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SAN MIGUEL CORPORATION v. MANDAUE PACKING PRODUCTS PLANTS-SAN MIGUEL PACKAGING PRODUCTS-SAN MIGUEL CORPORATION MONTHLY RANK-AND-FILE UNION-FFW

FACTS:

This case involves a petition for certification election filed by respondent Mandaue Packing Products Plants-San Miguel Packaging Products-San Miguel Corporation Monthlies Rank-And-File Union-FFW. The respondent filed the petition on June 15, 1998, claiming to be an affiliate of the Federation of Free Workers (FFW) and seeking to represent the permanent rank-and-file monthly paid employees of the petitioner. The petitioner filed a motion to dismiss the petition, arguing that the respondent was not a legitimate labor organization. The Chief of Labor Relations Division of DOLE Regional Office No. VII issued a Certificate of Creation of Local/Chapter on August 3, 1998, certifying that respondent had acquired legal personality as a labor organization/worker's association. Petitioner argued that respondent did not have the legal personality to file the petition. Med-Arbiter Manit issued an Order dismissing respondent's petition for certification election, but this was reversed by DOLE Undersecretary Dimapilis-Baldoz, who ordered the conduct of the certification election.

The case involved the interpretation of Department Order No. 9 and Department Order No. 40 in relation to the creation and legal personality of local/chapters of labor organizations. Department Order No. 9 prescribes the documentary requirements for the creation of a local/chapter, while Department Order No. 40 eases the requirements and introduces the term "chartered local" instead of "local/chapter." The dispute centered on when a local/chapter acquires legal personality, either upon submission of the complete documentary requirements or upon the issuance of a certificate of registration.

The Court recognized the less onerous procedure for the creation and registration of a local/chapter compared to a national union or federation. The local/chapter relies on the legal personality of the federation or national union and its affiliation provides stability and prevents collateral attacks on its legal personality. The Court also emphasized the obligation of the Bureau of Labor Relations to adjudge the authenticity of the submitted documents.

In a separate case, the petitioners invested in Sparrow Enterprises, Inc. based on false statements and misrepresentations made by the respondents. The petitioners filed a complaint for annulment of the subscription agreement, reimbursement, and damages before the Securities and Exchange Commission (SEC), which recommended that the petitioners file the proper action before the regular courts. The RTC initially dismissed the complaint for lack of jurisdiction, but the Court of Appeals reversed the decision and held that the complaint fell within the jurisdiction of the trial court.

ISSUES:

  1. Whether the duty of the Bureau of Labor Relations to register a local/chapter upon the submission of documentary requirements is ministerial.

  2. Whether the Bureau or Regional Office is empowered to look beyond the authenticity and due execution of the documentary requirements in denying legal recognition to a local/chapter.

  3. Whether matters pertaining to the personality of the federation or national union can be considered by the Bureau or Regional Office in evaluating the registration of a local/chapter.

  4. Whether the creation of a chartered local is within the sole discretion of the federation or national union.

  5. Whether the local/chapter acquired legal personality under Department Order No. 9.

  6. Whether the submission of the complete documentary requirements to the Regional Office or Bureau is necessary for the acquisition of legal personality.

  7. Whether the failure to submit a specific set of by-laws is fatal to the recognition of the local/chapter.

  8. Whether a separate set of by-laws is required to be submitted by the respondent labor organization.

  9. Whether the presence of supervisory employees as officers of the respondent labor organization affects its legal personality.

  10. Whether or not the Court of Appeals erred in dismissing the petition for certiorari filed by the petitioner.

  11. Whether or not the petitioner has the legal standing to file the petition for certiorari.

RULING:

  1. The duty of the Bureau of Labor Relations to recognize and register a local/chapter upon the submission of documentary requirements is not ministerial, as the Bureau is obliged to adjudge the authenticity of the submitted documents.

  2. The Bureau or Regional Office should not look beyond the authenticity and due execution of the documentary requirements in denying legal recognition to a local/chapter.

  3. Matters pertaining to the personality of the federation or national union should not be considered by the Bureau or Regional Office, as its legal personality cannot be subject to collateral attack.

  4. The creation of a chartered local is within the sole discretion of the federation or national union but should be reported to the Regional Office.

