G.R. No.
146202 July 14, 2004
RUFINA PATIS FACTORY, and JESUS LUCAS,
SR. petitioners,
vs.
JUAN ALUSITAIN, respondent.
DECISION
CARPIO MORALES, J.:
From the June 23, 2000 Decision1 of the Court of
Appeals in CA-G.R. SP No. 54722 affirming that of
the National Labor Relations Commission (NLRC)
awarding retirement benefits in the amount
of P88,595.00 to respondent Juan Alusitain
(Alusitain), petitioners Rufina Patis Factory and
Jesus Lucas, Sr. (Lucas) come to this Court on a
petition for review on certiorari.
The antecedent facts are as follows:
In March 1948, Alusitain was hired as a
laborer at the Rufina Patis Factory owned
and operated by petitioner Lucas. After
close to forty three years or on February 19,
1991, Alusitain admittedly tendered his
letter of resignation which is
quoted verbatim:
February 19, 1991
TO: MR. JESUS LUCAS, JR.
ASSISTANT MANAGER
RUFINA PATIS FACTORY
Gentlemen:
I would like to tender my separation letter as
a laborer, from your good company effective
this 20th of February 1991. May I take this
opportunity to extent my heartfelt thanks to
you for having given me the chance to
commit myself to work in your factory from
which I owe varied experiences that has
made a part of me and be what I am today.
Anticipating your outmost consideration on
this matter. I remain.
VERY TRULY YOURS,
(Signed)
JUAN A. ALUSITAIN
RECEIVED THE ABOVE SEPARATION
LETTER ON THIS DAY, FEBRUARY 20,
1991.
(Signed)
BY: JESUS R. LUCAS, JR.
Assistant Manager2
On May 22, 1991, Alusitain executed a duly
notarized affidavit of separation from employment
and submitted the same on even date to the
Pensions Department of the Social Security System
(SSS). The affidavit reads:
Republic of the Philippines )SSS
Quezon City )
AFFIDAVIT OF SEPARATION FROM
EMPLOYMENT
I, JUAN ASERAS ALUSITAIN of legal age,
63, Filipino and residing at Int. 18 Flores St.,
Mal. Mla, after having [been] sworn to in
accordance with law hereby depose and
state;
1. That I am [a] bonafide member of
the Social Security System with SSS
Number 03-0107252-0
2. That I was separated from my last
employer RUFINA PATIS FACTORY
with address at 290 C. Arellano St.,
Malabon, Metro Manila on 2-20-91
and thereafter, I was never again re-
employed.
3. That I cannot secure a
certification of separation from my
last employer because I have not
reached the company applicable age
of retirement.
4. That I am executing this affidavit
to attest to the truth of the foregoing
facts and to support my retirement
paper.
 FURTHER AFFIANT
SAYETH NAUGHT.
(Signed)
Affiant3
On January 7, 1993, Republic Act No. 7641 (R.A.
7641),4 "AN ACT AMENDING ARTICLE 287 OF
PRESIDENTIAL DECREE NO. 442, AS AMENDED
OTHERWISE KNOWN AS THE LABOR CODE OF
THE PHILIPPINES, BY PROVIDING FOR
RETIREMENT PAY TO QUALIFIED PRIVATE
SECTOR EMPLOYEES IN THE ABSENCE OF
ANY RETIRMENT PLAN IN THE
ESTABLISHMENT," took effect5 providing, among
other things, thusly:
Art. 287. Retirement. — Any employee may
be retired upon reaching the retirement age
established in the collective bargaining
agreement or other applicable employment
contract.
xxx
In the absence of a retirement plan or
agreement providing for retirement benefits
of employees in the establishment, an
employee upon reaching the age of sixty
(60) years or more, but not beyond sixty five
(65) years which is hereby declared the
compulsory retirement age, who has served
at least five (5) years in the said
establishment, may retire and shall be
entitled to retirement pay equivalent to at
least one half (1/2) month salary for every
year of service, a fraction of at least six (6)
months being considered as one whole
year.
Unless the parties provide for broader
inclusions, the term one half (1/2) month
salary shall mean fifteen (15) days plus one
twelfth (1/12) of the 13th month pay and the
cash equivalent of not more than five (5)
days of service incentive leaves.
xxx
Violation of this provision is hereby declared
unlawful and subject to the penal provisions
under Article 288 of this Code.6
Sometime in 1995, Alusitain, claiming that he
retired from the company on January 31, 1995,
having reached the age of 657 and due to poor
health, verbally demanded from petitioner Lucas for
the payment of his retirement benefits. By his
computation, he claimed that he was entitled
to P86,710.008 broken down as follows:
Retirement = ½ month salary for every y
Benefits service
One-half month = P1,885.00
salary
Years of Service = 47 years
Retirement = P86,710.009
Benefits
Petitioner Lucas, however, refused to pay the
retirement benefits of Alusitain, prompting the latter
to make a written demand on September 20, 1995.
Lucas, however, remained adamant in his refusal to
give in to Alusitain's demands.
Having failed to arrive at an amicable settlement,
Alusitain filed on November 17, 1995 a complaint
before the NLRC against petitioners Rufina Patis
Factory and Lucas for non-payment of retirement
benefits. The complaint was docketed as NLRC
Case No. 00-11-07474-95.
Petitioners maintained that Alusitain had resigned
from the company on February 19, 1991 per his
letter of resignation and the Affidavit of Separation
dated May 22, 1991.10
On the other hand, while respondent admitted
having tendered his letter of resignation on
February 19, 1991 and executed the Affidavit of
Separation on May 22, 1991,11 he nevertheless
maintained that he continued working for petitioners
until January 1995, the date of actual retirement,
due to illness and old age, and that he merely
accomplished the foregoing documents in
compliance with the requirements of the SSS in
order to avail of his retirement benefits.12
By Decision13 of February 6, 1997, Executive Labor
Arbiter Valentin C. Guanio upheld Alusitain's
position in this wise:
After carefully considering the respective
submissions of the parties and the evidence
they adduced in support of their opposing
claims, this Office rules in favor of the
complainant.
To substantiate his allegation that he had
continued working for the respondents even
after his supposed resignation on February
19, 1991, the complainant submitted in
evidence his sworn statement and that of
his eldest daughter, Gloria Alusitain. In his
affidavit, the complainant swore that:
"Bagamat ako ay pensionado ng SSS, ako
ay patuloy na naglilingkod/nagtratrabaho sa
kompanya ng Rufina Patis Factory
hanggang noong buwan ng Enero 1995."
By way of corroboration, his daughter on the
other hand, stated under oath that since
elementary school (sic), she was the one
who brought food to her father at work in the
Rufina Patis Factory; and that the last time
she brought him food at the said factory was
in the month of January 1995.
While the foregoing statements may appear
to be self-serving, still they have the ring of
truth. From experience, it is quite common
that the eldest daughter would be tasked
with the duty of taking lunch to her father at
work. Besides, the respondents failed to
controvert these sworn declarations by
submitting their counter-affidavits. If it is true
that the complainant had in fact stopped
working on February 1991, the respondents
could have produced a number of witnesses
who could have attested to this. Hence,
their failure to submit even a single affidavit
does not speak well of their credibility in this
regard.
Thus, this Office finds that the complainant
had executed the letter of resignation and
affidavit of separation from employment in
1991 only for the purpose of securing a
pension from the SSS, but that despite this
he remained in the employ of the
respondents until his actual retirement on
January 31, 1995, two years after the
effectivity of Republic Act 7641 on January
7, 1993. At the time of his retirement, the
complainant was already sixty-five (65)
years of age and had served the respondent
company for forty-seven (47) years and
therefore, he is legally entitled to the
retirement benefits granted by R.A. 7641
which is one-half (1/2) month salary for
every year of service which as computed
will amount to a total of P88,595.00
(P1,885.00 x 47 years).
WHEREFORE, in view of the foregoing,
judgment is hereby rendered ordering the
respondents "Rufina Patis Factory" and
Jesus Lucas, Sr., jointly and severally to
pay complainant Juan Alusitain his
retirement benefits in the amount
of P88,595.00.
SO ORDERED.14
On appeal, the NLRC, by Resolution15 of May 17,
1999, affirmed the Labor Arbiter's decision.
Aggrieved by the NLRC resolution, petitioners
brought the case on certiorari16 to the Court of
Appeals which, by the assailed decision, dismissed
it, holding that the NLRC committed no error much
less any grave abuse of discretion17as Alusitain was
able to sufficiently establish that his letter of
resignation and Affidavit of Separation were
executed only for the purpose of securing a
pension from the SSS and that he remained in the
employ of petitioners.18
Their motion for reconsideration having been
denied by the Court of Appeals by Resolution19 of
December 6, 2000, petitioners lodged the present
petition.20
Petitioners argue that the appellate court erred
when it did not give weight and probative value to
Alusitain's letter of resignation and Affidavit of
Separation, choosing instead to give credence to
his self-serving sworn statement and that of his
daughter that he remained in the employ of
petitioners until January 31, 1995.
Petitioners assert that the Affidavit of Separation,
being a public document, is entitled to full faith and
credit upon its face, and proof is required to assail
and controvert the same, citing Cacho v. Court of
Appeals21 and Arrieta v. Llosa.22
Petitioners further assert that the appellate court
erred in applying retroactively R.A. 7641 as said
law does not expressly provide for such retroactive
application and to do so would defeat the clear
intent of Congress. Furthermore, petitioners insist
that the case of Oro Enterprises, Inc. v. NLRC23 is
inapplicable and submit that what is controlling is
the case of J.V. Angeles Construction Corp. v.
NLRC24 where this Court held that before R.A. 7641
could be given retroactive effect, the claimant
should still be an employee of the employer at the
time the said law took effect,.
The petition is impressed with merit.
This Court held in Oro25 that R.A. 7641 should be
given retroactive effect, viz:
R.A. 7641 is undoubtedly a social
legislation. The law has been enacted as a
labor protection measure and as a curative
statute that – absent a retirement plan
devised by, an agreement with, or a
voluntary grant from, an employer – can
respond, in part at least, to the financial
well-being of workers during their twilight
years soon following their life of labor. There
should be little doubt about the fact that the
law can apply to labor contracts still
existing at the time the statute has taken
effect, and that its benefits can be reckoned
not only from the date of the law's
enactment but retroactively to the time said
employment contracts have started. .
.26(Underscoring supplied)
The doctrine enunciated in Oro has been clarified in
several cases. In CJC Trading, Inc. v. NLRC,27 this
Court, speaking through Justice Florentino
Feliciano, held that R.A. 7641 may be given
retroactive effect where (1) the claimant for
retirement benefits was still the employee of the
employer at the time the statute took effect; and (2)
the claimant had complied with the requirements for
eligibility under the statute for such retirement
benefits.28 These twin requirements for the
retroactive application of R.A. 7641 have been
reiterated in Philippine Scout Veterans Security and
Investigation Agency v. NLRC,29 Cabcaban v.
NLRC,30 J.V. Angeles Construction Corporation v.
NLRC,31 and Manuel L. Quezon University v.
NLRC.32
It is thus clear that in order for respondent to claim
retirement benefits from petitioner Rufina Patis
Factory, he has to prove that he was its
employee at the time R.A. 7641 took effect.
As a general rule, the factual findings and
conclusions of quasi-judicial agencies such as the
NLRC are, on appeal, accorded great weight and
even finality, unless petitioners are able to show
that the NLRC arbitrarily disregarded the evidence
before it or misapprehended evidence of such
nature as to compel a contrary conclusion if
properly appreciated.33
In affirming the decision of the NLRC and the Labor
Arbiter, the Court of Appeals disregarded
Alusitain's letter of resignation and Affidavit of
Separation and gave weight to his and his
daughter's sworn statements that he remained in
the employ of petitioners until January 31, 1995.
It is a basic rule in evidence, however, that the
burden of proof is on the part of the party who
makes the allegations34 – ei incumbit probatio, qui
dicit, non qui negat.35 If he claims a right granted by
law, he must prove his claim by competent
evidence, relying on the strength of his own
evidence and not upon the weakness of that of his
opponent.
In the case at bar, it was incumbent on Alusitain to
prove that he retired on January 31, 1995 and not
on February 20, 1991 as indicated on his letter of
resignation. As the following discussion will show,
he utterly failed to discharge the onus.
Respondent's letter of resignation and May 22,
1991 Affidavit of Separation which he admittedly
voluntarily executed constitute admissions against
his own interest.36 The said documents belie his
claim that he retired on January 31, 1995. Being an
admission against interest, the documents are the
best evidence which affords the greatest certainty
of the facts in dispute.37 The rationale for the rule is
based on the presumption that no man would
declare anything against himself unless such
declaration was true.38 Thus, it is fair to presume
that the declaration corresponds with the truth, and
it is his fault if it does not.39
While these two documents may have facilitated
the release of Alusitain's retirement benefits from
the SSS, hence, beneficial to him at that time, they
may still be considered admissions against interest
since the disserving quality of the admission is
judged as of the time it is used or offered in
evidence and not when such admission is
made.40Thus, it matters not that the admission is
self-serving when it was made, so long as it is
against respondent's present claim.41
No doubt, admissions against interest may be
refuted by the declarant.42 It bears stressing,
however, that Alusitain's Affidavit of Separation
filed with the SSS is a notarial
document,43 hence, prima facie evidence44 of the
facts expressed therein.45
Since notarial documents have in their favor the
presumption of regularity, to contradict the facts
stated therein, there must be evidence that is clear,
convincing and more than merely
preponderant.46
Alusitain explains through his subsequent sworn
statement that he only executed these two
documents in order to obtain his retirement benefits
from the SSS. His daughter, also by sworn
statement, corroborates his explanation. His
position does not persuade.
In order for a declarant to impugn a notarial
document which he himself executed, it is not
enough for him to merely execute a subsequent
notarial document. What the law requires in order
to contradict the facts stated in a notarial document
is clear and convincing evidence. The subsequent
notarial documents executed by respondent and his
daughter fall short of this standard.
The case of Reyes v. Zaballero47 is instructive. In
said case, the creditor executed on December 1,
1944 a notarial document stating that he was
releasing a real estate mortgage as the debtor had
already paid his debt. On even date, the creditor
subsequently executed an affidavit without the
debtor's knowledge stating that he had accepted
the payment under protest and "obligado por las
circunstancias actuales." This Court held that the
creditor's statement in his affidavit that he received
the money "obligado por las circunstancias
actuales" is self-serving evidence.48
A contrary rule would undermine the confidence of
the public in the integrity of notarial documents.
In Dequito v. Llamas,49 this Court held:
After executing the affidavit voluntarily
wherein he made admissions and
declarations against his own interest under
the solemnity of an oath, he cannot be
allowed to spurn them and undo what he
has done. He cannot, even "with great
repentance, retrieve the body he forsook
and now wishes to live."50
Neither is the sworn statement of Alusitain's
daughter sufficient to prove that he indeed retired
on January 31, 1995. The February 6, 1997
Decision of Labor Arbiter Guanio relates the
material portion of the sworn statement of
Alusitain's daughter as follows:
. . . By way of corroboration, his daughter on
the other hand, stated under oath that since
elementary school (sic), she was the one
who brought food to her father at work in the
Rufina Patis Factory; and that the last time
she brought him food at the said factory was
in the month of January 1995.51 (Emphasis
and underscoring supplied)
Alusitain's daughter did not state, however, that her
father worked for petitioner Rufina Patis Factory
until his alleged retirement on January 31, 1995. All
she said was that the last time she brought him
food at the factory was in January 1995. To
conclude that Alusitain was still employed on
January 1995 from the mere fact that his daughter
brought him food at the Rufina Patis Factory is non
sequitur.
Lastly, while it is evident that Alusitain's subsequent
sworn statement is in the nature of a retraction of
his May 22, 1991 Affidavit of Separation, such
retraction does not necessarily negate the affidavit.
For retractions are generally unreliable and looked
upon with considerable disfavor by the courts as
they can easily be fabricated. Thus, before
accepting a retraction, it is necessary to examine
the circumstances surrounding it and possible
motives for reversing the previous declaration, as
these motives may not necessarily be in
consonance with the truth. To automatically adopt
them hook, line and sinker would allow
unscrupulous individuals to throw wide open the
doors to fraud.
In the case at bar, Alusitain's retraction is highly
suspect. Other than his bare and self-serving
allegations and the sworn statement of his daughter
which, as reflected above, cannot be relied upon,
he has not shown any scintilla of evidence that he
was employed with petitioner Rufina Patis Factory
at the time R.A. 7641 took effect. He did not
produce any documentary evidence such as pay
slips, income tax return, his identification card, or
any other independent evidence to substantiate his
claim.
While the NLRC and its Labor Arbiters are not
bound by technical rules of procedure and evidence
in the adjudication of cases,52 this should not be
construed as a license to disregard fundamental
rules on evidence in proving one's allegations.53
In fine, Alusitain having failed to prove that he was
an employee of petitioner at the time R.A. 7641
took effect, his claim for retirement benefits
thereunder must be disallowed.
WHEREFORE, the petition is GRANTED. The
Court of Appeals June 23, 2000 Decision and
December 6, 2000 Resolution in CA-G.R. SP No. June 21, 2017
54722 are REVERSED and SET ASIDE.
G.R. No. 218242
SO ORDERED.
PAULINO M. ALDABA, Petitioner
vs.
CAREER PHILIPPINES, SHIP-MANAGEMENT,
INC., COLUMBIA SHIPMANAGEMENT LTD.,
and/or VERLOU CARMELINO, Respondents

