G.R. No. 108625 March 11, 1996
Alliance of Democratic Free Labor Organization (ADFLO), petitioner, vs. Undersecretary of Labor Bienvenido Laguesma and Confederation of Labor and Allied Social Services (CLASS), respondents.

FACTS

The Alliance of Democratic Free Labor Organization (ADFLO) was registered as a legitimate labor federation in March 1988. In February 1989, the Confederation of Labor and Allied Social Services (CLASS) filed a petition for the cancellation of ADFLO’s registration, alleging that the documents ADFLO submitted for registration, including minutes of meetings and resolutions of affiliation from its local unions, were simulated. CLASS claimed that officers of the alleged affiliate unions had never participated in ADFLO’s organizational activities. The Bureau of Labor Relations (BLR) conducted a conference and a hearing. ADFLO filed an answer and a motion to inhibit the BLR Director, alleging prejudgment. The BLR Director denied the motion and subsequently recommended cancellation, which was affirmed by the Undersecretary of Labor. The Undersecretary’s decision cancelled ADFLO’s registration based on the evidence submitted by CLASS, without formally ruling on its admissibility, and ordered ADFLO’s affiliates to either register independently or affiliate with other federations.

ISSUE

Whether the Undersecretary of Labor committed grave abuse of discretion in cancelling ADFLO’s certificate of registration without affording it due process and based on evidence of questionable admissibility.

RULING

Yes. The Supreme Court granted the petition, setting aside the assailed Decision and Order. The Court ruled that ADFLO was denied its fundamental right to due process. The essence of due process in administrative proceedings includes the opportunity to be heard, to present evidence, and to confront and cross-examine adverse witnesses. The BLR Director’s denial of ADFLO’s motion to inhibit, coupled with the failure to conduct a full hearing where ADFLO could properly refute the allegations of fraud, constituted a violation of this right. Furthermore, the Court found the decision lacked substantial basis. The BLR Director never made a formal ruling on the admissibility of the exhibits presented by CLASS. Consequently, these exhibits could not be legally used to decide the case, rendering the cancellation order unsupported by competent evidence. The order directing ADFLO’s affiliates to take action was also unwarranted as these affiliates were not parties to the case. The case was remanded to the Bureau of Labor Relations for further proceedings consistent with due process.