 1706 31 of the Civil Code.
Ang filed a motion for reconsideration, but the same was denied in the assailed Resolution. 32 Hence, this Petition.
Ang argues that the LA Decision had already attained finality and that the NLRC erroneously gave due course to respondents' defective appeal. On the substantive issues, he contends that the CA erred in upholding the validity of his suspension because he did not commit any violation. Since PPC No. 16-M cannot be enforced against him, he could not have violated the Bank's Code of Conduct. He also cannot be faulted for limiting his examination of the checks to the signatures since the checks were referred to him as SDs and not as PRs. As such, and considering that he was merely doing his job, he cannot be held guilty of negligence, gross or otherwise. With regard to the deductions made from his salaries, Ang maintains that these are neither sanctioned by the Labor Code and its implementing rules, nor by Article 1706 of the Civil Code. Ang also reiterates his claims for damages and attorney's fees.
In their Comment 33 June 23, 2014, respondents insist that Ang was guilty of violating PPC No. 16-M, PPC No. 216-D, PPC No. 373-B, as well as Article 282 (b) [now 297 (b)] of the Labor Code. According to respondents, Ang's gross negligence was demonstrated by the following circumstances, among others: (i) all 60 checks bear the stamp "PR" which Ang ignored; (ii) Ang did not bother to consult the client first despite that there was only a daily average of 13 inward checks for verification; and, (iii) the fraud occurred in 21 out of 24 banking days. Meanwhile, the habituality of Ang's negligence is shown by the fact that 60 spurious checks were honored in 21 continuous banking days. Respondents also argue that Ang's duty of reviewing PR checks remained the same despite the change in the system of clearing checks. With respect to the deductions made from his salaries, respondents contend that these are justified following the Court's pronouncement in China Banking Corporation v. Borromeo. 34 Respondents also refute Ang's claim for damages and attorney's fees for lack of basis.
In his Reply 35 dated October 27, 2014, Ang adds that his duty to "review" defective checks is limited to the defects identified by the CSD. Moreover, under PPC No. 373-B, it is only when a check has been determined as "returnable" will a confirmation with the client be required. Yet, PPC No. 216-D and PPC No. 373-B lacked clear standards on which checks should be confirmed with the client.
Issues
The following issues are for resolution of the Court:
1. Whether the LA Decision had already attained finality due to respondents' defective appeal before the NLRC;
2. Whether Ang was illegally suspended by respondent bank;
3. Whether respondent bank illegally deducted the losses it incurred from Ang's salaries; and
4. Whether Ang is entitled to actual, moral, and exemplary damages, as well as attorney's fees.
The Court's Ruling
The Court finds merit in the Petition.
In labor cases, a petition for review on certiorari is limited to reviewing whether the CA correctly found the presence or absence of grave abuse of discretion on the part of the NLRC. 36 With this kind of review, and considering that the Court is not a trier of facts, only questions of law may be raised before the Court. Nonetheless, this rule admits of exceptions, 37 such as when the findings of facts are conflicting, as in this case.
The rules of procedure should
Ang claims that the NLRC erred in giving due course to respondents' appeal of the LA Decision despite the following defects: (1) the appeal did not raise any valid grounds; (2) respondents' signatory to the verification and certification on non-forum shopping was not duly authorized; and (3) respondents failed to provide a certified true copy of the surety bond, as well as a proper Joint Declaration attesting to the genuineness and period of effectivity of the bond. 38 According to Ang, respondents were not deserving of leniency because they failed to offer any explanation to justify the foregoing defects. Thus, the LA Decision should be deemed to have attained finality and impervious to any modification.
The NLRC, as well as the CA, did not err in excusing the defects attending respondents' appeal.
As correctly found by the CA, respondents raised a valid ground for appeal, i.e., serious errors in the finding of facts. 39 The Court also recognized that the following officials or employees of the company can sign the verification and certification without need of a board resolution: (1) the Chairperson of the Board of Directors, (2) the President of a corporation, (3) the General Manager or Acting General Manager, (4) Personnel Officer, and (5) an Employment Specialist in a labor case. 40 Thus, respondent bank's Vice President is likewise deemed duly authorized to sign the verification and certification on non-forum shopping. 41 In addition, the records show that respondents subsequently submitted the corrected documents to cure the defect of its surety bond and Joint Declaration. 42
Respondents' substantial and subsequent compliance with the requirements for an appeal call for the liberal application of the NLRC rules of procedure. 43 After all, technical rules of procedure may be relaxed in the interest of substantial justice and to assist the parties in obtaining just, expeditious, and inexpensive resolution and settlement of labor disputes. 44
Now, on the substantive issues.
