Ponente: Bersamin, J.
SUMMARY:
Ronaldo San Miguel worked as a checker/customs
representative of Zeta Brokerage Corporation (Zeta). He was subsequently terminated
upon the supposed cessation of operations of the corporation, which, following
amendments to its articles of incorporation, was renamed Zuellig Freight and
Cargo Systems (Zuellig). San Miguel filed a complaint before the Labor Arbiter
for illegal dismissal, arguing that the amendments of the articles of
incorporation of Zeta were for the purpose of changing its corporate name,
broadening its primary functions, and increasing its capital stocks, all of
which did not mean that Zeta had been thereby dissolved. The LA, NLRC, and the CA
all ruled in favor of San Miguel. The SC affirmed the uniform holdings of the
LA, NLRC, and the CA, ruling that the change of name of Zeta into Zuellig did
not give it the license to terminate San Miguel without just or authorized
cause.
FACTS:
Ronaldo San Miguel started working at Zeta Brokerage
Corporation (Zeta) in 1985 as a checker/customs representative.
In 1994, he and other employees were informed that Zeta
would cease operations, and that all affected employees, including him, would
be separated.
By a letter dated February 1994, Zeta informed San Miguel of
his termination effective March 31, 1994 due to the company’s cessation of
business operations.
He reluctantly accepted his separation pay subject to the
standing offer to be hired to his former position by Zeta.
Subsequently, Zeta amended its articles of incorporation and
changed its name to Zuellig Freight and Cargo Systems (Zuellig).
On April 15, 1994, San Miguel was summarily terminated
without any valid cause and due process. Consequently, he filed a complaint
before the Labor Arbiter for illegal dismissal.
SAN MIGUEL: Zeta did not really cease its operations. The
amendments of the articles of incorporation of Zeta were for the purpose of
changing the corporate name, broadening the primary functions, and increasing
the capital stock; and that such amendments could not mean that Zeta had been
thereby dissolved.
ZETA/ZUELLIG: The dismissal was in accordance with the Labor
Code because the company had ceased operations and closed its business.
LABOR ARBITER: San Miguel was illegally dismissed. Contrary
to the company’s claim of cessation of operations, there was merely a change of
business name and primary purpose and upgrading of stocks of the corporation.
Granted, Zuellig and Zeta are legally the same person and entity. The company
is therefore ordered to pay San Miguel his backwages, attorney’s fees, plus
costs of the suit.
NLRC: Affirmed the LA’s ruling.
CA: Affirmed the NLRC ruling. Zeta’s closure of business
operations was not validly made. The factual milieu of the case, considered in
its totality, shows that there was no closure to speak of. The termination of
services allegedly due to cessation of business operations of Zeta was illegal.
Notwithstanding San Miguel’s receipt of separation benefits from Zuellig, the
former is not estopped from questioning the legality of his dismissal.
Hence, the instant petition.
RULING:
Whether the amendments
of the articles of incorporation of Zeta to change its corporate name to
Zuellig Freight and Cargo Systems, Inc., resulted in the dissolution of Zeta as
a corporation. – NO.
A change in the corporate name does not make a new
corporation, whether effected by a special act or under a general law. It has
no effect on the identity of the corporation, or on its property, rights, or
liabilities. The corporation, upon such change in its name, is in no sense a
new corporation, nor the successor of the original corporation. It is the same
corporation with a different name, and its character is in no respect changed.
The changing of the name of a corporation is no more the
creation of a corporation than the changing of the name of a natural person is
begetting of a natural person. The act, in both cases, would seem to be what
the language which we use to designate it imports – a change of name, and not a
change of being.
The Corporation Code defined and delineated the different
modes of dissolving a corporation, and amendment of the articles of
incorporation was not one of such modes.
In other words, the mere change in the corporate name is not
considered under the law as the creation of a new corporation.
As such, the effect of Zeta’s change of name to Zuellig was
not a change of its corporate being.
Whether San Miguel was
illegally dismissed. – YES.
Where there is no showing of a clear, valid, and legal cause
for the termination of employment, the law considers the matter a case of
illegal dismissal and the burden is on the employer to prove that the
termination was for a valid or authorized cause.
Despite its new name, Zuellig remains to be the mere
continuation of Zeta’s corporate being. As such, it has the obligation to honor
all of Zeta’s obligations, one of which was to respect San Miguel’s security of
tenure. The dismissal of San Miguel from employment on the pretext that
Zuellig, being a different corporation, had no obligation to accept him as its
employee, was illegal and ineffectual.
Zuellig’s defense that San Miguel's dismissal was
due to his failure to receive the termination letter from Zeta despite due
notice and from there sign a new employment contract with Zuellig is of no
moment in view of the circumstances.
The dismissal remained illegal for the
said condition (i.e., accepting the termination letter and signing a new
employment contract) was null and void. In point of facts and law, San Miguel
remained an employee of Zuellig.
DOCTRINE:
A change in the corporate name does not make a new
corporation, whether effected by a special act or under a general law. It has
no effect on the identity of the corporation, or on its property, rights, or
liabilities. The corporation, upon such change in its name, is in no sense a
new corporation, nor the successor of the original corporation. It is the same
corporation with a different name, and its character is in no respect changed.