9. Lemoine v. Alkan

4/6/2016 PHILIPPINE REPORTS ANNOTATED VOLUME 033

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[No. 10422. January 11, 1916.]

A. LEMOINE, plaintiff and appellant, vs. C. ALKAN,defendant and appellant.

DAMAGES; BREACH OF CONTRACT FOR SERVICES;ARTICLES 1101 AND 1586, CIVIL CODE.—An action byan employee against his employer to recover damages forwrongful discharge before the expiration of the term ofemployment agreed upon is founded on article 1586 of theCivil Code providing that "fieldhands, mechanics,artisans, and other hired laborers, for a certain time andfor a certain work, shall not leave nor be dismissed,without just cause, before the fulfillment of the contract;"and on article 1101 which provides that "those who, infulfilling their obligations, are guilty of fraud, neglect ordelay, or who violate the provisions thereof, are liable forthe damages caused thereby."

ID.; ID.; ID.; MITIGATION OF DAMAGES.—The factthat the plaintiff in such an action could have obtained bythe use of reasonable diligence like employment undersimilar conditions in the same locality, or that theemployer who wrongfully discharged him offered to permithim to return to his employment under substantially thesame conditions as formerly and at the same rate ofwages, does not constitute a defense to the action but arematters in mitigation.

ID.; ID.; MEASURE OF DAMAGES.—An action by anemployee against his employer to recover damages forwrongful discharge is an action for breach of contract andthe damages are prima facie the amount of wages for thefull term. He is entitled however to such other damages ashe has actually suffered which spring directly from thebreach and which he can prove.

ID.; ID.; MITIGATION OF DAMAGES.—In order that thedefendant in such an action may take advantage of the



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fact that the plaintiff could have obtained likeemployment under similar conditions in the same locality,he must show the rate of wages which plaintiff wouldhave received if he had obtained such employment.Defendant cannot be allowed a sum to reduce plaintiff'sdamages unless he has proved what that sum is.

ID.; ID.; ID.; OFFER OF REINSTATEMENT INSERVICE.—Where an employee has been wrongfullydischarged by his employer and the latter, before theemployee has obtained other employment, offers to takehim back into his employ in the same position, undersubstantially the same conditions and at the same rate ofwages, the employee is bound to return, even af ter anaction has been begun by him to recover damages for thebreach of the contract; provided such return does notprevent him from recovering the damages alreadysustained, and provided the

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employer has not so mistreated him as to prevent a selfrespecting man from returning.

ID.; ID.; ID.; ID.—Where, under such circumstances, theplaintiff refused to return to the employ of the defendant,the latter is entitled to offset plaintiff's damages with thewages which he would have received if he had returned,from the time when the offer was made.

APPEAL from a judgment of the Court of First Instance ofManila. Del Rosario, J.

The facts are stated in the opinion of the court.Eduardo Gutierrez Repide and Felix Socias for plaintiff.Alfredo Chicote and R. del Castillo Tirol for defendant.

MORELAND, J.:This is an action brought to recover damages for breach

of a contract for lease of services.On the 10th day of July, 1913, the plaintiff and

defendant signed a written contract whereby the def



endant hired the plaintiff, an expert automobile mechanic,to perform services as such expert mechanic in hisautomobile repair shop in the city of Manila for the periodof three years from the date of the contract at a salary ofP350 a month. Plaintiff entered defendant's service on theday on which the contract was executed and continuedtherein until he was discharged by the def endant thelatter part of August of the same year, plaintiff actuallyleaving defendant's service on the 5th day of September.On the 8th of the same month this action was begun torecover, as damages for breach of contract, the wages towhich he was entitled under the contract.

The defendant presents three defenses to the action.The first' is that plaintiff was incompetent and

insubordinate and that he unduly and without permissionabsented himself f rom the repair shop during the hourswhen, under the contract, he should have been at work.

The second is f ounded on the claim that plaintiff, if hehad used due diligence, would have been able to obtain alike position in the city of Manila, it appearing by theevidence, asserts defendant, that various owners of other

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164 PHILIPPINE REPORTS ANNOTATEDLemoine vs. Alkan.

automobile repair shops were anxious to obtain the servicesof mechanics of plaintiff's ability and that any one of themwould have hired him immediately on his discharge if hehad presented himself for that purpose.

