Republic of the Philippines

Department of Labor and Employment

OFFICE OF THE VOLUNTARY ARBITRATOR
Regional Conciliation and Mediation Branch No. III
City of San Fernando, Pampanga

WESLEYAN UNIVERSITY-
PHILIPPINES FACULTY AND
STAFF ASSOCIATION, ET. AL.
Complainants,

-VERSUS- VA CASE NO: AC975-RCMBIII-LVA-08-01-07-2019

AVA DARROW P. ODSEY

WESLEYAN UNIVERSITY-
PHILIPPINES AND/OR JUDGE
BENJAMIN D. TURGANO (Ret.)
Respondents.
X--------------------------------------------X

REPLY
TO RESPONDENTS’ POSITION PAPER

Complainants, through undersigned Union President 1, assisted by

Federation president/representative unto this Honorable Office, by way of
Reply to respondents’ Position Paper respectfully state:

ON THE FIRST ISSUE

Contrary to the position taken by the respondent that the issue of

RLE is not or should not be the subject of this Voluntary Arbitration,
complainant is firm that the same should be included.

In fact, respondents, in its position paper admitted that the subject

matter of this case is the RLE benefits from 2017 onwards and does not
include the RLE benefits from 2010-2013 and 2014-2017.

Moreover, while this case involves the same parties and the same
issue of RLE, it was not the same when it comes to the year of their
entitlement of RLE benefits.

The case before the Supreme Court involves refers to RLE benefits
from 2010-2013 and 2014-2017.

1
Liberty Manufacturing Workers Union v. Court of First Instance of Bulacan, No. L-35252, 29 November 1972, 48
SCRA 273 citing National Brewery and Allied Industries Labor Union of the Philippines v. San Miguel Brewery, Inc.,
No. L-1917, 27 December 1963, 9 SCRA 847 and Itogon-Suyoc Mines, Inc. v. Sañgilo-Itogon Workers Union, No. L-
24189, 30 August 1968, 24 SCRA 873, the Court held that the aforementioned provision authorizes a union to file a
“representative suit” for the benefit of its members in the interest of avoiding an otherwise cumbersome
procedure of joining all union mebers in the complaint, even if they number by the hundreds, cited in Liana’s
Supermarket vs NLRC, et. al. G.R. No. 111014 May 31, 1996.

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 Further, in the same position paper, respondent admitted that “the
Management is seriously considering releasing the benefit from 2017
onwards and has initially come up with the proposed formula for the
distribution of the benefit. The said formula is yet to be finally approved by
the Management but the same can be initially presented to the WUPFSA
for possible settlement.”

Considering such admission by the respondents, it is enough proof

that they are withholding and guilty of non-payment of RLE.

To refresh the memory of the respondents, if indeed, they are sincere

in their pronouncement, they could have presented their proposed formula
to the BOARD at the very start of the conference/hearing of this case.

In our position paper, we categorically stated that “the issue of non-

payment of RLE in this instant case refers only for the academic years
2013-2014, 2014-2015, 2015-2016 up to present 2018-2019, and does not
include years earlier which is now pending resolution in the Supreme
Court,” to which respondent agreed when the same was included in the
Submission Agreement.

Perusal of the position paper filed by respondent will show that

respondent position is as follow:

The sales proceeds of the

WUPFSA dormitory known as the
Wesley Dormitory were fully
distributed to all the beneficiaries
who were rank-and-file during the
SY 2013-2014

Under the Memorandum of Agreement (MOA) entered into between

the WUPFSA and the WU-P. Under the said MOA, the WU-P shall and has
already transferred the ownership of the Wesleyan Dormitory in favor of
WUPFSA as payment for the outstanding obligation amounting to P20
million. (Annex “1”)

Clearly, under the MOA, the amount stated is P20 million

Respondent, by its own admission, “only participation of the WU-P is

that it executed a Deed of Absolute Sale directly in favor of that third
person.”

Respondent further admitted that “it must be noted that the said
scheme is upon the request of the WUPFSA because transferring the title
of the property to WUPFSA and then to a third person would result to
incurring more expenses for the capital gains tax and other cost and
expenses for the transfer of title.”

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 The question that must be resolved is who is respondent referring to
as WUPFSA that they are dealing with?

