G.R. No. 245370 , July 13, 2020
Eagle Clarc Shipping Philippines, Inc., Mama Shipping Sarl and Capt. Leopoldo Arcilla, Petitioners, v. National Labor Relations Commission (Fourth Division) and John P. Loyola, Respondents.

FACTS

John P. Loyola was employed by Eagle Clarc Shipping Philippines, Inc. for its foreign principal, Mama Shipping Sarl, as an Able Seaman under an eight-month contract starting November 12, 2015. His contract was supplemented by the Italian Collective Bargaining Agreement. He boarded the vessel MV Grande Luanda on November 26, 2015, and disembarked on February 2, 2016, six months before his contract’s expiration.
Loyola filed a complaint for illegal dismissal and monetary claims, alleging that on January 29, 2016, he was shown a document he refused to sign, was advised of his termination, and was forced to disembark without being informed of any offense or afforded due process. Petitioners averred that Loyola had difficulty performing his tasks, was served a formal warning for breach of the Code of Conduct, incompetence, and inefficiency, and was subjected to a disciplinary hearing. They claimed his dismissal was based on Section 33 of the POEA-SEC for incompetency and inefficiency, and that he was afforded due process through two notices he refused to receive.
The Labor Arbiter dismissed the complaint due to Loyola’s failure to personally sign the verification in his position paper. The NLRC reversed the Labor Arbiter, finding illegal dismissal and awarding Loyola the unexpired portion of his contract, moral and exemplary damages, and attorney’s fees. The Court of Appeals affirmed the NLRC with modification, reducing the salary award to basic wages only for the unexpired portion. Both parties moved for reconsideration, which was denied.

ISSUE

1. Whether Loyola’s complaint should be dismissed for procedural defects.
2. Whether Loyola was illegally dismissed.
3. Whether the monetary awards, including attorney’s fees and damages, are proper.
4. Whether Capt. Leopoldo Arcilla should be held solidarily liable.

RULING

1. On Procedural Defects: The Court found no merit in the petitioners’ argument. The rule on verification is formal, not jurisdictional. Non-compliance does not render a pleading fatally defective if signed by one with ample knowledge of the allegations. Substantial compliance exists when counsel signs the certification based on a Special Power of Attorney from the client. Procedural rules were relaxed to serve justice.
2. On Illegal Dismissal: The Court affirmed the findings of the NLRC and CA. The burden of proving just or authorized cause for dismissal lies with the employer. Petitioners failed to provide substantial evidence of Loyola’s incompetence or inefficiency. The alleged notices lacked detail, and no corroborating evidence like affidavits from co-workers or entries in the ship’s logbook was presented. The twin notice requirements of due process were not sufficiently proven to have been complied with. Thus, the dismissal was illegal.
3. On Monetary Awards: The Court modified the CA’s computation. Loyola is entitled to salaries for the unexpired portion of his contract, which includes not only basic wages but also the fixed overtime pay, leave pay, weekend compensation, and social benefits and bonus as stipulated in his contract, totaling US$7,680.00. Moral and exemplary damages were proper due to the manner of dismissal causing humiliation. Attorney’s fees were also proper as Loyola was forced to litigate.
4. On Solidary Liability of Capt. Arcilla: Under Section 10 of R.A. No. 8042 , as amended, corporate officers of a recruitment agency are jointly and solidarily liable with the corporation. As President and General Manager of Eagle Clarc, Capt. Arcilla cannot evade liability.
DISPOSITIVE:
The petition was DENIED. The CA Decision and Resolution were AFFIRMED with MODIFICATION. Loyola is entitled to US$7,680.00 (or its Peso equivalent) for the unexpired portion of his contract, plus full reimbursement of his placement fee with 12% interest per annum, moral and exemplary damages, and attorney’s fees. All monetary awards shall earn legal interest at 6% per annum from finality until fully paid. Capt. Arcilla is held solidarily liable.