The defendant claims as his third defense that on the6th of December, 1913, in a letter addressed to plaintiff, heoffered to take him back into his employ under terms andconditions substantially the same as those specified in theoriginal contract of service and at the same rate of wages;and that plaintiff, without reason or justification, refusedto accept the offer. He then invokes the principle of lawthat, where a servant has been wrongfully discharged andhas failed to obtain other employment, he must accept theoffer of his original employer to receive him back in hisemploy under terms and conditions which are substantiallythose of his previous employment and at the same rate ofwages, on pain of being unable to recover wages ordamages after the date of the offer.



The court found for the defendant on his second defensebut allowed plaintiff wages for three months, which thecourt considered a reasonable time which ought to beconceded to him in which to obtain other employment. Bothparties appealed.

With respect to defendant's first defense, the trial court found against him on the f acts; and a thorough review ofthe evidence in the record leads us to agree with thatconclusion. The evidence is clearly insufficient to support afinding that plaintiff was incompetent or insubordinate orthat he absented himself during working hours withoutpermission. A fair preponderance of the evidence showsthat he was an exceptionally good mechanic, entirelycompetent to perform the work set for him, that he didperform it efficiently, that he was reasonably tractable andobedient, and that he did not absent himself from thegarage during working hours except on the orders ofdefendant.

In regard to the second defense, the trial court found asa fact in the evidence that positions of like nature were, atthe time of his discharge, open to plaintiff in the city of

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Manila and that, with ordinary diligence, he would havebeen able to obtain like employment immediately. We arein complete conformity with the finding of the trial courtthat plaintiff, by the use of reasonable diligence, could,immediately on his discharge, have obtained likeemployment in the city of Manila. It is clearly supported bya fair preponderance of the evidence and must accordinglybe. sustained. From this finding of fact the trial court drewthe conclusion that plaintiff was not entitled to recover onhis complaint, except in part, as he had failed to use thediligence required under the circumstances in seekingother employment of like nature in the same locality.

While we agree with the findings of fact as to thesealleged defenses, we do not agree with the conclusion of lawwhich the trial court draws therefrom, for reasons whichwe will set out hereafter.

The defendant asserts as a third defense that, on the 6thday of December, 1913, in a letter addressed to the



plaintiff, he offered to take him back into his employ underterms and conditions substantially the same as thosespecified in the original contract and at the same rate ofwages, and that plaintiff, without reason or justification,refused to accept the offer. He then invokes the principle oflaw that, where a servant has been illegally discharged andhas failed to obtain other employment, he must accept theoffer of the employer who discharged him to receive himback into his employ under terms and conditionssubstantially those of his previous employment and at thesame rate of wages on pain of having his damages on a suitf or breach of contract reduced to the extent of the wageswhich he would have received if he had accepted the offer.We understand that the facts on which this defense restsare admitted by both parties. There remains only thediscussion as to whether such facts constitute a def ense orwhether they may be used in mitigation of damages towhich plaintiff may prove himself entitled. This discussionwill also be reserved until later.

The action in this case is founded on that provision of

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the Civil Code which provides that "fieldhands, mechanics,artisans, and other hired laborers, for a certain time andfor a certain work, shall not leave nor be dismissed,without just cause, before the fulfillment of the contract"(art. 1586); and also that disposition of the same codewhich provides that "those who, in fulfilling theirobligations, are guilty of fraud, neglect or delay, or whoviolate the provisions thereof, are liable for the damagescaused thereby." (Art. 1101.)

