G.R. No. 88195 -96 January 27, 1994
“Y” TRANSIT CO, INC., petitioner, vs. THE NATIONAL LABOR RELATIONS COMMISSION AND YUJUICO TRANSIT EMPLOYEES UNION (ASSOCIATED LABOR UNION), MANUEL VILLARTA, respondents.

FACTS

Yujuico Transit Co., Inc. mortgaged ten buses to the Development Bank of the Philippines (DBP). To settle the loan, its President, Jesus Yujuico, transferred the Saint Martin Technical Institute to DBP via dacion en pago, leading DBP to release the mortgages. The buses were then transferred to Jesus Yujuico. Meanwhile, in June and July 1979, the Yujuico Transit Employees Union filed complaints against Yujuico Transit Co., Inc. for unfair labor practice and non-payment of allowances under various Presidential Decrees. On May 21, 1980, Jesus Yujuico sold the buses to petitioner “Y” Transit Co., Inc. On July 23, 1981, the Labor Arbiter dismissed the unfair labor practice complaint but held Yujuico Transit Co., Inc. liable for monetary awards. A writ of execution was issued, and an alias writ led to a levy on the ten buses on June 14, 1982. “Y” Transit Co., Inc. filed Third-Party Claims, asserting ownership. The Labor Arbiter granted the claim, finding valid title and constructive registration, and ordered the buses released. The NLRC reversed, holding the transfers lacked the prior approval of the Board of Transportation (BOT) as required by the Public Service Act and that the buses remained registered under Yujuico Transit Co., Inc. “Y” Transit Co., Inc. filed this certiorari petition. A separate motion was filed to cite the Labor Arbiter for contempt for not releasing the buses despite a Supreme Court TRO and for requiring payment of storage fees.

ISSUE

Did the National Labor Relations Commission commit grave abuse of discretion in reinstating the levy on the buses, despite their transfer to “Y” Transit Co., Inc., due to the lack of prior BOT approval under the Public Service Act?

RULING

No, the NLRC did not commit grave abuse of discretion. The Supreme Court ruled that the transfers of the buses from Yujuico Transit Co., Inc. to Jesus Yujuico, and from Jesus Yujuico to “Y” Transit Co., Inc., lacked the prior approval of the BOT as required by Section 20 of the Public Service Act. Citing Montoya v. Ignacio, the Court held that without such approval, the transfer is not binding against the BOT and third parties; as far as the law is concerned, the registered owner (Yujuico Transit Co., Inc.) remains the owner, and the transferee holds the property merely as an agent. Consequently, the buses could be levied to satisfy the monetary judgment against Yujuico Transit Co., Inc. The petition was dismissed. The Motion for Contempt against the Labor Arbiter was denied, as the levy order preceded the TRO. The Court upheld the requirement for petitioner to pay storage costs and sheriff’s fees in accordance with NLRC rules.