Case Digest: Barba vs. Liceo de Cagayan

G .R. No. 193857 : November 28, 2012




Petitioner Dr. Ma. Mercedes L. Barba (Barba) was the Dean of the College of Physical Therapy of respondent Liceo de Cagayan University, Inc. (Liceo).

In the school year 2003 to 2004, the College of Physical Therapy suffered a dramatic decline in the number of enrollees from a total of 1,121 students in the school year 1995 to 1996 to only 29 students in the first semester of school year 2003 to 2004. Due to the low number of enrollees, Liceo decided to freeze the operation of the College of Physical Therapy indefinitely. Thereafter, the College of Physical Therapy ceased operations and Barba went on leave without pay starting. Subsequently, Liceo sent Barba a letter dated April 27, 2005 instructing Barba to return to work on and report to Ma. Chona Palomares, the Acting Dean of the College of Nursing, to receive her teaching load and assignment as a full-time faculty member in that department. Barba did not report to Palomares and requested for the processing of her separation benefits in view of the closure of the College of Physical Therapy.

Another letter was sent to Barba but the latter still refused to return to work. Hence, Liceo sent Barba a notice terminating her services on the ground of abandonment.

Barba filed a complaint before the Labor Arbiter for illegal dismissal, payment of separation pay and retirement benefits againstLiceo. She alleged that her transfer to the College of Nursing as a faculty member is a demotion amounting to constructive dismissal.

The LA ruled that Barba was not constructively dismissed. The NLRC reversed the LA. Liceo went to the CA and filed a Supplemental Petition raising for the first time the issue of lack of jurisdiction of the Labor Arbiter and the NLRC over the case. Liceo claimed that a College Dean is a corporate officer under its by-laws and Barba was a corporate officer of Liceo since her appointment was approved by the board of directors. Thus, Liceo maintained that the jurisdiction over the case is with the regular courts and not with the labor tribunals.

In its original Decision, the CA reversed the NLRC resolutions. The CA did not find merit in Liceos assertion in its Supplemental Petition that the position of Barba as College Dean was a corporate office. The CA further found that no constructive dismissal occurred nor has Barba abandoned her work.

Unsatisfied, both Barba and Liceo sought reconsideration of the CA decision. Thereafter, the CA reversed its earlier ruling. Hence,Barba filed the present petition.


I. Whether or not the labor tribunals have jurisdiction over Barbas complaint for constructive dismissal?
II. Whether or not Barba was constructively dismissed?

HELD: The petition is granted.

MERCANTILE LAW: corporate officers

FIRST ISSUE: Labor tribunals have jurisdiction over Barbas complaint.

Corporate officers are elected or appointed by the directors or stockholders, and are those who are given that character either by the Corporation Code or by the corporations by-laws. Section 25 of the Corporation Code enumerates corporate officers as the president, the secretary, the treasurer and such other officers as may be provided for in the by-laws. In Matling Industrial and Commercial Corporation v. Coros, the phrase "such other officers as may be provided for in the by-laws" has been clarified, thus: "Conformably with Section 25, a position must be expressly mentioned in the By-Laws in order to be considered as a corporate office. The rest of the corporate officers could be considered only as employees of subordinate officials."

However, an assiduous perusal of these documents does not convince us that Barba occupies a corporate office position in the university. In Liceos by-laws, there are four officers specifically mentioned, namely, a president, a vice president, a secretary and a treasurer. In addition, it is provided that there shall be other appointive officials, a College Director and heads of departments whose appointments, compensations, powers and duties shall be determined by the board of directors. It is worthy to note that a College Dean is not among the corporate officers mentioned in Liceos by-laws. Barba was not directly elected nor appointed by the board of directors to any corporate office but her appointment was merely approved by the board together with the other academic deans of respondent university in accordance with the procedure prescribed in Liceos Administrative Manual. Though the board of directors may create appointive positions other than the positions of corporate officers, the persons occupying such positions cannot be deemed as corporate officers as contemplated by Section 25 of the Corporation Code. Thus, petitioner, being an employee of respondent, her complaint for illegal/constructive dismissal against respondent was properly within the jurisdiction of the LaborArbiter and the NLRC.

LABOR LAW: constructive dismissal

On the issue of constructive dismissal, we agree with the Labor Arbiter and the appellate courts earlier ruling that Barba was not constructively dismissed.Barbas letter of appointment specifically appointed her as Dean of the College of Physical Therapy and Doctor-in-Charge of the Rehabilitation Clinic "for a period of three years effective July 1, 2002 unless sooner revoked for valid cause or causes." Evidently, Barbas appointment as College Dean was for a fixed term, subject to reappointment and revocation or termination for a valid cause. When Liceo decided to close its College of Physical Therapy due to drastic decrease in enrollees,Barbas appointment as its College Dean was validly revoked and her subsequent assignment to teach in the College of Nursing was justified as it is still related to her scholarship studies in Physical Therapy. Particularly, for a transfer not to be considered a constructive dismissal, the employer must be able to show that such transfer is not unreasonable, inconvenient, or prejudicial to the employee.