[ G.R. No. L-9115. August 31, 1956 ] 99 Phil. 854
[ G.R. No. L-9115. August 31, 1956 ]
PHILIPPINE ASSOCIATION OP FREE LABOR UNIONS (PAFLU) AND MAJESTIC & REPUBLIC THEATERS EMPLOYEES ASSOCIATION (PAFLU), PETITIONERS, VS. HONORABLE BIENVENIDO A. TAN, JUDGE OF THE COURT OF FIRST INSTANCE OF MANILA AND REMA, INCORPORATED, RESPONDENTS. D E C I S I O N
BAUTISTA ANGELO, J.:
This is a petition for certiorari and prohibition with preliminary injunction seeking to nullify all the proceedings had before respondent Judge in Civil Case No. 26169 of the Court of First Instance of Manila, particularly that which refers to the order issued by him on May 10, 1955, enjoining the Philippine Association of Free Labor Unions (PAFLU), its members, associates, or agents to cease and desist from picketing the properties of respondent REMA, Incorporated, as well as molesting, transferring or preventing the public from entering the Republic and Majestic theaters leased and operated by said respondent. In due course, this Court issued the writ of preliminary injunction prayed for upon the filing by petitioners of a bond of P500.
On May 9, 1955, REMA, Incorporated filed an action for damages with preliminary injunction against petitioners in the Court of First Instance of Manila alleging, among other things, that the “plaintiff is the leasee and operator of the “Republic” and ‘Majestic” Theaters doing business at Florentino Torres Street, Manila, which establishments were leased by the plaintiff on April 27th, 1955 from the Goodwill Trading Co., Inc., who on the same date acquired the said theaters by way of purchase from the L. C. Eugenio and Co., Inc., the former owner"; that “the members of the defendant labor union, PAFLU and the other defendants who are mostly members of the defendant labor union, PAFLU, were formerly employed with the above-mentioned theaters when the latter were still under the ownership, operation and management of the former owner, L. C. Eugenio and Co., Inc., but who ceased to be such employees since the sale of the said theaters on April 27, 1955, to the Goodwill Trading Co., Inc., and their subsequent lease to the plaintiff on the same date”; and that “the plaintiff and the defendants have no employer-employee relation because the latter are not in any manner the employees or laborers of the plaintiff and as such they have no labor dispute between them.”
The court, presided over by Hon. Bienvenido A. Tan, set for hearing the petition for injunction requiring defendants (now petitioners) to appear on May 10, 1955 to show cause why the writ should not be issued as prayed for in the complaint. On the date of hearing, defendants assailed the jurisdiction of the court on the ground that, it involving a labor dispute or an employer-employee relation, the sole power to determine the issue is the Court of Industrial Relations as provided for in Republic Act N6. 875. After the case has been argued orally by counsel of both parties, but without receiving any evidence in support of the factual allegations of the petition, respondent judge declared himself with jurisdiction to act and in effect issued on May 10, 1955 an order granting the writ of injunction upon plaintiff’s filing a bond in the amount of P500. Hence the present petition for certiorari.
The first issue to be determined is whether the main case involves a labor dispute or an employer-employee relation. This needs a brief statement of the facts which led to the institution of the main case in the lower court.
On September 11, 1954, a collective bargaining agreement was entered into by and between the Republic Theater Enterprises and the Majestic Theater, Inc. on one hand and the Majestic and Republic Theaters Employees Association on the other. This agreement was to run for a period of two years. Because of the failure of the theater enterprises to comply with some terms of the agreement, the employees of the association went on strike on January 2, 1955. In consideration of the return of the strikers to work, the collective bargaining contract was modified and a new one entered into also for a term of two years on February 16, 1955. This new agreement was signed by the Philippine Association of Free Labor Unions (PAFLU), with which the employees association had affiliated after the conclusion of the original collective bargaining agreement. Among the pertinent provisions of the agreement, as amended, were that during the period of its life the association or any laborer or employee shall not declare a strike, nor engage in picketing, while the management of the theaters in return “shall not lockout their employees.” The revised agreement also included rigid clauses in the payment of overtime pay, night differential pay and a provision for the examination of the books of the theaters on June 30, 1955.
