G.R. No.

196036               October 23, 2013

ELIZABETH M. GAGUI, Petitioner,
vs.
SIMEON DEJERO and TEODORO R. PERMEJO, Respondents.

DECISION

SERENO, CJ:

This is a Rule 45 Petition1 dated 30 March 2011 assailing the Decision2 and Resolution3 of the Court
of Appeals (CA) in CA-G.R. SP No. 104292, which affirmed the Decision4 of the National Labor
Relations Commission (NLRC) in NLRC Case No. OCW-RAB-IV-4-392-96-RI, finding petitioner
Elizabeth M. Gagui solidarily liable with the placement agency, PRO Agency Manila, Inc., to pay
respondents all the money claims awarded by virtue of their illegal dismissal.

The antecedent facts are as follows:

On 14 December 1993, respondents Simeon Dejero and Teodoro Permejo filed separate
Complaints5 for illegal dismissal, nonpayment of salaries and overtime pay, refund of transportation
expenses, damages, and attorney’s fees against PRO Agency Manila, Inc., and Abdul Rahman Al
Mahwes.

After due proceedings, on 7 May 1997, Labor Arbiter Pedro Ramos rendered a Decision,6 the
dispositive portion of which reads:

WHEREFORE, ALL FOREGOING CONSIDERED, judgment is hereby rendered ordering

respondents Pro Agency Manila, Inc., and Abdul Rahman Al Mahwes to jointly and severally pay
complainants, as follows:

a) US$4,130.00 each complainant or a total of US$8,260.00, their unpaid salaries from July
31, 1992 up to September 1993, less cash advances of total of SR11,000.00, or its Peso
equivalent at the time of payment;

b) US$1,032.00 each complainant for two (2) hours overtime pay for fourteen (14) months of
services rendered or a total of US$2,065.00 or its Peso equivalent at the time of payment;

c) US$2,950.00 each complainant or a total of US$5,900.00 or its Peso equivalent at the

time of payment, representing the unexpired portion of their contract;

d) Refund of plane ticket of complainants Teodoro Parejo and Simeon Dejero from Saudi
Arabia to the Philippines, in the amount of ₱15,642.90 and ₱16,932.00 respectively;

e) Refund of excessive collection of placement fees in the amount of ₱4,000.00 each

complainant, or a total of ₱8,000.00;

f) Moral and exemplary damages in the amount of ₱10,000.00 each complainant, or a total
of ₱20,000.00;

g) Attorney’s fees in the amount of ₱48,750.00.

SO ORDERED.

Pursuant to this Decision, Labor Arbiter Ramos issued a Writ of Execution7 on 10 October 1997.
When the writ was returned unsatisfied,8 an Alias Writ of Execution was issued, but was also
returned unsatisfied.9

On 30 October 2002, respondents filed a Motion to Implead Respondent Pro Agency Manila, Inc.’s
Corporate Officers and Directors as Judgment Debtors.10 It included petitioner as the Vice-
President/Stockholder/Director of PRO Agency, Manila, Inc.

After due hearing, Executive Labor Arbiter Voltaire A. Balitaan issued an Order11 on 25 April 2003
granting respondents’ motion, to wit:

WHEREFORE, the motion to implead is hereby granted insofar as Merlita G. Lapuz and Elizabeth
M. Gagui as parties-respondents and accordingly held liable to complainant jointly and solidarily with
the original party-respondent adjudged liable under the Decision of May 7, 1998. Let 2nd Alias Writ
of Execution be issued for the enforcement of the Decision consistent with the foregoing tenor.

SO ORDERED.

