Balais v. Velasco

G.R. No. 118491 (January 31, 1996)

Facts:

This case involves a labor dispute between Central Textile Mills, Inc. (CTMI) and its supervisors' union, which was referred to voluntary arbitration due to unresolved issues. On November 21, 1991, Voluntary Arbitrator Jesus C. Sebastian issued an award directing CTMI to grant a wage increase to its workers and comply with Wage Order No. 2. CTMI's motion for reconsideration was denied, and a writ of execution was issued due to CTMI's failure to comply with the award.

On November 11, 1994, the CTMI Supervisors Union filed a motion for an alias writ of execution, which was served by petitioners Balais and Estonilo on November 26, 1994. They levied various personal properties of CTMI, including scrap metals and unserviceable machinery. A notice of levy was provided to CTMI, but the caretaker refused to acknowledge receipt. The petitioners posted notices in conspicuous places and conducted an auction sale on December 2, 1994, where petitioner Lotilla won the bid and paid for the properties.

In response, CTMI filed a civil case in the Regional Trial Court (RTC) for damages and sought a temporary restraining order (TRO), alleging that the petitioners forcibly dismantled and removed machinery from its premises, including serviceable equipment not included in the levy. The RTC issued a TRO against the petitioners, prompting them to file a motion to dismiss, arguing that the RTC lacked jurisdiction as the matter should have been addressed to the National Labor Relations Commission (NLRC).

The RTC denied the motion to dismiss and later granted a TRO against the petitioners, leading to the petitioners seeking certiorari and prohibition from the Supreme Court.

Legal Issues:

1. Whether the RTC had jurisdiction over the case filed by CTMI against the petitioners.
2. Whether the voluntary arbitrator retained exclusive jurisdiction over incidents affecting the enforcement of the alias writ of execution related to the labor dispute.

Arguments:

• Petitioners' Arguments:

  • The RTC lacked jurisdiction as the case arose from a labor dispute, which should be addressed by the NLRC.
  • The actions taken were in compliance with the alias writ of execution, and any claims of unlawful acts should be directed to the voluntary arbitrator.

• Respondent's Arguments (CTMI):

  • The petitioners committed unlawful acts by dismantling and removing machinery not included in the levy, which constituted a violation of their rights.
  • The RTC had jurisdiction to address the damages caused by the petitioners' actions, as these were not directly related to the labor dispute.

Court's Decision and Legal Reasoning:

The Supreme Court ruled in favor of the petitioners, granting the petition for certiorari and prohibition. The Court emphasized that the core issue was the enforcement of the voluntary arbitrator's award and the subsequent actions taken by the petitioners in executing the alias writ. The Court reiterated that the voluntary arbitrator has the authority to oversee the execution of his decisions and that any disputes regarding the execution should be referred back to him.

The Court highlighted that the regular courts do not have jurisdiction over matters that arise from labor disputes, as these should be handled by the appropriate labor authorities. The Court also noted that the petitioners' actions were within the scope of their duties as sheriffs executing the writ, and any claims of irregularities should have been addressed to the voluntary arbitrator rather than the RTC.

Significant Legal Principles Established:

1. The jurisdiction over incidents arising from the enforcement of labor dispute awards lies with the voluntary arbitrator and not with the regular courts.
2. Regular courts lack jurisdiction to hear cases that are incidental to the enforcement of decisions rendered in labor disputes.
3. The voluntary arbitrator retains supervisory control over the execution of his awards, including the authority to address any irregularities that may arise during execution.