Republic of the Philippines

Department of Labor and Employment

NATIONAL LABOR RELATION COMMISSION
Cagayan De Oro City

ROEL MANDULIN,
Complainant-Appellee,
NLRC RAB X CASE NO.
-versus- 10-04-00263-1028

PRECIOUS XYSA LENDING

CORP. and/or RONASMA
QUIBOD, OWNER,
Respondents-Appellant.
x------------------------------------x

NOTICE AND MEMORANDUM OF APPEAL

COMES NOW, respondent-appellant, PRECIOUS

XYSA LENDING CORPORATION, through the undersigned
counsel and unto this Honorable Office, by way of appeal,
most respectfully moves for this Honorable Commission for
the setting-aside of the Decision issued by the Honorable
Labor Arbiter finding for complainant and humbly posits the
following:

PREFATORY STATEMENT

In this present case, we have an employer who

incurred business losses, sustained bad or uncollectible
accounts and suffered business failure caused by the
incompetence, negligence and fraudulence of its employee.
Despite that, the employer, who showed grace and
compassion to the employee when he allowed the latter to
remain in the company, is now held liable for a large amount
by the Honorable Labor Arbiter. A great contradiction to the
warning given by the Supreme Court itself that protection to
labor should not be a cause for the killing of the proverbial
hen that lays the golden eggs.
 “While the Constitution is committed to the policy of
social justice and the protection of the working class, it
should not be supposed that every labor dispute will be
automatically decided in favor of labor. Management also
has its rights which are entitled to respect and enforcement
in the interest of simple fair play. Out of its concern for the
less privileged in life, the Court has inclined, more often
than not, toward the worker and upheld his cause in his
conflicts with the employer. Such favoritism, however, has
not blinded the Court to the rule that justice in every case
for the deserving, to be dispensed in the light of the
established facts and the applicable law and doctrine.” 1

STATEMENT AND NATURE OF THE CASE

1. This is originally a complaint for Illegal Dismissal, refund

of Cash Bond, Separation Fee and 13th Month Pay;

2. After the mandatory conference, no amicable settlement

was reached between Complainant-Appellee and
Respondent-Appellant; hence, they were required to
submit their respective position papers. After the
submission of their respective position papers, the case
was submitted for resolution;

3. On January 31, 2019, a DECISION was issued by

Honorable Labor Arbiter Jean Domaboc-Munez, in favor of
Complainant-Appellee and against Respondent-Appellant.
The dispositive portion of the decision declares, to wit:

“WHEREFORE, premises foregoing,

complainant Roel L. Mandulin is declared to
have been CONSTRUCTIVELY DISMISSED.
Consequently, respondent PRECIOUS XYSA
LENDING CORPORATION is hereby DIRECTED
to pay complainant Roel L. Mandulin the total
amount of Seven Hundred Ninety-Seven
Thousand five Hundred Seventeen and 57/100
(P797,517.57) representing his separation pay,
full backwages, 13th month pay, refund of cash
bond and attorney’s fees.

1
Danilo Javier v. Fly Ace Corporation, G.R. No. 192558, February 15, 2012
 All other monetary claims are denied for
lack of merit.

SO ORDERED.”

TIMELINESS OF THE APPEAL

4. Respondent-Appellant received the above-mentioned

Decision on February 27, 2019. Pursuant to the 2011
NLRC Rules of Procedure, complainant-appellant has ten
(10) days from receipt of the decision within which to file
this appeal. Counting ten (10) days from said date, and
considering that the last day falls on a weekend (March 9,
2019), the last day of filing an appeal is March 11, 2019.
Hence, the filing of this appeal and memorandum of
appeal is within the reglementary period to file an appeal.