It was likewise admitted that “it is worthy to note that the actual sale
transaction was in reality between the WUPFSA and the third person and
the actual payment of the purchase price was directly made in favor of
WUPFSA which were thereafter distributed to the employees.”

Again who is WUPFSA referred to by respondent and how did

respondent knew that it was DISTRIBUTED TO THE EMPLOYEES!?

By presenting the MOA which the cost of the Dorm is in reality

P20,000,000.00, respondent WUP should now accounting for the said
amount and not for the alleged sale of P8,300,000.00, unless they can
prove that it was sold in the latter amount.

As already mentioned, as a general rule, one who pleads payment

has the burden of proving it. Even when the plaintiff must allege non-
payment, the general rule is that the burden rests on the defendant to
prove payment, rather than the plaintiff to prove non-payment. The debtor
has the burden of showing with legal certainty that the obligation has been
discharge with payment. It is not for an employee to prove non-payment of
benefits to which he is entitled by law. Rather, it is on the employer that the
burden of proving payment of these claims rests.

Respondents’ denied that there was erroneous payment of the

Seed Money in the amount of P550,000 Intended for the Capital Gains
Tax, Transfer of Registration fee for the sale of the Wesleyan-
WUPFSA Dormitory.

There was no erroneous payment of the Prize for WUPFSA as

grand winner In the DOLE NCMB Search for Best Dispute Resolution
Practices in the amount of P50,000.

By way admission, respondents is dealing only with “then President

Corazon C. Gonzales. Being the President of the WUPFSA, Mrs. Corazon
Gonzales is clothed with authority to receive such money which is intended
for a particular purpose.”

“It is worthy to note that the said real property was already transferred in
favor of a third person and there was no issued raised by the vendee/third
person with respect to the payment of the Capital Gains Tax, Transfer of
Registration and other fees and expenses and it could be safely assume
that the same has been paid using the above-said amount actually paid to
Mrs. Corazon Gonzales.”

“The amount of P50,000 as prize for the WUPFSA as a grand winner

in the last DOLE NCMB Search for Best Dispute Resolution Practices in
the amount of P50,000 has already been paid by the WU-P to the
WUPFSA thru its then President Corazon Gonzales. Being the then
President of the WUPFSA, Mrs. Corazon Gonzales is duly authorized to

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received the said amount which should have been remitted to the coffers of
the WUPFSA or should have redounded to its benefit.”
In Agbayani v. Lupa Realty Holding Corp., 2 the Supreme Court
teaches:
American jurisprudence sets the following
parameters on judicial admissions:
A judicial admission is a formal statement, either
by party or his or her attorney, in course of judicial
proceeding which removes an admitted fact from
field of controversy. It is a voluntary concession of
fact by a party or a party's attorney during judicial
proceedings.
Judicial admissions are used as a substitute for
legal evidence at trial. Admissions made in the
course of judicial proceedings or judicial admissions
waive or dispense with, the production of evidence,
and the actual proof of facts by conceding for the
purpose of litigation that the proposition of the fact
alleged by the opponent is true. x x x
A judicial admission is a deliberate, clear,
unequivocal statement of a party about a concrete
fact within that party's peculiar knowledge, not a
matter of law. x x x In order to constitute a judicial
admission, the statement must be one of fact, not
opinion. To be a judicial admission, a statement
must be contrary to an essential fact or defense
asserted by the person giving the testimony; it must
be deliberate, clear and unequivocal x x x.
Judicial admissions are evidence against the
party who made them, and are considered
conclusive and binding as to the party making the
judicial admission. A judicial admission bars the
admitting party from disputing it. x x x
A judicial admission of fact may carry with it an
admission of other facts necessarily implied from it.
xxx xxx xxx
Judicial admissions may occur at any point
during the litigation process. An admission in open
court is a judicial admission. x x x
|||
In our position paper, we made it clear that respondents is
answerable to the Union by erroneously or deliberately disbursing funds
intended for the Union but were disbursed personally to the former Union
President, Mrs. Corazon C. Gonzales.

Course of events proves as a matter of fact, e.g. the amount of Five

Hundred Fifty Thousand Pesos (P550,000.00) was disbursed instead to
the Union (WUPFSA), was disbursed personally to Corazon C. Gonzales
per JV Number: 14-05-149 dated 5/30/2014 intended for the processing of
2
G.R. No. 201193 (Resolution), [June 10, 2019])

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the Capital Gain Tax, transfer and registration fee for the sale of Wesleyan-
WUPFSA Dormitory. (See Annex “F”).

