SUPREME COURT

EN BANC

PHILIPPINE LAND-AIR-SEA LABOR

UNION (PLASLU), INC.,
Petitioner,

-versus- G.R. Nos. L-5664 & L-5698

September 17, 1953

COURT OF INDUSTRIAL RELATIONS

and PEPSI-COLA BOTTLING
COMPANY (Cebu Branch),
Respondents.
x----------------------------------------------------x

DECISION

BAUTISTA ANGELO, J.:

This is a Petition for Review of the Resolution of the Court of

Industrial Relations dated March 1, 1952 wherein it held that
petitioner, whose permit had been withdrawn, lost its personality to
prosecute the present case and, consequently, in pursuance of
Sections 4 and 7 of Commonwealth Act No. 103, as amended, it
should be substituted for its individual members with the warning
that, upon failure to do so, the case should be dismissed.chanroblespublishingcompany
Petitioner was a labor union which was registered in accordance with
law and was granted permit to act as such by the Department of
Labor on February 12, 1948. chanroblespublishingcompany

On November 29, 1949, petitioner filed a petition with the Court of

Industrial Relations, docketed as Case No. 390-V, wherein it
submitted several grievances and demands against respondent, a
corporation organized under the laws of the Philippines, for
arbitration and settlement. chanroblespublishingcompany

On March 3, 1950, petitioner filed an incidental motion against the

same respondent, which was docketed as Case No. 390-V-(1),
complaining about the separation from the service without justifiable
cause of sixteen (16) of its laborers and employees and praying that
they be reinstated. chanroblespublishingcompany

On March 23, 1950, respondent filed a motion to dismiss on two

grounds: (1) that petitioner does not represent respondent’s workers;
and (2) less than thirty-one (31) workers are involved in the case. This
motion was opposed in writing by petitioner and, after proper hearing
during which both parties presented pertinent evidence, the court
denied the motion because it found that at least eighty-two (82) of the
members of petitioning union were actually employed by respondent
and were affected by the dispute. The court found further that
petitioner was a legitimate labor organization registered under the
provisions of Commonwealth Act No. 213. chanroblespublishingcompany

On February 28, 1950, petitioner paid the fee for the renewal of its
permit to the Bureau of Labor with the request that said permit be
renewed, but because of its failure to meet certain requirement
relative to the inspection of its books of accounts, on August 25, 1950,
the Secretary of Labor advised petitioner that its name as a labor
union had been dropped from the list of registered labor
organizations. chanroblespublishingcompany

On January 16, 1951, instead of pressing for action on its request for
renewal of the permit, petitioner took steps to organize itself, as it
did, as a non-stock corporation under the Corporation Law by filing
the necessary papers with the Securities and Exchange Commission
with the result that Certificate of Incorporation No. 5754 was issued
to it on January 20, 1951. chanroblespublishingcompany

On August 8, 1951, respondent filed a new motion to dismiss, this

time based on the ground that petitioner, not being a registered
union, has no capacity to sue under Commonwealth Act No. 213, and
therefore this case should be dismissed.

On October 18, 1951, the court maintained its former stand denying
the motion for lack of merit; but, on motion for reconsideration by
respondent, the court reversed its stand holding that petitioner lacks
capacity to sue and ordering that petitioner be substituted for its
individual members, as otherwise the case would be dismissed. Not
agreeable to this ruling, petitioner brought this petition for review.