STATEMENT OF FACTS

5. Respondent-Appellant PRECIOUS XYSA LENDING

CORPORATION AND/OR RONASMA QUIBOD, is engaged in
lending business with business address located at 1148.
Caina Apartment, Central Village, Camaman-an, Cagayan
de Oro City;

6. By reason of its business, respondent-appellant has to

employ persons for the effective implementation of its
operation about 300 employees including its branch
situated at No. 1250 E. Instruction St., Sampaloc, Manila
wherein one of the employees therein is the complainant-
appellee ROEL L. MANDULIN;

7. Originally, the complainant-appellee was hired as one of

the respondent’s collectors in Camaman-an, Cagayan de
Oro City Branch (Camaman-an Branch for brevity)
sometime in year 2007. Thereafter, he became a Credit
Investigator (CI) in the same branch. And, lastly became
the Manager of Sampaloc, Manila Branch (Manila Branch
for brevity) in 2016 to 2017;

8. Unfortunately, the complainant-appellee’s performance as

Branch Manager of Manila Branch had not been
 promising. Hence, his performance has been assessed as
“low performance” as evidenced by the periodic
reminders2 of the corporation’s Operations Manager,
Precious Xysa A. Smith;

9. Since the complaint-appellees’s performance did not

improve despite multiple reminders of the management,
the Manila Branch was reviewed/studied and it was found
out the complainant-appellee resorted to a combination of
misrepresentation, deception, unwarranted and
misleading scheme or mechanism by inducing and forcing
some of the clients/borrowers of the Manila Branch to
renew or restructure their overdue and defaulted loans by
using other persons who are inexistent;

10. Among the clients or borrowers affected by the

misrepresentation of the complainant-appellee are Edna
Moog, Natividad J. Delmonte and Cenen B. Bayotas as
evidence by their “Sinumpaang Salaysay”3;

11. Renewal or restructuring of defaulting loans in any form

or manner, has been strictly prohibited by the
respondent-appellant being as a standing policy and
lifeline of the business; this is because the end result is
disadvantageous to the borrowers as well as to the
business itself;

12. It was also found out that the shortfall on collections was
due to non-remittance by the collectors and in which
through the tolerance which constitutes gross neglect of
the complainant-appellee as evidenced by the promissory
notes4 executed by Marian Villanueva and Ana Marie Cruz;

13. Sometime in December 2017, believing that the

complainant-appellee is still an asset to the company,
perhaps in other field of the business, the respondent-
appellant pulled back and re-assigned the former in
Camaman-an Branch instead of terminating him. This was
done after considering the years of service of the
complainant-appellee to the company, and for
humanitarian reason. Thus, the appellant believes that it
would be fair to retain him in the company than to

2
See Annexes “1” to “1-B” of the Position Paper
3
See Annexes “2” to “2-B” of the Position Paper
4
See Annexes “3” and “4” of the Position Paper
 terminate him and lose all the benefits which he could
have received because of his serious infractions. The idea
was to allow him to recover from or correct his mistakes;

14. Hence, the complainant-appellee acted as Collector of

Camaman-an Branch without affecting his appointment or
rank as Manager and without affecting or reducing his
salary and benefits;

15. At first, the complainant-appellee comply with the

transfer, however, in the second week of January 2018,
he absented himself from work and he never came back
from then;

16. The respondent-appellant was just surprised that the

complainant brought the matter to the Department of
Labor and alleges illegal dismissal where in truth he
voluntarily abandoned his post. Hence, this dispute.

GROUNDS FOR THE APPEAL

With all due respect, the Honorable Labor Arbiter

committed grave abuse of discretion and serious
errors of fact and law, which, if not corrected, would
cause grave or irreparable damage or injury to the
respondent appellant:

In finding that:
1. The complainant-appellee was constructively
dismissed;
2. The complainant-appellee is entitled to
separation pay;
3. The complainant-appellee is entitled to full
backwages;
4. The complainant-appellee is entitled to 13th
month pay;
5. The complainant-appellee is entitled to refund of
cash bond;
6. The complainant-appellee is entitled to attorney’s
fee.

ARGUMENTS AND DISCUSSIONS

The Honorable Labor
Arbiter gravely erred when
she declared that the
complainant-appellee was
constructively dismissed.