On 10 June 2003, a 2nd Alias Writ of Execution was issued,12 which resulted in the garnishment of
petitioner’s bank deposit in the amount of ₱85,430.48.13 However, since the judgment remained
unsatisfied, respondents sought the issuance of a third alias writ of execution on 26 February 2004.14

On 15 December 2004, Executive Labor Arbiter Lita V. Aglibut issued an Order15 granting

respondents’ motion for a third alias writ. Accordingly, the 3rd Alias Writ of Execution16 was issued on
6 June 2005, resulting in the levying of two parcels of lot owned by petitioner located in San
Fernando, Pampanga.17

On 14 September 2005, petitioner filed a Motion to Quash 3rd Alias Writ of Execution;18 and on 29
June 2006, a Supplemental Motion to Quash Alias Writ of Execution.19 In these motions, petitioner
alleged that apart from not being made aware that she was impleaded as one of the parties to the
case,20 the dispositive portion of the 7 May 1997 Decision (1997 Decision) did not hold her liable in
any form whatsoever.21 More importantly, impleading her for the purpose of execution was
tantamount to modifying a decision that had long become final and executory.22

On 26 June 2006, Executive Labor Arbiter Lita V. Aglibut issued an Order23 denying petitioner’s
motions on the following grounds: (1) records disclosed that despite having been given sufficient
notices to be able to register an opposition, petitioner refused to do so, effectively waiving her right
to be heard;24 and (2) under Section 10 of Republic Act No. 8042 (R.A. 8042) or the Migrant Workers
and Overseas Filipinos Act of 1995, corporate officers may be held jointly and severally liable with
the placement agency for the judgment award.25

Aggrieved, petitioner appealed to the NLRC, which rendered a Decision26 in the following wise:

WHEREFORE, premises considered, the appeal of the respondent Elizabeth M. Gagui is hereby
DENIED for lack of merit. Accordingly, the Order of Labor Arbiter Lita V. Aglibut dated June 26, 2006
is AFFIRMED.

SO ORDERED.
The NLRC ruled that "in so far as overseas migrant workers are concerned, it is R.A. 8042 itself that
describes the nature of the liability of the corporation and its officers and directors. x x x [I]t is not
essential that the individual officers and directors be impleaded as party respondents to the case
instituted by the worker. A finding of liability on the part of the corporation will necessarily mean the
liability of the corporate officers or directors."27

Upon appellate review, the CA affirmed the NLRC in a Decision28 promulgated on 15 November

2010:

From the foregoing, the Court finds no reason to hold the NLRC guilty of grave abuse of discretion
amounting to lack or excess of jurisdiction in affirming the Order of Executive Labor Arbiter Aglibut
which held petitioner solidarily liable with PRO Agency Manila, Inc. and Abdul Rahman Al Mahwes
as adjudged in the May 7, 1997 Decision of Labor Arbiter Pedro Ramos.

WHEREFORE, the Petition is DENIED.

SO ORDERED. (Emphasis in the original)

The CA stated that there was "no need for petitioner to be impleaded x x x because by express
provision of the law, she is made solidarily liable with PRO Agency Manila, Inc., for any and all
money claims filed by private respondents."29 The CA further said that this is not a case in which the
liability of the corporate officer must be established because an allegation of malice must be proven.
The general rule is that corporate officers, directors and stockholders are not liable, except when
they are made liable for their corporate act by a specific provision of law, such as R.A. 8042.30

On 8 and 15 December 2010, petitioner filed two Motions for Reconsideration, but both were denied
in a Resolution31 issued by the CA on 25 February 2011.

Hence, this Petition for Review filed on 30 March 2011.

On 1 August 2011, respondents filed their Comment,32 alleging that the petition had been filed 15
days after the prescriptive period of appeal under Section 2, Rule 45 of the Rules of Court.

On 14 February 2012, petitioner filed a Reply,33 countering that she has a fresh period of 15 days
from 16 March 2011 (the date she received the Resolution of the CA) or up to 31 March 2011 to file
the Petition.

ISSUES

From the foregoing, we reduce the issues to the following:

1. Whether or not this petition was filed on time; and

2. Whether or not petitioner may be held jointly and severally liable with PRO Agency Manila,
Inc. in accordance with Section 10 of R.A. 8042, despite not having been impleaded in the
Complaint and named in the Decision.

