G.R. No. 122655 December 15, 1997
REYNALDO B. ALFANTE, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION-FIFTH DIVISION, AND PEPSI-COLA PRODUCTS PHILIPPINES, INC., respondents.

FACTS

Petitioner Reynaldo B. Alfante was employed by Pepsi-Cola Distributors (PCD) on August 1, 1984. His employment was terminated by PCD on December 31, 1988. Alfante filed a complaint for illegal dismissal. On May 15, 1989, the Labor Arbiter declared the dismissal illegal and ordered reinstatement with backwages. The NLRC, on April 25, 1991, modified the decision, ordering payment of backwages (subject to a three-year limitation) and separation pay in lieu of reinstatement. PCD’s petition to the Supreme Court was dismissed, making the NLRC decision final and executory. A writ of execution was issued against PCD on May 13, 1992. Subsequently, Alfante filed a motion for a writ of execution also against Pepsi-Cola Products Philippines, Inc. (PCPPI), alleging it was PCD’s successor-in-interest. PCPPI opposed, arguing it was a separate juridical entity not a party to the case. The Labor Arbiter granted Alfante’s motion on March 1, 1995. PCPPI challenged this order before the NLRC, which, on September 27, 1995, set aside the Labor Arbiter’s order, ruling it had no jurisdiction over PCPPI. Alfante filed this petition directly, without a prior motion for reconsideration of the NLRC decision.

ISSUE

Whether the National Labor Relations Commission committed grave abuse of discretion in ruling that PCPPI has a separate and distinct personality from PCD and is therefore not bound by the judgment against PCD.

RULING

The Supreme Court GRANTED the petition. It ruled that the NLRC committed grave abuse of discretion. The Court held that the issue of PCPPI’s liability as the successor-in-interest of PCD had been settled with finality in previous cases (Pepsi-Cola Bottling v. NLRC, Pepsi-Cola Distributors of the Philippines, Inc. v. NLRC, Corral v. NLRC, and Caliquia v. NLRC). These precedents established that PCPPI, having taken over the business of PCD, is answerable for PCD’s liabilities. The Court treated the petition as an exception to the rule requiring a prior motion for reconsideration because the NLRC decision ignored settled jurisprudence and was therefore a nullity. The Court modified the award, ordering PCPPI to pay Alfante full backwages without deduction (removing the three-year limitation) and, if reinstatement is no longer feasible, separation pay computed from his illegal dismissal on December 31, 1988, until actual payment. The March 1, 1995, Order of the Labor Arbiter was reinstated with this modification.