17. To begin with, decisions or orders by any tribunal should

be based on the facts proven during the proceedings and
only on the issues raised by the parties;

18. It must be emphasized that the complainant-appellee

never alleged as an issue that pertains to the fact
“constructive dismissal”. Thus, nothing in the records of
the instant dispute, especially in the prayers provided in
the complaint and the position papers of the parties, that
would suggest that the issue of constructive dismissal was
specifically pointed out;

19. Among those issues raised before the Honorable Labor

Arbiter and even during the initiation of this dispute is the
general allegation of illegal dismissal only, not
constructive dismissal. Hence, the respondent-appellant
only focused, in its position paper and its supporting
evidence, to matters supporting the fact that the
complainant-appellee was not it dismissed or illegally
dismissed and without any evidence or facts in
repudiation to the fact of constructive dismissal;

20. Moreover, respondent-appellant did not introduce facts

or evidence that would refute constructive dismissal
because the 2011 NLRC Rules of Procedure5, as well as
the Order of the Honorable Arbiter dated May 16, 2018,
provides that parties are not allowed to allege facts or
present evidence to prove facts and any cause of action
not referred to or included in the complaint;

21. Now, however, the Honorable Labor Arbiter declared that

the complainant-appellee was constructively dismissed
and the respondent-appellant is now constrained to
disprove such conclusions;

22. The finding of constructive dismissal would result

injustice on the part of the respondent-appellant who,
instead of terminating, decided to retain the complainant-
5
Section 12, Rule V of the 2011 NLRC Rules of Procedure
 appellee for humanitarian reason and after considering his
length of service to the company; and, who refused to
hold the complainant-appellee criminally liable for his
unlawful conducts;

23. Notably, the infractions committed by the complainant-

appellee were already ripe for his termination. In fact,
notices6 were served to the complainant-appellee to
inform him from his violations of the company policies and
from his deceitful activities in the conduct of the operation
of Manila Branch. An elaboration of the said infractions is
necessary, to wit:

a. that the he was assessed by the management

as “low performance” as the Manila Branch has
incurred losses during his supervision or
management7;

b. that he violated the company policy against

restructuring or renewal of defaulting loans8;

c. that he employed unlawful, misrepresentation

and misleading schemes by using other persons,
in fact inexistent persons, or by interchanging the
middle name and family name of the existing
clients to make it appear that they are different
persons or clients9;

d. that he failed to improve his branch’s daily

collection10;

e. that he negligently caused the increased of bad

accounts;

f. that he allowed the shortages of his collectors’

remittances which have ballooned into great
amounts11;

g. that he failed to render accounts after audit has

been made with the Manila Branch;

6
See Annexes “1” to “1-B” of the Position Paper
7
See Annexes “1” to “1-B” of the Position Paper
8
See Annex “1-A” of the Position Paper
9
See Annexes “2” to “2-B”
10
See Annex “1-B” of the Position Paper
11
See Annexes “3” and “4” of the Position Paper
24. The above-enumerated infractions could supposedly
justify the termination of the complainant under Art. 282
of the Labor Code, to wit:

Art. 282. Termination by employer. An

employer may terminate an employment for any
of the following causes:

a. Serious misconduct or willful disobedience

by the employee of the lawful orders of his
employer or representative in connection with
his work;

b. Gross and habitual neglect by the

employee of his duties;

c. Fraud or willful breach by the employee of

the trust reposed in him by his employer or duly
authorized representative;

d. Commission of a crime or offense by the

employee against the person of his employer or
any immediate member of his family or his duly
authorized representatives; and,

e. Other causes analogous to the foregoing (in

this instant case: violation of company rules and
regulations; incompetence, inefficiency or
ineptitude; and, failure to attain work quota).

25. At this juncture, the appellant was confronted with the

situation in which a question should be asked, “What
should be done regarding the above-enumerated
infractions and violations of the complainant-appellee?”;

26. The answer to such question would require management

discretion or judgment in which must be accorded respect
and must remain undisturbed as long as the same is not
contrary to law, jurisprudence, morals, good customs,
public order and public policy;

27. It must be remembered that management prerogatives

are granted to the employer to regulate every aspect of
their business, generally without restraint in accordance
 with their own discretion and judgment. This privilege is
inherent in the right of employers to control and manage
their enterprise effectively. Such aspects of employment
include hiring, work assignments, working methods, time,
place and manner of work, tools to be used, processes to
be followed, supervision of workers, working regulations,
transfer of employees, lay-off of workers and the
discipline, dismissal and recall of workers;

