Alemar’s Sibal & Sons, Inc. v. NLRC [G.R. No. 114761, January 10, 2000]

FACTS: Private respondent NLM Katipunan filed with the Dole a notice of strike raising charges of ULP and illegal dismissal against petitioner. The charges were elevated to NLRC for compulsory arbitration. The Labor Arbiter ordered petitioner to pay private respondent separation pay of ½ month pay for every year of service. Private respondent filed a motion for execution of the decision of the Labor Arbiter. The Rehabilitation Receiver of petitioner submitted a Manifestation with Motion, alleging that petitioner was not yet in a position to comply with the directive of the Labor Arbiter as it was still under Rehabilitation Receivership by virtue of the order of the SEC. The Labor Arbiter granted the motion for execution. Petitioner contends that public respondent should have denied the order of the LA for the immediate payment of separation pay because of the order of the SEC suspending all claims against petitioner pending before any court, tribunal or body. However, the NLRC emphasized that the order of execution made by the LA had reached finality and that petitioner’s succeeding motions had been filed out of time. At the time this petition had been filed on May 4, 1984, petitioner had been placed under rehabilitation receivership.

ISSUE: Whether or not the order of the SEC can stay the execution of judgment against petitioner.

HELD: No. A stay of execution may be warranted by the fact that a petitioner corporation has been placed under rehabilitation receivership. However, the Sec issued an order approving the rehabilitation plan of petitioner and placing it under liquidation pursuant to PD 902-A. Since receivership proceedings have ceased and petitioner’s rehabilitation receiver and liquidator, Ledesma, Saludo and Associates has been given the imprimatur to proceed with corporate liquidation, the cited order of the Sec has been rendered functus oficio. Petitioner’s monetary obligation to private respondent is long overdue and thus cannot delay the satisfaction of private respondent’s claim. However, due to events subsequent to the filing of this petition, private respondent must present its claim with the rehabilitation receiver and liquidator in the SEC, subject to the rules on preference of credits.