This was supported by an acknowledgement receipt by Mrs. Corazon

C. Gonzales dated 5 March 2014. (See Annex “G”).

The transaction was by virtue of a note made by then University

President Pacifico B. Aniag of the respondents presenting a detailed
assessment/computation, viz:

Realty Tax - P500,000.00

Capital Gains Tax- 550,000.00
Total - P1,050,000.00

See Annex “H”.

The liquidation of the P550,000.00 disbursed for Capital Gains Tax

was fully consummated with no Official Bank receipts attached.

The truth of the matter is: 1) President Pacifico B. Aniag of the

respondents, executed another Deed of Absolute Sale for the same
property mentioned above or for TCT No. T-127656 and TCT No. T-127655
for and in consideration of only the sum of Four Hundred Thousand
(P400,000.00).

This is in lieu of (P8,300,000.00) just for the Capital Gains Tax to be

computed only for P50,754.60 instead of P550,000.00.

Where did the respondents and Mrs. Corazon C. Gonzales hide the
excess of P499,245.40?

In the course of accounting, funds recorded as receipts by the Union

in the amount of P550,000.00 incurred a loss of P499,245.40 due to the
fault of erroneous payments to a wrong person is deemed by the Union to
be corrected by the culprit themselves.

While the foregoing premises considered establishing the deliberate

error, respondents insisted in the minutes of meeting of the Labor-
Management Grievance Committee held on the 21 st. of May 2018 on page
No. 3 paragraph 1 of item No. 4 which reads:

xxxx
The management panel argued that payment of
proceeds to Mrs. Corazon C. Gonzales by the
university is not erroneous because she represents
the Union being then the president and besides
there is a resolution by WUPFSA authorizing her
for the purpose of using the proceeds for the
development of WUPFSA Village. (underscoring
ours)
xxxx

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 (See Annex “L”.)

The Union vehemently deny the existence of such WUPFSA

resolution authorizing Corazon C. Gonzales to personally receive fund for
the Union or in behalf of the Union particularly for the amount of
P550,000.00 for the Capital Gains Tax and P50,000.00 respectively for the
development of the WUPFSA Village.

Worth to reiterate that, acts of an officer that are not authorized by the
board of directors/trustees do not bind the corporation unless the
corporation ratifies the acts or holds the officer out as a person with
authority to transact on its behalf.
It is a basic axiom in civil law embodied in our Civil Code that no one
may contract in the name of another without being authorized by the
latter, or unless he has by law a right to represent him.3  A contract
entered into in the name of another by one who has no authority or the
legal representation or who has acted beyond his powers, shall be
unenforceable, unless it is ratified, expressly or impliedly, by the
person on whose behalf it has been executed, before it is revoked by
the other contracting party.4 Article 1403 (1) of the same Code also
provides:

ART. 1403. The following contracts are unenforceable, unless

they are justified:

(1) Those entered into in the name of another person by one

who hi - been given no authority or legal representation or who
has acted beyond his powers; ...

Agency is basically personal representative, and derivative in nature.

The authority of the agent to act emanates from the powers granted to him
by his principal;

Clearly, Mrs. Corazon Gonzales, has no power to receive any amount

due to WUPFSA without any special power of Attorney.

Rule III, SECTION 9. AUTHORITY TO BIND PARTY. - Attorneys and

other representatives of parties shall have authority to bind their clients in
all matters of procedure; but they cannot, without a special power of
attorney or express consent, enter into a compromise agreement with
the opposing party in full or partial discharge of a client's claim.

In the case of GOLDEN DONUTS, INC. vs. NATIONAL LABOR

RELATIONS COMMISSION, et. al., [G.R. Nos. 113666-68. January 19,
2000] the supreme Court held:

First, even if a clear majority of the union

members agreed to a settlement with the
employer, the union has no authority to
compromise the individual claims of members
who did not consent to such settlement. Rule
138 Section 23 of the 1964 Revised Rules of
3
Art. 1317, Civil Code of the Philippines

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 Court requires a special authority before an
attorney may compromise his client’s litigation .
"The authority to compromise cannot lightly be
presumed and should be duly established by
evidence." Kaisahan ng mga Manggagawa sa La
Campana v. Sarmiento, 133 SCRA 220, 235
(1984)