28. The respondent-appellant could have terminated the

complainant-appellee but, in the exercise of its
management prerogative, it chose to hold the latter
otherwise. And, instead of filing criminal complaint against
the complainant-appellee for his malicious, unlawful and
deceitful activities, the respondent-appellant allowed the
former to remain in the company and recover from or
correct his mistakes;

29. Consequently, complainant-appellee was retained back

in Camaman-an Branch as Collector because it manifested
that he is incapable to operate a branch and there are
already managers assigned in all the branches of Precious
Xysa Lending Corporation;

30. It must be stressed however that the complainant

originally agreed that he will act as a Collector while his
designation or rank as Manager will persist together with
his salary and benefits as a new manager will take over
the Manila Branch for its rehabilitation or recovery;

31. To the surprise and great dismay of the respondent-

appellant whose purest intention is to back up and to
support rather than to destroy the complainant-appellee,
the latter abandoned his post without any cause and filed
this instant dispute and portrayed an untruthful and
misleading tales that he was illegally dismissed when in
truth and in fact he was not;

32. Disappointingly to say that, here, we have the

respondent-appellant who incurred business losses,
sustained bad or uncollectible accounts and suffered
business failure caused by the incompetence, negligence
and fraudulence of the complainant-appellee. Despite
that, the respondent-appellant, who showed grace and
compassion to the appellee when he allowed the latter to
 remain in the company, is now held liable for a large
amount by the Honorable Labor Arbiter. A great
contradiction to the warning given by the Supreme Court
itself that protection to labor should not be a cause for the
killing of the proverbial hen that lays the golden eggs;

33. Surely, this is not the intention of our labor law.

The complainant-appellee was

not illegally dismissed.

34. With all due respect, complainant was not dismissed.

The findings of facts that complainant-appellee had been
dismissed by the respondent-appellant is clearly
unfounded for not being supported by any evidence on
record and is contrary to existing jurisprudence. What we
have here is the unwarranted presumption of the
Honorable Labor Arbiter, with all due respect, drawn to
the so-called social justice that is submitted not to the
sacrificed and would result to irreparable damage or
injury;

35. On one hand, the respondent-appellant maintains that it

never dismissed, much less illegally dismissed the
complainant-appellee;

36. On the other hand, the complainant-appellee was

consistent with his allegation from the filing of complaint,
during the conciliation conference, and to the submission
of position paper that he was illegally dismissed. He
maintains that he was actually dismissed. To illustrate, as
can be read in his allegation of facts of his position paper:

“2.3 Being regular employee, after about more

than FIFTEEN (15) continuous years in the
service, sometime on June 2017, he was
informed that his services is terminated, thus,
was told to back to Cagayan de Oro City.
Therein, complainant was given ORALLY
“walking papers”. It was made effective on the
same date, June 2017. No reason nor just valid
cause was given for such TERMINATION save
that his alleged Collector was not able to remit
the collections due. Not even allowed an
 explanation. In patent, violation of our
procedural and substantive LABOR LAWS;”12

37. It can be inferred from the above allegation that

complainant-appellee was actually dismissed by being
informed that his services is terminated. However, such
allegation is self-serving and not supported by any
evidence;

38. Jurisprudence dictates that, it is incumbent upon the

employees to first establish the fact of dismissal before
the burden is shifted to the employer to prove that the
dismissal was legal.13 Fair evidentiary rule dictates that
before employers are burdened to prove that they did not
commit illegal dismissal, it is incumbent upon the
employee to first establish the fact of his dismissal.14
Moreover, the fact of dismissal must be evidenced by
positive and overt acts indicating the intention to
dismiss;

39. Complainant-appellee’s bare allegation that he was

dismissed from employment by the respondent-appellant,
unsubstantiated by impartial and independent evidence is
insufficient to establish such fact of dismissal. Basic is the
rule of evidence that each party must prove his
affirmative allegation, that mere allegation is not
evidence. Thus, the evidence to prove the fact of the
complainant’s termination from employment must be
clear, positive, and convincing. Absent any showing of
an overt or positive act proving that respondent-appellant
had dismissed complainant-appellee, the latter’s claim of
illegal dismissal cannot be sustained – as the same
would be self-serving, conjectural, and of no
probative value;15

