G.R. No. L-8667; April 13, 1956
URBANO TABORA, plaintiff-appellant, vs. HONORABLE ALFREDO MONTELIBANO, in his capacity as Secretary of Economic Coordination, and NATIONAL RICE AND CORN CORPORATION (NARIC), defendants. NATIONAL RICE AND CORN CORPORATION (NARIC), defendant-appellee.

FACTS

Plaintiff Urbano Tabora was employed by the National Rice and Corn Corporation (NARIC) from 1936 until the Japanese occupation in 1942, and was reemployed from May 1946. On June 30, 1950, he was suspended from his position as warehouseman of warehouse No. 9-B by the Assistant General Manager of NARIC following a report by an Inventory Committee of a shortage of 4,775 sacks under his custody. An administrative investigation was conducted, but the stipulation of facts states Tabora did not receive notice and was unable to appear or defend himself. He was criminally prosecuted for malversation and was acquitted on September 20, 1952. Despite his acquittal and repeated demands, NARIC refused to reinstate him or pay his back salaries from the date of his suspension. Tabora filed an action seeking reinstatement, payment of back salaries, damages, and payment for accumulated sick/vacation leave and severance pay under NARIC Resolution No. 416. The Secretary of Economic Coordination was dismissed as a defendant. The parties entered into a stipulation of facts, and the trial court dismissed the complaint, ruling that NARIC employees were not covered by civil service rules and regulations, citing Section 6(b) of Republic Act No. 663 , which empowered NARIC’s Board of Directors to establish its own employment rules.

ISSUE

Whether the plaintiff, as an employee of NARIC, is entitled to reinstatement and payment of back salaries following his acquittal from criminal charges, and whether NARIC employees are governed by civil service rules and regulations.

RULING

The Supreme Court reversed the trial court’s judgment. It held that NARIC, as a government entity established to perform governmental functions (protecting the public from unreasonable cereal prices), its officers and employees fall under the protection of civil service rules and regulations. The Court emphasized that such protection, including security of tenure and the right to be heard before dismissal, is essential for honesty and efficiency. The Court found Tabora’s separation from service unlawful. His suspension was initially justified, but his continued separation after his acquittal was not. The administrative investigation could not validly support his dismissal because the stipulated facts confirmed he did not receive notice and was unable to defend himself. Consequently, his acquittal entitled him to reinstatement and payment of back salaries from the date of suspension (June 30, 1950) until reinstatement. The Court denied the claims for moral and exemplary damages for lack of evidence and held that the alternative prayers for leave commutation and severance pay need not be granted if reinstatement and back salaries were awarded. NARIC was directed to reinstate Tabora and pay his back unpaid salaries. No costs were awarded.