The Supreme Court ruled that Regional Trial Courts (RTC) cannot issue injunctions against the execution of decisions made by the National Labor Relations Commission (NLRC). This decision reinforces the NLRC’s exclusive jurisdiction over labor disputes and prevents interference from co-equal courts. It ensures that labor cases are resolved within the specialized labor tribunals, maintaining the integrity and efficiency of the labor dispute resolution system.

Property Dispute or Labor Issue: When Does the NLRC’s Authority Prevail?

In the case of Deltaventures Resources, Inc. vs. Hon. Fernando P. Cabato, the central question revolved around whether a Regional Trial Court (RTC) could interfere with the execution of a decision made by the National Labor Relations Commission (NLRC). The dispute arose when Deltaventures Resources, Inc. filed a third-party claim asserting ownership over a property that was being levied upon to satisfy a judgment in a labor case. The RTC initially issued a temporary restraining order, but later dismissed Deltaventures’ complaint, leading to the present petition before the Supreme Court. This case highlights the critical distinction between property rights and labor disputes, and the boundaries of jurisdiction between regular courts and specialized labor tribunals.

The Supreme Court firmly sided with the principle of exclusive jurisdiction, emphasizing that the NLRC’s authority over labor disputes extends to all aspects of their resolution, including the execution of judgments. The Court stated that the jurisdiction over the subject matter is determined by the allegations in the complaint. Citing Bernardo, Sr. v. CA, 263 SCRA 660, 671 (1996), the Court reiterated that jurisdiction is based on the facts alleged in the complaint, not on whether the plaintiff is ultimately entitled to relief.

“Jurisdiction over the subject-matter is determined upon the allegations made in the complaint, irrespective of whether the plaintiff is entitled or not entitled to recover upon the claim asserted therein – a matter resolved only after and as a result of the trial.”

In this case, Deltaventures’ complaint, although framed as a property dispute, directly challenged the execution of a judgment arising from an illegal dismissal and unfair labor practice case. This connection to a labor dispute placed the matter squarely within the NLRC’s jurisdiction. The Court underscored that Regional Trial Courts have no jurisdiction to act on labor cases or incidents arising from them, including the execution of decisions. This principle is essential to prevent conflicting rulings and maintain the integrity of the labor dispute resolution process. Allowing regular courts to interfere with the NLRC’s decisions would create a chaotic system where labor disputes could be endlessly litigated in multiple forums.

The Court also addressed Deltaventures’ argument that its claim did not involve a labor dispute because no employer-employee relationship existed between Deltaventures and the laborers. However, the Court clarified that the relevant factor was not the direct involvement of Deltaventures in the labor dispute, but rather the connection between Deltaventures’ claim and the execution of the NLRC’s judgment. Because the claim arose directly from the enforcement of a labor-related decision, it fell within the NLRC’s exclusive jurisdiction. The decision serves as a reminder that jurisdiction is not solely determined by the parties involved, but also by the nature of the underlying dispute and its connection to specialized areas of law.

Furthermore, the Supreme Court emphasized the prohibition against injunctions in labor disputes, stating that Article 254 of the Labor Code explicitly prohibits courts from issuing injunctions in cases “involving or growing out of labor disputes.” This prohibition reflects a policy decision to protect the NLRC’s authority and prevent delays in the resolution of labor disputes. The Court noted that Deltaventures should have filed its third-party claim before the Labor Arbiter, as outlined in the NLRC’s Manual on Execution of Judgment. This manual provides a specific mechanism for third-party claimants to assert their rights over property being levied upon in connection with a labor dispute.

The Supreme Court further supported the decision of the court a quo, underscoring a fundamental tenet of hierarchical adjudication: a Regional Trial Court, being a co-equal body with the National Labor Relations Commission, lacks the jurisdictional purview to issue restraining orders or injunctions that impede the execution of decisions rendered by the latter. Citing New Pangasinan Review, Inc. v. NLRC, 196 SCRA 56, 66 (1991), the Court reinforced the principle that courts of equal rank cannot interfere with each other’s judgments or processes. This doctrine of non-interference ensures the orderly administration of justice and prevents one court from undermining the authority of another.

