G.R. Nos. 76142-43 December 27, 1993
VDA FISH BROKER and/or VENERANDO ALONZO, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, RUPERTO BULA and VIRGILIO SALAC, respondents.

FACTS

Petitioner VDA Fish Broker, owned by Venerando Alonzo, is a fish broker engaged in selling fish. It engaged the services of private respondents Ruperto Bula and Virgilio Salac as “batilyos” to arrange fish in containers and move them. On May 14, 1982, a complaint (Case No. NLRC-NCR-5-3832-82) was filed by the Samahan ng Nagkakaisang Batilyo-NFL, represented by Bula and joined by Salac, against VDA for non-payment of various monetary benefits. On May 26, 1983, Labor Arbiter Porfirio E. Villanueva dismissed the case, ruling there was no employer-employee relationship, as the batilyos worked in their own way, were paid by results, and were not under the control and supervision of the fish brokers. This decision became final as no appeal was taken.
Subsequently, claiming they were terminated on or about January 1, 1984, Salac and Bula filed separate complaints (Case Nos. NLRC-NCR-1-153-84 and NLRC-NCR-1-169-84) for illegal dismissal and damages. On August 28, 1984, Labor Arbiter Adelaido F. Martinez dismissed these complaints, also finding no employer-employee relationship and characterizing the batilyos as independent contractors. On appeal, the NLRC reversed the Labor Arbiter’s decision on August 8, 1986, ordering reinstatement and payment of back wages. Petitioner then filed this petition, arguing that the final ruling in the first case on the absence of an employer-employee relationship constituted res judicata barring the second suit.

ISSUE

Whether the final ruling in the first case (NLRC-NCR-5-3832-82) that no employer-employee relationship existed between the parties constitutes res judicata, thereby barring the subsequent complaints (NLRC-NCR-1-153-84 and NLRC-NCR-1-169-84) for illegal dismissal.

RULING

Yes. The Supreme Court granted the petition and set aside the NLRC decision. The Court held that the principle of res judicata, specifically “conclusiveness of judgment,” applies to final decisions of administrative agencies like the NLRC exercising quasi-judicial powers. While the causes of action in the two cases were different (the first for monetary benefits, the second for illegal dismissal), there was identity of parties and the crucial factual issue of the existence of an employer-employee relationship was actually and directly litigated and determined with finality in the first case. That finding is conclusive upon the parties in the subsequent action, even if a different claim is involved. Private respondents, by not appealing the first decision, are precluded from disputing the same finding a second time. The NLRC thus committed grave abuse of discretion in disregarding this principle. The decision of Labor Arbiter Adelaido F. Martinez dated August 28, 1984, dismissing the complaints for illegal dismissal, was reinstated and affirmed.