DECISION

PERALTA, J.:

For this Court's consideration is the Petition for

Review on Certiorari under Rule 45 of the Rules of
Court dated June 4, 2015 of petitioner Paulino M.
Aldaba that seeks to reverse and set aside the
Decision1 dated November 19, 2014 of the Court of
Appeals (CA) in CA-G.R. SP No. 127057 reversing
the Decision dated July 16, 2012 and Resolution
dated August 3 1, 2012 of the National Labor
Relations Commission (NLRC), 2nd Division
granting petitioner total and permanent disability
benefits in the amount of US$60,000.00.

The facts follow.

Petitioner Paulino M. Aldaba was hired by

respondents Career Philippines Shipmanagement
Incorporated, and Verlou Carmelina, in behalf of
their foreign principal, petitioner Columbia
Shipmanagement Ltd., as Bosun for work on board
the vessel M/V Cape Frio with a basic monthly
salary of US$564.00.

In the course of the performance of his duties, on

April 4, 2011, petitioner was accidentally hit by
twisted chains made of heavy metal causing him to
fall and eventually resulted to a back injury.

Thus, on April 7, 2011, when the vessel was at the

Port of Hongkong, petitioner was examined at the
Quality Health Care Medical Center by Dr. Thomas
Wong, with the examination showing that petitioner
suffered a fractured back and was declared unfit to
work. As such, he was immediately repatriated.

