THE SAN MIGUEL CORPORATION (Formerly San Miguel Brewery, Inc.), petitioner, vs. MACARIO CRUZ and the COURT OF INDUSTRIAL RELATIONS, respondents. ; G.R. No. L-27828 February 27, 1970

TOPIC: Art.6. "Rights may be waived unless the waiver is contrary to law, public order, public policy, morals, or good customs, or prejudicial to a third person with a right recognized by law."

GIST: CRUZ'S ACCEPTANCE OF ALL THE BENEFITS AMOUNTS TO A WAIVER OF RIGHT TO CONTEST THE COMPANY'S ACT.

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FACTS:

1. Macario Cruz was a driver-employee and member of the labor organization "Pagkakaisa Samahang Manggagawa sa S.M.B. (Paflu) in San Miguel Corporation which staged a strike somewhere in October 1957.

2. Cruz was then told by Mr. Camahort, San Miguel's company official that he would be dismissed if he would not stop his participation in union activities.

3. 15 March 1958: Cruz wrote the company requesting that the benefits due him on account of his retirement be given in only one installment. he must have been tipped and requested this before he was told on

4. 17 March 1958:  the company is to retire him from service for physical disability.

5. 10 April 1958: Cruz received Cheeks Nos. K905357 and K905358 in the total sum of P3,019.46 as "full and complete payment of all my (his) retirement benefits."

6.  12 June 1958:  Cruz also filed with the Social Security System an application for disability

benefit. wherein he affirmed having retired from employment on 31 March 1958. This claim,

however, was denied for the reason that the case properly falls under sickness benefits, to which

claimant was not yet entitled, he having been a member of the System for less than one year.

7.  27 May 1961: Three years after he was retired,  Cruz filed a formal complaint on  against the San Miguel Company before the Court of Industrial Relations with unfair labor practices for his dismissal in 1958, allegedly for union activities.

8.  The trial Judge  sustained the charges and ordered San Miguel Corp. to reinstate the complainant with back, wages, but deducting therefrom the amounts already received by him as retirement benefits.

9. The company sought reconsideration thereof before the court en banc, and when the same was denied on 5 June 1967 (with two judges dissenting) the present petition for review was filed. 

ISSUES:

Whether or not a former employee who has accepted retirement benefits may still contest the regularity and validity of his retirement 3 years thereafter. 

RULING:

NO. Complainant Macario Cruz not only specified, and obtained, payment of retirement gratuities due him in a lump sum but even applied for disability benefits with the Social Security System. Moreover, he never protested his alleged illegal dismissal nor demanded reinstatement. It took him more than 3 years to question the validity of his said retirement. The original posture taken by the complainant, indeed, can be nothing but an agreement, or at least acquiescence, to the decision of the company to have him retired for physical disability. Thus, even assuming that there was ground to declare his separation from the service invalid, the complainant's receipt of all the benefits arising therefrom, with full knowledge of all the facts surrounding the same, amounts to a waiver of the right to contest the validity of the company's act.

The decision of the Court of Industrial Relations under review is hereby reversed, and the complaint for unfair labor practices against herein petitioner, dismissed. No pronouncement as to costs.

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ADDITIONAL INFO:

SAN MIG's basis is not only ESTOPPEL but also the principle of LACHES.

Estoppel is a legal principle that prevents someone from arguing something or asserting a right that contradicts what they previously said or agreed to by law.

Elements for the operation of the principle of laches:

(a) conduct on the part of the employer that gave rise to the situation on which the complaint is made: 

- which is the retirement of the complainant for physical disability;

(b) delay in the assertion of complainant's right

— the lapsing of a period of 3 years which is neither explained nor justified;

(c) lack of knowledge or notice on the part of the respondent employer that the complainant would assert the right on  which the present suit is based; and (this was unexpected since he was already paid and it has been three years since then)

(d) injury or prejudice to the employer in the event relief is awarded to the complainant. (san mig already paid cruz in full 3 years ago)

PRESCRIPTION VS. LACHES  (Nielson & Co., Inc. vs. Lepanto Consolidated Mining Co., L-21601, 17 December 1966).

PRESCRIPTION

- concerned with the fact of delay

- a matter of time

- statutory

- applies at law

- based on fixed time

 

LACHES

- concerned with the effect of delay

- principally a question of inequity of permitting a claim to be enforced, this inequity being founded on some change

in the condition of the property or the relation of the parties

- not statutory

- applies in equity

- not based on a fixed time