In its decision, the Court also noted that Deltaventures had initially submitted itself to the jurisdiction of the NLRC by filing a third-party claim with the deputy sheriff. By taking this step, Deltaventures implicitly acknowledged the NLRC’s authority to resolve the dispute over the property. The Court stated that “jurisdiction once acquired is not lost upon the instance of the parties but continues until the case is terminated.” Citing Gimenez v. Nazareno, 160 SCRA 1, 5 (1988). This principle of continuing jurisdiction ensures that a tribunal retains the power to resolve all issues related to a case, even if the parties attempt to withdraw or transfer the case to another forum.

The Supreme Court decision serves as a clear demarcation of authority between regular courts and specialized labor tribunals. It reinforces the principle that the NLRC has exclusive jurisdiction over labor disputes and that Regional Trial Courts cannot interfere with the execution of NLRC decisions. This ruling is essential for maintaining the integrity of the labor dispute resolution system and ensuring that labor cases are resolved efficiently and effectively. By upholding the NLRC’s authority, the Court protects the rights of workers and promotes a stable labor environment.

FAQs

What was the key issue in this case?	The key issue was whether a Regional Trial Court (RTC) could issue an injunction against the execution of a decision by the National Labor Relations Commission (NLRC) in a labor dispute. The Supreme Court ruled that the RTC lacked jurisdiction to do so.
Why did Deltaventures file a complaint with the RTC?	Deltaventures filed a complaint with the RTC claiming ownership of a property that was being levied upon to satisfy a judgment in a labor case. They sought an injunction to stop the execution of the judgment.
What is a third-party claim in this context?	A third-party claim is a legal assertion by someone who is not directly involved in a lawsuit, claiming ownership or rights to property that is subject to execution or attachment. In this case, Deltaventures filed a third-party claim asserting ownership over the levied property.
What does it mean for the NLRC to have exclusive jurisdiction?	Exclusive jurisdiction means that only the NLRC has the power to hear and decide cases related to labor disputes. Other courts, like the RTC, cannot interfere with the NLRC’s decisions or processes in these matters.
What is Article 254 of the Labor Code?	Article 254 of the Labor Code prohibits courts from issuing injunctions in cases “involving or growing out of labor disputes.” This provision aims to protect the NLRC’s authority and prevent delays in the resolution of labor disputes.
What should Deltaventures have done instead of filing a case with the RTC?	Deltaventures should have filed its third-party claim before the Labor Arbiter, as outlined in the NLRC’s Manual on Execution of Judgment. This manual provides a specific process for asserting claims over property being levied upon in labor cases.
What is the significance of the NLRC’s Manual on Execution of Judgment?	The NLRC’s Manual on Execution of Judgment outlines the procedures for enforcing decisions made by the NLRC and Labor Arbiters. It includes provisions for handling third-party claims and resolving disputes related to the execution of judgments.
What is the principle of continuing jurisdiction?	The principle of continuing jurisdiction means that once a court or tribunal acquires jurisdiction over a case, it retains that jurisdiction until the case is fully resolved. This prevents parties from attempting to transfer the case to another forum mid-proceedings.
Why can’t co-equal courts interfere with each other’s decisions?	Co-equal courts, like the RTC and NLRC, cannot interfere with each other’s decisions because they have the same level of authority within their respective jurisdictions. Allowing such interference would create a chaotic system and undermine the authority of each tribunal.

This case clarifies the jurisdictional boundaries between the NLRC and regular courts, ensuring that labor disputes are handled by the specialized tribunals designed for that purpose. This decision has significant implications for property owners who may find their assets subject to levy in connection with labor disputes, as it emphasizes the importance of following the proper procedures within the NLRC framework.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: DELTAVENTURES RESOURCES, INC. vs. HON. FERNANDO P. CABATO, G.R. No. 118216, March 09, 2000