FIRST DIVISION
[G.R. No. 253617. September 29, 2021.]
ARMS CORPORATION OF THE PHILIPPINES, petitioner, vs. MARVIN A. OLIVO, BRYAN L. DAUS, RAMMEL C. GABAT, BERNARD B. DEGUINIO, MARIO S. LUCAÑAS, JR., ALBERT CHRISTIAN S. MANALO, JOHN EMERSON D. PADUA, DICK V. TOGONON, RANDY MALIBIRAN, RAMIL DUNGARAN, JESROME SIEGA, AND LANZ NIGEL A. MOLINA, respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, First Division, issued a Resolution dated September 29, 2021which reads as follows:
"G.R. No. 253617 (Arms Corporation of the Philippines v. Marvin A. Olivo, Bryan L. Daus, Rammel C. Gabat, Bernard B. Deguinio, Mario S. Lucañas, Jr., Albert Christian S. Manalo, John Emerson D. Padua, Dick V. Togonon, Randy Malibiran, Ramil Dungaran, Jesrome Siega, and Lanz Nigel A. Molina). — In this Petition for Review on Certiorari1 under Rule 45 of the Rules of Court, petitioner Armscor Corporation of the Philippines (Amscor) questions the award of moral and exemplary damages by the Court of Appeals (CA) in its Decision 2 dated January 23, 2019, and Amended Decision 3 dated September 16, 2020, in CA-G.R. SP No. 155227.
In this case, Armscor notified Nozomi Fortune Services, Inc. (Nozomi) that it will no longer renew their job contracting agreement effective October 31, 2016. As a result, respondents Olivo, et al. or the Nozomi complainants were recalled by Nozomi and were no longer allowed to report for work in Armscor. However, record shows that respondents Olivo, et al. directly applied with Armscor as machine operators. After being hired, they were placed under one service provider after another, until they were transferred to Nozomi. When they reported for work in November 2016, they were informed by the supervisor that their employments have been terminated because they refused to sign another contract with the new manpower agency. 4
As for Ramil Dungaran, Randy Malibiran, Albert Christian S. Manalo, Lanz Nigel A. Molina, Jesrome Siega, and Dick V. Togonan (MOSI complainants), or respondents Manalo, et al., they also applied for a job directly with Armscor. After the usual testing and interview, they were made to work under the manpower agency PLUS and were subsequently transferred to Manpower Outsourcing Services, Inc. (MOSI) in June 2015. But unlike the Nozomi complainants whose services were terminated, the MOSI complainants were still employed at Armscor at the time of the filing of their complaint for regularization. 5
Based on the evidence presented, the Labor Arbiter (LA), the National Labor Relations Commission (NLRC), and the CA ruled that Armscor, MOSI, and Nozomi engaged in prohibited labor-only contracting. All respondents, both MOSI and Nozomi complainants were declared to be regular employees of Armscor, who were entitled to all benefits given to Armscor's regular employees. As for the Nozomi complainants, they were found to have been illegally dismissed and were ordered reinstated to their former positions without loss of seniority rights. They were also awarded backwages reckoned from their dismissal until reinstated, plus attorney's fees.
Armscor no longer disputed the finding that respondents were regular employees of the company and that the Nozomi complainants were illegally dismissed. Yet, it insisted that the LA and the NLRC did not find any basis for the grant of moral and exemplary damages to respondents. Thus, it argues that it was an error for the CA to award these damages when there was no evidence that the job contracting arrangement between Armscor, Nozomi, and MOSI, and the dismissal of the Nozomi complainants were attended by bad faith or ill motive.
In termination cases, the award of moral damages is based on Articles 2219 6 and 2220 7 of the Civil Code. Moral damages may be recovered in instances where there was bad faith, malice, or fraud, or where the employee's dismissal constitutes an act oppressive to labor, or where the dismissal was done in a manner contrary to morals, good customs, or public policy. 8
On the other hand, exemplary damages may be awarded if the dismissal is done in a wanton, oppressive or malevolent manner, or where employees were terminated on frivolous, arbitrary, and unjust grounds. The Court has also awarded exemplary damages to employees who were dismissed by an employer in an attempt to evade compliance with statutorily established employee benefits and those who were terminated for cause, but without due process. 9
Guided by the foregoing, the Court agrees with the CA that there was bad faith in the dismissal of the Nozomi complainants. 10 The non-renewal of the job contracting agreement between Armscor and Nozomi was evidently a ploy to prevent the Nozomi complainants from attaining regular employment status and deny them of lawful benefits. The dismissal was also done in a wanton, oppressive or malevolent manner considering that the Nozomi complainants were denied substantive and procedural due process. There was no valid cause shown for their termination and they were just verbally notified by their supervisor of their dismissal before being barred from Armscor's premises. These insidious acts indeed justify the awards of P50,000.00 moral damages and P50,000.00 exemplary damages for respondents Olivo, et al.11
The same is true with regard to the other respondents Manalo, et al. or the MOSI complainants. While respondents Manalo, et al. were not dismissed and remained as employees of Armscor at the time of the filing of the complaint, still, there was bad faith on the part of Armscor and MOSI. They resorted to prohibited labor-only contracting as a subterfuge to avoid the regularization of the MOSI complainants, which circumvented labor laws and are considered oppressive to labor. Hence, the Court affirms the CA's award of damages to respondents Manalo, et al.12
FOR THESE REASONS, the petition is DENIED. The Court of Appeals' Decision dated January 23, 2019, and Amended Decision dated September 16, 2020, in CA-G.R. SP No. 155227 are AFFIRMED.
SO ORDERED." Lazaro-Javier, J., no part; Inting, J., designated additional Member per Raffle dated December 2, 2020.
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. 13-30.
2.Id. at 35-58. Penned by Associate Justice Amy C. Lazaro-Javier (now a member of this Court), with the concurrence Associate Justices Remedios A. Salazar-Fernando and Marie Christine Azcarraga-Jacob.
3.Id. at 60-75. Penned by Associate Justice Marie Christine Azcarraga-Jacob, with the concurrence of Associate Justices Remedios A. Salazar-Fernando and Maria Elisa Sempio Diy.
4 Id. at 861.
5.Id. at 862.
6. ART. 2219. Moral damages may be recovered in the following and analogous cases:
xxx xxx xxx
(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.
xxx xxx xxx
ART. 21. Any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage.
7. ART. 2220. Willful injury to property may be a legal ground for awarding moral damages if the court should find that, under the circumstances, such damages are justly due. The same rule applies to breaches of contract where the defendant acted fraudulently or in bad faith.
8.Saudi Arabian Airlines (SAUDIA) v. Rebesencio, 750 Phil. 791, 842 (2015).
9.Id. at 843; Quadra v. Court of Appeals, 529 Phil. 218, 223-224 (2006); and Montinola v. Philippine Airlines, 742 Phil. 487, 510-511 (2014).
10.Rollo, pp. 55-56.
11.Kay Products, Inc. v. Court of Appeals, 502 Phil. 783, 798 (2005); and Fulache v. ABS-CBN Broadcasting Corp., 624 Phil. 562, 577-586 (2010). See also Cusap v. Adidas Philippines, Inc. (ADIDAS), 765 Phil. 121, 138-139 (2015).
12.Daguinod v. Southgate Foods, Inc., G.R. No. 227795 (Formerly UDK-15556), February 20, 2019; and Montinola v. Philippine Airlines, supra note 9, at 505-511 (2014).