By Joel R. San Juan - January 11, 2018
THE Supreme Court (SC) has nullified
a lower court’s order for immediate payment of P62.05 billion and notices of
garnishments against the National Power Corp. (Napocor) and the
Power Sector Assets and Liabilities Management Corp. (PSALM) to compensate more
than 9,272 employees who were illegally dismissed during the state-owned
power firm’s reorganization in 2003.
While the High Court granted the
petition of PSALM to “lift and quash” the order of the trial court, it affirmed
its previous findings that PSALM is directly liable to compensate the
illegally dismissed Napocor employees.
The amount represents settlement
claims of the members of Napocor’s Drivers and Mechanics Association (Dama),
who were terminated in 2003.
The Court also held that it is the
Commission on Audit (COA), and not the trial court, that should determine
the exact amount of PSALM’s liability in accordance with its audit rules and
procedures.
“The Napocor list and computation is
by no means final and binding either on the Court or the COA, regardless of the
petitioners’ acceptance and admission of the same,” the Court en banc said in a
decision penned by Associate Justice Teresita Leonardo-de Castro.
“It is still subject to the COA’s
validation and audit procedures. To enforce the satisfaction of the judgment
award, the amount of which has been provisionally computed in the
Napocor’s list and computation, the petitioners must now go before the
COA and file a separate money claim against the Napocor and PSALM,” the Court
added.
It would be entirely up to the COA,
according to the SC, whether to approve or disallow the claim.
The dismissed employees, however,
may still file an appeal before the Court in case of unfavorable ruling.
In effect, the Court denied Dama’s
request to immediately execute the judgment award issued by the Regional Trial
Court (RTC) of Quezon City in July 2014 and instead direct it to file a claim
against the government before the COA.
The trial court’s order was pursuant
to the Court’s final decision dated October 27, 2008, which declared
illegal the two resolutions issued by the Napocor Board (NPB) ordering the
termination of the said employees.
Declared illegal by the Court were
the NPB Resolutions 2002-124 and 2002-125 that implemented the Napocor
reorganization, because four of the department secretaries, who were members of
the NPB, did not participate personally in the deliberation of the resolutions
and sent their representatives, instead.
The department secretaries, who were
also members of the NPB, could not delegate their duties as members of the
board much less their power to vote and approve the board resolutions
because it is their personal judgment that must be exercised in the fulfillment
of such responsibility.
The Court subsequently held that the
illegally dismissed employees were entitled to reinstatement or payment of
separation benefits.
In the same ruling, the Court held
that the chairman and members of the NPB and the president of Napocor
Board and Napocor to prepare a verified list of the names of all Napocor
employees terminated and/or separated as a result of NPB Resolutions
2002-124 and 2002-125, and the amounts due to each of them, including
12-percent legal interest.
The Court also directed the Office
of the Clerk of Court and ex-officio Sheriff of the RTC of Quezon City to: a)
issue a writ of execution based on the list submitted by the Napocor; and b)
undertake all necessary actions to execute the herein decision and resolution.
The SC explained that, under the
Electric Power Industry Reform Act, PSALM should assume all Napocor’s existing
generation assets, liabilities, independent power producer contracts,
real estate and other disposable assets.
“It would be unfair and unjust if
PSALM gets nearly all of Napocor’s assets but will not pay for liabilities
incurred by Napocor during the privatization stage,” it said.
“Further, there was a transfer
of interest over these assets by operation of law. These properties may
be used to satisfy the judgment,” it added.
The SC noted that, after
privatization, Napocor’s corporate funds are largely within PSALM’s control.
In nullifying the P62.05-billion
monetary award and the notices of garnishment, the Court agreed its execution
would have a huge financial impact on Napocor and PSALM, which both play major
parts in the country’s electric power industry.
“Thus, a decision that may greatly
affect the operations of these entities may, in tum, also affect the rendition
of their services to the general public,” the Court said.
The Napocor earlier claimed the
hasty implementation of the trial court of the garnishment order would trigger
not only possible bankruptcy of the agency but also of the national government
as a whole.
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