THIRD DIVISION

[G.R. No. 108961. November 27, 1998.]

CITIBANK, N.A. , petitioner, vs . COURT OF APPEALS (Third Division),

and CITIBANK INTEGRATED GUARDS LABOR ALLIANCE (CIGLA)
SEGATUPAS/FSM LOCAL CHAPTER No. 1394 , respondents.

SYLLABUS

1. LABOR CODE; EMPLOYMENT; EMPLOYER-EMPLOYEE RELATIONSHIP;

TESTS THEREOF. — This Court has held in many cases that "in determining the existence of
an employer-employee relationship, the following elements are generally considered: 1)
the selection and engagement of the employee; 2) the payment of wages; 3) the power of
dismissal; and 4) the employer's power to control the employee with respect to the means
and methods by which the work is to be accomplished. AEcIaH

2. ID.; LABOR & SOCIAL LEGISLATION; LABOR ARBITER; JURISDICTION. — It has

been decided also that the Labor Arbiter has no jurisdiction over a claim led where no
employer-employee relationship existed between a company and the security guards
assigned to it by security service contractor. In this case, it was the security agency El
Toro that recruited, hired and assigned the watchmen to their place of work. It was the
security agency that was answerable to Citibank for the conduct of its guards. SCIcTD

3. REMEDIAL LAW; CIVIL PROCEDURE; JURISDICTION; DETERMINED BY THE

ALLEGATIONS OF THE COMPLAINT. — It is a basic rule of procedure that "jurisdiction of
the court over the subject matter of the action is determined by the allegations of the
complaint, irrespective of whether or not the plaintiff is entitled to recover upon all or
some of the claims asserted therein. The jurisdiction of the court cannot be made to
depend upon the defenses set up in the answer or upon the motion to dismiss, for
otherwise, the question of jurisdiction would almost entirely depend upon the defendant."
"What determines the jurisdiction of the court is the nature of the action pleaded as
appearing from the allegations in the complaint. The averments therein and the character
of the relief sought are the ones to be consulted."
4. ID.; ID.; ID.; ID.; CASE AT BAR. — In the complaint led with the trial court,
petitioner alleged that in 1983, it entered into a contract with El Toro, a security agency, for
security and protection service. The parties renewed the contract yearly until April 22,
1990. Petitioner further alleged that from June 11, 1990, until the ling of the complaint. El
Toro security guards formerly assigned to guard Citibank premises loitered around the
bank's premises in large groups and threatened to stage a strike, which would hamper its
operations and the normal conduct of its business and that the bank would suffer
damages should a strike push through. On the basis of the allegations of the complaint, it
is safe to conclude that the dispute involved is a civil one, not a labor dispute.
Consequently, we rule that jurisdiction over the subject matter of the complaint lies with
the regional trial court.

DECISION

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 PARDO , J : p

The Case
The case before the Court is a petition for review on certiorari seeking to reverse
and set aside the decision of the Court of Appeals 1 and its resolution denying
reconsideration 2 , ruling that it is the labor tribunal, not the regional trial court, that has
jurisdiction over the complaint for injunction and damages led by petitioner with the
regional trial court. cdll

The Facts
In 1983, Citibank and El Toro Security Agency, Inc. (hereafter El Toro) entered into a
contract for the latter to provide security and protective services to safeguard and protect
the bank's premises, situated at 8741 Paseo de Roxas, Makati, Metro Manila. Under the
contract, El Tore obligated itself to provide the services of security guards to safeguard
and protect the premises and property of Citibank against theft, robbery or any other
unlawful acts committed by any person or persons, and assumed responsibility for losses
and/or damages that may be incurred by Citibank due to or as a result of the negligence of
El Toro or any of its assigned personnel. 4
Citibank renewed the security contract with El Toro yearly until 1990. On April 22,
1990, the contract between Citibank and El Toro expired.
On June 7, 1990, respondent Citibank Integrated Guards Labor Alliance-SEGA-
TUPAS/FSM (hereafter CIGLA) led with National Conciliation and Mediation Board
(NCMB) a request for preventive mediation citing Citibank as respondent therein giving as
issues for preventive mediation the following:
a) Unfair labor practice;
b) Dismissal of union officers/members; and
c) Union busting.
On June 10, 1990, petitioner of Citibank served on El Toro a written notice that the
bank would not renew anymore the service agreement with the latter. Simultaneously,
Citibank hired another security agency, the Golden Pyramid Security Agency, to render
security services at Citibank's premises.
On the same date, June 10, 1990, respondent CIGLA led a manifestation with the
NCMB that it was converting its request for preventive mediation into a notice of strike for
failure of the parties to reach a mutually acceptable settlement of the issues, which it
followed with a supplemental notice of strike alleging as supplemental issue the mass
dismissal of all union officers and members.
On June 11, 1990, security guards of El Toro who were replaced by guards of the
Golden Pyramid Security Agency considered the non-renewal of El Toro's service
agreement with Citibank as constituting a lockout and/or a mass dismissal. They
threatened to go on strike against Citibank and picket its premises.
In fact, security guards formerly assigned to Citibank under the expired agreement
loitered around and near the Citibank premises in large groups of from twenty (20) and at
times fifty (50) persons.