On April 11, 2011, upon his arrival in Manila,

petitioner was referred by respondents to the
company-designated physician at NGC Medical
Specialist, Inc. for treatment and rehabilitation. The
x-ray examination on his back showed a
"misalignment of distal sacrum that may suggest
fracture." In addition, the x-ray examination on his
thoracic spine revealed an "anterior wedging
deformity, T11 Osteopenia and early degenerative
osseus changes."
The company-designated physician, after the
continuing evaluation and medical treatment for
163 days, issued a Medical Report dated
September 29, 2011 that reads as follows:
1. The patient has reached maximum medical cure.
2. The final disability grading under the POEA
schedule of disabilities is Grade 8 - moderate
rigidity or two thirds (2/3) loss of Thereafter, (sic)
motion or lifting power of the trunk.
Petitioner, on the other hand, consulted Dr. Misael
Jonathan A. Tieman, an Orthopedic Surgeon and
Diplomate, Philippine Board of Orthopedics, for an
independent assessment of his medical condition
and came out with findings showing that petitioner's
injury resulted to his permanent disability, thus,
making him unfit to work as a seafarer in any
capacity.
As a result, petitioner demanded for total disability
compensation, but respondents did not heed such
demand. Respondents, however, expressed
willingness to compensate petitioner the amount
corresponding to Grade 8 disability rating based on
the medical findings of the company-designated
physician.
Aggrieved, petitioner filed a complaint for payment
of total and permanent disability benefits, as well as
medical expenses, with prayer for damages and
attorney's fees against respondents with the
Arbitration Board of the NLRC.
The Labor Arbiter, on April 27, 2012, decided in
favor of respondents in a Decision2 the dispositive
portion of which reads:
WHEREFORE, premises considered, judgment is
hereby rendered ordering respondents to jointly
and severally pay complainant Paulino M. Aldaba
disability benefits in the amount of US$16,795.00
which is equivalent to Grade 8 disability under the
POEA Contract, or its peso equivalent at the time of
payment.
All other claims are dismissed for lack of merit.
SO ORDERED.
On appeal, the NLRC, in its Decision3 dated July
16, 2012 reversed the Decision of the Labor Arbiter
and ruled that petitioner is entitled to a permanent
total disability compensation, thus:
WHEREFORE, the Decision dated April 27, 2012 of
Labor Arbiter Pablo A. Gajardo is hereby reversed.
Respondents, jointly and severally, are hereby
ordered to pay Complainant-Appellant, by way of
permanent and total disability compensation, the
amount of US$60,000.00, pursuant to the POEA
Standard Contract and to pay attorney's fees of
10% of the total award.
SO ORDERED.
After respondents' motion for reconsideration was
denied by the NLRC, they elevated the case to the
CA. On November 19, 2014, the CA reversed the
Decision of the NLRC and reinstated the Decision
of the Labor Arbiter, thus:
WHEREFORE, premises considered, the present
Petition for Certiorari is GRANTED. The assailed
Decision dated July 16, 2012 and the Resolution
dated August 31, 2012 of the National Labor
Relations Commission (NLRC)-2nd Division in LAC
NO. 05-000486-12 are
hereby REVERSED and SET ASIDE. The Decision
dated April 27, 2012 of the Labor Arbiter in NLRC-
NCR-OFW (M) 12-19022-11 is
hereby REINSTATED.
SO ORDERED.4
Hence, the present petition wherein the petitioner
assigns the following errors:
The Honorable Court of Appeals committed
REVERSIBLE ERROR CONTRARY TO EXISTING
JURISPRUDENCE in promulgating the assailed
decision and resolution
I.
WHEN IT RULED THAT PETITIONER IS NOT
ENTITLED TO PERMANENT AND TOTAL
DISABILITY BENEFITS
II.
WHEN IT SOLELY GAVE CREDENCE TO THE
CERTIFICATION OF THE COMPANY PHYSICIAN
WITHOUT CONSIDERING THE FINDINGS OF
PETITIONER'S DOCTOR OF CHOICE.5
Petitioner insists that he is entitled to permanent
and total disability benefits because of his inability
to perform his job for more than 120 days, citing a
litany of cases decided by this Court. He further
argues that the fact that he had been evaluated by
respondents' company physicians is substantial
c9mpliance with the provision of the "Standard
Terms and Conditions Governing the Employment
of Filipino Seafarers On-Board Ocean-Going
Vessels" imposed by the Philippine Overseas
Employment Administration (POEA) and does not
preclude him from seeking medical attention to a
physician of his own choice, more so, if the purpose
of which is to provide an independent medical
assessment of his true condition. According to him,
the law does not exclusively vest to the company-
designated physician the sole authority to assess
and certify the extent of the injury/sickness for
purposes of payment of compensation and
disability benefits. Lastly, petitioner asserts that he
is entitled to the award of damages because the act
of respondents in failing to pay what is due him
shows utter disregard for public policy to protect
labor, which is a clear indication of bad faith and
attorney's fees as respondents' act has compelled
him to incur expenses to protect his interest.
Respondents, on the other hand, in their Comment
dated September 3, 2015, contend that the 240-day
rule enunciated in Vergara v. Hammonia Maritime
Services, Inc. and Atlantic Marine Ltd.,6 and
subsequent rulings of this Court, should govern,
considering that the complaint of petitioner was
filed on December 28, 2011. In the said decision of
this Court, it was ruled that a temporary total
disability only becomes permanent when so
declared by the company physician within the
periods he is allowed to do so, or upon the
expiration of the maximum 240-day medical
treatment period without a declaration of either
fitness to work or the existence of a permanent
disability. They also aver that the failure of
petitioner to follow the procedure of submitting
conflicting assessments to the opinion of an
independent third doctor bars his claim for disability
benefits. Finally, they insist that the claim for
damages and attorney's fees is bereft of any factual
and legal basis as there can be no malice, bad faith
or ill-motive that can be imputed against petitioner.
As a general rule, only questions of law raised via a
petition for review under Rule 45 of the Rules of
Court7 are reviewable by this Court.8 Factual
findings of administrative or quasi-judicial bodies,
including labor tribunals, are accorded much
respect by this Court as they are specialized to rule
on matters falling within their jurisdiction especially
when these are supported by substantial
evidence.9 However, a relaxation of this rule is
made permissible by this Court whenever any of
the following circumstances is present:
1. [W]hen the findings are grounded entirely on
speculations, surmises or conjectures;
2. when the inference made is manifestly mistaken,
absurd or impossible;
3. when there is grave abuse of discretion;
4. when the judgment is based on a
misapprehension of facts;
5. when the findings of fact are conflicting;
6. when in making its findings[,] the Court of
Appeals went beyond the issues of the case, or its
findings are contrary to the admissions of both the
appellant and the appellee;
7. when the findings are contrary to that of the trial
court;
8. when the findings are conclusions without
citation of specific evidence on which they are
based;
9. when the facts set forth in the petition[,] as well
as in the petitioner's main and reply briefs[,] are not
disputed by the respondent;'
10. when the findings of fact are premised on the
supposed absence of evidence and contradicted by
the evidence on record; [and]
11. when the Court of Appeals manifestly
overlooked certain relevant facts not disputed by
the parties, which, if properly considered, would
justify a different conclusion. 10
Whether or not petitioner's illness is compensable
as total and permanent disability is essentially a
factual issue, however, the present case falls under
one of the exceptions because the findings of the
CA differ with that of the NLRC. Thus, this Court
shall now proceed to resolve the issue raised in the
petition for review.
The petition is meritorious.
In Jebsen Maritime, Inc. v. Ravena, 11 the Court
summarized the applicable provisions that govern a
seafarer's disability claim, thus:
The entitlement of an overseas seafarer to disability
benefits is governed by the law, the employment
contract and the medical findings. 12
By law, the seafarer's disability benefits claim is
governed by Articles 191 to 193, Chapter VI
(Disability benefits) of the Labor Code, in relation to
Rule X, Section 2 of the Rules and Regulations
Implementing the Labor Code.
By contract, it is governed by the employment
contract which the seafarer and his employer/local
manning agency executes prior to employment,
and the applicable POEA-SEC that is deemed
incorporated in the employment contract. 13
Lastly, the medical findings of the company-
designated physician, the seafarer's personal
physician, and those of the mutually-agreed third
physician, pursuant to the POEA-SEC, govern.
Pertinent to the resolution of this petition's factual
issues of compensability (of ampullary cancer) and
compliance (with the POEASEC prescribed
procedures for disability determination) is Section
20-B of the 2000 POEA-SEC14(the governing
POEA-SEC at the time the petitioners employed
Ravena in 2006). It reads in part:
SECTION 20. COMPENSATION AND BENEFITS
xxxx
B. COMPENSATION AND BENEFITS FOR
INJURY OR ILLNESS The liabilities of the
employer when the seafarer suffers work-related
injury or illness during the term of his contract are
as follows:
xxxx
2. If the injury or illness requires medical and/or
dental treatment in a foreign port, the employer
shall be liable for the full cost of such medical,
serious dental, surgical and hospital treatment as
well as board and lodging until the seafarer is
declared fit to work or repatriated
However, if after repatriation, the seafarer still
requires medical attention arising from said injury or
illness, he shall be so provided at cost to the
employer until such time he is declared fit or the
degree of his disability has been established by the
company-designated physician.
3. Upon sign-off from the vessel for medical
treatment, the seafarer is entitled to sickness
allowance equivalent to his basic wage until he is
declared fit to work by the company-designated
physician or the degree of permanent disability has
been assessed by the company-designated
physician but in no case shall it exceed one
hundred twenty (120) days.
For this purpose, the seafarer shall submit himself
to a post-employment medical examination by a
company-designated physician within three working
days upon his return except when he is physically
incapacitated to do so, in which case, a written
notice to the agency within the same period is
deemed as compliance. Failure of the seafarer to
comply with the mandatory reporting requirement
shall result in his forfeiture of the right to claim the
above benefits.
If a doctor appointed by the seafarer disagrees with
the assessment, a third doctor may be agreed
jointly between the Employer and the seafarer. The
third doctor's decision shall be final and binding on
both parties.
4. Those illness not listed in Section 32 of this
Contract are disputably presumed as work related.
xxxx
6. In case of permanent total or partial disability of
the seafarer caused either by injury or illness, the
seafarer shall be compensated in accordance with
the schedule of benefits arising from an illness or
disease shall be governed by the rates and the
rules of compensation applicable at the time the
illness or disease was contracted.
xxx
As we pointed out above, Section 20-B of the PO
EA-SEC governs the compensation and benefits for
the work-related injury or illness that a seafarer on
board sea-going vessels may have suffered during
the term of his employment contract. This section
should be read together with Section 32-A of the
POEA-SEC that enumerates the various diseases
deemed occupational and therefore compensable.
Thus, for a seafarer to be entitled to the
compensation and benefits under Section 20-B, the
disability causing illness or injury must be one of
those listed under Section 32-A.
Of course, the law recognizes that under certain
circumstances, certain diseases not otherwise
considered as an occupational disease under the
POEA-SEC may nevertheless have been caused or
aggravated by the seafarer's working conditions. In
these situations, the law recognizes the inherent
paucity of the list and the difficulty, if not the
outright improbability, of accounting for all the
known and unknown diseases that may be
associated with, caused or aggravated by such
working conditions. (Emphasis supplied)
Thus, in situations where the seafarer seeks to
claim the compensation and benefits that Section
20-B grants to him, the law requires the seafarer to
prove that: (I) he suffered an illness; (2) he suffered
this illness during the term of his employment
contract; (3) he complied with the procedures
prescribed under Section 20-B; (4) his illness is one