On March 31, 1955, the two theaters, Republic and Majestic, with all their assets and improvements thereunto appertaining, were sold,by the owner L. C. Eugenio and Co., Inc. to Goodwill Trading Co., Inc., which was later supplemented by another agreement executed by the same parties on April 26, 1955. On the same date, April 26, 1955, a contract of lease concerning the operation of the two theaters was executed by Goodwill Trading Co., Inc. in favor of the REMA, Incorporated, and on April 27, 1955, the latter corporation, as leasee and operator of the two theaters, sent a circular letter to all the employees of the former owner requiring them to apply for employment with the new management in a form expressly prepared for the purpose. On May 8, 1955, the employees of the association started picketing the premises of the two theaters with the help of the members of the Philippine Association of Free Labor Unions (PAFLU), for which reason the REMA, Incorporated filed the present action for damages with preliminary injunction in the Court of First Instance of Manila. And on May 20, 1955, a complaint for unfair labor practice was filed before the Court of Industrial Relations by the Majestic and Republic Theaters Employees Association against its employers, the Republic Theater Enterprises and the Majestic Theater, Inc., alleging among other grounds, that the latter committed a breach of the collective bargaining agreement concluded between them.
It is contended by respondents that there is no relation of employer and employee between the REMA, Incorporated and the Republic and Majestic Theaters Employees Association for the reason that the two theaters had already been sold by their original owner and the vendee had in turn leased them to REMA, Incorporated which has no contractual relation whatsoever with the members of the association. There being no employer-employee relation, they contend, there is no labor dispute and consequently the lower court had jurisdiction to entertain the case. This claim is disputed by petitioners.
There is no merit in this claim of respondents. While it is true that the employees of the petitioning association do not have an actual contract of employment with REMA, Incorporated and were actually employed by the former owner of the two theaters with whom they had concluded a collective bargaining agreement, the fact however remains that these employees do not admit, and in fact dispute, the genuineness and validity of the alleged transfer and for that reason they still consider themselves as employees of the two theaters in contemplation of law. It is their stand that the alleged transfer is fictitious and was merely resorted to by the former, owner as a ruse to evade its liability under the collective bargaining agreement because of some provisions contained therein which in its opinion were detrimental to its interests although highly beneficial to the interests of the employees. There is therefore the vital issue concerning the genuineness and validity of the sale involved in the main case which in the light of the spirit of our labor legislation is deemed a labor dispute. Thus, it was held that “The disputants need not stand in relation of employer and employee for case to involve a ’labor dispute’ within Norris La Guardia Act regulating issuance of restraining order or injunction in cases involving labor disputes” (Green, et al. vs. Obergfell, et al., 121 F 2d., 46[1]. While, under our own Industrial Peace Act, the term “labor dispute” includes any controversy concerning terms, tenure, or conditions of employment, “regardless of whether the disputants stand in the proximate relation of employer and employee.” [Section 2, (j), Republic Act No. 875]. In our opinion, considering the equities involved, the relation of petitioner to respondent comes within the purview of this definition.
