G.R. No. L-14908; February 28, 1964
SINFORIANO V. URGELIO, JOSE V. ENCABO, and JORGE M. VILLARIN, petitioners-appellants, vs. SERGIO OSMEÑA, JR., THE MUNICIPAL BOARD OF CEBU CITY, THE CITY OF CEBU, et al., respondents-appellees.

FACTS

The petitioners, employees of Cebu City, were separated from service due to the abolition of their positions. They contested this abolition as having been done in bad faith and solely for the purpose of removing them. The Supreme Court, in a decision dated October 31, 1963, ruled in their favor, ordering their reinstatement and the payment of back salaries, less earnings from other employment. The respondents filed a motion for reconsideration, arguing against reinstatement and back pay.
The respondents advanced three main arguments for reconsideration. First, they claimed the petitioners, being non-civil service eligibles, had no right to reinstatement. Second, they asserted that the petitioners’ acceptance of terminal pay constituted a waiver of their right to question their separation. Third, they contended that the city charter exempted the City of Cebu from liability for payment of back salaries in such instances.

ISSUE

The core issue for reconsideration was whether the grounds raised by the respondents warranted a reversal of the Court’s decision ordering reinstatement and back salaries for the illegally dismissed petitioners.

RULING

The Supreme Court denied the motion for reconsideration, upholding its original decision. On the first ground, the Court clarified that while the petitioners were not civil service eligibles, their membership in the Government Service Insurance System indicated the permanent character of their tenure. Their appointments were not temporary, and their removal was invalid as it was based on a bad-faith abolition of positions. On the second ground, the Court ruled that the receipt of terminal pay did not equate to a waiver or estoppel. The precedent cited by respondents was distinguishable, as it involved acceptance of a gratuity provided for in the very resolution being challenged, a circumstance not present here. On the third ground, the Court found the cited charter provision inapplicable. The liability for back salaries arising from illegal dismissal does not fall under “damages or injuries” due to an officer’s failure to enforce laws or negligence, as described in the charter. The Court reinforced this by citing a consistent line of jurisprudence where the City of Cebu was ordered to pay back salaries to employees illegally separated, both before and after the single contrary case relied upon by respondents. Thus, the petitioners’ right to reinstatement and back salaries was firmly established.