of the enumerated occupational disease or that his
illness or injury is otherwise work-related; and (5)
he complied with the four conditions enumerated
under Section 32-A for an occupational disease or
a disputably-presumed work-related disease to be
compensable. 15
It is beyond dispute that petitioner suffered an
illness that is work-related during the term of his
employment contract and such is compensable.
The issue now is whether or not petitioner is
entitled to permanent and total disability benefits
because of his inability to perform his job for more
than 120 days, which respondents counter as not
being the case since the 240-day rule should
govern.
This Court, in Marlow Navigation Philippines, Inc. v.
Osias, 16 thoroughly discussed the120-day and 240-
day periods, thus:
As early as 1972, the Court has defined the term
permanent and total disability in the case
of Marcelino v. Seven-Up Bottling Co. of the
Phil, 17 in this wise: "[permanent total disability
means disablement of an employee to earn wages
in the same kind of work, or work of similar nature
that he was trained for, or accustomed to perform,
or any other kind of work which a person of his
mentality and attainments could do." 18
The present controversy involves the permanent
and total disability claim of a specific type of
laborer-a seafarer. The substantial rise in the
demand for seafarers in the international labor
market led to an increase of labor standards and
relations issues, including claims for permanent
and total disability benefits. To elucidate on the
subject, particularly on the propriety and timeliness
of a seafarer's entitlement to permanent and total
disability benefits, a review of the relevant laws and
recent jurisprudence is in order.
Article 192(c) (1) of the Labor Code, which defines
permanent and total disability of laborers, provides
that:
ART. 192. Permanent Total Disability.
xxx
(c) The following disabilities shall be deemed total
and permanent:
(1) Temporary total disability lasting continuously
for more than one hundred twenty days, except
as otherwise provided in the Rules; [Emphasis
supplied]
The rule referred to is Rule X, Section 2 of the
Amended Rules on Employees' Compensation,
implementing Book IV of the Labor Code (IRR),
which states:
Sec. 2. Period of entitlement. - (a) The income
benefit shall be paid beginning on the first day of
such disability. If caused by an injury or sickness it
shall not be paid longer than 120 consecutive
days except where such injury or sickness still
requires medical attendance beyond 120 days
but not to exceed 240 days from onset of
disability in which case benefit for temporary total
disability shall be paid. However, the System may
declare the total and permanent status at anytime
after 120 days of continuous temporary total
disability as may be warranted by the degree of
actual loss or impairment of physical or mental
functions as determined by the System. [Emphasis
and Underscoring Supplied]
These provisions should be read in relation to the
2000 Philippine Overseas Employment
Administration Standard Employment
Contract (POEA-SEC)19 whose Section 20 (B) (3)
states:
Upon sign-off from the vessel for medical
treatment, the seafarer is entitled to sickness
allowance equivalent to his basic wage until he is
declared fit to work or the degree of permanent
disability has been assessed by the company-
designated physician but in no case shall this
period exceed one hundred twenty
(120) days.[Emphasis Supplied]
In Crystal Shipping, Inc. v. Natividad,20 (Crystal
Shipping) the Court ruled that "[permanent disability
is the inability of a worker to perform his job for
more than 120 days, regardless of whether or not
he loses the use of any part of his
body."21 Thereafter, litigant-seafarers started
citing Crystal Shipping to demand permanent and
total disability benefits simply because they were
incapacitated to work for more than 120 days.
The Court in Vergara v. Hammonia Maritime
Services, Inc. 22 (Vergara), however, noted that the
doctrine expressed in Crystal Shipping - that
inability to perform customary work for more than
120 days constitutes permanent total disability -
should not be applied in all situations. The specific
context of the application should be considered in
light of the application of all rulings, laws and
implementing regulations. It was provided therein
that:
As these provisions operate, the seafarer, upon
signoff from his vessel, must report to the
company-designated physician within three (3)
days from arrival for diagnosis and treatment. For
the duration of the treatment but in no case to
exceed 120 days, the seaman is on temporary total
disability as he is totally unable to work. He
receives his basic wage during this period until he
is declared fit to work or his temporary disability is
acknowledged by the company to be permanent,
either partially or totally, as his condition is defined
under the POEA Standard Employment Contract
and by applicable Philippine laws. If the 120 days
initial period is exceeded and no such
declaration is made because the seafarer
requires further medical attention, then the
temporary total disability period may be
extended up to a maximum of 240 days, subject
to the right of the employer to declare within this
period that a permanent partial or total disability
already exists. The seaman may of course also be
declared fit to work at any time such declaration is
justified by his medical condition. [Emphasis and
Underscoring Supplied]
In effect, by considering the law, the POEA-SEC,
and especially the IRR, Vergara extended the
period within which the company-designated
physician could declare a seafarer's fitness or
disability to 240 days. Moreover, in that case, the
disability grading provided by the company-
designated physician was given more weight
compared to the mere incapacity of the seafarer
therein for a period of more than 120 days.
The apparent conflict between the 120-day period
under Crystal Shipping and the 240-day period
under Vergara was observed in the case of Kestrel
Shipping Co., Inc. v. Munar (Kestrel). 23 In the said
case, the Court recognized that Vergara presented
a restraint against the indiscriminate reliance
on Crystal Shipping. A seafarer's inability to work
despite the lapse of 120 days would not
automatically bring about a total and permanent
disability, considering that the treatment of the
company-designated physician may be extended
up to a maximum of 240 days. In Kestrel, however,
as the complaint was filed two years before the
Court promulgated Vergara on October 6, 2008,
then the seafarer therein was not stripped of his
cause of action.
To further clarify the conflict between Crystal
Shipping and Vergara, the Court in Montierro v.
Rickmers Marine Agency Phils., Inc. 24 stated that
"[i]f the maritime compensation complaint was filed
prior to October 6, 2008, the 120-day rule applies;
if, on the other hand, the complaint was filed from
October 6, 2008 onwards, the 240-day rule
applies."
Then came Carcedo v. Maine Marine Phils., Inc.
(Carcedo). 25 Although the said case recognized the
240-day rule in Vergara, it was pronounced therein
that "[t]he determination of the fitness of a seafarer
for sea duty is the province of the company-
designated physician, subject to the periods
prescribed by law." Carcedo further emphasized
that "[t]he company-designated physician is
expected to arrive at a definite assessment of the
seafarer's fitness to work or permanent disability
within the period of 120 or 240 days. That should
he fail to do so and the seafarer's medical condition
remains unresolved, the seafarer shall be deemed
totally and permanently disabled."26
Finally, in Elburg Shipmanagement Phils., Inc. v.
Quiogue, Jr, 27 (Elburg), it was affirmed that the
Crystal Shipping doctrine was not binding because
a seafarer's disability should not be simply
determined by the number of days that he could not
work. Nevertheless, the pronouncement
in Carcedo was reiterated - that the determination
of the fitness of a seafarer by the company-
designated physician should be subject to the
periods prescribed by law. Elburg provided a
summation of periods when the company-
designated physician must assess the seafarer, to
wit:
1. The company-designated physician must issue a
final medical assessment on the seafarer's
disability grading within a period of 120 days from
the time the seafarer reported to him;
2. If the company-designated physician fails to give
his assessment within the period of 120 days,
without any justifiable reason, then the seafarer's
disability becomes permanent and total;
3. If the company-designated physician fails to give
his assessment within the period of 120 days with a
sufficient justification (e.g., seafarer required further
medical treatment or seafarer was uncooperative),
then the period of diagnosis and treatment shall be
extended to 240 days. The employer has the
burden to prove that the company-designated
physician has sufficient justification to extend the
period; and
4. If the company-designated physician still fails to
give his assessment within the extended period of
240 days, then the seafarer's disability becomes
permanent and total, regardless of any justification.
In essence, the Court in Elburg no longer agreed
that the 240-day period provided by Vergara, which
was sourced from the IRR, should be an absolute
rule. The company-designated physician would still
be obligated to assess the seafarer within the
original 120-day period from the date of medical
repatriation and only with sufficient justification may
the company-designated physician be allowed to
extend the period of medical treatment to 240 days.
The Court reasoned that:
Certainly, the company-designated physician must
perform some significant act before he can invoke
the exceptional 240-day period under the IRR. It is
only fitting that the company-designated physician
must provide a sufficient justification to extend the
original 120-day period. Otherwise, under the law,
the seafarer must be granted the relief of
permanent and total disability benefits due to such
non-compliance.
On the contrary, if we completely ignore the general
120-day period under the Labor Code and POEA-
Contract and apply the exceptional 240-day period
under the IRR unconditionally, then the IRR
becomes absolute and it will render the law forever
inoperable. Such interpretation is contrary to the
tenets of statutory construction.
xxx
Thus, to strike a balance between the two
conflicting interests of the seafarer and its
employer, the rules methodically took into
consideration the applicability of both the 120-day
period under the Labor Code and the 240-day
period under the IRR. The medical assessment of
the company-designated physician is not the alpha
and the omega of the seafarer's claim for
permanent and total disability. To become effective,
such assessment must be issued within the bounds
of the authorized 120- day period or the properly
extended 240-day period.
Hence, as it stands, the current rule provides: (1)
that mere inability to work for a period of 120
days does not entitle a seafarer to permanent
and total disability benefits; (2) that the
determination of the fitness of a seafarer for sea
duty is within the province of the company-
designated physician, subject to the periods
prescribed by law; (3) that the company-
designated physician has an initial 120 days to
determine the fitness or disability of the
seafarer; and (4) that the period of treatment
may only be extended to 240 days if a
sufficientjustification exists such as when
further medical treatment is required or when
the seafarer is uncooperative.
For as long as the 120-day period under the Labor
Code and the POEA-SEC and the 240-day period
under the IRR co-exist, the Court must bend over
backwards to harmoniously interpret and give life to
both of the stated periods. Ultimately, the intent of
our labor laws and regulations is to strive for social
justice over the diverging interests of the employer
and the employee.
In Elburg Shipmanagement Phils., Inc. v. Quiogue,
Jr., 28 this Court set forth the following guidelines, to
wit:
1. The company-designated physician must
issue a final medical assessment on the
seafarer's disability grading within a period
of 120 days from the time the seafarer
reported to him;
2. If the company-designated physician fails
to give his assessment within the period of
120 days, without any justifiable reason,
 then the seafarer's disability becomes National Labor Relations Commission, 2nd
permanent and total; Division, granting petitioner total and permanent
disability benefits in the amount of US$60,000.00
3. If the company-designated physician fails is AFFIRMED and REINSTATED, with
to give his assessment within the period of the MODIFICATION that the award of attorney's
120 days with a sufficient justification (e.g. fees be omitted.
seafarer required further medical treatment
or seafarer was uncooperative), then the SO ORDERED.
period of diagnosis and treatment shall be
extended to 240 days. The employer has
the burden to prove that the company-
designated physician has sufficient
justification to extend the period; and