There is no basis to suspend
Respondent bank charged Ang with violations of PPC No. 16-M, PPC No. 216-D, PPC No. 373-B, the Bank's Code of Conduct, and Article 282 [now 297] of the Labor Code. Allegedly, Ang committed these infractions when he honored 60 spurious checks bearing the stamp "PR" without conferring with respondent bank's client, thereby causing respondent bank to suffer losses in the amount of P2,786,215.21.
As correctly held by the CA, PPC No. 16-M, which expressly requires client verification in case of PR checks with face value of P10,000.00 and above, cannot be enforced against Ang because, as admitted by respondent bank, it was not properly disseminated to the branch to which Ang belongs. To sustain a violation of a corporate policy, due process dictates that it must first be shown that the employee was duly apprised of the conduct being prohibited. Thus, the propriety of Ang's actions may only be gauged against PPC No. 216-D, PPC No. 373-B, the Bank's Code of Conduct, and the Labor Code.
PPC No. 373-B, enumerates the following duties of a Service Officer: (1) to review PR checks and technically defective inward checks referred by the CSD, and (2) to confirm returnable checks with the client and tag these in the RTOS. "Prime reject checks" refer to checks that are rejected by the Philippine Clearing House Corporation reading machines. 45 It includes checks with unreadable magnetic ink character recognition code. 46 Meanwhile, PPC No. 216-D, on the implementation of the RTOS, requires the immediate referral to client of items requiring decision and provides a 2:00 p.m. cut-off time for encoding the check's disposition in the RTOS.
Read together, PPC Nos. 373-B and 216-D require a Service Officer to review PR checks, irrespective of the checks' face value. Should a check present itself as an item for decision, the Service Officer must immediately confer with the client to determine its proper disposition — to return or honor the check. Once the client's advice has been obtained, the Service Officer must encode the check's disposition in the RTOS before the 2:00 p.m. cut-off time.
The parties, however, have differing interpretations of the procedure for the clearing of the checks. On the one hand, Ang maintains that, although the checks were stamped with "P.R.," they were referred to him by the CSD through the RTOS as "SD." As such, under the new check clearing procedure, he is justified in limiting his review or examination of the checks only to the defects specifically identified and referred to him by the CSD. Thus, he need not confer with the client since he was satisfied that the signatures appearing on the checks are identical to the specimen signatures on the branch's file. On the other hand, respondent bank contends that since the checks referred to Ang for disposition all bore the stamp "P.R.," Ang should have still treated these checks as PR checks and conferred with the client for decision. After all, despite the change in the bank's check clearing procedure, Ang's duty as a Service Officer to review PR checks remained the same. Respondents submit that the "items requiring decision" referred to by PPC No. 216-D include PR checks.
The Court finds in favor of Ang.
The evidence shows that all 60 checks 47 referred by the CSD to Ang indeed bore the stamp "P.R." and are, therefore, PR checks. Ang, however, disregarded the stamps appearing on the face of the checks and limited his examination of said checks to the signatures appearing thereon because they were referred to him as SDs and not as PRs. As explained by Ang in his Letter dated June 9, 2005, viz.:
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Unarguably, the alleged spurious checks were referred for disposition as "SD (Signature Differs)" instead of "PR (Prime Reject)" by the Clearing and Settlement Department in the Returnable Check System (RTOS). Guided by what was indicated thereon, I did what was appropriate under the circumstances and that was by comparing the specimen signature on file versus that of the returned check as appearing in the ECRS images. The signatures perfectly appeared the same and there was no sign at all of possible forgery. Satisfied after the comparison, I went on to tag the checks as "Honored."
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Had the alleged spurious checks [been] referred as "Prime Reject" or SD and PR at the same time, I would have complied with PPC No. 16-M; that is to confirm prime reject checks from clients/authorized signatories. But, I humbly beg you to consider, that this was not the case presented to me for immediate disposition at that time. It was for "signature differs" and no other. I presumed, and it is safe to assume that, the Clearing and Settlement Department (CSD) having physical possession of the checks must have satisfie[d] itself of the genuineness of the same except for the signatures.