The next issue that arises is: It appearing that the main case involves a labor dispute, does it come under the jurisdiction of an ordinary court of justice or should it be left entirely to the Court of Industrial Relations. This involves a little digression on the scope and extent of the jurisdiction of the Court of Industrial Relations which is now conferred upon it by the Industrial Peace Act. It should be noted that prior to the approval of the Industrial Peace Act (Republic Act No. 875), the law that governed the jurisdiction of the Court of Industrial Relations over cases involving labor disputes is Commonwealth Act 103. This Act gave to that court broad powers of compulsory arbitration on any matter involving a labor dispute. In fact, that Act gave that court “jurisdiction over the entire Philippines, to consider, investigate, decide and settle all questions, matters, controversies, or disputes arising between, and/or affecting employers and employees or laborers, and landlords and tenants or farm-laborers, and regulate the relations between them” (section 1). In other words, that court could take cognizance “of any industrial or agricultural dispute causing or likely to cause a strike or lockout” with the only limitation that the employees, laborers or tenants that may bring the matter to court exceed thirty in number (section 4). And, commenting on these broad powers given by Commonwealth Act No. 103 to the Court of Industrial Relations, this Court said:
“Resulta evidente de las disposiciones transcritas lo siguiente: (a) que cuando surge una disputa entre el principal y el empleado u obrero, vgr. sobre cuestion de salarios, la Corte de Relaciones Industriales tiene jurisdiccidn en todo el territorio de Filipinas para considerar, investigar y resolver dicha disputa, fijando” los salarios que estime justos y razonables; (b) que para los efectos de prevenci6n, arbitraje, decision y arreglo, el mismo Tribunal de Relaciones Industriales tiene igualmente jurisdiccion para conocer de cualqier disputa—industrial o agricola—resultante de cualesquier diferencias respecto de los salarios, participaciones o compensaciones, horas de trabajo, condiciones del empleo o de la aparceria entre los patrones y los empleados u obreros y entre los propietarios y los terratenientes u obreros agricolas previo el «umplimiento de ciertos requisites y condiciones, cuando se viere que dicha disputa ocasiona o puede ocasioner una huelga; (c) que en el ejercicio de sus facultades arriba especificadas, el Tribunal de Relaciones Industriales no queda limitado, al decidir la disputa, a conceder el remedio o remedios solicitados por las partes en la controversia, sino que puede incluir en la orden o decision cualquier materia o determinacion para el proposito de arreglar la disputa . o de prevenir ulteriores controversias industriales o agricolas." (The Shell Company of Philippine Islands, Limited vs. National Labor Union, G. R. No. L-1309, decided July 26, 1948)[2]
But this broad jurisdiction was somewhat curtailed ..upon the approval of Republic Act No. 875, the purpose being to limit it to certain specific cases, leaving the rest to the regular courts. Thus, as the law now stands, that power is confined to the following cases: (1) when the labor dispute affects an industry which is indispensable to the national interest and is so certified by the President to the industrial court (Section 10, Republic Act No. 875); (2) when the controversy refers to minimum wage under the Minimum Wage Law (Republic Act No. 602); (3) when it involves hours of employment under the Eight-Hour Labor Law (Commonwealth Act No. 444); and (4) when it involves and unfair labor practice [section 5, (a), Republic Act No. 875]. In all other cases, even if they grow out of a labor dispute, the Court of Industrial Relations does not have jurisdiction, the intendment of the law being “to prevent undue restriction of free enterprise for capital and labor and to encourage the truly democratic method of regulating the relations between the employer and employee by means of an agreement freely entered into in collective bargaining” (section 7, Republic Act No. 875): In other words, the policy of the law is to advance the settlement of disputes between the employers and the employees through collective bargaining, recognizing “that real industrial peace cannot be achieved by compulsion of law” [See section (c), in relation to section 20, (Idem.)].
It therefore appears that with the exception of the four cases above specified the Court of Industrial Relations has no jurisdiction even if it involves a labor dispute. And as the issue involved in the instant case does not fall under, nor refer to, any of those specified cases, it follows that the lower court has jurisdiction to entertain the same.
The remaining issue is: Can the lower court grant an injunction in connection with the picketing of the premises of respondent by the members of the petitioning association? If so, has respondent judge issued the relief in accordance with law?
The pertinent provisions concerning the issuance of injunctions in labor disputes are those embodied in sections 9 and 10 of Republic Act No. 875. Analyzing the provisions of these two sections, we find that there are two groups of activities that may be reckoned with in connection with the issuance of injunction, one? as to which injunction is prohibited even if they involve or grow out of a labor dispute, and another as to which injunction may be issued under certain conditions. For ready reference, we will quote the pertinent provisions of these section.