4. If the company-designated physician still

fails to give his assessment within the
extended period of 240 days, then the
seafarer's disability becomes permanent
and total, regardless of any justification.

In the present case, the company-designated

physician was only able to issue a certification
declaring respondent to be entitled to a disability
rating of Grade 8 on the 163rd day that petitioner
was undergoing continuous medical treatment,
which is beyond the period of 120 days, without
justifiable reason. It must be remembered that the
employer has the burden to prove that the
company-designated physician has sufficient
justification to extend the period. In this case, the
respondents failed to do so. Therefore, the
company-designated physician, failing to give his
assessment within the period of 120 days, without
justifiable reason, makes the disability of petitioner
permanent and total.

As such, the issue as to whether or not the

company-designated physician be the sole
authority to assess and certify the extent of the
injury/sickness for purposes of payment of
compensation and disability benefits is now
rendered moot.

This Court, however, does not see the need to

award petit10ner damages and attorney's fees
because petitioner has not given us any proof or
valid reason upon which to grant such award.

WHEREFORE, the Petition for Review

on Certiorari under Rule 45 of the Rules of Court
dated June 4, 2015 of petitioner Paulino M. Aldaba
is GRANTED and the Decision dated November
19, 2014 of the Court of Appeals in CA-G.R. SP
No. 127057 is REVERSED and SET
ASIDE. Consequently, the Decision dated July 16,
2012 and Resolution dated August 31, 2012 of the
 February 27, 2017
G.R. No. 223035
REYNALDO Y. SUNIT, Petitioner
vs.
OSM MARITIME SERVICES, INC., DOF OSM
MARITIME SERVICES A/S, and CAPT. ADONIS
B. DONATO, Respondents
DECISION
VELASCO, JR., J.:
Nature of the Case
Before this Court is a Petition for Review
on Certiorari under Rule 45 of the Rules of Court
assailing the June 10, 2015 Decision1 and February
10, 2016 Resolution2 of the Court of Appeals (CA)
in CA-G.R. SP No. 138268, which reversed and set
aside the August 29, 2014 Decision of the National
Labor Relations Commission (NLRC).
Factual Antecedents
On June 18, 2012, respondent OSM Maritime
Services, Inc. (OSM Maritime), the local agent of
respondent DOF OSM Maritime Services A/S, hired
petitioner Reynaldo Sunit (Sunit) to work onboard
the vessel Skandi Texel as Able Body Seaman for
three (3) months with a monthly salary of $689.
Deemed incorporated in the employment contract is
the 2010 Philippine Overseas Employment Agency
Standard Employment Contract (POEA-SEC) and
the NIS AMOSUP CBA.
During his employment, petitioner fell from the
vessel's tank approximately 4.5 meters high and
suffered a broken right femur. He was immediately
brought to a hospital in the Netherlands for
treatment and was eventually repatriated due to
medical reason. Upon his arrival in Manila on
October 6, 2012, he immediately underwent a post-
employment medical examination and treatment for
his injury at the Metropolitan Medical Center,
wherein the company-designated physician
diagnosed him to be suffering from a "Fractured,
Right Femur; S/PIntramedullary Nailing, Right
Femur."
On January 13, 2013, after 92 days of treatment,
the company-designated doctor issued a Medical
Report3 giving petitioner an interim disability Grade
of 10.4 Said medical report reads:
MEDICAL REPORT:
Patient's range of motion of the right hip has
improved although patient still ambulates with a
pair of axillary crutches.
Pain is at 1-2110 at the right hip.
Based on his present condition, his closest interim
assessment is Grade 10 - irregular union of fracture
in a thigh.
Dissatisfied with the company doctor's January 13,
2013 medical report, petitioner sought the opinion
of another doctor, Dr. Venancio P. Garduce (Dr.
Garduce ),5 who recommended a disability grade of
three (3) in his Medical Report dated February 6,
2013.
After further medical treatment, petitioner was
assessed with a final disability grade of 10 by the
company physician of respondent OSM Maritime,
Dr. William Chuasuan, Jr. (Dr. Chuasuan), on
February 15, 2013.6
Respondents offered petitioner disability benefit of
$30,225 in accordance with the disability Grade 10
that the company-designated doctor issued.
Petitioner, however, refused the offer and filed a
claim for a disability benefit of USD$150,000.00
based on the POEA-SEC and NIS AMOSUP CBA.7
During the pendency of the case with the Labor
Arbiter (LA), the parties agreed to consult Dr.
Lyndon L. Bathan (Dr. Bathan) for a third opinion.
Dr. Bathan issued a Medical Certificate
recommending a Grade 9 disability pursuant to the
Schedule of Disabilities and Impediments under the
POEA-SEC. In addition, Dr. Bathan stated therein
that petitioner is "not yet fit to work." Dr. Bathan's
certificate states:
This is to certify that SUNIT, REYNALDO consulted
the undersigned on 17 Feb. 2014 at Faculty
Medical Arts Building, PGH Compound, Taft Ave.,
Manila.
He was diagnosed to have:
FEMORAL FRACTURE S/PINTRAMEDULLARY
NAILING (2012); S/PBONE GRAFTING
Patient is Gr. 9 according to POEA Schedule of
disability. Patient is not yet fit to work and should
undergo rehabilitation. 8
Ruling of the LA
Pursuant to the Grade 9 disability issued by Dr.
Bathan, the LA awarded petitioner disability benefit
in the amount of $13,060. The dispositive portion
1âwphi 1
of its Decision9 dated April 28, 2014 reads:
WHEREFORE, respondents OSM Maritime
Services, Inc., DOF OSM Maritime Services
A/S, [are] hereby ordered to pay in solidum
complaint's disability benefit in the amount of
US$13,060.00 or its Philippine Peso equivalent at
the time of payment.
SO ORDERED.
Aggrieved, petitioner appealed to the NLRC.
Ruling of the NLRC
On August 29, 2014, the NLRC rendered a
Decision modifying the LA's findings and awarded
petitioner permanent and total disability benefit in
the amount of $150,000. The NLRC reasoned that
petitioner is considered as totally and permanently
disabled since Dr. Bathan, the third doctor, issued
the Grade 9 disability recommendation after the
lapse of the 240-day period required for the
determination of a seafarer's fitness to work or
degree of disability under the POEA-SEC. The
NLRC disposed of the case in this wise:
WHEREFORE, premises considered, the
complainant's appeal is hereby GRANTED.
Accordingly, the Decision dated 28 April 2014 of
Labor Arbiter Michelle P. Pagtalunan is hereby
REVERSED and SET ASIDE ordering
respondents, jointly and severally, to pay
complainant Reynaldo Y Sunit, the amount of ONE
HUNDRED FIFTY THOUSAND US DOLLARS
($150,000.00) representing permanent total
disability benefits plus ten percent (10%) thereof as
attorney's fees.
All other claims are DISMISSED for lack of merit.
SO ORDERED.
Respondents moved for reconsideration of the
decision, but the NLRC denied the same in its
Resolution dated October 22, 2014.
Respondents questioned the NLRC's decision in a
petition for certiorari before the CA.
Ruling of the CA
The CA granted the respondents' petition and
reinstated the LA's ruling in its Decision dated June
10, 2015, the dispositive portion of which reads:
WHEREFORE, the instant Petition for Certiorari is
GRANTED. The August 29, 2014 Decision and the
October 22, 2014 Resolution of public respondent
National Labor Relations Commission are
REVERSED and SET ASIDE. The April 28, 2014
Decision of the Labor Arbiter is REINSTATED.
SO ORDERED.
In reversing the NLRC, the appellate court held that
the 240-day period for assessing the degree of
disability only applies to the company-designated
doctor, and not to the third doctor. It is only upon
the company-designated doctor's failure to render a
final assessment of petitioner's condition within 240
days from repatriation that he will be considered
permanently and totally disabled and, hence,
entitled to maximum disability benefit. In petitioner's
case, the company-designated doctor was able to
make a determination of his disability within the
240-day period; hence, he is not considered as
totally and permanently disabled despite the
opinion of the third doctor having been rendered
after the lapse of 240 days from repatriation.
The CA further added that the extent of disability,
whether total or partial, is determined, not by the
number of days that petitioner could not work, but
by the disability grading the doctor recognizes
based on his resulting incapacity to work and earn
his wages. Thus, the mere fact that petitioner was
incapacitated to work for a period exceeding 120
days does not automatically entitle him to total and
permanent disability benefits. Concomitantly, the
CA stressed that the recommendation of Dr.
Bathan of Grade 9 disability and his determination
that the latter's disability is partial and not total are
binding on the parties.
Petitioner moved for the reconsideration of the
adverted decision, but the CA denied the same in
its Resolution dated February 10, 2016.
Hence, this petition.
Issues
Petitioner anchors his plea for the reversal of the
assailed Decision on the following issues:
I.
WHETHER OR NOT THE CA COMMITTED
SERIOUS ERROR OF LAW IN AWARDING A
PARTIAL DISABILITY OF GRADE 9 TO
PETITIONER; AND
II.
WHETHER OR NOT THE CA ERRED IN
DISMISSING PETITIONERS' CLAIMS FOR
DAMAGES AND ATTORNEY'S FEES DESPITE
RESPONDENTS' COMMISSION OF BAD FAITH
IN THE PERFORMANCE OF THEIR
OBLIGATIONS.
The primordial question to be resolved is whether
petitioner is entitled to permanent and total
disability benefits.
The parties do not dispute that petitioner's injury
was work-related and that he is entitled to disability
compensation. The disagreement, however, lies on
the degree of disability and amount of benefits that
petitioner is entitled.
Petitioner bases his entitlement to total and
permanent disability benefits on the failure of the
company-designated doctor to arrive at a definitive
assessment of his disability. Petitioner particularly
assails Dr. Chuasuan' s assessment of Grade 10
disability since he still required further medical
rehabilitation, as affirmed by Dr. Bathan, the third
doctor.
In addition, petitioner points at the inconsistency
between the Grade 9 disability issued by Dr.
Bathan in his certification and the latter's remark
therein that petitioner was still "not fit to work and
should undergo further rehabilitation." As noted by
the NLRC, petitioner's condition prevented him
from acquiring gainful employment for 499 days
reckoned from the time he arrived on October 6,
2012 until Dr. Bathan examined him on February
17, 2014 .10 Petitioner alleges that he could no
longer resume sea service without risk to himself
and to others due to the limited physical exertion
brought about by his injury, and is permanently unfit
for further sea duty.
In their Comment, respondents argue that the 240-
day rule does not apply to the case since the
company-designated doctor timely assessed
petitioner; that the 240-day period only applies to
the assessment of the company-designated doctor,
and not to the third doctor's opinion. Even
assuming that the 240 days limitation applies to the
third doctor, the parties validly extended the period
for assessment since it was at petitioner's instance
that a third doctor was appointed. By seeking this
relief, respondents insist that petitioner agreed to
whatever disability grading the third doctor will
issue.
In addition, respondents maintain that petitioner's
disability should be based on the Schedule of
Disability under Section 32 of the 2010 POEA-SEC
and should not be based on the number of days of
treatment or the number of days in which sickness
allowance is paid, citing Section 20 (A)(6) of the
2010 POEA-SEC. It is respondents' position that
the amendments therein require the injury or illness
to be compensated based solely on the Schedule
of Disability Gradings in Section 32 of the Contract,
and that the duration of treatment or payment of
sickness allowance should be discounted when
determining the applicable disability grading.
Moreover, respondents refuse to acknowledge that
they are liable for 100% disability compensation
under the CBA, arguing that the CBA does not
contain a permanent unfitness clause, but merely
mandates that the disability shall be based solely
on the disability grading provided under Section 32
of the PO EA-SEC, echoing Section 20(A)(6).
The Court's Ruling
The Court resolves to grant the petition.
Permanent disability is defined as the inability of a
worker to perform his job for more than 120 days
(or 240 days, as the case may be), regardless of
whether or not he loses the use of any part of his
body. Total disability, meanwhile, means the
disablement of an employee to earn wages in the
same kind of work of similar nature that he was
trained for, or accustomed to perform, or any kind
of work which a person of his mentality and
attainments could do.11
Under Article 192(c)(1) of the Labor
Code, disability that is both permanent and total
disability is defined as "temporary total disability
lasting continuously for more than one hundred
twenty days, except as otherwise provided in the
Rules."12 Similarly, Rule VII, Section 2(b) of the
Amended Rules on Employees' Compensation
(AREC) provides:
(b) A disability is total and permanent if as a
result of the injury or sickness the employee is
unable to perform any gainful occupation for a
continuous period exceeding 120 days, except as
otherwise provided for in Rule X of these Rules.
(emphasis supplied)
The adverted Rule X of the AREC, which
implements Book IV of the Labor Code, states in
part:
Sec. 2. Period of entitlement. - (a) The income
benefit shall be paid beginning on the first day of
such disability. If caused by an injury or sickness it
shall not be paid longer than 120 consecutive
days except where such injury or sickness still
requires medical attendance beyond 120 days
but not to exceed 240 days from onset of disability
in which case benefit for temporary total disability
shall be paid. However, the System may declare
the total and permanent status at anytime after 120
days of continuous temporary total disability as may
be warranted by the degree of actual loss or
impairment of physical or mental functions as
determined by the System. (emphasis supplied)
Section 20 (A)(3) of the POEA-SEC, meanwhile,
provides that:
SECTION 20. COMPENSATION AND BENEFITS
COMPENSATION AND BENEFITS FOR INJURY
OR ILLNESS
The liabilities of the employer when the seafarer
suffers work-related injury or illness during the term
of his contract are as follows:
3. In addition to the above obligation of the
employer to provide medical attention, the seafarer
shall also receive sickness allowance from his
employer in an amount equivalent to his basic
wage computed from the time he signed off until
he is declared fit to work or the degree of
disability has been assessed by the company-
designated physician. x xx
The case of Vergara v. Hammonia Maritime
Services, Inc.13 harmonized the provisions of the
Labor Code and the AREC with Section 20
(B)(3)14 of the POEA-SEC (now Section 20 [A][3] of
the 2010 POEA-SEC). Synthesizing the
abovementioned provisions, Vergara clarifies that
the 120- day period given to the employer to
assess the disability of the seafarer may be
extended to a maximum of 240 days:
As these provisions operate, the seafarer, upon
sign-off from his vessel, must report to the
company-designated physician within three (3)
