G.R. No. 169754; February 23, 2011
LEGEND INTERNATIONAL RESORTS LIMITED, Petitioner, vs. KILUSANG MANGGAGAWA NG LEGENDA (KML-INDEPENDENT), Respondent.

FACTS

On June 6, 2001, respondent Kilusang Manggagawa ng Legenda (KML), a labor organization issued a Certificate of Registration on May 18, 2001, filed a Petition for Certification Election among the rank-and-file employees of petitioner Legend International Resorts Limited (LEGEND). LEGEND moved to dismiss the petition, alleging that KML was not a legitimate labor organization because its membership impermissibly mixed rank-and-file and supervisory employees in violation of Article 245 of the Labor Code, and that KML committed fraud and misrepresentation in its registration by listing employees who did not attend its organizational meeting. The Med-Arbiter dismissed KML’s petition on September 20, 2001, finding merit in LEGEND’s allegations. KML appealed to the Office of the Secretary of the Department of Labor and Employment (DOLE).
On May 22, 2002, the Office of the Secretary of DOLE reversed the Med-Arbiter, ruling that KML’s legitimacy could not be collaterally attacked in certification election proceedings and ordered the conduct of an election. LEGEND’s motion for reconsideration was denied on August 20, 2002. LEGEND then filed a Petition for Certiorari with the Court of Appeals (CA).
Meanwhile, in a separate proceeding (Case No. RO300-0108-CP-001), LEGEND had filed a Petition for Cancellation of KML’s union registration. The DOLE Regional Office initially granted this petition on November 7, 2001, but the Bureau of Labor Relations (BLR) reversed this in a Decision dated March 26, 2002, upholding KML’s legitimacy. The CA, in its assailed Decision dated September 18, 2003, dismissed LEGEND’s certiorari petition, finding no grave abuse of discretion by the DOLE Secretary. The CA noted that the BLR’s March 26, 2002 Decision upholding KML’s legitimacy had become final and executory, as LEGEND failed to appeal it. LEGEND moved for reconsideration, informing the CA that it had, in fact, appealed the BLR’s cancellation case decision (docketed as CA-G.R. SP No. 72659). The CA denied reconsideration on September 14, 2005.
Subsequent to the CA’s denial, but during the pendency of this Petition for Review before the Supreme Court, the CA in the related cancellation case (CA-G.R. SP No. 72659) rendered a Decision on June 30, 2005, granting LEGEND’s petition, reversing the BLR’s March 26, 2002 Decision, and reinstating the Regional Office’s November 7, 2001 order cancelling KML’s registration. KML’s appeal of this CA Decision (docketed as G.R. No. 169972) was consolidated with the instant case.

ISSUE

Whether the Court of Appeals committed serious errors in law in upholding the DOLE Secretary’s order to conduct a certification election, despite the subsequent cancellation of KML’s certificate of registration in a separate proceeding.

RULING

The Supreme Court DENIED the petition and AFFIRMED the assailed Court of Appeals Decision.
The Court held that the legitimacy of a labor organization and its legal personality to file a petition for certification election cannot be collaterally attacked in the certification election proceedings themselves. Such an attack must be made in a separate and independent action for cancellation of union registration. The certification election is a mere investigation of a non-adversarial, fact-finding character. The Med-Arbiter, in dismissing the petition based on the alleged mixed membership, improperly ruled on the question of KML’s legitimacy, which was beyond his authority in that proceeding.
The Court emphasized that the policy of the Labor Code is to promote unionism and allow workers to freely choose their bargaining representative. Doubts in certification election controversies are resolved in favor of the holding of an election. At the time the DOLE Secretary and the CA rendered their decisions ordering the election, the BLR’s Decision upholding KML’s registration was the prevailing and final ruling. The subsequent reversal of that cancellation decision by the CA in a separate case does not retroactively invalidate the proceedings that were correctly based on the legal reality existing at the time they were conducted. The proper remedy for LEGEND was to seek the cancellation of KML’s registration in the separate proceeding, which it did, but the outcome of that separate case does not nullify the prior order to hold a certification election based on KML’s then-valid registration.