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l\epubUt of tuelbilippine,
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FIRST DIVISION

JAIME BILAN G.R. No. 208920

MONTEALEGRE and
CHAMON'TE, INC., Present:
Petitioners,
BERSAMIN, CJ., Chairperson,
-versus- DEL CASTILLO, Working Chairperson,
JARDELEZA,
SPOUSES ABRAHAM and GESMUNDO, and
REMEDIOS DE VERA, CARANDANG, JJ.
Respondents.
Promulgated:

'JUL 1 o 2019
X - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
DECISION

JARDELEZA, J.:

This is a petition for review on certiorari' assailing the Decision2 dated

January 18, 2013 and Resolution3 dated August 30, 2013 of the Court of
Appeals (CA) in CA-G.R. SP No. 126037 quashing the writ of execution and
the alias writ of execution against respondent spouses Abraham and Remedios
de Vera (respondents).

Jerson Servandil (Servandil) filed a complaint4 for illegal dismissal

against A. De Vera Corporation (Corporation). The case was referred to the
National Labor Relations Commission (NLRC) and raffled to Labor Arbiter
(LA) Joel Lustria. 5

On November 27, 2003, the LA rendered a Decision6 against the

Corporation, finding it guilty of illegal dismissal and holding it liable to
Servandil for backwages, separation pay and unpaid salary. The dispositive
portion of the LA's Decision reads:

1
Rollo, pp. 3-37.
2
Id. at 42-50; penned by Associate Justice Maritlor P. Punzalan Castillo, with Associate Justices Amy C.

I
Lazaro-Javier (now a member of this Court) and Zenaida T. Galapate-Laguilles concurring.
3
Id.at51-53.
4
Id. at 118.
5
6
Id. at 43.
Id. at 126-132. '
 Decision 2 G.R. No. 208920

WHEREFORE, premises considered, judgment is hereby

rendered finding respondent guilty of illegal dismissal.
Consequently, respondent is ordered liable:

1. To pay the complainant the amount of P363,293.55,

representing his backwages, computed only up to the
promulgation of this decision;

2. To pay the complainant the amount of P53,300.00,

representing his separation pay;

3. To pay complainant the amount of Pl 1,890.00,

representing his unpaid salary from July 1, 1998 to
September 27, 1998.

Other claims are dismissed for lack of merit.

SO ORDERED. 7

The corporation filed an appeal before the NLRC, which was dismissed
for lack of jurisdiction because of the failure to post the appeal bond. The
NLRC, in its Resolution 8 dated January 31, 2005, likewise denied the
corporation's motion for reconsideration.

The CA likewise denied the petition for certiorari filed before it. 9 When
the case was elevated to the Supreme Court, the petition was denied on April
23, 2007 for failure to show any reversible error in the CA Decision. 10

Meanwhile, on March 15, 2005, the NLRC issued an Entry of

Judgment 11 declaring that its January 31, 2005 Resolution had become final
and executory.

Consequently, a Writ of Execution 12 dated May 22, 2007 was issued

commanding the sheriff to proceed against the movable and immovable
properties of the corporation and respondent Abraham De Vera, viz.:

NOW THEREFORE, you are hereby commanded to

proceed to the premises of the respondents A. DE VERA
CORPORATION and ABRAHAM DE VERA, located at
16/F Citibank Tower, Citibank Plaza, 8741 Paseo de Roxas,
Valero St., Makati City or wherever they maybe found
within the Philippines, to collect the amount of THREE
HUNDRED SIXTY THREE THOUSAND TWO
HUNDRED NINETY THREE AND 55/100 (P363,293.55)
PESOS, representing complainant's backwages; the sum of
FIFTY THREE THOUSAND THREE HUNDRED
(P53,300.00) PESOS, as his separation pay, plus the amount

7
Id. at 131-132.
8
Id. at 137-138.
9
Id. at 140-150.
10
ld.at157.
✓
11
Id. at 158.
" Id. at 159-164.

0
 Decision 3 G.R. No. 208920

of ELEVEN THOUSAND EIGHT HUNDRED NINETY

(Pl 1,890.00) , representing his unpaid salary from July 1,
1998 to September 27, 1998. Any proceeds thereof shall be
turned over to the NLRC Cashier for proper disposition to
the complainant.