An examination of the Spanish authorities relative tothe right of a mechanic to bring an action f or damagesresulting f rom a wrongful discharge discloses nothingwhich indicates that that law differs in any materialrespect from that of Englishspeaking countries. Manresain his discussion of this subject follows the usual lines withwhich American lawyers and jurists are familiar. His firstserious remarks, after outlining the scope of the subject,refer to that portion of the article which seems to restrictits application to those who have agreed to work for a



certain time with respect to a certain work, the limitation,"for a certain work," seeming to indicate, says Manresa, iftaken literally, that the persons mentioned in the articlemay be discharged at will when they are employedgenerally and without reference to any particular piece ofwork, even though the hiring is for a specified time. Hisconclusion is that the wording of the article must not betaken so literally as to permit the perpetration of aninjustice which.would necessarily follow if, after theexecution of a contract of hiring for a specified time, theproprietor might, bef ore the designated period hadprescribed, capriciously discharge the employee. He seemsto think that the disjunctive "or" should take the place ofthe conjunctive "and" between the words "time" and "for,"making the article read "for a certain time or for a certainwork," he giving it as his opinion that that is the realmeaning of the article.

Continuing the discussion,' Manresa is of the opinionthat the Civil Code not having specified the causes whichwould justify a dismissal of the employee or theabandonment by

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the latter of his contract, all matters pertaining to thatquestion are left to the sound judgment of the courts. Headds that, along with the prohibition against wrongfuldischarge f ound in article 1586, goes also the supplementalobligation to indemnify in case of such discharge. He is ofthe opinion that there is no necessity for such a statementin article 1586 or elsewhere in the law relative to lease ofservices, inasmuch as the principles which it would embodyare enunciated in the law of obligations as laid down inprevious articles of the same Code. He makes somecomment with respect to the amount of damages to beawarded and adds that when, in actions based on awrongful discharge, the evidence establishes the fact ofwrongful discharge, the employer shall be considered, inrelation to the injured employee, a "debtor in bad faith."

Under both the Spanish and American law, then, theaction based on a wrongful discharge is one to recoverdamages f or breach of contract.



That which defendant alleges to be his second and thirddefenses, even if all the facts necessary to establish thedefenses as alleged were proved, could not really be calleddefenses. They would more properly go to a mitigation ofdamages. But even considering them as matters inmitigation of damages, the defendant has not proved f actssufficient to avail himself of the benefit thereof under hissocalled second defense. He has offered no evidenceshowing what wages plaintiff would have received if he hadobtained one of the positions to which defendant refers. Theevidence ref ers simply to the f act that plaintiff might haveobtained like employment in the same locality; but it doesnot show at what rate of wages. There is nothing in therecord showing the wages of a particular position or theusual wages paid in such employment. We understand it tobe the rule that before defendant can take advantage of thefailure of plaintiff to obtain like employment, it mustapear: (1) That it is like employment, (2) that it is in thesame locality; (3) that it is under substantially the sameconditions; and (4) the wages which he could have earned.We

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are of the opinion that defendant has successfullyestablished the first three conditions; but, on the otherhand, he has utterly failed to established the fourth. It isclear that the court cannot allow any sum in reduction ofdamages unless it has been proved; and it not appearing ofrecord how much plaintiff could have earned in likeemployment, it is impossible to determine the sum whichmust be deducted from the damages proved by plaintiff.

Def endant is more successf ul with what he calls histhird defense, It is admitted, as we have said, that about 3months after plaintiff had been discharged and was stillwithout employment, def endant offered to take him backinto his employ in the same repair shop, at the same rate ofwages and substantially under the conditions named in theoriginal contract and that plaintiff refused the offer. Hegave no reason for his refusal, but made a counteroffer inwhich he proposed material changes in the conditionsunder which he would return and in the wages which he



was to receive, he demanding a higher salary. He alsorequired that there be added to the contract of reëmployment a penal clause in the sum of P15,000 which thedefendant would be obliged to pay in case of a wrongfuldischarge in addition to the damages sustained. He alsorequired that the defendant permit a judgment to beentered against him in the present action for the fullamount of the damages claimed. Def endant ref used toaccept these new conditions and the plaintiff declined toaccept the offer to reemploy.