40. Actually what is involved in this case is abandonment of

work, which can be inferred from complainant’s
subsequent overt act. Just recently, the respondent-
appellant discovered that after leaving the company
without a valid and justifiable reason the complainant-
appellee sought employment with other company and
hired by GARMONES FOODS CORP whose business
12
See Page 3 of Position Paper of the Complainant
13
MZR Industries v. Colambot, G.R. No. 179001, August 28, 2013
14
Basay et.al v. Hacienda Consolacion, G.R. No 175532 April 19, 2010
15
Doctor v. NII Enterprise, G.R. No. 194001, November 22, 2017
 address is located at Del Puerto St., Kauswagan, Cagayan
de Oro City. This is a clear intention to sever employer-
employee relationship which is tantamount to
abandonment;

41. Considering that complainant deliberately abandoned his

work, and failure to report on the next working days,
there was no opportunity for the respondent to comply
with the two-notice rule or to conduct hearing on that
regards to suffice the procedural due process
requirements as mandated by law. But at any rate, it is
worth telling that respondent-appellant, is not required to
comply the requisites for due process in terminating the
complainant-appellee as at first, he was not terminated
from his employment and the former never intended to do
so;

42. Assuming arguendo that the complainant did not

abandon his work, at the very least, he should be
considered as deemed to have resigned. Resignation is
the voluntary act of an employee who is in a situation
where he believes that personal reasons cannot be
sacrificed in favor of the exigency of the service, and he
has then no other choice but to disassociate himself from
employment16;

The Honorable Labor

Arbiter gravely erred when
she awarded separation
pay in favor to the
complainant-appellee.

43. Our Labor Code allows payment of separation pay only

when there is a termination grounded on authorized
causes, such as, installation of labor-saving devices,
redundancy, retrenchment, closing or cessation of
business operations, and disease. In addition, our
jurisprudence also allows payment of separation pay in
lieu of reinstatement for illegally dismissed employees;

44. The complainant-appellee could have been rightfully

awarded separation pay in lieu of reinstatement if he was
illegally dismissed; unfortunately, with all due respect, he
was not;
16
Mendoza v. HMS Credit, G.R. No. 187232, April 17, 2013
45. In his position paper, the complainant-appellee, prayed
for reinstatement, as it reads to wit:

“5.1 WHEREFORE, premises considered, it is

most respectfully prayed of this Honorable
LABOR ARBITER that judgment be rendered
and judicially pronounced that the
COMPLAINANT was ILLEGALLY DISMISSED
from the service, thus, should be reinstated
with payment of full backwages. However,
due to strained relationship, Respondents
may be ordered to pay SEPARATION PAY
unto the Complainants. [Emphasis is
ours]”

46. Assuming arguendo, that the complainant-appellee was

illegally dismissed, the separation pay in lieu of
reinstatement does not also warrant in view of the facts of
the instant dispute and prevailing jurisprudence;

47. True that separation pay in lieu of reinstatement is

proper when reinstatement is not viable due to the
strained relations of the employer and employee.
However, the allegation of strained relations should be
demonstrated as a fact, however, to be adequately
supported by evidence substantial to show that the
relationship between the employer and the employee is
indeed strained as necessary consequence of the judicial
controversy;

48. Thus, in the case of Bernard A. Tenazas, et. al. v. R.

Villegaas Taxi Transport and Romualdo Villegas17, the
Highest Court of the Land posits:

“The doctrine of strained relations should not

be used recklessly or applied loosely nor be
based on impression alone. It bears to stress
that reinstatement is the rule and, for
exception of strained relations to apply, it
should be proved that is likely that if
reinstated, an atmosphere of antipathy and
antagonism would be generated as to adversely