In case you failed to collect sufficient amount in cash,

you are hereby further commanded to proceed against the
movable and immovable properties of the respondents not
exempt from the execution, and all proceeds must be
deposited to the NLRC Cashier of this Commission. For
further appropriate action. 13

When the Writ of Execution was returned unsatisfied, Servandil moved

for the issuance of an alias writ of execution which was granted. The pertinent
portions of the Alias Writ ofExecution 14 dated February 11, 2008 read:
NOW THEREFORE, you are hereby commanded to
proceed to the premises of the respondents A. DE VERA
CORPORATION and ABRAHAM DE VERA, located at
16/F Citibank Tower, Citibank Plaza, 8741 Paseo de Roxas,
Valero St., Makati City or wherever they maybe found
within the Philippines, to collect the amount of THREE
HUNDRED SIXTY THREE THOUSAND TWO
HUNDRED NINETY THREE AND 55/100 (P363,293.55)
PESOS, representing complainant's backwages; the sum of
FIFTY THREE THOUSAND THREE HUNDRED
(P53,300.00) PESOS, as his separation pay, plus the amount
of ELEVEN THOUSAND EIGHT HUNDRED NINETY
(Pl 1,890.00) , representing his unpaid salary from July 1,
1998 to September 27, 1998. Any proceeds thereof shall be
turned over to the NLRC Cashier for proper disposition to
the complainant.

In case you failed to collect sufficient amount in cash,

you are hereby further commanded to proceed against the
movable and immovable properties of the respondents not
exempt from the execution, and all proceeds must be
deposited to the NLRC Cashier of this Commission. For
further appropriate action. 15

Pursuant to this writ, a parcel of land (property) registered in the name

of respondents was levied upon and sold to petitioners Jaime Bilan
Montealegre and Chamon'te, Inc. (petitioners) at a public auction on May 16,
2008. 16 As no redemption was made during the period provided by law,
petitioners filed an omnibus motion 17 seeking the issuance of a final deed of
sale, cancellation of title in the name of respondents, and the issuance of a
new title in their names.

13
Id. at 163.
14
Id. at 165-167.
15
Id. at 166.
171-17!: ✓
16
Id. at
" Id. at 174-180
 Decision 4 G.R. No. 208920

It was during this time that respondents realized that only the
corporation was imp leaded as party-respondent in Servandil' s complaint for
illegal dismissal. Thus, respondents filed a verified counter-manifestation
with omnibus motion 18 stating that the property sold at auction does not
belong to the judgment debtor, the corporation, but to respondents, who were
not impleaded as party-respondents in the case for illegal dismissal. They
likewise claimed that the property was conjugal and there was no showing
that an advantage or benefit accrued to their conjugal partnership.

The LA denied respondents' omnibus motion in an August 25, 2011

Order, 19 the dispositive portion of which reads:

WHEREFORE, responsive to the foregoing, judgment is

hereby rendered, directing Sheriff Manolito G. Manuel to
issue and execute a Final Deed of Conveyance and/or Final
Deed of Sale of the subject property in favor of the
Purchasers/Appellees, JAIME BILAN MONTEALEGRE
and [CHAMON'TE], INC.

Likewise, let the levy effected by the RTC Cebu Court

Sheriff Rome C. Asombrado to the subject property be, as it
is hereby LIFTED/CANCELLED, on the ground afore-
stated.

SO ORDERED. 20

Aggrieved, respondents filed a petition before the NLRC with prayer

for the issuance of a temporary restraining order (TRO) and/or writ of
preliminary injunction to enjoin the LA or his representative from enforcing
the August 25, 2011 Order. 21

On October 10, 2011 and November 3, 2011, the NLRC issued a TRO
and a writ of preliminary injunction, 22 respectively.

