G.R. No. 173115 & 173163-64; April 16, 2009
ATTY. VIRGILIO R. GARCIA, Petitioner, vs. EASTERN TELECOMMUNICATIONS PHILIPPINES, INC. and ATTY. SALVADOR C. HIZON, Respondents. / EASTERN TELECOMMUNICATIONS PHILIPPINES, INC. and ATTY. SALVADOR C. HIZON, Petitioners, vs. ATTY. VIRGILIO R. GARCIA, Respondent.

FACTS

Atty. Virgilio R. Garcia was the Vice President and Head of Business Support Services and Human Resource Departments of Eastern Telecommunications Philippines, Inc. (ETPI). On January 16, 2000, he was placed under preventive suspension based on three complaints for sexual harassment filed by company employees. A Committee on Decorum investigated the complaints, after which Atty. Garcia was dismissed effective April 16, 2000, per a letter from ETPI President Atty. Salvador C. Hizon. Atty. Garcia filed a complaint for illegal dismissal with the NLRC. The Labor Arbiter, in a decision dated September 30, 2002, found the preventive suspension and dismissal illegal, ordered reinstatement, and awarded backwages and damages. Pending appeal, the Labor Arbiter issued writs of execution for reinstatement, which were partially satisfied. ETPI and Atty. Hizon appealed to the NLRC, raising for the first time the issue of lack of jurisdiction. The NLRC, in a decision dated March 21, 2003, reversed the Labor Arbiter and dismissed the case for lack of jurisdiction, ruling that the dismissal of a corporate vice president partook of an intra-corporate dispute cognizable by the Regional Trial Courts and not by Labor Arbiters. Atty. Garcia’s motion for reconsideration was denied. The Court of Appeals dismissed the petitions for certiorari questioning the NLRC decision, leading to the consolidated petitions before the Supreme Court.

ISSUE

Whether the Labor Arbiter and the NLRC have jurisdiction over the complaint for illegal dismissal filed by Atty. Virgilio R. Garcia, who held the position of Vice President and Head of Business Support Services and Human Resource Departments of ETPI.

RULING

The Supreme Court DENIED the petition in G.R. No. 173115 and GRANTED the petitions in G.R. Nos. 173163-64. The Court AFFIRMED the Decision of the Court of Appeals which upheld the NLRC’s dismissal of the case for lack of jurisdiction. The Court ruled that the nature of Atty. Garcia’s position and the circumstances of his dismissal made the controversy an intra-corporate dispute. As a corporate officer (Vice President) appointed by the Board of Directors of ETPI, his dismissal involved the removal of a corporate officer which is a corporate act. Disputes arising from the removal of corporate officers fall within the jurisdiction of the Regional Trial Courts acting as special commercial courts, pursuant to the Securities Regulation Code ( Republic Act No. 8799 ), and not with the Labor Arbiters under the Labor Code. The Court held that the jurisdiction of the Labor Arbiter is determined by the allegations in the complaint and the nature of the relief sought. Since the complaint essentially involved an intra-corporate controversy, the Labor Arbiter had no jurisdiction over the case. The defense of lack of jurisdiction can be raised at any stage of the proceedings and is not subject to waiver or estoppel.