SSS v. Rizal Poultry (G.R. No. 167050; June 1, 2011)


FACTS: Angeles had earlier filed a complaint for illegal dismissal against BSD Agro and/or its owner, Benjamin San Diego (San Diego).The Labor Arbiter initially found that Angeles was an employee and that he was illegally dismissed.On appeal, however, the NLRC reversed the Labor Arbiter's Decision and held that no employer-employee relationship existed between Angeles and respondents.The ruling was anchored on the finding that the duties performed by Angeles, such as carpentry, plumbing, painting and electrical works, were not independent and integral steps in the essential operations of the company, which is engaged in the poultry business.Angeles elevated the case to the Court of Appeals via petition for certiorari.The appellate court affirmed the NLRC ruling and upheld the absence of employer-employee relationship. Angeles moved for reconsideration but it was denied by the Court of Appeals. No further appeal was undertaken, hence, an entry of judgment was made on 26 May 2001.

At any rate, the SSC did not take into consideration the decision of the NLRC.t denied respondents' motion to dismiss.

Unfazed, respondents sought recourse before the Court of Appeals by way of a petition for certiorari.The Court of Appeals reversed the rulings of the SSC and held that there is a common issue between the cases before the SSC and in the NLRC; and it is whether there existed an employer-employee relationship between Angeles and respondents. Thus, the case falls squarely under the principle of res judicata, particularly under the rule on conclusiveness of judgment, as enunciated in Smith Bell and Co. v. Court of Appeals

ISSUE: Is the issue regarding the employer-employee relationship barred by res judicata?

HELD: The elements of res judicata are:(1) the judgment sought to bar the new action must be final;
(2) the decision must have been rendered by a court having jurisdiction over the subject matter and the parties;
(3) the disposition of the case must be a judgment on the merits; and
(4) there must be as between the first and second action, identity of parties, subject matter, and causes of action.

Should identity of parties, subject matter, and causes of action be shown in the two cases, then res judicata in its aspect as a "bar by prior judgment" would apply.If as between the two cases, only identity of parties can be shown, but not identical causes of action, then res judicata as "conclusiveness of judgment" applies.

Verily, the principle of res judicata in the mode of "conclusiveness of judgment" applies in this case.The first element is present in this case. The NLRC ruling was affirmed by the Court of Appeals.It was a judicial affirmation through a decision duly promulgated and rendered final and executory when no appeal was undertaken within the reglementary period.The jurisdiction of the NLRC, which is a quasi-judicial body, was undisputed.Neither can the jurisdiction of the Court of Appeals over the NLRC decision be the subject of a dispute.The NLRC case was clearly decided on its merits; likewise on the merits was the affirmance of the NLRC by the Court of Appeals.

In the instant case, therefore, res judicata in the concept of "conclusiveness of judgment" applies.The judgment in the NLRC case pertaining to a finding of an absence of employer-employee relationship between Angeles and respondents is conclusive on the SSC case.

A case in point is Smith Bell and Co. v. Court of Appeals which, contrary to SSC, is apt and proper reference.Smith Bell availed of the services of private respondents to transport cargoes from the pier to the company's warehouse.Cases were filed against Smith Bell, one for illegal dismissal before the NLRC and the other one with the SSC, to direct Smith Bell to report all private respondents to the SSS for coverage.While the SSC case was pending before the Court of Appeals, Smith Bell presented the resolution of the Supreme Court in G.R. No. L-44620, which affirmed the NLRC, Secretary of Labor, and Court of Appeals' finding that no employer-employee relationship existed between the parties, to constitute as bar to the SSC case. We granted the petition of Smith Bell and ordered the dismissal of the case.We held that the controversy is squarely covered by the principle of res judicata, particularly under the rule on "conclusiveness of judgment."herefore, the judgment in G.R. No. L-44620 bars the SSC case, as the relief sought in the latter case is inextricably related to the ruling in G.R. No. L-44620 to the effect that private respondents are not employees of Smith Bell.

The NLRC decision on the absence of employer-employee relationship being binding in the SSC case, we affirm the dismissal by Court of Appeals of the SSC case. DENIED.