However, on March 29, 2012, it denied respondents' petition, affirming

in toto the August 25, 2011 Order of the LA. 23 The NLRC noted that
respondent Abraham filed an earlier omnibus motion dated May 19, 2008,
which sought to annul the Notice of Sheriffs Sales for the levy and public
sale of the property, and this omnibus motion was resolved in an Order24 dated
December 8, 2009. The December 8, 2009 Order declared that the levy and
sale of the property is valid. Considering that no motion for reconsideration
or appeal was filed, the December 8, 2009 Order became final and
executory. 25 The NLRC held that respondents are prohibited to question a

18
Id. at 188-202.
19
Id. at 518-528.
20
Id. at 95, 528.
21
Id. at 44.
22 Id.
23
24
Rollo, p. 1r3.
Id. at 302-3 0.
25
Id. at I03.
 Decision 5 G.R. No. 208920

final and executory December 8, 2009 Order by assailing the August 25, 2011
Order, which merely enforced the earlier Order. More, the NLRC rejected
respondent Abraham's argument that the corporation is a distinct entity and
therefore, its creditors cannot go after his property. The NLRC reasoned that,
although as a rule, the officers and members of a corporation are not
personally liable for acts done in performance of their duties, an exceptional
circumstance exists in this case, i.e., the corporation is no longer existing and
is unable to satisfy the judgment in favor of the employee. Finally, the NLRC
declared that the validity of the levy and sale of the property cannot likewise
be questioned on the basis that the property levied upon is a conjugal property
of respondents. This is because respondent Remedios failed to file a third-
party claim within five days from the last day of posting or publication of the
notice of execution sale. 26 The NLRC likewise denied respondents' motion
for reconsideration. 27

Aggrieved, respondents filed a petition for certiorari2 8 before the CA.

On January 18, 2013, the CA granted the petition and reversed the
NLRC Resolutions. The decretal portion of the CA Decision29 states:

WHEREFORE, premises considered, the instant

petition is GRANTED. The Resolutions dated 29 March
2012 and 28 May 2012, respectively, of public respondent
NLRC are REVERSED and SET ASIDE. The Order of
public respondent Labor Arbiter dated 25 August 2011 is
ANULLED and the Writ of Execution dated 22 May 2007
and Alias Writ of Execution dated 11 February 2008 are
QUASHED.

The Labor Arbiter is DIRECTED to implement the final

and executory Decision of the National Labor Relations
Commission dated 27 November 2003 against all the assets
of A. De Vera Corporation, in conformity with the terms of
the dispositive portion of the said decision.

SO ORDERED. 30

The CA stated that the respondent in the November 27, 2003 LA

Decision31 refers to the corporation and no other party-respondent was
impleaded. The LA, however, ordered the execution against "A. De Vera
Corporation and Abraham De Vera." Clearly, the writ of execution and the
alias writ of execution modified and/or amended the final decision dated
November 27, 2003. Respondent Abraham was never impleaded as a party-
respondent in the complaint for illegal dismissal against A. De Vera
Corporation. Therefore, the LA exceeded his authority and acted without

i
26
Id. at 102-109.
27
/d.atll5-117.
28
Id. at 54-93.
29
30
Supra note 2.
Rollo, p. 49.
31
Id. at 126-132.
 Decision 6 G.R. No. 208920

jurisdiction in issuing said writs of execution, which do not conform to the

dispositive of the final judgment. Thus, the December 8, 2009 32 and August
25, 2011 33 Orders directing the issuance of a final deed of sale to petitioners
cannot validate the void writs of execution and could never attain finality. 34

On August 30, 2013, the CA denied petitioners' motion for

reconsideration. 35 It ruled that, contrary to petitioners' contentions, it is not
undisputed that the corporation has ceased to exist. While Servandil alleged
this fact before the LA, said closure is not supported by the evidence on
record. Furthermore, the ruling in A. C. Ransom Labor Union- CCLV v.
NLRC, 36 which made corporate officers liable in case of closure of the
corporation is inapplicable in this case. Unlike in the present case, the
corporate officers in A. C. Ransom were imp leaded from the very beginning.

Hence, this petition arguing that the CA gravely erred in ruling that: 1)
the Writ of Execution and the Alias Writ of Execution are void because they
do not conform to the dispositive portion of the November 17, 2003 Decision
holding the corporation liable for illegal dismissal; 2) respondent Abraham
De Vera cannot be held liable as responsible officer of the corporation because
he is not a party in the case filed against the corporation; 3) the corporation
had not ceased to exist when the respondents themselves had not rebutted the
same; and 4) the orders of LA Lustria dated December 8, 2009 and August
25, 2011 are null and void on the ground that they are the offshoot of a void
writ of execution. Petitioners likewise faulted the CA for giving due course to
respondents' petition in violation of the NLRC rules of procedure. 37

We deny the petition.

