G.R. No. L-50320. March 30, 1988.
PHILIPPINE APPAREL WORKERS UNION, petitioner, vs. THE NATIONAL LABOR RELATIONS COMMISSION and PHILIPPINE APPAREL, INC., respondents.

FACTS

This case involves the execution of a final and executory Supreme Court decision dated July 31, 1981, which ordered private respondent Philippine Apparel, Inc. (PAI) to pay its employees a negotiated daily wage increase of P0.80 effective April 1, 1977, among other benefits. The Court’s denial of PAI’s motion for reconsideration became final on October 30, 1981. Despite this finality, full execution was obstructed. The NLRC cited difficulties in computing the exact awards due to missing payroll records for certain periods. Concurrently, PAI, with the support of a rival union, the Bagong Pilipino Philippine Apparel Workers’ Union (BPPAWU), and its counsel, Atty. Luis D. Flores, engaged in a scheme to circumvent the judgment. They offered union members lump sums of P300 or P500 as “full payment” for their claims, pressuring financially vulnerable workers to sign quitclaims and releases.
Petitioner union filed an Urgent Manifestation and Motion, alleging that despite multiple motions for execution, the NLRC’s execution arm failed to act and that PAI and BPPAWU were actively subverting the Court’s decision. On October 27, 1983, the Supreme Court found BPPAWU, Atty. Flores, and PAI guilty of contempt for these acts and issued specific orders for PAI to comply with the judgment and for the NLRC to complete the computation.

ISSUE

Whether the respondents’ actions to obstruct the execution of a final and executory judgment constitute contempt of court and warrant the Court’s direct intervention to ensure full implementation.

RULING

Yes. The Supreme Court modified its 1983 resolution to impose stiffer penalties and ensure complete execution. The Court emphasized that a final and executory judgment entitles the prevailing party to a writ of execution as a matter of right. The tactics employed by PAI, BPPAWU, and Atty. Flores—offering paltry sums as full settlement while coercing quitclaims from employees who were entitled to substantially more (at least P1,248 each)—constituted a willful disregard of judicial authority and an attempt to render the Court’s decision meaningless. These acts disrespect the administration of justice and violate the sanctity of the judicially upheld collective bargaining agreement.
The Court declared the quitclaims void, citing Mercury Drug Co. v. CIR, as they were executed under exploitative circumstances. It then ordered: (a) the NLRC to fully implement the decision, with PAI to pay the computed partial backwages of P695,413.17 plus legal interest from the date of finality, minus any amounts already paid, with 10% attorney’s fees; and (b) increased the contempt fines against BPPAWU, Atty. Luis D. Flores, and PAI to Ten Thousand Pesos (P10,000.00) each. The resolution was declared immediately executory to end years of delay and ensure the workers receive their rightful awards.