We are of opinion that plaintiff should have accepted theoffer of defendant and that, in refusing to do so, heconferred on the defendant the right to present his offer inmitigation of any damages which plaintiff might havesustained by reason of the wrongful discharge. We areaware that it has been held that, when a contract ofemployment has once been broken by the employer by awrongful discharge of the employee and that status hasbeen recognized by both parties, the employee is notobliged to do anything more under the original contract;that, it having been broken volun

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tarily by the employer, his employee is no, longer underany obligation to comply with the terms thereof. But,notwithstanding this, we believe that, under suchcircumstances, the employee should accept an offer evenunder the old contract, as long as it does not involve arenunciation of any right already accrued, although it isdoubtful if it can be said in the case at bar that the offerwas in reality one to return to employment under the oldcontract but was, rather, the creation of a new contract, theterms and conditions of which were substantially those ofthe old. The mere acceptance of the offer of defendantwould not constitute a waiver of his right to recoverdamages for the time intervening from the date of thewrongful discharge to the time when he returned to workunder the new offer, which would consist in the loss ofwages for that period, and any other damages which mighthave been sustained and which plaintiff could prove. We donot mean to hold that an employer may wrongfully



discharge an employee an indefinite number of times andrequire him each time to return to work under the samecontract. There would be a legal remedy for that sort oftreatment,. even if an employer should be so disregardfulof his own interests as to give his employee an opportunityto begin an indefinite number of actions against him ineach one of which he could recover damages equal to orexceeding the wages which he would have received if hehad not been wrongfully discharged, together with interestand costs in each case, and possibly much more. We believethat it is the purpose of the law to require an employee tolabor if he is given the opportunity; and that it does notpermit him to remain idle and collect his wagesnevertheless when he has an opportunity to return to hisformer employment. The employer is the same employerwhen the employee is offered the opportunity to return ashe was when the original contract was made; and theconditions under which the employment is to proceed aresubstantially the same. Of course, where the employer hasso mistreated the employee that a selfrespecting man couldnot again work for him, the situation

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would be different. Nothing of that sort appears in this caseand we are convinced that, as matter of law, the plaintiffshould have returned to service under the offer ofdefendant.

It is true that, at the time the offer was made, thisaction had been commenced. Plaintiff left defendant'sservice on September 5th and began this action on the 8th.The offer was made on December 5th. We do not believe,however, that the pendency of the action alters thesituation materially. There was no condition attached tothe offer requiring the plaintiff to dismiss his actionwithout costs or even without judgment and it is to bepresumed that defendant intended plaintiff to have theright to continue his action to final determination andobtain the damages which he had suffered during theperiod intervening between the discharge and thereinstatement.

Plaintiff proved no other damages than the loss of



wages. The damages in an action for wrongful dischargeare prima facie the amount of wages for the full term.These are the damages and the only damages whichplaintiff proved. The complaint alleges damages tocharacter and reputation arising from the fact of thewrongful discharge. No evidence was offered showingdamages of that kind or the amount thereof. The amountwhich defendant proved in mitigation or recoupment isequal to the amount which plaintiff proved his damages tobe, with the exception of the period between September 5thand December 5th of the same year. As a necessary resultplaintiff can recover in this action only for the threemonths' period. The court below allowed plaintiff his wagesfor the months of September, October and November, buton a different theory from that on which we have based hisright; but, whatever the theory, the amount is correct andthe judgment of the trial court is to that extent proper.

It is contended that the burden of proving that plaintiffcould have procured like employment in the same localityunder similar conditions is on plaintiff. We cannot agreewith this under the principles either of Spanish orAmerican.

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VOL. 33, JANUARY 11, 1916. 171De Jesus vs. G. Urrutia & Co.

law. Under the Spanish law, as we have seen, theemployer, when he wrongfully discharges an employee,becomes, with respect to the employee, a debtor in bad faith. On a debtor in bad faith is laid the necessity ofaffirmatively establishing every fact necessary to extricatehim from that position. In this necassity we find the germof that principle of the American law which throws on theemployer in an action for wrongful discharge the burden ofproving affirmatively that if the employee had used duediligence he could, immediately on his discharge, haveobtained like employment in the same locality. (Hicks vs.Manila Hotel Co., 28 Phil. Rep., 325, and cases cited.)

The judgment, appealed from is affirmed, withoutspecial finding as to costs in this instance. So ordered.

Arellano, C. J., Torres, Carson, Trent, and Araullo, JJ.,concur.



Judgment affirmed.

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9. Lemoine v. Alkan