View full case

NATIVIDAD PONDOC v. NLRC

## FACTS:

This case involves the issue of whether the NLRC can nullify a final judgment of the labor arbiter in favor of the complainant by entertaining a petition for injunction and damages, and an appeal from the labor arbiter's denial of a claim for set-off.

Petitioner Natividad Pondoc, who was substituted by her son Hipolito after her death, filed a complaint for various money claims before the NLRC against respondent Eulalio Pondoc. The labor arbiter rendered a decision in favor of Natividad, ordering Eulalio to pay her P44,118.00. Eulalio sought to set-off his alleged indebtedness against the judgment but was denied by the Labor Arbiter, who issued a writ of execution.

Before the writ of execution could be implemented, Eulalio obtained a restraining order from the NLRC and filed a petition for "Injunction and Damages." The NLRC allowed the set-off and directed Eulalio to pay Natividad P3,066.65. Natividad challenged the decision of the NLRC, arguing that the labor arbiter's decision was already final and executory when Eulalio asserted the set-off claim, which was not pleaded before the Labor Arbiter before judgment. She filed a special civil action for certiorari to nullify the decision of the NLRC and enforce the writ of execution.

ISSUES

  1. Can the Fifth Division of the National Labor Relations Commission (NLRC) validly defeat a final judgment of a labor arbiter by:

    • Entertaining a petition for injunction and damages, and an appeal from the labor arbiter's denial of a claim for set-off based on alleged indebtedness, and order of execution of the final judgment?

    • Receiving evidence and adjudging recovery on such indebtedness and authorizing it to offset the labor arbiter's final award?

RULING

The Supreme Court ruled in favor of the petitioner. The Fifth Division of the NLRC was found to have acted without jurisdiction or with grave abuse of discretion by:

  • Entertaining the private respondent's separate petition for injunction and damages, which was a scheme to obstruct the enforcement of the labor arbiter’s judgment.

  • Accepting the appeal which acknowledged the final and executory character of the judgment, rather than challenging the decision directly.

  • Lacking jurisdiction, either original or appellate, to receive evidence on the alleged indebtedness, render judgment thereon, and direct that its award be set-off against the final judgment of the labor arbiter.

Therefore, the rulings of the NLRC were annulled and set aside, and enforcement of the labor arbiter’s judgment was ordered without further delay.

PRINCIPLES

  • Finality of Judgment: Once a judgment becomes final and executory, it should be enforced without delay.

  • Scope of NLRC jurisdiction: The NLRC does not have blanket authority to issue writs of injunction, and its appellate jurisdiction is limited to cases decided by labor arbiters under specific conditions.

  • Inappropriate Use of Injunction: Injunctions should not be used as ancillary remedies in ordinary labor disputes to obstruct the enforcement of final judgments.

  • Jurisdiction on Set-off Claims: Claims for set-off not raised during the original proceedings before a labor arbiter are deemed waived and cannot be entertained by the NLRC on appeal.

  • Application of the Rules of Court in Labor Proceedings: Defenses and counterclaims not raised timely in labor proceedings are deemed waived or barred, similar to civil proceedings under the Rules of Court.