The main issue for our resolution is whether the CA correctly declared
null the writs of execution issued by the LA and the subsequent orders and
resolutions of the LA and NLRC implementing said writs of execution against
respondents' property.

We hold that the CA acted correctly.

As a general rule, a writ of execution must strictly conform to every

particular of the judgment to be executed. It should not vary the terms of the
judgment it seeks to enforce, nor may it go beyond the terms of the judgment
sought to be executed, otherwise, if it is in excess of or beyond the original
judgment or award, the execution is void. 38 Furthermore, the power of the
courts in executing judgments extends only to properties unquestionably

32
Supra note 24.

I
33
Supra note 19.
34
Rollo, pp. 46-48.
35
/d.at51-53.
36
G.R. No. L-69494, June 10, 1986, 142 SCRA 269.
37
Rollo, p. 14.
38
Pascual v. Daquioag, G.R. No. 162063, March 31, 2014, 720 SCRA 230, 240-24 .
 Decision 7 G.R. No. 208920

belonging to the judgment debtor and liability may even be incurred by the
sheriff for levying properties not belonging to the judgment debtor. 39

In Mandaue Dinghow Dimsum House, Co., Inc. v. National Labor

Relations Commission-Fourth Division40 we ruled:

The Order and the Alias Writ of Execution issued by the

LA are null and void for lack of jurisdiction and for altering
the tenor of the NLRC decision dated October 24, 2000
which directed Mandaue Dinghow alone to pay the private
respondents' separation pay. The private respondents did not
assail this ruling. Thus, the same became final and
executory. Even granting that the NLRC committed a
mistake in failing to indicate in the dispositive portion that
Uytengsu was solidarily liable with Mandaue Dinghow, the
correction - which is substantial - can no longer be
allowed in this case because the judgment has already
become final and executory. 41

Here, it is undisputed that the final and executory November 27, 2003
LA Decision42 adjudged the corporation guilty of illegal dismissal and ordered
it to pay Servandil separation pay and backwages. It did not mention
respondents' liability. Nevertheless, the Writ of Execution dated May 22,
2007 and the Alias Writ of Execution dated February 11, 2008 were directed
against the movable and immovable properties of both the corporation and
respondent Abraham. Clearly, the writs of execution here exceeded the terms
of the final and executory judgment of the LA.

Consequently, the CA correctly set aside the levy and sale of the subject
property pursuant to said writs and the August 25, 2011 Order, which directed
the issuance of a Final Deed of Sale in favor of petitioners, for being the
offshoot of a void execution, as well as the NLRC Resolutions dated March
29, 2012 and May 28, 2012, which affirmed the August 25, 2011 Order. 43

Petitioners also want us to disregard the corporation's separate

personality and hold respondent Abraham De Vera liable. Petitioners allege
that the corporation has already ceased to operate and there is no other way
by which the LA judgment could have been satisfied other than through the
levy and sale of the property belonging to respondent Abraham De Vera.
Consequently, they claim that the levy and sale of the property pursuant to the
writs of execution and orders of the LA are likewise valid. 44

39
Pantranco Employees Association (PEA-PTGWO) v. National Labor Relations Commission, G.R. No.
170689, March 17, 2009, 581 SCRA 598,612.
40
G.R. No. 161134, March 3, 2008, 547 SCRA 402.
41
Id. at 413-414.
42
43
Supra notev.
Rollo, p. 49.
44
Id. at 24-25.
 Decision 8 G.R. No. 208920 ·

Petitioners cite the rulings in A.C. Ransom Labor Union-CCLV v.

NLRC45 and Restaurante Las Conchas v. Llego 46 to justify their contention
that respondent Abraham may be held liable as the corporation's responsible
officer.

Contrary to petitioners' assertions, the piercing of the veil of corporate

fiction is unwarranted in this case.

