Case Digest: Bibiana Farms v. Lado

G.R. No. 157861: February 2, 2010

BIBIANA FARMS AND MILLS, INC., Petitioner, v. ARTURO LADO, Respondent.



Mildred Manzo (Manzo) transacted with Rosalia Manalo (Manalo), the petitioners cashier, for the purchase of 3,000 pieces of empty sacks. Manalo then gave Manzo a note containing the number and words "3,000/mix-mix" and told her to proceed to the warehouse. Manzo did and showed the note to Lado. At Manzos request, Lado loaded 68 bundles (or 3,400 pieces of empty sacks) in the dump truck for unloading at the gate after payment. Upon payment, however, Manalo only accepted the cash payment for 60 bundles (3,000 pieces) and refused to accept Manzos personal check for the excess; thus, Manzo only paid for the original 60 bundles purchased. Instead of personally overseeing the segregation and unloading of the excess 8 bundles on being informed that only 60 bundles were paid for, Lado allegedly delegated the task. The excess 8 bundles, however, were not removed from the truck and the whole lot was unloaded at the gate.

Petitioners GM, Lim, then asked Lado to submit a written explanation on the release of 3,400 pieces of empty sacks when only 3,000 pieces were duly paid for and covered by receipt, and the release of one-use sack when Manalos note expressly authorized the release of mix-use sacks.

Lado apologized for the incident, but stressed that the company did not lose anything. He explained that it was an honest mistake due to time constraints and that he acted without any malice or bad intention.

Lado was placed under preventive suspension for a week. Lim issued a notice informing Lado that management would conduct further investigation/inquiry on the incident. Since, Lado was under preventive suspension, the notice was sent to his residence. Lado, however, was not at home and his housemaid refused to receive the notice.

After investigation and consideration of Lados written explanations, Lim issued Lado a Notice of Termination,dismissing him from the service effective upon receipt, for "serious misconduct, dishonesty, willful breach of trust, fraud, loss of confidence and other grounds.

Lado filed a complaint for illegal dismissal against the petitioner and Lim. In defense, the petitioner alleged that Lado was validly dismissed for loss of trust and confidence.

The LA dismissed the complaint for lack of merit. However, the NLRC reversed the LAs decision on appeal. Upon denial of its motion for reconsideration, petitioner appealed to the CA. The CA set aside the NLRC Resolutions and ruled that Lado had been illegally dismissed. It found no basis for Lados dismissal for loss of trust and confidence because the release of the excess 400 empty sacks was not made with fraudulent intent.

Its motion reconsideration being denied, petitioner files the present petition to the SC.

Whether or not Lado was validly dismissed


Guidelines for the application of loss of trust and confidence as a just cause for dismissal of an employee from the service

For loss of trust and confidence to be a valid ground for dismissal, the following must be observed: a) loss of confidence should not be simulated; b) it should not be used as subterfuge for causes which are improper, illegal or unjustified; c) it may not be arbitrarily asserted in the face of overwhelming evidence to the contrary; and d) it must be genuine, not a mere afterthought to justify earlier action taken in bad faith.

Lado was no ordinary rank-and-file employee. As warehouseman, his duties involved the handling of incoming and outgoing feed ingredients, classifying feed ingredients, classifying and controlling feeds empty sacks, and supervising feed mill laborers. He had, as the Arbiter noted, access to company property. As early as fifteen (15) days into his employment by the company, the petitioners then operations manager, Froilan G. Tecson, issued Lado a memorandum directing him to devise means to immediately check the full sacks sent to the stations and the empties being returned, and to take extra care of their accounting and inventory, down to the last sack. In short, the petitioner tasked Lado with the close monitoring and handling of company property, especially the outflow of full sacks of feeds destined for the stations and the return of empty sacks, to avoid or minimize losses. . In other words, Lado held a position of trust and confidence. It was this trust that he had to uphold during that event when Manzo purchased the companys empty sacks.

Interestingly, when Manalo confronted Lado on the excess empty sacks when the delivery receipt was for only 3,000 pieces, Lado could only try to convince Manalo to allow the excess to be paid by Manzos check. Although Lado denied this company claim, the weight of the other evidence leads us to disbelieve this denial. At that point, Lado had been caught red-handed in a scheme to spirit off unpaid company sacks.

There was really no excuse he could offer Manalo, given the written authorizations for the release of only 3,000 empty sacks; thus he could only plead that the excess be paid for by check. To be sure, the failure of the guard to heed his unloading orders and the purported time constraint could have been given as justifications. That no such excuse was then given only leads to the inference that, right then and there, the guards would have denied the alleged unloading instructions; thus, the lame offer to pay by check was the only way out given.

When he disregarded Manalos note, Lado violated company procedures, laying the company open to the possibility of loss. This is already serious misconduct for which he should be held accountable. When he failed to unload despite the clear obligation to do so, he consummated his end of the deal that would have led to the loss of company property and thereby violated his fiduciary duty as custodian of company property.

The guidelines set forth were complied with in the present case. To reiterate, Lado held a position of trust and confidence and was given access to and authority over company property with clear tasks and guidelines laid down very early in his employment.Like any business entity, the petitioner has every right to protect itself from actual threats to the viability of its operations.