As to the first group, section 9(a) provides:
“(a) No Court, Commission or Board of the Philippines shall have jurisdiction except as provided in section ten of this Act to issue any restraining order, temporary or permanent injunction in any case involving or growing out of labor dispute to prohibit any person or persons participating or interested in such dispute from doing, whether singly or in concert, any of the following acts:
(1) Ceasing or refusing to perform any work or to remain in any relation of employment;
(2) Becoming or remaining a member of any labor organization or of any employee organization regardless of any undertaking or promise as is described in section eight of this Act;
(3) Paying or giving. to, or withholding, from any person participating or interested in such labor dispute, any strike or unemployment benefits or insurance, or moneys or things of value;
(4) By all lawful means aiding any person participating or interested in any labor dispute who is being proceeded against in, or is prosecuting any action or suit in any court of the Philippines;
(5) Giving publicity to the existence of, or the facts involved in any labor dispute, whether by advertising, speaking, patrolling, or,by any method not involving fraud or violence;
(6) Assembling peaceably to act or to organize to act in promotion of their interests in a labor dispute;
(7) Advising or notifying any person of an intention to do any of the acts heretofore specified;
(8) Agreeing with other persons to do or not to do any of the acts heretofore specified; and
(9) Advising, urging, or otherwise causing or inducing without fraud or violence, the acts heretofore specified, regardless of any such understanding or promise as is described in section eight of this Act.”
And as to the second group, section 9(d) and section 10 provide: Sec. 9.
“(d) No court of the Philippines shall have jurisdiction to issue a temporary or permanent injunction in any case involving or growing out of a labor dispute, as herein defined except after hearing the testimony of witnesses in open court (with opportunity for cross-examination) in support of the allegations of a complaint made under oath, and testimony in opposition thereto, if offered, and except after finding of fact by the Court, to the effect:
(1) That unlawful acts have been threatened and will be committed unless restrained, or have been committed and will be continued unless restrained, but no injunction or temporary restraining order shall be issued on account of any threat or unlawful act excepting against the person or persons, association, or organization making the threat or committing the unlawful act or actually authorizing or ratifying the same after actual knowledge thereof;
(2) That substantial and irreparable injury to complainant’s property will follow;
(3) That as to each item of relief granted greater injury will be inflicted upon complainant by the denial of relief than will be inflicted upon defendants by the granting of relief;
(4) That complainant has no adequate remedy at law; and
(5) That the public officers charged with the duty to protect complainant’s property are unable or unwilling to furnish adequate protection.”
“Sec. 10. Labor Disputes in Industries Indispensable to the National Interest.—When in the opinion of the President of the Philippines there exists a labor dispute in an industry indispensable to the national interest and when such labor dispute is certified by the President to the Court of Industrial Relations, said Court may cause to be issued a restraining order forbidding the employees to strike or the employer to lockout the employees, pendingan investigation by the Court, and if no other solution to the dispute is found, the Court may issue an order fixing the terms and conditions of employment.”
From the above-quoted provisions it can be seen that the activities that cannot be enjoined are those enumerated in section 9, paragraph a, even if they involve or grow out of a labor dispute. To this we may add the case provided for in section 9, (b), when there is an unlawful combination or conspiracy on the part of those engaged in the labor dispute in connection with the acts above enumerated. And those that can be enjoined refer to the case certified by the President as affecting national interest and to those enumerated in section 9, paragraph d, particularly when “unlawful acts have been threatened and will be committed unless restrained, or have been committed and will be continued unless restrained.” Note that, as to the acts that may be enjoined, section 9 (d) contains a number of conditions which the court must find to exist before an injunction can be granted and which are considered as limitations on the court’s power to grant relief. This requirement was held to be jurisdictional such that, if not followed, it may result in the annulment of the proceedings.
