Jacinto Retuya vs Salic Dumarpa

written by Howard

G.R. No. 148848 – 455 Phil. 734 – 408 SCRA 315 – Mercantile Law – Corporation Law – Doctrine of Separate Identity – Veil of Corporate Fiction

Antonio Murillo is the majority owner of Insular Builders, Inc. His son, Rodolfo Murillo is the manager thereof. Rodolfo also owns a corporation of his own, Queen City Builders, Inc.

In 1993, Antonio and Rodolfo had a bitter feud which led to Rodolfo being fired as a manager of Insular Builders.

Caught in the crossfire between the Murillos were several employees which included Jacinto Retuya et al. Without notice, these employees were fired by Antonio. The employees then filed an illegal dismissal case against Antonio Murillo. Impleaded in the complaint were Insular Builders, Rodolfo Murillo, and Queen City Builders (it appears that Rodolfo and Queen City Builders were impleaded because Insular Builders already closed). The arbiter ruled in favor of the employees but the National Labor Relations Commission (NLRC) chaired by Salic Dumarpa reversed the decision of the arbiter. The Court of Appeals reversed the NLRC but ordered a lower pay, hence, the employees appealed further.

ISSUE: Whether or not Rodolfo Murillo and Queen City Builders, Inc. should be impleaded.

HELD: No. There is no question that Retuya et al were illegally dismissed by Antonio Murillo. But Rodolfo Murillo and the Queen City Builders cannot be held solidarily liable with Antonio and Insular Builders. Antonio’s and Rodolfo’s corporations have a separate and distinct personality. It is not enough that since the corporation owners were father and son, they and their corporations should be held solidarily liable. No employer-employee relationship exists between Rodolfo and the employees. Likewise, no employer-employee relationship exists between Queen City Builders and the employees.

The corporate veil of related companies may not be pierced in the absence of proof that the corporate fiction is being used to defeat public convenience, justify a wrong, inflict a fraud or defend a crime.

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