CA allows PAL’s P730-million damage suit vs striking pilots

The Court of Appeals (CA) has allowed flag carrier Philippine Airlines (PAL) to pursue its damage suit seeking to collect more than P730 million compensation from the Airline Pilots Association of the Philippines (ALPAP) who went on strike in 1998 as the country celebrated its centennial.

In a 26-page decision, the CA’s 13th Division through Associate Justice Ramon Cruz modified the ruling issued by the National Labor Relations Commission (NLRC) on Feb. 26, 2010, which dismissed the complaint for damages filed by flag carrier due to lack of jurisdiction and prescription.

The appellate court said although the NLRC was correct in holding that the jurisdiction over PAL’s claim for damages arising from the illegal strike belongs to the civil courts, it committed grave abuse of discretion when it declared that PAL’s complaint had already prescribed because of its failure to file the same within the three-year prescriptive period.

It agreed with the assertion of the flag carrier that it could only file a complaint for damages arising from the illegality of the ALPAP strike after the finality of the Supreme Court’s decision declaring the June 1998 ALPAP strike as illegal, not before.

It is because the complaint was based on the illegality of the strike staged by ALPAP and its officers and members, the CA noted.

The appellate court ruled that until the issue pertaining to the legality of the strike is finally settled, the filing of the suit for damages is premature, which is considered a “groundless suit.”

“The Supreme Court decision resolving the illegality of the strike attained finality only on Aug. 29, 2002. It was only then that private respondents’ act of abandoning their aircraft had been declared illegal and hence, they could already be held culpable for causing injury to petitioner’s business, assuming such could be proven by the petitioner,” the CA stressed.

“Stated differently, petitioner’s cause of action only accrued upon finality of the Supreme Court decision declaring private respondents’ strike to be illegal,” it said.

Associate Justices Jose Reyes, Jr. and Antonio Villamor concurred with the ruling.

On June 5, 1998, ALPAP officers and members went on strike, which PAL claimed was deliberately done to coincide with the peak season for air travel, summer vacation, and at the time when thousands of overseas Filipinos were set to travel to the Philippines for its 1998 centennial celebration.

On the second day of the strike, PAL asserted that the striking ALPAP pilots abandoned their respective assigned aircraft, together with their passengers and cargo in Bangkok, Thailand and San Francisco, USA.

As a result, the passengers were left stranded, rendering PAL liable for violation of its contract of carriage and forcing it to incur expenses by way of hotel accommodations and meals for passengers, airport parking fees and other operational expenses.

The illegal strike stage by ALPAP pilots also crippled PAL’s operations, resulting in losses consisting of ticket refunds, extraordinary expenses to cope with the shutdown and lost income from cancelled flights.

The striking pilots refused to heed the return-to-work order issued by the Department of Labor and Employment Secretary Rosalinda Baldoz, prompting it to declare that they have lost their employment status.

Subsequently, the appellate court upheld the ruling of DoLE declaring that the strike was illegal, prompting the pilots to elevate the case before the high tribunal.

The SC dismissed the petition in a resolution issued on April 10, 2002 which became final and executory in August 2009.

To seek redress, PAL filed a complaint for damages incurred during the illegal strike in April 2003 before the labor arbiter, which dismissed the complaint on the ground that the flag carrier’s cause of action had already prescribed since the period of reckoning the accrual of damages is June 5, 1998, when the strike was staged.

The NLRC affirmed the labor arbiter’s ruling, prompting PAL to file a petition for certiorari before the CA. –Benjamin B. Pulta, Daily Tribune