VIVIAN T. RAMIREZ et al vs. MAR FISHING CO., INC., MIRAMAR FISHING CO., INC., ROBERT BUEHS AND JEROME SPIT

G.R. No. 168208, June 13, 2012

Doctrine of Piercing the Corporate Veil

Facts: On 28 June 2001, Mar Fishing Co., Inc. sold its principal assets to co-respondent Miramar Fishing Co., Inc. Mar Fishing informed its employees that it will cease its operation by the end of the month. Thereafter, Mar Fishing’s labor union entered into a MOA. The agreement provided that Miramar shall absorb Mar Fishing’s regular rank and file employees whose performance was satisfactory. Unfortunately petitioners were not among those absorbed nor paid separation pay by Miramar.

Aggrieved, petitioners filed a complaint for illegal dismissal with money claims before the Labor Arbiter. LA found that petitioners were legally dismissed and that Miramar is not liable for the separation pay. NLRC modified the decision that Mar Fishing and Miramar were one and the same entity, it applied the doctrine of piercing the corporate veil.

Issue: Whether NLRC was correct in applying the doctrine of piercing the corporate veil.

Held: NO. The doctrine was inapplicable in the present case. The SC ruled that those who seek to pierce the veil must clearly establish that the separate and distinct personalities of the corporations are set up to justify a wrong, protect a fraud, or perpetrate a deception. The allegation of take-over by Miramar of Mar Fishing operations and the evident of similarity of their businesses fails to meet the rigid standard that merits the application of the doctrine.