INTEREST
G.R. No. 189871; 703 SCRA 439 – NACAR v. GALLERY FRAMES PERALTA Nacar won backwages and separation pay in an illegal dismissal case he filed against h is employer. The The LA decision had a computation of awards. As Gallery rames appealed up to the !"# the $udgment reached finality much later than the promulgation at the LA le%el# and so Nacar sought recomputation of the award to include the period up to finality. The "ourt ruled in Nacar&s fa%or# reasoning that recomputing monetary awards did not amount to a %iolation of the principle of the immutability of $udgments# and that the inflated award was a conse'uence of Gallery rames&s ha%ing chosen to appeal the decision of the LA. (n interest# the "ourt ruled that in the absence of an e)press contract as to rate of interest for loans and forbearances of money# the applicable rate from *+ ,uly -*+ onwards would be /0 1instead of the pre%ious +-0 demonstrated in the case of Eastern !hipping Lines2 because of the amendment of "ircular No. 3*4# s. +35- by 6onetary 7oard Resolution No. 83/.
DOCTRINE Effecti%e *+ ,uly -*+# the rate of interest for the loan or forbearance of any money# goods or credits and the rate allowed in $udgments# in the absence of an e)press contract as to such rate of interest# shall be si) percent 1/02 per annum. 16onetary 7oard Resolution No. 83/# amending !ec. - of "ircular No. 3*4# s. +35-2
IMPORTANT PEOPLE 9ario Nacar# petitioner Gallery rames and:or elipe 7ordey# ,r. 1G2# respondent FACTS +. Nacar filed filed a complaint complaint for construc constructi%e ti%e dismissal dismissal against against Gallery Gallery rames rames 1G2. 1No details details were gi%en gi%en about his case.2 case.2 The LA ruled ruled in his fa%or fa%or## and he was awarded awarded P158,919.9 P158,919.9 in backwages and separation pay in lieu of reinstatement. The award was computed# as stated in dispositi%e# ;only up to the promulgation of the decision.< -. Respondent Respondents s unsuccessfull unsuccessfully y appealed to the NLR"# NLR"# "A# and !". An entry entry of $udgment was issued issued certifying certifying that the resolution 1of !" denying the petition for re%iew of "A&s "A&s resolution2 !"#$%" &'($) $(* "+"#-o/ o( 7 M$/ 00. 00 . . *4 No%. No%. -**-= -**-= Nacar Nacar filed filed a 6otio 6otion n for "orrec "orrectt "omput "omputati ation# on# prayin praying g that that his backwag backwages es be comput computed ed up to the finality of the !" resolution 1not the promulgation of the LA decision2. >t was recomputed to be P471,30.31. P471,30.31. ?. LA issued issued a writ writ of e)ecut e)ecution ion.. G filed filed motion motion to 'uash 'uash the writ. writ. G&s G&s theory theory== After After finalit finality y# the decisio decision n 1and 1and the amount computed by the LA2 can no longer be altered or amended. LA denied the motion and issued an alias writ# so G appealed to the NLR". NLR" granted the appeal and ordered another recomputation 1yes# another @$sym2. 4. The NLR" resolu resolution tion became became final final and e)ecutory e)ecutory by entry entry of $udgment. $udgment. Nacar mo%ed mo%ed for an alias alias writ of e)ecuti e)ecution on to enforce the earlier recomputed $udgment of P?8+#-*.+. hen the records were further recomputed# the award was assess assessed ed to be only only P147,50.19. P147,50.19. Nacar mo%ed that the original amount 1as computed by LA2 be gi%en to him pending final computation. LA issued a writ for the latest 1and lowest2 computation 1P+?8k2# which Nacar recei%d. /. The LA then then issued an order for for P++#?43 P++#?43## because Nacar Nacar was entitled entitled to the original original computati computation on 1P+452# 1P+452# but he had already recei%ed P+?8k. Nacar appealed before the NLR" 1denied2# and eth "A 1denied also2. Bence this petition. 8. Naca Nacar& r&s s pos posit itio ion= n= a. "omputati "omputation on of backwages backwages is not final final until finalit finality y of the decision# decision# and so the basis of the the computation computation should should be the finality of the resolution of the !"# and not the promulgation of the decision of the LA. b. G&s G&s counterCargum counterCargument= ent= Recomput Recomputatio ation n would %iolate %iolate the rule on immutability immutability of $udgments. $udgments. ISSE 2'- OLDING 1. 6N "#o% "#o% -$-$-'o 'o( ( ' o o" " – YES YES inality of the decision pertains to the finding of the illegality of the dismissal and the kinds of sums and benefits awarded. This does not include the %"" #o%-$-'o( o& 2$- -" *"#''o( "-$!)'"* # and so the awards may be recomputed. Recomputation is necessary because relief in an illegal dismissal case runs until reinstatement or# if separation pay is to be gi%en# up to the finality of the decision. The increase in the amount payable is a conse'uence of the respondents& ha%ing continued to seek recourse against the LA decision.
