APPEAL BOND
PETITIONERS Grand Asian Shipping Lines, Inc., Eduardo P. Francisco and William How appealed the decision of the labor arbiter (LA) awarding to respondent Wilfredo Galvez and nine others the amount of P7,104,438.84 via a Notice of Appeal with a Very Urgent Motion to Reduce Bond and posted a cash bond in the amount of P500,000 and a supersedeas bond in the amount of P1.5 million. The National Labor Relations Commission (NLRC), despite its earlier order denying the petitioners’ motion for the reduction of appeal bond, reduce the amount of appeal bond to P1.5 million and gave due course to petitioners’ appeal.
The Court of Appeals (CA) set aside the NLRC’s decision. It held that the NLRC’s act of entertaining the appeal is a jurisdictional error since petitioners’ failure to post additional bond rendered the labor arbiter’s decision final, executory and immutable. Can the CA ruling be justified?
The Supreme Court (Second Division) ruling: No.
In order to perfect an appeal from the Decision of the Labor Arbiter granting monetary award, the Labor Code requires the posting of a bond, either in cash or surety bond, in an amount equivalent to the monetary award. xxx Nonetheless, we have consistently held that rules should not be applied in a very rigid and strict sense. This is especially true in labor cases wherein the substantial merits of the case must accordingly be decided upon to serve the interest of justice. When there has been substantial compliance, relaxation of the Rules is warranted.
In Mendoza v. HMS Credit Corp., G.R. No. 187232, April 17, 2013, we held that the posting of an appeal bond in the amount of P650,000.00 instead of P1,025,081.82 award stated in the Decision of the Labor Arbiter is substantial compliance with the requirement under Article 223. Likewise, in Pasig Cylinder Mfg. Corp. v. Rollo, G.R. No. 173631, September 8, 2010, 630 SCRA 320, 329–330, we ruled that the filing of a reduced appeal bond of P100,000.00 is not fatal in an appeal from the labor arbiter’s ruling awarding P3,132,335.57 to the dismissed employees.
In Rosewood Processing, Inc. v. National Labor Relations Commission, 352 Phil. 1013 (1998), we allowed the filing of a reduced bond of P50,000.00, accompanied with a motion, in an appeal from the Labor Arbiter’s award of P789,154.39.
In the case at bench, petitioners appealed from the Decision of the Labor Arbiter awarding to crewmembers the amount of P7,104,483.84 by filing a Notice of Appeal with a Very Urgent Motion to Reduce Bond and posting a cash bond in the amount of P500,000.00 and a supersedeas bond in the amount of P1.5 million. We find this to be in substantial compliance with Article 223 of the Labor Code. It is true that the NLRC initially denied the request for reduction of the appeal bond. However, it eventually allowed its reduction and entertained petitioners’ appeal. We disagree with the CA in holding that the NLRC acted with grave abuse of discretion as the granting of a motion to reduce appeal bond lies within the sound discretion of the NLRC upon showing of the reasonableness of the bond tendered and the merits of the grounds relied upon. Hence, the NLRC did not err or commit grave abuse of discretion in taking cognizance of petitioners’ appeal before it. (Grand Asian Shipping Lines, Inc., Eduardo P. Francisco and William How vs. Wilfredo Galvez, et. al., G.R. No. 178184, Jan. 29, 2014).