  5. The local/chapter acquired legal personality under Department Order No. 9. The issuance of the certificate of registration by the Bureau or Regional Office is not the operative act that vests legal personality upon a local/chapter. Rather, legal personality is acquired from the filing of the complete documentary requirements enumerated in Section 1, Rule VI. Despite deviations in the manner of acquisition, the Court upholds the conclusion made by the DOLE and the Court of Appeals.

  6. The submission of the complete documentary requirements to the Regional Office or Bureau is not necessary for the acquisition of legal personality. It is the federation or national union, already in possession of legal personality, which initiates the creation of the local/chapter. By submitting the charter certificate, names of officers, constitution, and by-laws to the Regional Office or Bureau, legal personality is vested in the local/chapter. In this case, even though the federation did not submit the documentary requirements, the local/chapter submitted these documents along with its petition for certification election, allowing the Court to rule that the local/chapter acquired legal personality at the same time it filed the petition.

  7. The failure to submit a specific set of by-laws is not fatal to the recognition of the local/chapter. The submission of both a constitution and a set of by-laws is required under Department Order No. 9. However, if the key provisions governing the internal governance of the local/chapter are already provided in the constitution, the requirement for by-laws may be overlooked. In this case, as long as the constitution includes provisions on matters such as quorum requirements and meetings, the absence of a separate set of by-laws does not affect the recognition of the local/chapter.

  8. There is no need for a separate set of by-laws to be submitted by the respondent labor organization. The respondent's constitution is comprehensive in establishing the necessary rules for its operation. It covers membership requisites, functions of officers, election procedures, impeachment procedures, establishment of standing committees, rules for meetings, dues and payments, quorum requirements, and amendment procedures. The Court finds that the respondent's constitution sufficiently provides for the necessary rules and regulations, making a separate set of by-laws redundant and unnecessary.

  9. The issue of the presence of supervisory employees as officers of the respondent labor organization has already been settled by the denial of an independent petition for cancellation filed by the petitioner. The Regional Director, DOLE, Court of Appeals, and Supreme Court all previously ruled on this issue in favor of the respondent. The denial of the petition for cancellation was based on the ground that the inclusion of supervisory employees in the union's membership did not amount to fraud, misrepresentation, or false statement. As such, the respondent's legal personality cannot be subject to collateral attack and can only be questioned in an independent petition for cancellation.

  10. The Court of Appeals did not err in dismissing the petition for certiorari filed by the petitioner.

  11. The petitioner does not have the legal standing to file the petition for certiorari.

PRINCIPLES:

  • The duty of the Bureau of Labor Relations to recognize and register a local/chapter is not ministerial but involves the authentication of submitted documents.

  • The Bureau or Regional Office should not go beyond the authenticity and due execution of the documentary requirements for the registration of a local/chapter.

  • The legal personality of a federation or national union cannot be subject to collateral attack.

  • The creation of a chartered local is within the discretion of the federation or national union but should be reported to the Regional Office.

  • The issuance of the certificate of registration is not the operative act that vests legal personality upon a local/chapter. Legal personality is acquired from the filing of the complete documentary requirements.

  • Labor laws are generally construed liberally in favor of labor, especially if doing so affirms the constitutionally guaranteed right to self-organization.

  • The submission of the complete documentary requirements to the Regional Office or Bureau is not necessary for the acquisition of legal personality. Legal personality is vested in the local/chapter when the federation or national union submits the necessary documents.

  • The requirement for by-laws may be overlooked if the key provisions governing the internal governance of the local/chapter are already provided in the constitution.

  • The submission of a separate set of by-laws may not be necessary if the labor organization's constitution is comprehensive enough to establish the necessary rules and regulations.

  • The legal personality of a labor organization cannot be subject to collateral attack, but can only be questioned in an independent petition for cancellation.

  • The actual functions of an employee, not merely the job title, are determinative in classifying the employee as managerial, supervisory, or rank and file.

  • Good faith is presumed in all representations. Intent to mislead is an essential element of fraud, false statement, and misrepresentation.

  • The grounds for cancellation of union registration should not be applied automatically but with utmost discretion. A remedy short of cancellation should be preferred, and the right to self-organization and promotion of free trade unionism should not be emasculated.

  • The local/chapter of a union retains a separate legal personality from its officers or members, which remains viable despite any turnover in officers or members.

  • Certiorari is a remedy that is available only when there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law.

  • Legal standing or locus standi is a personal and substantial interest in the case, such that the party who invokes the power of judicial review must allege and show that he has been or is about to be denied of certain personal and individual rights that are directly affected by the challenged act.