days from arrival for diagnosis and treatment. For
the duration of the treatment but in no case to
exceed 120 days, the seaman is on temporary total
disability as he is totally unable to work. He
receives his basic wage during this period until he
is declared fit to work or his temporary disability is
acknowledged by the company to be permanent,
either partially or totally, as his condition is defined
under the POEA Standard Employment Contract
and by applicable Philippine laws. If the 120 days
initial period is exceeded and no such
declaration is made because the seafarer
requires further medical attention, then the
temporary total disability period may be
extended up to a maximum of 240 days, subject
to the right of the employer to declare within
this period that a permanent partial or total
disability already exists. The seaman may of
course also be declared fit to work at any time such
declaration is justified by his medical condition.
Tile 1201240-day period in Article
192 (c)(1) and Rule X, Section 2 of
the AREC only applies to tile
company-designated doctor
From the above-cited laws, it is the company-
designated doctor who is given the responsibility
to make a conclusive assessment on the degree of
the seafarer's disability and his capacity to
resume work within 120/240 days. The parties,
however, are free to disregard the findings of the
company doctor, as well as the chosen doctor of
the seafarer, in case they cannot agree on the
disability gradings issued and jointly seek the
opinion of a third-party doctor pursuant to Section
20 (A)(3) of the 2010 POEA-SEC:
SECTION 20. COMPENSATION AND BENEFITS
COMPENSATION AND BENEFITS FOR INJURY
OR ILLNESS
The liabilities of the employer when the seafarer
suffers work-related injury or illness during the term
of his contract are as follows:
3. x x x
If a doctor appointed by the seafarer disagrees
with the assessment, a third doctor may be
agreed jointly between the Employer and the
seafarer. The third doctor's decision shall be final
and binding on both parties. (emphasis supplied)
The above-quoted provision clearly does not state
a specific period within which the third doctor must
render his or her disability assessment. This is only
reasonable since the parties may opt to resort to a
third opinion even during the conciliation and
mediation stage to abbreviate the proceedings,
which usually transpire way beyond the 120/240
day period for medical treatment. The CA, thus,
correctly held that the 240-day period for assessing
the degree of disability only applies to the
company-designated doctor, and not the third
doctor.
The third doctor's assessment of the extent
of disability must be definite and conclusive
in order to be binding between the parties
Indeed, the employer and the seafarer are bound
by the disability assessment of the third-party
physician in the event that they choose to appoint
one. Nonetheless, similar to what is required of the
company-designated doctor, the appointed third-
party physician must likewise arrive at a
definite and conclusive assessment of the
seafarer's disability or fitness to return to work
before his or her opinion can be valid and
binding between the parties.
We point to our discussion in Kestrel Shipping Co.,
Inc. v. Munar,15 underscoring that the assessment
of the company-designated physician of the
seafarer's fitness to work or permanent disability
within the period of 120 or 240 days must
be definite, viz:
Moreover, the company-designated physician is
expected to arrive at a definite assessment of
the seafarer's fitness to work or permanent
disability within the period of 120 or 240 days.
That should he fail to do so and the seafarer's
medical condition remains unresolved, the seafarer
shall be deemed totally and permanently disabled.
(emphasis supplied)
Jurisprudence is replete with cases bearing similar
pronouncements of this Court. In Fil-Star Maritime
Corporation v. Rosete,16 We concluded that the
company-designated doctor's certification issued
within the prescribed periods must be a definite
assessment of the seafarer's fitness to work or
disability:
For the courts and labor tribunals, determining
whether a seafarer's fitness to work despite
suffering an alleged partial injury generally requires
resort to the assessment and certification issued
within the 120/240-day period by the company-
designated physician. Through such certification, a
seafarer's fitness to resume work or the degree of
disability can be known, unless challenged by the
seafarer through a second opinion secured by
virtue of his right under the POEA-SEC. Such
certification, as held by this Court in numerous
cases, must be a definite assessment of the
seafarer's fitness to work or permanent
disability. As stated in Oriental Shipmanagement
Co., Inc. v. Bastol, the company-designated doctor
must declare the seaman fit to work or assess the
degree of his permanent disability. Without which,
the characterization of a seafarer's condition as
permanent and total will ensue because the ability
to return to one's accustomed work before the
applicable periods elapse cannot be shown.
(emphasis supplied)
In Carcedo v. Maine Marine Phils., Inc.,17 We ruled
that the company-designated physician's disability
assessment was not definitive since the seafarer
continued to require medical treatments thereafter.
Thus, because the doctor failed to issue a final
assessment, the disability of the seafarer therein
was declared to be permanent and total.
In Fil-Pride Shipping Company, Inc. v.
Balasta,18 We declared that the company-
designated physician must arrive at a definite
assessment of the seafarer's fitness to work or
permanent disability within the period of 120 or 240
days pursuant to Article 192 (c)(1) of the Labor
Code and Rule X, Section 2 of the AREC. If he fails
to do so and the seafarer's medical condition
remains unresolved, the latter shall be deemed
totally and permanently disabled. Thus, We
considered the failure of the company doctor to
arrive at a definite assessment of the seafarer's
fitness to work or permanent disability within the
said period in holding that the seafarer was totally
and permanently disabled.
A final and definite disability assessment is
necessary in order to truly reflect the true extent of
the sickness or injuries of the seafarer and his or
her capacity to resume work as such. Otherwise,
the corresponding disability benefits awarded might
not be commensurate with the prolonged effects of
the injuries suffered.
Due to the abovestated reasons, We see it fit to
apply the same prerequisite to the appointed third
doctor before the latter's disability assessment will
be binding on the parties.
In the case at bench, despite the disability grading
that Dr. Bathan issued, petitioner's medical
condition remained unresolved. For emphasis, Dr.
Bathan' s certification is reproduced hereunder:
This is to certify that SUNIT, REYNALDO consulted
the undersigned on 17 Feb. 2014 at Faculty
Medical Arts Building, PGH Compound, Taft Ave.,
Manila.
x x xx
Patient is Gr. 9 according to POEA Schedule of
disability. Patient is not yet fit to work and
should undergo rehabilitation.19 (emphasis
supplied)
The language of Dr. Bathan' s assessment brooks
no argument that no final and definitive assessment
was made concerning petitioner's disability. If it
were otherwise, Dr. Bathan would not have
recommended that he undergo further
rehabilitation. Dr. Bathan' s assessment of
petitioner's degree of disability, therefore, is still
inconclusive and indefinite.
Petitioner's disability is permanent and
total despite the Grade 9 partial disability
that Dr. Bathan issued since his incapacity
to work lasted for more than 240 days from
his repatriation
Petitioner was repatriated on October 6, 2012. After
undergoing medical treatment, the company-
designated doctor issued petitioner an interim
Grade 10 disability on January 13, 2013. Petitioner
was then issued with a final Grade 10 disability by
the company-designated doctor on February 15,
2013.
Prior to the February 15, 2013 assessment,
petitioner consulted the opinion of a second doctor,
Dr. Garduce, who recommended a Grade 3
disability.
Both parties then consulted a third doctor to assess
petitioner's degree of disability, who assessed
petitioner with a Grade 9 partial disability on
February 17, 2014, 499 days from his
repatriation. In addition to the partial disability
grading, Dr. Bathan likewise assessed petitioner
as unfit to work and recommended him to
undergo further rehabilitation.
While We have ruled that Dr. Bathan is not bound
to render his assessment within the 120/240 day
period, and that the said period is inconsequential
and has no application on the third doctor,
petitioner's disability and incapacity to resume
working clearly continued for more than 240 days.
Applying Article 192 (c)(1) of the Labor Code,
petitioner's disability should be considered
permanent and total despite the Grade 9 disability
grading.
This conclusion is in accordance
with Kestrel,20 wherein this Court underscored that if
partial and permanent injuries or disabilities would
incapacitate a seafarer from performing his usual
sea duties for a period of more than 120 or 240
days, depending on the need for further medical
treatment, then he is, under legal contemplation,
totally and permanently disabled:
Indeed, under Section 32 of the POEA-SEC, only
those injuries or disabilities that are classified as
Grade 1 may be considered as total and
permanent. However, if those injuries or
disabilities with a disability grading from 2 to
14, hence, partial and permanent, would
incapacitate a seafarer from performing his
usual sea duties for a period of more than 120
or 240 days, depending on the need for further
medical treatment, then he is, under legal
contemplation, totally and permanently
disabled. In other words, an impediment should be
characterized as partial and permanent not only
under the Schedule of Disabilities found in Section
32 of the POEA-SEC but should be so under the
relevant provisions of the Labor Code and the
Amended Rules on Employee Compensation
(AREC) implementing Title II, Book IV of the Labor
Code. That while the seafarer is partially injured or
disabled, he is not precluded from earning doing
the same work he had before his injury or disability
or that he is accustomed or trained to do.
Otherwise, if his illness or injury prevents him from
engaging in gainful employment for more than 120
or 240 days, as the case may be, he shall be
deemed totally and permanently disabled.
(emphasis supplied)
In determining whether a disability is total or partial,
what is crucial is whether the employee who
suffered from disability could still perform his work
notwithstanding the disability he met. A permanent
partial disability presupposes a seafarer's fitness to
resume sea duties before the end of the 120/240-
day medical treatment period despite the injuries
sustained, and works on the premise that such
partial injuries did not disable a seafarer to earn
wages in the same kind of work or similar nature for
which he was trained.21
To reiterate, the company doctor or the appointed
third-party physician must arrive at a definite and
conclusive assessment of the seafarer's disability
or fitness to return to work before his or her opinion
can be valid and binding between the parties. Dr.
Bathan, whose opinion should have bound the
parties despite the lapse of the 120/240 day period,
did not make such definite and conclusive
assessment.
It was likewise proved that petitioner's disability
persisted beyond the 240-day period and he was
even declared unfit to work by the third doctor
himself. As noted by the NLRC, petitioner failed to
have gainful employment for 499 days reckoned
from the time he arrived on October 6, 2012 until
Dr. Bathan conducted his assessment22 due to his
injuries. Moreover, Dr. Bathan's inconclusive
assessment and petitioner's prolonged disability
only served to underscore that the company-
designated doctor himself failed to render a
definitive assessment of petitioner's disability.
As petitioner was actually unable to work even after
the expiration of the 240-day period and there was
no final and conclusive disability assessment made
by the third doctor on his medical condition, it would
be inconsistent to declare him as merely
permanently and partially disabled. It should be
stressed that a total disability does not require that
the employee be completely disabled, or totally
paralyzed.23 In disability compensation, it is not
the injury which is compensated, but rather it is
the incapacity to work resulting in the
impairment of one's earning capacity.24
In view of the foregoing circumstances, petitioner is
considered permanently and totally disabled, and
should be awarded the corresponding disability
benefits.
At this juncture, it bears to recapitulate the
procedural requisites under the rules and
established jurispn1dence where the parties opt to
resort to the opinion of a third doctor:
First, according to the POEA-SEC25 and as
established by Vergara,26 when a seafarer sustains
a work-related illness or injury while on board the
vessel, his fitness or unfitness for work shall be
determined by the company-designated physician.
Second, if the seafarer disagrees with the findings
of the company doctor, then he has the right to
engage the services of a doctor of his choice. If the
second doctor appointed by the seafarer disagrees
with the findings of the company doctor, and the
company likewise disagrees with the findings of the
second doctor, then a third doctor may be agreed
jointly between the employer and the seafarer,
whose decision shall be final and binding on both of
them.
It must be emphasized that the language of the
POEA-SEC is clear in that both the seafarer and
the employermust mutually agree to seek the
opinion of a third doctor. In the event of
disagreement on the services of the third doctor,
the seafarer has the right to institute a complaint
with the LA or NLRC.
Third, despite the binding effect of the third doctor's
assessment, a dissatisfied party may institute a
complaint with the LA to contest the same on the
ground of evident partiality, corruption of the third
doctor, fraud, other undue means, 27 lack of basis to
support the assessment, or being contrary to law or
settled jurisprudence.
Petitioner is entitled to attorney's fees
Considering that petitioner was forced to litigate
and incur expenses to protect his right and interest,
petitioner is entitled to a reasonable amount of
attorney's fees, pursuant to Article 2208(8).28 The
Court notes, however, that respondents have not
shown to act in gross and evident bad faith in
refusing to satisfy petitioner's demands, and even
offered to pay him disability benefits, although in a
reduced amount. Thus, the Court finds the award of
attorney's fees in the amount of $1,000 as
reasonable.29
WHEREFORE, premises considered, the petition
is GRANTED. The June 10, 2015 Decision and
February 10, 2016 Resolution of the Court of
Appeals in CA-G.R. SP No. 138268
are REVERSED and SET ASIDE. Respondents are
ordered to jointly and severally pay petitioner
Reynaldo Y. Sunit the amount of $150,000 or its
equivalent amount in Philippine currency at the time
of payment, representing total and permanent
disability benefits, plus $1,000, or its equivalent in
Philippine currency, as attorney's fees.
SO ORDERED. G.R. No. 204307, June 06, 2018