THE COURT’S RULING

Petitioner has a fresh period of 15 days within which to file this petition, in accordance with the
Neypes rule.
We first address the procedural issue of this case.

In a misleading attempt to discredit this petition, respondents insist that by opting to file a Motion for
Reconsideration instead of directly appealing the CA Decision, petitioner effectively lost her right to
appeal. Hence, she should have sought an extension of time to file her appeal from the denial of her
motion.

This contention, however, deserves scant consideration. We agree with petitioner that starting from
the date she received the Resolution denying her Motion for Reconsideration, she had a "fresh
period" of 15 days within which to appeal to this Court. The matter has already been settled in
Neypes v. Court of Appeals,34 as follows:

To standardize the appeal periods provided in the Rules and to afford litigants fair opportunity to
appeal their cases, the Court deems it practical to allow a fresh period of 15 days within which to file
the notice of appeal in the Regional Trial Court, counted from receipt of the order dismissing a
motion for a new trial or motion for reconsideration.

Henceforth, this "fresh period rule" shall also apply to Rule 40 governing appeals from the Municipal
Trial Courts to the Regional Trial Courts; Rule 42 on petitions for review from the Regional Trial
Courts to the Court of Appeals; Rule 43 on appeals from quasi-judicial agencies to the Court of
Appeals and Rule 45 governing appeals by certiorari to the Supreme Court. The new rule aims to
regiment or make the appeal period uniform, to be counted from receipt of the order denying the
motion for new trial, motion for reconsideration (whether full or partial) or any final order or
resolution.

Since petitioner received the CA Resolution denying her two Motions for Reconsideration only on 16
March 2011, she had another 15 days within which to file her Petition, or until 31 March 2011. This
Petition, filed on 30 March 2011, fell within the prescribed 15-day period.

Petitioner may not be held jointly and severally liable, absent a finding that she was remiss in
directing the affairs of the agency.

As to the merits of the case, petitioner argues that while it is true that R.A. 8042 and the Corporation
Code provide for solidary liability, this liability must be so stated in the decision sought to be
implemented.35 Absent this express statement, a corporate officer may not be impleaded and made
to personally answer for the liability of the corporation.36 Moreover, the 1997 Decision had already
been final and executory for five years and, as such, can no longer be modified.37 If at all,
respondents are clearly guilty of laches for waiting for five years before taking action against
petitioner.38

In disposing the issue, the CA cited Section 10 of R.A. 8042, stating that there was "no need for
petitioner to be impleaded x x x because by express provision of the law, she is made solidarily
liable with PRO Agency Manila, Inc., for any and all money claims filed by private respondents."39

We reverse the CA.

At the outset, we have declared that "R.A. 8042 is a police power measure intended to regulate the
recruitment and deployment of OFWs. It aims to curb, if not eliminate, the injustices and abuses
suffered by numerous OFWs seeking to work abroad."40

The pertinent portion of Section 10, R.A. 8042 reads as follows:

SEC. 10. MONEY CLAIMS. - Notwithstanding any provision of law to the contrary, the Labor Arbiters
of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction
to hear and decide, within ninety (90) calendar days after filing of the complaint, the claims arising
out of an employer-employee relationship or by virtue of any law or contract involving Filipino
workers for overseas deployment including claims for actual, moral, exemplary and other forms of
damages.

The liability of the principal/employer and the recruitment/placement agency for any and all claims
under this section shall be joint and several. This provision shall be incorporated in the contract for
overseas employment and shall be a condition precedent for its approval. The performance bond to
be filed by the recruitment/placement agency, as provided by law, shall be answerable for all money
claims or damages that may be awarded to the workers. If the recruitment/placement agency is a
juridical being, the corporate officers and directors and partners as the case may be, shall
themselves be jointly and solidarily liable with the corporation or partnership for the aforesaid claims
and damages. (Emphasis supplied)

