G.R. No. 82312 April 19, 1989
MANUEL L. QUEZON UNIVERSITY ASSOCIATION, ET AL., petitioners, vs. MANUEL L. QUEZON EDUCATIONAL INSTITUTION, INC. (MLQ UNIVERSITY), HON. DIONISIO C. DELA SERNA, UNDERSECRETARY OF LABOR AND EMPLOYMENT, respondents.

FACTS

The petitioners, faculty members of MLQ University, filed a complaint for unpaid salary differentials based on P.D. No. 451, which mandated that 60% of authorized tuition fee increases be allocated for salary increases. They alleged the university failed to give the full mandated increase per lecture hour for the school years 1974-1975 to 1977-1978. The Regional Director, in an Order dated June 15, 1983, partially granted their claim but ruled that claims accruing more than three years before the filing of the complaint had prescribed. The petitioners filed a motion for reconsideration, which was treated as an appeal.
Deputy Minister Leogardo initially dismissed this appeal as filed out of time but later, on reconsideration, issued an order on December 6, 1985, reinstating the appeal and increasing the awarded differentials. Subsequently, Undersecretary of Labor Dionisio Dela Serna, upon motions for reconsideration from both parties, annulled Leogardo’s 1985 order. He ruled that the petitioners’ original motion for reconsideration of the Regional Director’s 1983 order was indeed filed beyond the ten-day reglementary period, making that 1983 order final and unappealable. He held that Deputy Minister Leogardo therefore had no authority to later modify a final order.

ISSUE

The primary issue is whether respondent Undersecretary Dela Serna committed grave abuse of discretion in annulling the order that increased the pay differentials, primarily on the ground of finality of judgment due to an untimely appeal.

RULING

The Supreme Court dismissed the petition, finding no grave abuse of discretion. The legal logic centers on the finality of judgments and the applicable prescriptive period. On procedural grounds, the Court upheld Undersecretary Dela Serna’s finding that the petitioners’ motion for reconsideration of the Regional Director’s June 15, 1983 order was filed beyond the ten-day period prescribed by Article 223 of the Labor Code. Consequently, that order became final and executory. A final order cannot be altered or modified, as Deputy Minister Leogardo attempted to do in 1985. The principle of finality of judgment is fundamental to judicial and quasi-judicial proceedings to ensure stability and end litigation.
On the substantive claim for prescription, the Court affirmed that money claims arising from employer-employee relations, including salary differentials under P.D. 451, prescribe in three years under Article 291 (formerly 292) of the Labor Code, not the ten-year period under the Civil Code. The Court found that the petitioners’ written extrajudicial demand in November 1974 interrupted the prescriptive period, but it resumed and expired by November 1977. Their complaint, filed in April 1979, was thus filed late for the claims pertaining to school years 1974-1975 and 1975-1976. The special law (Labor Code) governs over the general law (Civil Code) on this matter. The Court also found no error in excluding the twenty-five faculty members who voluntarily withdrew their claims.