NAGUIAT V. NLRC be held jointly and severally liable for the obligations of CFTI. And similarly, Sergio F.

G.R. No. 116123 Naguiat and Antolin Naguiat were merely officers and stockholders of CFTI and, thus,
March 13, 1997 could not be held personally accountable for corporate debts.
Topic: Part 1
Petitioners: SERGIO F. NAGUIAT, doing business under the name and style SERGIO F. ISSUE: W/N Sergio Naguiat is solidarily liable.
NAGUIAT ENT., INC., & CLARK FIELD TAXI, INC.
Respondents: NATIONAL LABOR RELATIONS COMMISSION (THIRD DIVISION), NATIONAL HELD: YES
ORGANIZATION OF WORKINGMEN and its members, LEONARDO T. GALANG, Et Al.
Ponente: PANGANIBAN, J Sergio F. Naguiat, in his capacity as president of CFTI, cannot be exonerated from joint and
several liability in the payment of separation pay to individual respondents. The Labor Code
DOCTRINE: Essentially, "tort" consists in the violation of a right given or the omission of a duty
provides that an ‘Employer’ includes any person acting in the interest of an employer, directly
imposed by law. Simply stated, tort is a breach of a legal duty.
or indirectly. The term shall not include any labor organization or any of its officers or agents
except when acting as employer. As a corporation is an artificial person, it must have an officer
FACTS:
who can be presumed to be the employer, being the ‘person acting in the interest of the
● Petitioner CFTI held a concessionaire’s contract with the Army Air Force Exchange
‘employer corporation’. The corporation, only in the technical sense, is the employer. The
Services ("AAFES") for the operation of taxi services within Clark Air Base. Sergio F.
responsible officer of an employer corporation can be held personally liable.
Naguiat was CFTI’s president, while Antolin T. Naguiat was its vice-president. Like
Sergio F. Naguiat Enterprises, Incorporated ("Naguiat Enterprises" or “NE”), a trading
Sergio F. Naguiat, admittedly, was the president of CFTI who actively managed the business.
firm, it was a family-owned corporation. Respondents were previously employed by
Thus, he falls under the definition of the word ‘employer’. Petitioners conceded that CFTI and
CFTI as taxicab drivers.
NE were close family corporations. According to the Corp Code, stockholders of close family
● Due to the phase-out of the US military bases in the Philippines, the AAFES was
corporations shall be personally liable for corporate torts. Essentially, "tort" consists in the
dissolved, and the services of individual respondents were officially terminated.
violation of a right given or the omission of a duty imposed by law. Simply stated, tort is a
Thus, the AAFES Taxi Drivers Association ("drivers’ union") and CFTI held
breach of a legal duty. The Labor Code mandates the employer to grant separation pay to
negotiations as regards separation benefits that should be awarded in favor of the
employees in case of closure or cessation of operations of establishment or undertaking not
drivers. The parties agreed that the separated drivers will be given severance pay.
due to serious business losses or financial reverses, which is the condition obtaining at bar.
Most of the drivers accepted said amount, but the respondents herein refused to
CFTI failed to comply with this law-imposed duty or obligation. Consequently, its stockholder
accept theirs.
who was actively engaged in the management or operation of the business should be held
● The respondents, after disaffiliating themselves from the driver’s union and joining
personally liable. In the present case, Sergio Naguiat is held solidarily liable for corporate tort
a new labor organization (National Organization of Workingmen or “NOWM”), filed
because he had actively engaged in the management and operation of CFTI, a close
a complaint against the petitioners for payment of separation pay due to
corporation.
termination/phase-out. The respondents alleged that they were regular employees
of Naguiat Enterprises, although their individual applications for employment were
WHEREFORE, the foregoing premises considered, the petition is PARTLY GRANTED. The
approved by CFTI. They claimed to have been assigned to Naguiat Enterprises after
assailed February 28, 1994 Resolution of the NLRC is hereby MODIFIED as follows:
having been hired by CFTI, and that the former managed, controlled, and supervised
their employment; that they were entitled to separation pay. On the other hand,
(1) Petitioner Clark Field Taxi, Incorporated, and Sergio F. Naguiat, president and co-
petitioners claimed that the cessation of business of CFTI was due to "great financial
owner thereof, are ORDERED to pay, jointly and severally, the individual respondents their
losses and lost business opportunity" resulting from the phase-out of Clark Air Base
separation pay computed at US$120.00 for every year of service, or its peso equivalent at the
brought about by the Mt. Pinatubo eruption and the expiration of the RP-US military
time of payment or satisfaction of the judgment;
bases agreement.
● The labor arbiter, finding the individual complainants to be regular workers of CFTI,
XXX
ordered the latter to pay them P1,200.00 for every year of service "for humanitarian
consideration”(they weren’t granted separation pay, to do so would be unjust to the
employer whose business was brought down by force majeure). Thus, respondents
appealed to the NLRC. In its Resolution, the NLRC modified the decision of the labor
arbiter by granting separation pay to the private respondents. In discharging the
above obligations, Sergio F. Naguiat Enterprises should be joined as indispensable
party whose liability is joint and several.
● Petitioners submitted additional issues by way of supplement, the pertinent issue
being Naguiat Enterprises, Inc. is a separate and distinct juridical entity which cannot