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 On June 14, 1990, respondent CIGLA led a notice of strike directed at the premises
of the Citibank main office.
Faced with the prospect of disruption of its business operations, on June 5, 1990,
petitioner Citibank led with the Regional Trial Court, Makati, a complaint for injunction and
damages. 5 The complaint sought to enjoin CIGLA and any person claiming membership
therein from striking or otherwise disrupting the operations of the bank.
On June 18, 1990, respondent CIGLA led with the trial court a motion to dismiss
the complaint. The motion alleged that:
a) The Court had no jurisdiction, this being labor dispute.
b) The guards were employees of the bank.
c) There were pending cases/labor disputes between the guards and
the bank at the different agencies of the Department of Labor and
Employment (DOLE).
d) The bank was guilty of forum shopping in ling the complaint with the
Regional Trial Court after submitting itself voluntarily to the
jurisdiction of the different agencies of the DOLE.
By order dated August 19, 1990, the trial court denied respondent CIGLA's motion
to dismiss. The relevant portion of the order reads as follows:
"Plaintiff in its Opposition alleged that jurisdiction of the court is
determined by the allegations of the complaints. In the plaintiff's complaint there
are allegations, which negate any employer-employee relationship between it and
the CIGLA members; however the Court could not dismiss the case and lift the
restraining order without first threshing out the same at the trial of the case.

The Court finding the grounds alleged in the defendant's motion well taken,
the motion is hereby denied.

SO ORDERED."

In due time, respondent CIGLA led with the trial court a motion for reconsideration
of the above-mentioned order. On October 1, 1990, the trial court denied the motion.
Subsequently, respondent CIGLA led with the trial court its answer to the
complaint, and averred as special and a rmative defense lack of jurisdiction of the court
over the subject matter of the case. Treating the averment as motion to dismiss, on April
27, 1991, the lower court issued an order denying the motion. The lower court stated:
"The Court noted in defendant's Memorandum of Authorities that they
made no mention who among the parties — the plaintiff bank or the defendants
union — paid their wages or salaries and who has the power to dismiss them.
Defendants also alleged that the complaint states no valid cause of action
as plaintiff's allegations are purely anchored on conjectures and conclusions and
not based on ultimate facts.

Plaintiff in its Opposition alleged that it is a well-settled rule, that in a

motion to dismiss based on the ground that the complaint fails to state a cause
of action, the question submitted to the court for determination is the su ciency
of the allegation in the complaint itself. Plaintiff also alleged that the defendants
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 disputed the jurisdiction of the court, the parties having employer-employee
relationship; this mere allegation did not serve to automatically deprive the court
of its jurisdiction duly conferred by the allegations of the complaint; in the opinion
of the defendants, a labor dispute exists, the court is duty bound to nd out if
such circumstances really exist.
The Court weighing the evidence and jurisprudence in support of the
respective contention of the parties, and nding that in the case at bar, plaintiff
seeks to recover pecuniary damages, the Court gives more credence to the
decisions cited by the plaintiff, hence the special and a rmative defenses
alleged in the answer treated as a 'Motion to Dismiss' is hereby denied." Cdpr

On May 24, 1991 respondent CIGLA led with the Court of Appeals a petition for
certiorari with preliminary injunction 6 assailing the validity of the proceedings had before
the regional trial court.
After due proceedings, on March 31, 1992, the Court of Appeals promulgated its
decision in CIGLA's favor, the dispositive portion of which states:
"WHEREFORE, the Writ of Certiorari is GRANTED, and the proceedings
before respondent Judge more particularly the challenged orders are declared null
and void and respondent Judge is enjoined from taking any further action in Civil
Case No. 90-1612 except for the purpose of dismissing it. Following, however, the
disposition in San Miguel Corporation Employees Union vs. Bersamira, the status
quo ante declaration of strike shall be observed pending the proceedings in the
National Conciliation and Mediation Board, Department of Labor and
Employment, National Capital Region (Annex A of Petition). No Costs.
SO ORDERED."