In the case at bar, minority union members did not authorize the
union to compromise their individual claims. Absent a showing of the
union’s special authority to compromise the individual claims of
private respondents for reinstatement and back wages, there is no
valid waiver of the aforesaid rights. As private respondents did not
authorize the union to represent them in the compromise settlement,
they are not bound by the terms thereof. Quiban vs. Butalid, 189
SCRA 107 (1990)

Second, whether minority union members who did not consent

to a compromise agreement are bound by the majority decision
approving a compromise settlement has been resolved in the
negative. General Rubber and Footwear Corp. vs. Drilon, 169 SCRA
808 (1989)

In La Campana, we explicitly declared:

"Money claims due to laborers cannot be

the object of settlement or compromise effected
by a union or counsel without the specific
individual consent of each laborer concerned.
The beneficiaries are the individual
complainants themselves. The union to which
they belong can only assist them but cannot
decide for them." Kaisahan ng mga
Manggagawa sa La Campana v. Sarmiento,
supra, on p. 236; Danao Development Corp. vs.
NLRC, 81 SCRA 487 (1978); Marquez vs.
Secretary of Labor, 171 SCRA 337 (1989)

A compromise agreement is not valid when a party in the case

has not signed the same or when someone signs for and in behalf of
such party without authority to do so. Quiban vs. Butalid, supra, on p.
119.

In SMI Fish Industries, Inc. vs. NLRC, 213 SCRA 444, 448 (1992)
this Court declared that where the compromise agreement was
signed by only three of the five respondents, the non-signatories
cannot be bound by that amicable settlement. This is so as a
compromise agreement is a contract and cannot affect third persons
who are not parties to it. J. M. Tuazon Co. vs. Tongol, 16 SCRA 331
(1964); University of the East vs. Secretary of Labor and Employment,
204 SCRA 254, 262 (1991)

In the case of Dusit Hotel Nikko vs NUWHRAIN, G.R. No.

160391, 09 August 2005, the Supreme Court held:

 
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 Rule 138, Section 23 of the 1964 Revised
Rules of Court requires a special authority
before an attorney may compromise his client’s
litigation.  “The authority to compromise cannot
lightly be presumed and should be duly
established by evidence.”

Complainant, reiterate, replead and adopts all allegations contained in their

position paper.

PRAYER

WHEREFORE, premises considered, it is respectfully prayed that a

Decision BE RENDERED in favor of the Union:

DECLARING Wesleyan University Philippines Guilty of Diminution of

Benefits;

ORDERING the respondents to pay the Union members RLE shares

to all covered union members/employees for the academic years 2013-
2014, 2014-2015, 2015-2016 up to present 2018-2019;

ORDERING the payment of balances on the sales proceeds of

Wesleyan Dormitory in the amount of THREE MILLION THREE
HUNDRED THOUSAND PESOS (P3,300,000.00) TO WUPFSA MEMBER
BENEFICIARIES.

DECLARING Wesleyan University Philippines Guilty of Erroneous

Payment;

ORDERING Wesleyan University-Philippines to Pay the Union:

P499,245.40 representing shortage from Gain Tax

P 50,000.00 representing the Prize for WUPFSA as Grand Winner for

Best Dispute Resolution Practices

Payment of Moral and Exemplary Damages; and

Payment of Union Service Fee equivalent to Ten (10%) of the Total

Award.

Cabanatuan City for City of Pampanga. 14 January 2020.

WESLEYAN UNIVERSITY
-PHILIPPINES FACULTY AND STAFF
ASSOCIATION-LAKAS AT GABAY NG
MANGAGAWANG NAGKAKAISA (WUPFSA-
LAGMAN)
G/F Library Bldg., Mabini Extension
Cabanatuan City

By:

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 EUFEMIA C. AYRO
President

Assisted by:

LAKAS AT GABAY NG MANGAGAWANG

NAGKAKAISA (LAGMAN)
2/F Unit D, Tempus Place Condominium II
Matalino St., Diliman, Quezon City

By:

TOMAS E. SEMANA
National President/
Accredited Voluntary Arbitrator

Copy Furnished:

ATTY. MICHAEL REYES

Cousel for Respondent
Wesleyan University-Philippines
Mabini extension, Cabanatuan City

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