In Zaragoza v. Tan, 47 We examined the factual milieu of A. C. Ransom

and the application of the piercing of the veil doctrine. Ransom was found
guilty of unfair labor practice and was ordered, together with its officers and
agents, to reinstate twenty-two union members to their respective positions
with payment of backwages. When the decision became final and executory,
the writ of execution could not be implemented against Ransom because it
already disposed its leviable assets. The Court found that while the case was
still pending, Ransom put up another corporation, Rosario Industrial
Corporation, as a ploy to evade Ransom's obligation to its employees.
Therein, We allowed the piercing of the corporate fiction by making
Ransom's officers personally liable.

We further explained that Carag v. National Labor Relations

Commission 48 clarified that Article 212(e) of the Labor Code, by itself, does
not make a corporate officer personally liable for the debts of the
corporation. It emphasized that the governing law on personal liability of
directors or officers for debts of the corporation is still Section 31 of the
Corporation Code. 49 Thus, We ruled that the doctrine of piercing the
corporate veil applies only in three basic areas, namely: 1) defeat of public
convenience as when the corporate fiction is used as a vehicle for the evasion
of an existing obligation; 2) fraud cases or when the corporate entity is used
to justify a wrong, protect fraud, or defend a crime; or 3) alter ego cases,
where a corporation is merely a farce since it is a mere alter ego or business
conduit of a person, or where the corporation is so organized and controlled
and its affairs are so conducted as to make it merely an instrumentality,
agency, conduit or adjunct of another corporation. In the absence of malice,
bad faith, or a specific provision of law making a corporate officer
liable, such corporate officer cannot be made personally liable for
corporate liabilities. 50

45
Supra note 36.
46
G.R. No. 119085, September 9, 1999, 314 SCRA 24.
47
G.R. No. 225544, December 4, 2017, 847 SCRA 437.
48
G.R. No. 147590, April 2, 2007, 520 SCRA 28, as cited in Zaragoza v. Tan, id. at 452.
49
Sec. 31. Liability ofDirectors, Trustees or Officers. - Directors or trustees who willfully and knowingly
vote for or assent to patently unlawful acts of the corporation or who are guilty of gross negligence or bad
faith in directing the affairs of the corporation or acquire any personal or pecuniary interest in conflict with
their duty as such directors, or trustees shall be liable jointly and severally for all damages resulting
therefrom suffered by the corporation, its stockholders or members and other persons.
When a director, trustee or officer attempts to acquire or acquires, in violation of his duty, any interest
adverse to the corporation in respect of any matter which has been reposed in him in confidence, as to

corporation and must

" Supra not'39 at 61!
:~\c7
which equity imposes a disability upon him to deal in his own behalf, he shall be liable as a trustee for the
for the profits which otherwise would have accrued to the corporation.
 Decision 9 G.R. No. 208920

In Lozada v. Mendoza, 51 We likewise ruled that the general rule is

corporate officers are not held solidarily liable with the corporation for
separation pay because the corporation is invested by law with a personality
separate and distinct from those persons composing it as well as from that of
any other legal entity to which it may be related. To hold a director or officer
personally liable for corporate obligation is the exception and it only occurs
when the following requisites are present: ( 1) the complaint must allege that
the director or officer assented to the patently unlawful acts of the corporation,
or that the director or officer was guilty of gross negligence or bad faith; and
(2) there must be proof that the director or officer acted in bad faith. 52

Here, the two requisites are wanting. Servandil 's complaint failed to
allege or impute bad faith or malice on the part of respondent Abraham De
Vera. There was likewise nothing in the November 27, 2003 LA Decision that
would establish that respondent Abraham De Vera acted in bad faith when
Servandil was dismissed from the service. There was likewise no invocation
of bad faith on the part of respondent Abraham De Vera to evade any
judgment against the corporation.

WHEREFORE, the petition is DENIED. The Decision dated January

18, 2013 and Resolution dated August 30, 2013 of the Court of Appeals in
CA-G.R. SP No. 126037 are AFFIRMED.

SO ORDERED.

Associate Justice

WE CONCUR:

L'?/~;,
'l(i~iANO C. DEL CASTILLO
Associate Justice

51
G.R. No. 196134, October 12, 2016, 805 SCRA 673.
52
Id. at 681.
Decision 10 G.R. No. 208920.

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, it is hereby

certified that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court's Division.