GR 143384; (February, 2005) (Digest)
G.R. No. 143384 ; February 4, 2005
DR. ERNESTO I. MAQUILING, petitioner, vs. PHILIPPINE TUBERCULOSIS SOCIETY, INC., Respondent.
FACTS
Petitioner Dr. Ernesto Maquiling was employed by respondent Philippine Tuberculosis Society, Inc. (PTS) in 1968 and rose to the position of Deputy Executive Director. On June 8, 1991, after 23 years of service, he was dismissed from employment. The dismissal followed a memorandum from the OIC-Executive Director requiring Dr. Maquiling to explain several administrative and financial matters, including delayed GSIS remittances and a reported deficit. He submitted an explanatory letter and had a brief conversation with the OIC but received no formal hearing before his termination.
Dr. Maquiling filed a complaint for illegal dismissal. The Labor Arbiter and the National Labor Relations Commission (NLRC) ruled in his favor, ordering reinstatement with full backwages and damages. The Court of Appeals reversed these decisions, holding the dismissal to be for a just cause but procedurally defective. It awarded separation pay and nominal damages instead of reinstatement. Dr. Maquiling elevated the case to the Supreme Court, arguing for full backwages under the Serrano doctrine and contesting the procedural findings.
ISSUE
Whether the dismissal of Dr. Maquiling was valid, and if not, what is the proper remedy and award due to him.
RULING
The Supreme Court modified the Court of Appeals’ decision. It upheld the finding that the dismissal was for a just cause, relating to loss of trust and confidence due to Dr. Maquiling’s failure to properly address serious financial and administrative lapses under his managerial watch. As a holder of a managerial position characterized by trust, his long tenure did not outweigh the breach of confidence.
However, the Court found that PTS failed to comply with the twin-notice requirement and a hearing, constituting a denial of procedural due process. Applying the prevailing rule in Agabon v. NLRC, which superseded the Serrano doctrine, the penalty for a dismissal with just cause but without due process is the payment of nominal damages, not reinstatement or full backwages. Consequently, the Court ordered PTS to pay Dr. Maquiling nominal damages in the amount of Thirty Thousand Pesos (P30,000.00). The award of separation pay by the Court of Appeals was deleted, as separation pay is not warranted when dismissal is for a just cause.