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. o2 $)) )"$) '(-""- !" #o%-"*: T' ' -" '" '( -' #$".< S$%" $ '( E$-"( S''(# "+#"- that instead of +-0 as the rate of interest for a loan or forbearance of money# it shall be /0 per annum. This is in accordance with the 7!P 6onetary 7oard resolution 1No. 83/2 appro%ing the amendment of "ircular No. 3*4# effecti%e *+ ,uly -*+. + Thus# absent a stipulation as to interest# the rate for loans or forbearance of money# goods# or credits and the rate allowed in $udgments shall no longer be +-0 as reflected in Eastern !hipping Lines# but /0 per annum. This is a prospecti%e rule# and so interest shall be applied at +-0 until * ,une -*+. !tarting *+ ,uly -*+# /0 shall be applied 1when applicable2. DISPOSITI=E PORTION BERE(RE# premises considered# the 9ecision dated !eptember -# -**5 of the "ourt of Appeals in "ACG.R. !PNo. 3543+# and the Resolution dated (ctober 3# -**3 are REDER!E9 and !ET A!>9E. Respondents are (R9ERE9 to PA petitioner= +. backwages computed from the time petitioner was illegally dismissed on ,anuary -?# +338 up to 6ay -8# -**-# when the Resolution of this "ourt in G.R. No. +4+- became final and e)ecutoryF -. separation pay computed from August +33* up to 6ay -8# -**- at the rate of one month pay per year of ser%iceF and . interest of twel%e percent 1+-02 per annum of the total monetary awards# computed from 6ay -8# -**- to ,une *# -*+ and si) percent 1/02 per annum from ,uly +# -*+ until their full satisfaction. The Labor Arbiter is hereby (R9ERE9 to make another recomputation of the total monetary benefits awarded and due to petitioner in accordance with this 9ecision. !( (R9ERE9. NOTE TE ONLY REALLY IMPORTANT PART OF TIS CASE IT RESPECT TO CREDIT; SCRA 457< To recapitulate and for future guidance# the guidelines laid down in the case of Eastern !hipping Lines are accordingly modified to embody 7!PC67 "ircular No. 833# as follows= I. "( $( o!)'$-'o(, "$*)" o& '- o#", '."., )$2, #o(-$#-, >$'?#o(-$#-, *")'#- o >$'?*")'#- ' !"$#"*, -" #o(-$v"(o #$( !" ")* )'$!)" &o *$%$". T" ov''o( (*" T'-)" @=III o( D$%$"B o& -" C'v') Co*" ov"( '( *"-"%'('( -" %"$" o& "#ov"$!)" *$%$". II. '- "$* $-'#)$)/ -o $( $2$* o& '(-""- '( -" #o(#"- o& $#-$) $(* #o%"($-o/ *$%$", -" $-" o& '(-""-, $ 2")) $ -" $##$) -""o&, ' '%o"*, $ &o))o2 +. hen the obligation is breached# and '- #o('- '( -" $/%"(- o& $ % o& %o("/ # i.e.# a loan or forbearance of money# the interest due should !" -$- 2'# %$/ $v" !""( -')$-"* in writing. urthermore# -" '(-""- *" $)) '-")& "$( )"$) '(-""- &o% -" -'%" '- ' *'#'$))/ *"%$(*"* . I( -" $!"(#" o& -')$-'o( # the rate of interest shall be " $((% -o !" #o%-"* &o% *"&$)-# i.e.# from $udicial or e)tra$udicial demand under and sub$ect to the pro%isions of Article ++/3 of the "i%il "ode. -. hen an obligation, (o- #o(-'--'( $ )o$( o &o!"$$(#" o& %o("/ # is breached# an interest on the amount of *$%$" $2$*"* %$/ !" '%o"* $- -" *'#"-'o( o& -" #o- $- -" $-" o& " $((% . No interest# howe%er# shall be ad$udged on unli'uidated claims or damages# e)cept when or until the demand can be established with reasonable certainty. Accordingly# where the demand is established with reasonable certainty# the interest shall begin to run from the time the claim is made $udicially or e)tra$udicially 1Art. ++/3# "i%il "ode2# but when such certainty cannot be so reasonably established at the time the demand is made# the interest shall begin to run only from the date the $udgment of the court is made 1at which time the 'uantification of damages may be deemed to ha%e been reasonably ascertained2. The actual base for the computation of legal interest shall# in any case# be on the amount finally ad$udged. . hen the $udgment of the court awarding a sum of money becomes final and e)ecutory# the rate of legal interest# whether the case falls under paragraph + or paragraph -# abo%e# shall be " $((% &o% # &'($)'-/ (-') '- $-'&$#-'o(, -' '(-"'% "'o* !"'( *""%"* -o !" !/ -"( $( ">'v$)"(- -o $ &o!"$$(#" o& #"*'-. A(*, '( $**'-'o( -o -" $!ov", *%"(- -$- $v" !"#o%" &'($) $(* "+"#-o/ 'o -o )/ 1, 013, $)) (o- !" *'-!"* $(* $)) #o(-'(" -o !" '%)"%"(-"* $)/'( -" $-" o& '(-""- &'+"* -""'(.
+ The rate of interest for the loan or forbearance of any money# goods or credits and the rate allowed in $udgments# in the absence of an e)press contract as to such rate of interest# shall be si) percent 1/02 per annum.
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