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Ang explains that this is in line with the new check clearing system adopted in August 2004. 49 Originally, the entire process of clearing of checks was done by the branch. Under the new system, the original checks are sent to the CSD in Makati which, in turn, will verify the checks' authenticity and identify the defects. Defective checks are then encoded by the CSD in the RTOS, indicating thereon the identified defects. Scanned copies of the defective checks are also forwarded to the branch for assessment.
The Court finds Ang's interpretation of the procedure under the new check clearing system to be supported by the September 27, 2005 internal memo sent by respondent Garate to respondent bank's officers, thus:
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3. CSD Manila, referred to branch, the questioned checks of clients, through RTOS, as part of technical defects, with the reason "signature differs," and not "prime reject," though, the questioned checks are stamped with "PR."
4. CSD Manila should have referred the questioned checks to maintaining branch as "SPR," or spurious, and not "signature differs." Result from PNP Crime Lab in Camp Crame, through the assistance from SID, revealed that questioned checks are indeed not authentic.
5. Upon receipt by branch of questioned checks sent by CSD Manila, through scanned copies, maintaining branch did not confirm with clients on the cited technical defect of "signature differs," because they found the signatures in the scanned copies, no different from the signatures on file. Actions for non-referral to client, were based on concerned officers sound judgment under that particular circumstances [(sic)], not mentioning volume of transactions and non-receipt of PPC [No.] 16 and its amendments thereof. If checks in question were referred to maintaining branch as "prime reject," that could have triggered for the branch officer to immediately communicate with CSD Manila, what PR or "prime reject," is all about. In fact, it was cited by audit, that branch ignored the stamped PR on the questioned checks. This statement will support item No. 1 justification, that Branches are not provided with copies of PPC No. 16-M.
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Notably, even respondent Garate, respondent bank's First Vice President and Head of Transaction Banking Division, understood the new check clearing procedure to limit a branch's review and examination of checks to the defects specifically noted by the CSD in the RTOS. Following respondent Garate's interpretation of the procedure, Ang need not go beyond the examination of the signatures on the checks as these were the only defects identified and referred by the CSD to him through the RTOS. After all, it is also apparent from the exchanges of the parties that the RTOS is the platform through which the CSD endorses defective checks to the maintaining branch for review. Thus, to the mind of the Court, Ang's reliance on the defects specifically identified in the RTOS was totally justified. Since Ang was already satisfied that the signatures appearing on the checks referred to him were identical to the specimen signatures on file, he did not need to confer with the client for verification. The checks, therefore, are not "items requiring decision" which must be referred to client pursuant to PPC No. 216-D.
At any rate, any ambiguities brought about by the interplay between the existing check clearing policies and the new check clearing system, i.e., whether a Service Officer must limit its review of the check only to defects specifically identified by the CSD in the RTOS or whether a Service Officer still has a duty to go beyond the RTOS, should be viewed in favor of Ang — the employee. Thus, although the Bank's Code of Conduct penalizes "[f]ailure to comply and/or enforce policies and procedures x x x resulting in damage and/or prejudice to [respondent bank]," 51 it cannot definitely be said that Ang failed to comply with respondent bank's check clearing procedures. It will be the height of injustice to fault Ang for his actions when confusion still seemed to plague the newly adopted check clearing system. This is shown by the September 27, 2005 internal memo from respondent Garate, quoted above, where respondent Garate, a high-ranking officer of respondent bank, admits to have understood the procedure differently from respondent bank and in fact his understanding aligns with that of Ang. Further, another employee, Hipolito, committed the same mistake as Ang. Besides, respondent bank did not even explain why the checks were not also tagged as "P.R." in the RTOS when the RTOS is the platform used to refer defects to the maintaining branches.
Likewise, Ang cannot be held guilty of gross and habitual neglect of duties under Article 282 [now 297] of the Labor Code. To justify a dismissal under this provision, the employee's negligence must be both gross and habitual. Gross neglect of duty connotes "a flagrant and culpable refusal or unwillingness of a person to perform a duty" 52 and "refers to negligence characterized by the want of even slight care, acting or omitting to act in a situation where there is a duty to act, not inadvertently, but willfully and intentionally, with a conscious indifference to consequences insofar as other persons may be affected." 53 To warrant dismissal, it must also be habitual such that "a single or isolated act of negligence does not constitute a just cause for the dismissal of an employee." 54 Neglect is habitual when there is "repeated failure to perform one's duties over a period of time, depending upon the circumstances." 55 Here, it cannot even be said that Ang was negligent in the performance of his duties to begin with, since his actions, i.e., limiting his examination of the check to the defects identified in the RTOS and deciding not to refer the checks to client for verification, are reasonably justified under the prevailing check clearing policies. Ang did not exhibit lack of care in the performance of duties as Service Officer insofar as the honoring of the 60 checks is concerned.