In Sto. Tomas v. Salac,41 we had the opportunity to pass upon the constitutionality of this provision.
We have thus maintained:

The key issue that Gumabay, et al. present is whether or not the 2nd paragraph of Section 10, R.A.
8042, which holds the corporate directors, officers, and partners of recruitment and placement
agencies jointly and solidarily liable for money claims and damages that may be adjudged against
the latter agencies, is unconstitutional.

xxxx

But the Court has already held, pending adjudication of this case, that the liability of corporate
directors and officers is not automatic. To make them jointly and solidarily liable with their company,
there must be a finding that they were remiss in directing the affairs of that company, such as
sponsoring or tolerating the conduct of illegal activities. In the case of Becmen and White Falcon,
while there is evidence that these companies were at fault in not investigating the cause of Jasmin’s
death, there is no mention of any evidence in the case against them that intervenors Gumabay, et
al., Becmen’s corporate officers and directors, were personally involved in their company’s particular
actions or omissions in Jasmin’s case. (Emphasis supplied)

Hence, for petitioner to be found jointly and solidarily liable, there must be a separate finding that
she was remiss in directing the affairs of the agency, resulting in the illegal dismissal of respondents.
Examination of the records would reveal that there was no finding of neglect on the part of the
petitioner in directing the affairs of the agency. In fact, respondents made no mention of any instance
when petitioner allegedly failed to manage the agency in accordance with law, thereby contributing
to their illegal dismissal.

Moreover, petitioner is correct in saying that impleading her for the purpose of execution is
tantamount to modifying a decision that had long become final and executory.42 The fallo of the 1997
Decision by the NLRC only held "respondents Pro Agency Manila Inc., and Abdul Rahman Al
Mahwes to jointly and severally pay complainants x x x."43 By holding her liable despite not being
ordained as such by the decision, both the CA and NLRC violated the doctrine on immutability of
judgments.

In PH Credit Corporation v. Court of Appeals,44 we stressed that "respondent's petitioner’s obligation

is based on the judgment rendered by the trial court. The dispositive portion or the fallo is its decisive
resolution and is thus the subject of execution. x x x. Hence the execution must conform with that
which is ordained or decreed in the dispositive portion of the decision."

In JNIMACO v. NLRC,45 we a]so held thus:

None of the parties in the case before the Labor Arbiter appealed the Decision dated March 10,
1987, hence the same became final and executory. It was, therefore, removed from the jurisdiction
of the Labor Arbiter or the NLRC to further alter or amend it. Thus, the proceedings held for the
purpose of amending or altering the dispositive portion of the said decision are null and void for lack
of jurisdiction. Also, the Alias Writ of Execution is null and void because it varied the tenor of the
judgment in that it sought to enforce the final judgment against ''Antonio Gonzales/Industrial
Management Development Corp. (INIMACO) and/or Filipinas Carbon and Mining Corp. and Gerardo
Sicat, which makes the liability solidary.

In other words, "once a decision or order becomes final and executory, it is removed from. the power
or jurisdiction of the court which rendered it to further alter or amend it. It thereby becomes
immutable and unalterable and any amendment or alteration which substantially affects a final and
executory judgment is null and void for lack of jurisdiction, including the entire proceedings held for
that purpose. An order of exen1tion which varies the tenor of the judgment or exceeds the terms
thereof is a nullity."46

While labor laws should be construed liberally in favor of labor, we must be able to balance this with
the equally important right of petitioner to due process. Because the 1997 Decision of Labor Arbiter
Ramos was not appealed, it became final and executory and was therefore removed from his
jurisdiction. Modifying the tenor of the judgment via a motion impleading petitioner and filed only in
2002 runs contrary to settled jurisprudence, rendering such action a nullity. WHEREFORE, the
Petition for Review on Certiorari is hereby GRANTED The assailed Decision dated 5 November
2010 and Resolution dated 25 February 2011 of the Court of Appeals in CA-G.R. SP No. 104292 are
hereby REVERSED.

SO ORDERED.