We are of the opinion that petitioner has lost its capacity to sue in the
present case as a labor union entitled “to all the rights and privileges
granted by law” when on August 25, 1950, the Secretary of Labor
dropped its name from the list of registered labor organizations in
view of its failure to comply with certain requirement relative to the
inspection of its books of accounts. chanroblespublishingcompany

Commonwealth Act No. 213 has been enacted in order to allow a

labor union to organize itself and acquire a personality distinct and
separate from its members and to serve as an instrumentality to
conclude collective bargaining agreements and enjoy all the rights
and privileges granted by law to a labor organization. But in order
that it may acquire such personality, it is necessary that it first comply
with certain requirements, one of them being that it must register and
secure a permit to operate as such from the Department of Labor. The
procedure to secure this permit is well laid down in the law. An
application shall be filed with the Secretary of Labor, who shall
conduct an investigation of the activities of the applying labor
organization and if, on such investigation, it shall appear that the
applicant is entitled to registration, he shall issue a permit therefor
upon payment of the registration fee of five pesos. (Section 3,
Commonwealth Act No. 213.) chanroblespublishingcompany

That such is the clear implication of the law is evident. A labor

organization is not considered legitimate in contemplation of law
unless that requirement has been complied with. Thus, the law
postulates that “a legitimate labor organization is an organization,
association or union of laborers duly registered and permitted to
operate by the Department of Labor”, and that “the registration of,
and the issuance of a permit to, any legitimate labor organization
shall entitle it to all the rights and privileges granted by law.”
(Sections 1 and 2, Commonwealth Act No. 213.) To be considered a
legitimate labor organization with the right to enjoy all the rights and
privileges recognized by law, it is therefore necessary that it be
registered and permitted to operate as required by law. These rights
and privileges are none other than those accorded by Commonwealth
Act No. 213, among them, the right to conclude collective bargaining
agreements and to appear in behalf of its members before the Court
of Industrial Relations “for the purpose of seeking better working and
living conditions, fair wages, and shorter working hours for laborers,
and, in general, to promote the material, social and moral well-being
of its members.” (Section 2, Commonwealth Act No. 213.) chanroblespublishingcompany

The fact that petitioner has organized itself under the Corporation
Law as a non-stock corporation and has obtained a certificate of
incorporation from the Securities and Exchange Commission is of no
moment, for such incorporation has only the effect of giving to it
juridical personality before regular courts of justice. Such
incorporation cannot be availed of by it to enjoy the rights and
privileges granted by law to a legitimate labor organization. chanroblespublishingcompany

The foregoing observations notwithstanding, we are of the opinion

that the failure of petitioner to secure the renewal of its permit from
the Labor Department will not operate as a dismissal of this case, it
appearing that when it filed the present petition it had juridical
personality and respondent court had acquired jurisdiction over the
case. In previous cases where a similar question was raised, this Court
denied the motion to dismiss upon the theory that jurisdiction once
acquired is not lost until the case is completely decided. Thus, in a
recent case this Court held:chanroblespublishingcompany

“The second point raised by petitioner is likewise without merit.

In the first place, there being more than 30 laborers involved
and the Secretary of Labor having certified the dispute to the
Court of Industrial Relations, that Court duly acquired
 jurisdiction over the case (International Oil Factory vs. NLU,
Inc., 73 Phil. 401; Section 4, C. A. 103). This jurisdiction was not
lost when the Department of Labor suspended the permit of the
respondent Kaisahan as a labor organization. For once
jurisdiction is acquired by the Court of Industrial Relations it is
retained until the case is completely decided. (Manila Hotel
Employees Association vs. Manila Hotel Co. et al., 73 Phil.
374.)” (La Campana Coffee Factory, Inc., et el. vs. Kaisahan Ng
Mga Manggagawa Sa La Campana [KKH], et al.; supra, p. 160.)

In conclusion, we hold that the present case can be continued without

need of any substitution of parties subject however to the
understanding that whatever decision may be rendered therein will
only be binding upon those members of petitioning union who have
not signified their desire to withdraw from the case before its trial and
decision on the merits. Wherefore, the resolution appealed from is
hereby modified in the sense above indicated, and it is ordered that
this case be remanded to the respondent court for further
proceedings, without pronouncement as to costs. chanroblespublishingcompany

Paras, C.J., Pablo, Bengzon, Padilla, Tuason, Montemayor,

Reyes, Jugo and Labrador, JJ., concur.
chanroblespublishingcompany
chanroblespublishingcompany