In view of the foregoing, there is no basis to penalize Ang either under the Bank's Code of Conduct or the Labor Code. His suspension is, therefore, illegal. Consequently, there is also no basis to hold him liable for the P2,786,215.21 loss incurred by respondent bank on account of the erroneous honoring of the spurious checks. Respondent bank is therefore liable for the return of the amounts it deducted from Ang's salaries.
Ang is only entitled to moral
Actual damages are awarded to compensate for pecuniary loss, 56 and covers not only the value of the loss suffered, but also the unrealized profits. 57 To sustain an award for actual damages, the loss must be duly proven. 58 Here, apart from the return of the amounts deducted from his salaries, Ang is also seeking actual damages for opportunity loss or loss of income. 59 He claims that he was not promoted despite respondent bank's policy of promoting its employees every two years. 60 He also laments that he has been refused employment by other banks because of the pendency of the present case. 61 Unfortunately, however, he failed to present any proof that respondent bank indeed has a policy of promoting its employees periodically, that he is entitled to promotion, as well as the amount he would have been entitled to. To be sure, Ang himself admits that he cannot quantify the amount he claimed to have suffered as damages because of the alleged lost opportunity. Thus, the Court is without any factual basis to award Ang actual damages.
Ang, however, is entitled to moral and exemplary damages. Moral damages are recoverable where the dismissal of the employee was attended by bad faith or fraud or constituted an act oppressive to labor, or was done in a manner contrary to morals, good customs, or public policy, while exemplary damages may be awarded if the dismissal was effected in a wanton, oppressive or malevolent manner. 62
As earlier discussed, respondent bank's new check clearing procedure is not clear on whether a Service Officer is to limit his examination of checks to the defects specifically identified by the CSD in the RTOS. There was also no explanation on why the CSD did not tag the checks as PR checks when it referred the same to Ang through the RTOS. That respondent bank pinned the entire blame for the erroneous honoring of the checks on Ang and proceeded with the collection of the P2,786,215.21 loss it suffered through salary deductions over the objections of Ang smacks of bad faith. To be sure, respondent bank's act of reducing Ang's penalty from dismissal to suspension due to the non-dissemination of PPC No. 16-M is a tacit recognition that it cannot fully fault Ang under the circumstances. Thus, to hold Ang liable for a staggering amount in spite of the foregoing circumstances is unfair and oppressive. Respondent bank's bad faith in the implementation of salary deductions justifies the award of moral and exemplary damages in favor of Ang. The amounts awarded by the LA as moral and exemplary damages are, however, reduced to P100,000.00 each.
Ang is also entitled to attorney's fees equivalent to ten percent (10%) of the total judgment award pursuant to Article 111 of the Labor Code and Article 2208 of the Civil Code.
Finally, following prevailing jurisprudence, legal interest at the rate of six percent (6%) per annum is also imposed on the total monetary award, reckoned from the finality of this Resolution until full payment.
WHEREFORE, premises considered, the Petition for Review on Certiorari is GRANTED. The Decision dated March 15, 2013 and Resolution dated December 2, 2013 of the Court of Appeals in CA-G.R. SP No. 04709 are hereby ANNULLED and SET ASIDE, and a NEW ONE ENTERED finding the suspension of petitioner Jeffrey Y. Ang and the deductions from his salaries illegal, and ordering respondent Equitable PCI Bank to:
(1) pay Ang backwages for the period of his illegal suspension of thirty (30) days;
(2) return to Ang the amounts it illegally deducted from his salaries;
(3) pay Ang moral damages amounting to One Hundred Thousand Pesos (P100,000.00), and exemplary damages likewise amounting to One Hundred Thousand Pesos (P100,000.00); and
(4) pay Ang attorney's fees equivalent to ten percent (10%) of the judgment award.
The total judgment award shall earn legal interest at the rate of six percent (6%) per annum, computed from the finality of this Resolution until full payment.