“Section 7 declares that no court of the United States shall have jurisdiction to issue a temporary or permanent injunction in any case involving or growing out of a labor dispute, as herein defined’ except after a hearing of a described character, ‘and except after findings of fact by the court, to the effect—(a) That unlawful acts have been threatened and will be committed unless restrained or have been committed and will be continued unless restrained’ and that no injunction ‘shall be issued on account of any threat or unlawful act excepting against the person or persons, association or organization making the threat or committing the unlawful act or actually authorizing or ratifying the same . . .’ By subsections (b) to (c) it is provided that relief shall not be granted unless the court finds that substantial and irreparable injury to complainants’ property will follow: that as to each item or relief granted greater injury will be inflicted upon the complainant by denying the relief than will be inflicted upon defendants by granting it; that complainant has no adequate remedy at law; and that the public ‘officers charged with the duty to protect, complainants’ property are unable or unwilling to provide adequate protection. There can be no question of the power of Congress thus to define and limit the jurisdiction of the inferior courts of the United States. The District Court made one of the required findings save as to irreparable injury and lack of remedy at law. It follows that in issuing the injunction U exceeded its jurisdiction.” (Lauf vs. E. G. Shinner & Co., Inc., Wis. 1938, 58 S. Ct. 578, 303 U. S., 323, 82 L. Ed., 872.) (Italics supplied.)
With regard to activities that may be enjoined, in order to ascertain what court has jurisdiction to issue the injunction, it is necessary to determine the nature of the controversy. When the case involves a labor dispute that affects national interest and is certified to the Court of Industrial Relations, or refers to the Minimum Wage Law or Eight-Hour Labor Law, there is no doubt that it is this court that has jurisdiction over the incident. The same thing may be said when the case involves an unfair labor practice, for under section 5 (a), Republic Act No. 875, the jurisdiction of the Court of Industrial Relations is exclusive. But the situation varies with regard to other acts where injunction is permissible because of the ambiguity in the language of the Jaw! Note that the law refers to “no court of the Philippines”, which gives the connotation that if not because of the prohibition any court may issue the injunction. It is true that the last part of section 9 (d) says “after finding of fact by the Gourt” and, in section 2 (a), in defining the word “court”, it says: " ‘Court’ means the Court of Industrial Relations * * * unless another Court shall be specified"; but this definition is no authority for us to conclude that only the Court of Industrial Relations can issue injunctions in all cases mentioned. in section 9 (d) for, as already adverted to, there are cases which may involve or grow out of a labor dispute which may not necessarily come under its jurisdiction. To hold otherwise would be to give to the Court of Industrial Relations jurisdiction over cases which it does not have under the law. We are therefore forced to conclude that that court can only issue injunction in cases that come under its exclusive jurisdiction and in those cases that do not, the power can be exercised by regular courts. The instant case is one of those that do not come under its jurisdiction.
We believe however that in order that an injunction may be properly issued the procedure laid down in section 9 (d) of Republic Act 875. should be followed and cannot be granted ex-parte as allowed by Rule 60, section 6, of the Rules of Court. The reason is that the case, involving as it does a labor dispute, comes under said section 9 (d) of the law. That procedure requires that there should be a hearing at which the parties should be given an opportunity to present witnesses in support of the complaint and of the opposition, if any, with opportunity for cross-examination, and that the other conditions required by said section as prerequisites for the granting of relief must be established and stated in the order of the court. Unless this procedure is followed, the proceedings would be invalid and of no effect. The court would then be acting in excess of its jurisdiction. (Lauf vs, E.. G. Shinner & Co., Inc., supra.)
It appearing that in the present case such procedure was not followed, we are persuaded to conclude that the order of respondent court of May 10, 1955 granting the writ of injunction prayed for by plaintiff-respondent is invalid and should be nullified.
Petition is granted. The order of respondent court dated May 10, 1955 is set aside. Costs against REMA, Incorporated.
Bengzon, Padilla, Labrador, Endencia, and Felix, JJ., concur.