On April 29, 1992, petitioner Citibank led a motion for reconsideration of the
decision. On February 12, 1993, the Court of Appeals denied the motion, nding that the
arguments in the motion for reconsideration are but a rehash, if not a repetition, of the
arguments in its comments, which had been considered by the Court in its decision.
Hence, the petitioner's recourse to this Court.
The Issue
The basic issue involved is whether it is the labor tribunal or the regional trial court
that has jurisdiction over the subject matter of the complaint led by Citibank with the trial
court.
Petitioner's Submission
Petitioner Citibank contends that there is no employer-employee relationship
between Citibank and the security guards represented by respondent CIGLA and that there
is no "labor dispute" in the subject controversy. The security guards were employees of El
Toro security agency, not of Citibank. Its service contract with Citibank had expired and
not renewed.
The Court's Ruling
We sustain the petitioner's contention. This Court has held in many cases that "in
determining the existence of an employer-employee relationship, the following elements
are generally considered: 1) the selection and engagement of the employee; 2) the
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 payment of wages; 3) the power of dismissal; and 4) the employer's power to control the
employee with respect to the means and methods by which the work is to be
accomplished". 7 It has been decided also that the Labor Arbiter has no jurisdiction over a
claim led where no employer-employee relationship existed between a company and the
security guards assigned to it by a security service contractor. 8 In this case, it was the
security agency El Toro that recruited, hired and assigned the watchmen to their place of
work. It was the security agency that was answerable to Citibank for the conduct of its
guards.
The question arises. Is there a labor dispute between Citibank and the security
guards, members of respondent CIGLA, regardless of whether they stand in the relation of
employer and employees? Article 212, paragraph 1 of the Labor Code provides the
de nition of a " labor dispute". It "includes any controversy or matter concerning terms of
conditions of employment or the association or representation of persons in negotiating,
xing, maintaining, changing or arranging the terms and conditions of employment,
regardless of whether the disputants stand in the proximate relation of employer and
employee."
If at all, the dispute between the Citibank and El Toro security agency is one
regarding the termination or non-renewal of the contract of services. This is a civil dispute.
9 El Toro was an independent contractor. Thus, no employer-employee relationship existed
between Citibank and the security guards members of the union in the security agency
who were assigned to secure the bank's premises and property. Hence, there was no labor
dispute and no right to strike against the bank.
It is a basic rule of procedure that "jurisdiction of the court over the subject matter
of the action is determined by the allegations of the complaint, irrespective of whether or
not the plaintiff is entitled to recover upon all or some of the claims asserted therein. The
jurisdiction of the court can not be made to depend upon the defenses set up in the
answer or upon the motion to dismiss, for otherwise, the question of jurisdiction would
almost entirely depend upon the defendant." 1 0 "What determines the jurisdiction of the
court is the nature of the action pleaded as appearing from the allegations in the
complaint. The averments therein and the character of the relief sought are the ones to be
consulted." 1 1
In the complaint led with the trial court, petitioner alleged that in 1983, it entered
into a contract with El Toro, a security agency, for security and protection service. The
parties renewed the contract yearly until April 22, 1990. Petitioner further alleged that from
June 11, 1990, until the ling of the complaint, El Toro security guards formerly assigned
to guard Citibank premises loitered around the bank's premises in large groups and
threatened to stage a strike, which would hamper its operations and the normal conduct of
its business and that the bank would suffer damages should a strike push through. cdasia

On the basis of the allegations of the complaint, it is safe to conclude that the
dispute involved is a civil one, not a labor dispute. 12 Consequently, we rule that jurisdiction
over the subject matter of the complaint lies with the regional trial court.
Relief
WHEREFORE, the Court hereby GRANTS the petition for review on certiorari. We
REVERSE and SET ASIDE the decision of the Court of Appeals and its resolution denying
reconsideration in CA-G.R. SP No. 25584, and REMAND the records of the case to the
Regional Trial Court, Makati, for further proceedings in line with the ruling herein that
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 jurisdiction over the subject matter of the complaint in Civil Case No. 90-1612, is vested
therein.
No pronouncement as to costs.
SO ORDERED.
Narvasa, C .J ., Romero and Purisima, JJ ., concur.
Kapunan, J ., took no part.

Footnotes
1. CA-G.R. No. SP 25584, promulgated on March 31, 1992.
2. Adopted on February 12, 1993.
3. Footnotes reference and footnotes text are not found in the original files.
4. Petition, Annex "A", Rollo, pp. 37-42.

5. Civil Case No. 90-1612.

6. CA-G.R. SP No. 25584.
7. Sandigan Savings and Loan Bank, Inc. v. National Labor Relations Commission, 254
SCRA 126; See also Victorias Milling Co., Inc. v. National Labor Relations Commission,
262 SCRA 623; Filipinas Broadcasting Network, Inc. v. NLRC and Simeon Mapa, Jr., G.R.
No. 118892, March 11, 1998.
8. Philippine Airlines, Inc. v. National Labor Relations Commission, 263 SCRA 638; Georg
Grotjahn GMBH & Co. vs. Isnani, 235 SCRA 216.
9. Cf. Liwayway Publications, Inc. v. Permanent Concrete Workers Union, 108 SCRA 161;
Trade Union of the Philippines & Allied Services v. Coscolluela, 140 SCRA 302 [1985].
10. Serdoncillo v. Benolirao, G.R. No. 118328, October 8, 1998, citing cases; San Miguel
Corp. v. National Labor Relations Commission, 255 SCRA 133.
11. Serdoncillo v. Benolirao, supra, citing Banayos v. Susana Realty, Inc., 71 SCRA 557
[1976].
12. National Mines and Allied Workers Union v. Vera, 133 SCRA 259; Peñalosa v.
Villanueva, 177 SCRA 778.

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