Let the records of the case be remanded to the Labor Arbiter for proper computation of the award in accordance with this Resolution.
SO ORDERED."Lopez, M., J., on official leave.
By authority of the Court:
(SGD.) LIBRADA C. BUENADivision Clerk of Court
By:
MARIA TERESA B. SIBULODeputy Division Clerk of Court
Footnotes
1.Rollo, pp. 3-34.
2.Id. at 35-55. Penned by Associate Justice Gabriel T. Ingles and concurred in by Associate Justices Pampio A. Abarintos and Pedro B. Corales.
3.Id. at 56-61. Penned by Associate Justice Gabriel T. Ingles and concurred in by Associate Justices Pampio A. Abarintos and Ma. Luisa C. Quijano-Padilla.
4. Eighteenth Division and Special Former Eighteenth Division, respectively.
5.Id. at 229.
6.Id.
7.Id.
8.Id.
9.Id. at 229-230.
10.Id. at 137-138.
11.Id. at 137-138. Emphasis and italics in the original.
12.Id. at 139-140.
13.Id. at 141-143.
14.Id. at 144-146.
15.Id. at 147-149.
16.Id. at 147.
17.Id. at 150.
18.Id. at 229-230.
19.Id. at 151.
20.Id. at 152.
21.Id. at 97.
22.Id. at 120.
23.Id. at 229-239. Penned by Labor Arbiter Jose G. Gutierrez.
24.Id. at 232-233.
25.Id. at 93-104. Penned by Presiding Commissioner Violeta Ortiz-Bantug, concurred in by Commissioner Pablo C. Espiritu, Jr. and dissented by Commissioner Aurelio D. Menzon.
26.Id. at 104. Emphasis in the original.
27.Id. at 106-112.
28. CIVIL CODE, Art. 1146 provides:
Art. 1146. The following actions must be instituted within four years:
xxx xxx xxx
(2) Upon a quasi-delict. (n)
29.Rollo, p. 115.
30.Id. at 55. Emphasis in the original.
31. CIVIL CODE, Art. 1706 provides:
Art. 1706. Withholding of the wages, except for a debt due, shall not be made by the employer.
32.Supra note 3.
33.Id. at 405-425.
34. G.R. No. 156515, October 19, 2004, 440 SCRA 621.
35.Rollo, pp. 427-433.
36.Fuji Television Network, Inc. v. Espiritu, 749 Phil. 388, 415 (2014).
37. INTERNAL RULES OF THE SUPREME COURT, as amended, Rule 3, Section 4.
38.Rollo, pp. 26-28.
39.Id. at 59.
40.PCI Travel Corporation v. National Labor Relations Commission, G.R. No. 154379, October 31, 2008, 570 SCRA 315, 321.
41. See id.
42.Rollo, p. 109.
43. See Santos v. Litton Mills, Incorporated, G.R. No. 170646, June 22, 2011, 652 SCRA 510, 522.
44.Beltran v. AMA Computer College-Biñan/AMA Education System, G.R. No. 223795, April 3, 2019, accessed at <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/65309>.
45. Respondents' Position Paper, rollo, p. 158.
46. Complainant's Position Paper, id. at 128.
47.Id.
48.Id. at 139-140.
49.Id. at 127-128.
50.Id. at 147.
51.Id. at 197.
52.Philippine Savings Bank v. Genove, G.R. No. 202049, June 15, 2020, accessed at <https://sc.judiciary.gov.ph/15492/>.
53.Id.
54.Id.
55.De Guzman v. Kforce Global Solutions, G.R. No. 229844, July 10, 2019 (Unsigned Resolution), accessed at <https://sc.judiciary.gov.ph/6281/>.
56. CIVIL CODE, Art. 2199 provides:
Art. 2199. Except as provided by law or by stipulation, one is entitled to an adequate compensation only for such pecuniary loss suffered by him as he has duly proved. Such compensation is referred to as actual or compensatory damages.
57.Id., Art. 2200 states:
Art. 2200. Indemnification for damages shall comprehend not only the value of the loss suffered, but also that of the profits which the obligee failed to obtain. (1106)
58.Id.
59.Rollo, p. 29.
60.Id.
61.Id.
62.Roxas v. Baliwag Transit, Inc., G.R. No. 231859, February 19, 2020, accessed at <https://sc.judiciary.gov.ph/11788>.