17
G.R. No. 192998, April 2, 2019
 affect the efficiency and productivity of the
employee concerned”;

49. Nothing in the records or in the position paper of the

complainant-appellee that alleges or proves circumstances
which may have rendered the reinstatement of the
complainant-appellee unlikely or unwise and the latter
even prayed for reinstatement alongside with the
payment of backwages;

50. Furthermore, as discussed above, complainant was not

illegally dismissed; he intentionally abandoned his work,
much less, and he must have been deemed to have
resigned. As a rule, an employee who voluntarily resigns
from employment is not entitled to separation pay, except
when it is stipulated in the employment contract or CBA
or it is sanctioned by established employer practice or
policy.18

51. Since there is no standing agreement between the

parties that effectuate the claim of separation pay upon
resignation, thus, complainant is not entitled for the
same.

The Honorable Labor

Arbiter gravely erred when
she awarded full
backwages to the
complainant-appellee.

52. As discussed above, the complainant-appellee was not

dismissed nor illegally dismissed. And, as a rule the award
of backwages is inconsistent with a fact that there was no
illegal dismissal;

53. The time-honored rule governing the relation between

labor and capital, or management and employee, of “fair
day’s wage for a fair day’s labor” remains as the basic
factor in determining employee’s wages. If there is no
work performed by the employee, there can be no wage
or pay – unless, of course, the laborer was able, willing
and ready to work but was illegally locked out, suspended

18
J. Marketing Corp. v. Taran, G.R. No. 163924, June 18, 2009
 or dismissed, or otherwise illegally prevented from
working;19

54. Since the complainant-appellee was not illegally

dismissed, as discussed above, the payment of
backwages is improper;

55. Unjust enrichment because the complainant-appellee

immediately after the abandonment found new
employment with Garmones Foods, Corporation located at
Del Puerto, Kauswagan, Cagayan de Oro City;

56.
57.

In fine, the Supreme Court has declared where there is

neither termination nor abandonment involved; there is no
occasion to grant separation pay and backwages, or to allow
collection of any other monetary claims absent evidence to
substantiate the same. The employer and the employee do
not have any obligation one to another. Radar Security &
Watchman Agency, Inc. v. Castro, G.R. No. 211210, 02
December 2015

PRAYER

WHEREFORE, based on the foregoing, RESPONDENT-

APPELLANT respectfully prays that the DECISION dated
January 31, 2019 be REVERSED and SET ASIDE.
Complainant further prays that a new Decision/Resolution be
rendered in favor of the respondent-appellant and ordering
payment of her money claims and for damages.

Such other relief as may be deemed just and equitable

under the premises is likewise prayed for.

Respectfully submitted.

Cagayan de Oro City, Philippines.

March 11, 2019.

19
Borja v. Minoza, G.R. No. 218384, July 3, 2017
 VERIFICATION AND CERTIFICATE OF NON FORUM
SHOPPING

I, AIDELEN T. CAPAYAS, of legal age, married,

Filipino, and a resident of #1148, Central, Brgy. Camaman-
an, Cagayan de Oro City, having been duly sworn in
accordance with law, hereby depose and state, that:

1. I am the duly authorized representative of respondent-

appellant Precious Xysa Lending Corporation by virtue of
Special Power of Attorney dated February 10, 2018 a copy of
which has been submitted and on the records of the instant
case;
2. I have caused the preparation of this Notice and
Memorandum of Appeal;
3. I have read and understood the contents thereof, which is
true and correct of my own knowledge and authenticity of
the documents;
4. I have not commenced any action or filed any claim
involving the same issues in any court, tribunal or quasi-
judicial agency and to the best of my knowledge, no such
action or claim is pending therein; and
5. Should I thereafter learn that the same or similar action
or claim has been filed or is pending, I would report such
fact within five (5) days therefrom.

IN WITNESS WHEREOF, I have hereunto affixed my

signature this _____th day of __________, 2019 at
Cagayan de Oro City.

AIDELEN T. CAPAYAS
Affiant

SUBSCRIBED AND SWORN TO before me this ___th

day of _______________, 2019 at Cagayan de Oro City,
Philippines.
Doc. No. _____;
Page No. _____;
Book No. _____;
Series of 2019