GR 114761; (January, 2000) (Digest)
G.R. No. 114761. January 19, 2000
ALEMAR’S SIBAL & SONS, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and NLM-KATIPUNAN (representing the group of CHARITO ALIMORONG), respondents.
FACTS
The case originated from a notice of strike filed in 1984 by respondent union against petitioner company for unfair labor practice and illegal dismissal. The Labor Arbiter, in a 1985 decision, ordered petitioner to pay separation pay. In 1988, the parties agreed to a specific computation and a payment schedule for the award. Petitioner, however, failed to make the initial payment, citing an August 1984 Securities and Exchange Commission (SEC) order placing it under rehabilitation receivership, which suspended all claims. The Labor Arbiter granted the union’s motion for execution. Petitioner’s subsequent motions for reconsideration and to suspend execution were denied for being filed out of time and for lack of merit, a ruling affirmed by the NLRC. Petitioner elevated the case via certiorari, arguing the SEC suspension order justified a stay of execution.
ISSUE
Whether the execution of the final and executory labor monetary award should be suspended due to the SEC order placing the petitioner corporation under rehabilitation receivership.
RULING
The Supreme Court dismissed the petition. The legal logic proceeds from the principle that a stay of execution due to rehabilitation receivership is a provisional remedy intended to aid a company’s recovery by preventing a scramble for its assets. However, this suspension is co-terminous with the receivership proceedings. The Court noted a critical subsequent development: during the pendency of the petition, the SEC had issued a 1997 order approving petitioner’s rehabilitation plan and placing it under liquidation. This order terminated the rehabilitation receivership. Consequently, the legal basis for the suspension of claims—the SEC’s earlier order—was rendered functus officio (having fulfilled its purpose and no longer operative). With the receivership concluded, there was no longer any legal impediment to the execution of the final labor judgment. The Court emphasized that petitioner’s obligation, evidenced by its own prior agreement on the computation and schedule, was long overdue. Nonetheless, due to the liquidation order, the proper remedy for the private respondent is to present its claim before the appointed liquidator, subject to the statutory rules on preference of credits, to ensure orderly payment alongside other creditors.