ORIENT HOPE AGENCIES, INC. AND/OR ZEO

MARINE CORPORATION, Petitioners, v. MICHAEL E.
JARA, Respondent.

DECISION

LEONEN, J.:

Failure of the company-designated physician to render a

final and definitive assessment of a seafarer's condition
within the 240-day extended period transforms the
seafarer's temporary and total disability to permanent and
total disability.

This Petition for Review on Certiorari1 seeks to annul the

Court of Appeals August 15, 2012 Decision2 and
November 6, 2012 Resolution3 in CA-G.R. SP No. 113214.
The Court of Appeals reversed the National Labor
Relations Commission September 30, 2009 Decision4 and
granted Michael E. Jara (Jara) permanent and total
disability benefits of US$60,000.00 and 10% attorney's
fees. It also denied Orient Hope Agencies, Inc. (Orient
Hope) and/or Zeo Marine Corporation's (Zeo Marine)
Motion for Reconsideration.

Jara was hired by Orient Hope, on behalf of its foreign

principal, Zeo Marine, as engine cadet5 on board M/V
Orchid Sun.6 The employment contract was for a duration
of 10 months with a basic monthly salary of US$230.00.7

On its way to Oman, M/V Orchid Sun sank off Muscat on

July 12, 2007, during which Jara sustained leg
injuries.8 He was treated at Khoula Hospital in Oman and
thereafter repatriated and admitted on August 3, 2007 at
the Metropolitan Hospital in Manila.9

Jara was diagnosed to have suffered from "fracture, shaft

of left ulna and left fibula."10 On August 28, 2007 and
January 9, 2008, he underwent knee operations.11 He did
not return to the company-designated doctor after his
check up on March 17, 2008.12

Meanwhile, on March 6, 2008,13 Jara filed a complaint with

the Labor Arbiter, insisting that he was entitled to total
permanent disability benefits amounting to
US$60,000.00.14

On May 29, 2008, Assistant Medical Coordinator Dr.

Mylene Cruz Balbon of the Marine Medical Services of
Metropolitan Medical Center issued a letter, which Medical
Coordinator Dr. Robert D. Lim noted and which read:

This is with regards to your query regarding the case of

Wiper Michael E. Jara who was initially seen and admitted
here at Metropolitan Medical Center on August 3, 2007
and was diagnosed to have Fracture, Shaft of Left Ulna
and Left Fibula; S/P Open Reduction and Internal Fixation,
Left Ulna; S/P Arthroscopic Release, Debridement,
Synovectomy, Adhesiolysis, Lateral Complex
Reconstruction, Fibular Collateral Ligament Advancement
and Partial Lateral Meniscectomy, Left Knee on August 28,
2007; S/P Anterior Cruciate Ligament Reconstruction, Left
Knee using bone patellar tendon graft with interference
screw fixation on January 9, 2008.
Patient was last seen at the clinic on March 17, 2008.
Patient still has complaints of left knee pain especially
upon doing left knee flexion.
Based on his last follow-up, his suggested disability
grading is Grade 11 – stretching leg or ligaments of a
knee resulting in instability of the joint.15
In his August 29, 2008 Decision,16 Labor Arbiter Daniel J.
Cajilig found Jara entitled to compensation equivalent to
Grade 11 disability.17 He solely relied on the assessment
of the company-designated physician. He found no
evidence or other medical report on record to dispute the
company designated physician's determination and to
support Jara's claim.18 The dispositive portion of this
Decision read:
WHEREFORE, judgment is hereby rendered ordering
respondents jointly and severally to pay complainant the
amount of US$7,465.00 or its Philippine Peso equivalent
at the time of payment representing his disability benefits
plus 10% thereof as and by way of attorney's fee.
Other claims are hereby denied for lack of merit.
SO ORDERED.19
The National Labor Relations Commission affirmed20 the
Labor Arbiter's award.21 It rejected Jara's unsubstantiated
allegation that he was permanently and fully disabled.22 It
found no evidence, such as a credible assessment from
another doctor, to overturn the company-designated
physician's finding that indeed Jara was suffering from a
Grade 11 disability.23
Jara filed a Motion for Reconsideration, but it was denied
by the National Labor Relations Commission in its
December 10, 2009 Resolution.24
Insisting that he was entitled to permanent disability
compensation, Jara elevated the matter to the Court of
Appeals through a Petition for Certiorari under Rule 65.25
In its August 15, 2012 Decision, the Court of Appeals held
that Jara was "entitled to permanent disability benefits
because the assessment of the company-designated
physician that he was suffering from a grade '11' disability
was issued after nine (9) months or more than 120 days
from the time he was medically
repatriated."26 Citing Valenzona v. Fair Shipping
Corporation, et al.27 and Fil-Star Maritime Corporation, et
al. v. Rosete,28 the Court of Appeals held that Jara's
disability was permanent and total considering that "he
was unable to return to his job . . . for more than one
hundred twenty days already."29 Given Jara's knee injury,
the Court of Appeals ruled that it would be nearly
impossible for Jara to go back to sea duties.30
This Decision disposed as follows:
WHEREFORE, the petition is GRANTED. The September
30, 2009 decision of the NLRC and its December 10,
2009 resolution are REVERSED and SET ASIDE. The
respondents are held jointly and severally liable to pay the
petitioner permanent and total disability benefits of
US$60,000.00 and attorney's fees of ten percent (10%) of
the total monetary award, both at its peso equivalent at
the time of actual payment.
SO ORDERED.31
Orient Hope and/or Zeo Marine filed a Motion for
Reconsideration,32 citing the cases of Vergara v.
Hammonia Maritime Services,33Magsaysay Maritime Corp.
v. Lobusta,34 and Santiago v. Pacbasin Shipmanagement,
Inc.,35 where it was clarified that the medical treatment
period of 120 days may be extended up to a maximum of
240 days. As such, they argued that a temporary total
disability only becomes permanent when a company-
designated physician, within the 240-day period, declares
it to be so, or when after the lapse of this period, he or
she fails to make a declaration of the seafarer's fitness to
work or a degree of disability.36
The Court of Appeals maintained its ruling, stating:
Following the argument of [Orient Hope and/or Zeo
Marine], [Jara] is still entitled to permanent disability
benefits because the assessment of the company-
designated physician was issued on May 29, 2008, after
nine (9) months or more than 240 days from the time he
was medically repatriated on August 3, 2007.37
On November 28, 2012, Orient Hope and/or Zeo Marine
filed their Petition for Review on Certiorari before this
Court.38
Petitioners contend that based on prevailing
jurisprudence, the 120-day period within which a
company-designated physician must give an assessment
or declare a seafarer fit to work is extendible to 240
days.39 Where the 240-day period has lapsed without any
such declaration from a company-designated doctor, a
presumption then arises which may entitle the seafarer to
permanent and total disability compensation.40 However,
petitioners argue that this presumption is not applicable to
respondent's case in light of the Grade 11 disability
assessment made by their company-designated
physician.41 Petitioners add that since respondent
abandoned his treatment, the disability assessment issued
by their company-designated physician on May 29, 2008
must be deemed to have been given on March 17, 2008,
the last day respondent was seen by their company-
designated physician.42 Petitioners submit that their
company-designated physician's findings must be
respected absent any showing of fraud or arbitrariness in
arriving at those findings,43 more importantly, where "no
competent evidence [was] adduced by [r]espondent
showing that he [was] permanently and totally
disabled."44
Petitioners further argue that pursuant to Section 20(B) of
the Philippine Overseas Employment Administration-
Standard Employment Contract (POEA-SEC), there must
be resort to a third physician to settle any conflict in the
findings of the company-designated physician.45 Since
respondent did not comply with this procedure, then it is
the company- designated physician's determination that
must prevail.46 Thus, the Court of Appeals was not
justified in disregarding the findings of the company-
designated physician and in awarding respondent the sum
of US$60,000.00 equivalent to a permanent and total
disability.47
Finally, petitioners aver that respondent's complaint
should be dismissed for lack of cause of action.48 For one,
respondent was given a disability grading before the
expiration of the 240-day period.49 Moreover, when
respondent filed his complaint, he had not yet consulted
with his own physician.50 In fact, "the medical report upon
which he anchors his claim for compensation
corresponding to a Grade '1' disability was issued way
after he had filed his complaint, i.e. on 11 February 2010,
when the case was already with the Honorable Court of
Appeals."51
In his Comment,52 respondent counters that the
assessment of the company-designated physician was
issued only after nine (9) months or more than 120 days
from his medical repatriation.53 Furthermore, having an
injured and fragile knee would make it impossible for him
to meet the demands of a seafaring job.54 Hence, the
Court of Appeals did not err in granting him permanent
and total disability benefits.55
Respondent further prays for moral damages of
P300,000.00 for the "terrible depression and
anxiety"56that he has suffered because of this case.
Additionally, he prays for exemplary damages of
P200,000.00, due to the "despicable and inhumane acts of
the petitioners."57
Petitioners filed their Reply,58 arguing that the Labor
Arbiter's factual findings that respondent never presented
evidence to support his claim for total and permanent
disability benefits, as affirmed by the National Labor
Relations Commission, are binding and entitled to great
respect.59
They aver that the Medical Report dated February 11,
201060 of respondent's physician was issued almost three
(3) years after the sinking of the vessel. It was also
"based only on one instance of physical
examination,"61 and was introduced as new evidence only
in a petition for certiorari with the Court of
Appeals.62 Allowing this report would run counter to the
mandatory procedure laid down in the POEA-SEC of
getting a third doctor's opinion in case of conflict between
the findings of a company-designated physician and the
seafarer's physician of choice.63 Hence, the report should
not be considered as valid to support respondent's
claim.64
They maintain that the disability grade given by the
company-designated physician is entitled to great
weight.65
Finally, they point out that "[respondent's] failure to
comply with his treatment schedule . . . bars his claim for
disability benefits."66
The issues for this Court's resolution are as follows:
First, whether or not respondent Michael E. Jara is entitled
to permanent and total disability compensation
considering that there was a Grade 11 disability grading
given by the company-designated physician; and
Second, whether or not respondent Michael E. Jara is
entitled to damages and attorney's fees.
This Court denies the Petition and affirms with
modification the Court of Appeals August 15, 2012
Decision by awarding moral and exemplary damages,
considering the circumstances in this case.
I
This Court's review in this Rule 45 Petition is confined to
determining the legal correctness of the Court of Appeals
August 15, 2012 Decision on a Rule 65 petition filed
before it.67 Accordingly, this Court resolves whether or not
the Court of Appeals properly found grave abuse of
discretion on the part of the National Labor Relations
Commission when it ruled that respondent is entitled only
to a Grade 11 disability compensation.
This Court finds that the Court of Appeals properly found
that the National Labor Relations Commission gravely
abused its discretion when it overlooked the company-
designated physician's failure to issue a final and
definitive medical assessment within the 240-day
extended period, which under the law and jurisprudence
transforms respondent's disability to permanent and total.
Jurisprudence68 teaches that in claims for a seafarer's
disability benefits, POEA-SEC69 is deemed incorporated in
the seafarer's employment contract and must be read in
light of the relevant provisions on disability of the Labor
Code and its implementing rules. In this case, the 2000
version of the POEA-SEC applies since respondent was
hired in December 2005 and he filed his complaint in
2008.
The 120-day period mandated in Section 20(B)70 of the
POEA-SEC, within which a company-designated physician
should declare a seafarer's fitness for sea duty or degree
of disability, should accordingly be harmonized with Article
198 [192](c)(1) of the Labor Code, in relation with Book
IV, Title II, Rule X of the Implementing Rules of the Labor
Code, or the Amended Rules on Employee Compensation.
Book IV, Title II, Article 198 [192](c)(1) of the Labor
Code, as amended, reads:
Article 198. [192] Permanent total disability. — . . .
....
(c) The following disabilities shall be deemed total and
permanent:
(1) Temporary total disability lasting continuously for
more than one hundred twenty days, except as otherwise
provided for in the Rules.,]
Meanwhile, Rule X, Section 2 of the Implementing Rules
of the Labor Code, reads:
Section 2. Period of entitlement. — (a) The income benefit
shall be paid beginning on the first day of such disability.
If caused by an injury or sickness it shall not be paid
longer than 120 consecutive days except where such
injury or sickness still requires medical attendance beyond
120 days but not to exceed 240 days from onset of
disability in which case benefit for temporary total
disability shall be paid. However, the System may declare
the total and permanent status at any time after 120 days
of continuous temporary total disability as may be
warranted by the degree of actual loss or impairment of
physical or mental functions as determined by the
System. (Emphasis supplied)
This Court discussed the interplay of these provisions
in Vergara v. Hammonia Maritime Services, Inc.:71
As these provisions operate, the seafarer, upon sign-off
from his vessel, must report to the company-designated
physician within three (3) days from arrival for diagnosis
and treatment. For the duration of the treatment but in no
case to exceed 120 days, the seaman is on temporary
total disability as he is totally unable to work. He receives
his basic wage during this period until he is declared fit to
work or his temporary disability is acknowledged by the
company to be permanent, either partially or totally, as
his condition is defined under the POEA Standard
Employment Contract and by applicable Philippine laws. If
the 120 days initial period is exceeded and no such
declaration is made because the seafarer requires further
medical attention, then the temporary total disability
period may be extended up to a maximum of 240 days,
subject to the right of the employer to declare within this
period that a permanent partial or total disability already
exists.72(Emphasis in the original, citations omitted)
Petitioners aptly argue that starting with Vergara, the
prevailing rule is that a seafarer's mere inability to
perform his or her usual work after 120 days does not
automatically lead to entitlement to permanent and total
disability benefits because the 120-day period for
treatment and medical evaluation by a company-
designated physician may be extended to a maximum of
240 days.73
Subsequent cases,74 nonetheless, emphasized that there
must be a sufficient justification to extend the medical
treatment from 120 days to 240 days. In other words, the
240-day extended period remains to be an exception, and
as such, must be clearly shown to be warranted under the
circumstances of the case before it can be applied.
For instance, in Marlow Navigation Philippines, Inc. v.
Osias,75 this Court found the medical report of a company-
designated physician to have been properly issued within
the 240-day extended period because the seafarer was
uncooperative, resulting in the extended period of
treatment.
In the case at bench, the sufficient justification to apply
the 240-day extended period would be the
uncooperativeness of Osias. Based on the evidence
presented, it is clear that he did not fully comply with the
prescribed medical therapy. In his medical report, dated
March 31, 2010, Dr. Arago, as company-designated
physician, required Osias to undergo 10 sessions of
physical therapy every Monday, Tuesday and Thursday,
starting on April 5, 2010. After four (4) sessions,
however, Osias failed to appear for the continuation of his
physical therapy without any prior notice for his sudden
non-attendance. It was only on May 14, 2010, or after
more than a month, that Osias returned to see Dr. Arago
after coming back from La Union. Osias neither denied nor
attempted to justify his abrupt absence. His disregard of
the doctor's orders was duly noted by Dr. Arago in his
medical report, dated May 14, 2010.
The manifest non-compliance of Osias with the prescribed
therapy by the company-designated physician
demonstrates that he was uncooperative with the
treatment. Osias utterly disregarded the limited amount of
time the company-designated physician had to finalize his
medical assessment by ignoring the scheduled therapy
sessions. The LA correctly ruled that, by going to La
Union, Osias capriciously and wittingly dispensed with the
treatment of the company-designated physician. Likewise,
the NLRC observed that it would be unfair to award
disability benefits to Osias due to the lapse of 120-day
period because the extended period of the treatment was
attributable to him.76 (Emphasis supplied)
However, in Aldaba v. Career Philippines, Inc.,77 this Court
deemed the disability of a seafarer to be permanent and
total despite the Grade 8 disability rating given by a
company-designated physician because the assessment
was issued only on the 163rd day of the seafarer's
medical treatment without any justifiable reason.
Talaroc v. Arpaphil Shipping Corp.78 stressed that for a
company-designated physician to avail of the extended
240-day period, he or she must perform some complete
and definite medical assessment to show that the illness
still requires medical attendance beyond the 120 days,
but not to exceed 240 days. In such case, the temporary
total disability period is extended to a maximum of 240
days. Without sufficient justification for the extension of
the treatment period, a seafarer's disability shall be
conclusively presumed to be permanent and total. This
Court summarized the following guidelines to be observed
when a seafarer claims permanent and total disability
benefits:
1. The company-designated physician must issue a
final medical assessment on the seafarer's
disability grading within a period of 120 days from
the time the seafarer reported to him;
2. If the company-designated physician fails to give
his assessment within the period of 120 days,
without any justifiable reason, then the seafarer's
disability becomes permanent and total;
3. If the company-designated physician fails to give
his assessment within the period of 120 days with
a sufficient justification (e.g., seafarer required
further medical treatment or seafarer was
uncooperative), then the period of diagnosis and
treatment shall be extended to 240 days. The
employer has the burden to prove that the
company-designated physician has sufficient
justification to extend the period; and
4. If the company-designated physician still fails to
give his assessment within the extended period of
 240 days, then the seafarer's disability becomes
permanent and total, regardless of any
justification.79
In this case, the company-designated physician did not
issue a medical assessment within the 120-day period.
Nonetheless, the surgical procedure performed on
respondent on January 9, 2008, or 159 days from his
repatriation, shows that his condition required further
medical treatment, justifying the extension of the 120-day
period to 240 days. Thus, this Court deems the temporary
total disability period to be accordingly extended up to a
maximum of 240 days.
Petitioners contend that the Court of Appeals erred in
applying the 240-day presumptive rule and awarding
respondent permanent and total disability benefits despite
the Grade 11 disability rating issued by the company-
designated physician. Invoking the ruling in Santiago v.
Pacbasin Shipmanagement, Inc.,80 petitioners contend
that the 240-day presumptive disability rule operates only
in default of a declaration of a seafarer's fitness or
disability assessment from a company-designated
physician.81
Petitioners further insist that respondent's complaint
should have been dismissed for lack of cause of action
because the 240-day period had yet to lapse when the
complaint was filed.82
This Court is not persuaded.
In Island Overseas Transport Corporation v. Beja,83 this
Court clarified that:
[I]f the maritime compensation complaint was filed prior
to October 6, 2008, the rule on the 120-day period,
during which the disability assessment should have been
made in accordance with Crystal Shipping, Inc. v.
Natividad, that is, the doctrine then prevailing before the
promulgation of Vergara on October 6, 2008, stands; if,
on the other hand, the complaint was filed from October
6, 2008 onwards, the 240-day rule applies.84 (Emphasis
supplied, citations omitted)
When respondent filed his Complaint on March 6, 2008, or
after more than 120 days had lapsed, the company-
designated physician had not yet determined his disability
and respondent had not yet fully recovered. Applying the
above ruling in Island Overseas Transport Corporation,
respondent is deemed to have already acquired a cause of
action for permanent and total disability benefits.
This Court, nonetheless, will tackle the timeliness and
appropriateness of the disability rating issued by the
company-designated physician.
The case of Santiago cited by petitioners is not apropos.
There, a seafarer underwent several tests and treatment
two (2) days after his repatriation on March 17, 2005. On
August 13, 2005, or on the 148thday, clearly within the
240-day period, a company-designated physician declared
that he was suffering from a Grade 12 disability only, not
a permanent total one. This Court ruled that the seafarer's
condition could not be considered a permanent total
disability. It also held that "a temporary total disability
only becomes permanent when the company-designated
physician, within the 240[-]day period, declares it to be
so, or when after the lapse of the same, he fails to make
such declaration."85
In contrast, this case has no medical or progress report
that was ever made by the company-designated physician
other than that issued on May 29, 2008, or 300 days from
respondent's repatriation on August 3, 2007.
Respondent was last seen by the company-designated
physician on March 17, 2008, or on the 227th day from his
repatriation. At this point, the company-designated
physician is nearing the end of the extended period of 240
days, 13 days to be exact, within which to give
respondent's final disability assessment, yet none was
given. Petitioners, however, would put the blame on
respondent for not returning to the doctor for further
consultation and treatment.86 There is no showing,
though, in the records that the physician required him to
return within a specified period.
Respondent could not be faulted for not returning to the
company designated physician who failed to assess him of
rightful disability grading after treatment of more than
seven (7) months. The company-designated physician
should have at least issued a medical report containing an
evaluation of respondent's condition on March 17, 2008.
This is reasonably expected given the proximity of
respondent's last check up to the expiration of the 240-
day period.
Instead, the company-designated physician issued an
assessment only on May 29, 2008, simply stating that
"[b]ased on his last follow-up, his suggested disability
grading is Grade 11 – stretching leg or ligaments of a
knee resulting in instability of the joint."87 Furthermore,
other than this succinct statement, the report is devoid of
any explanation to back up the findings of the company-
designated physician or of any detail of the progress of
respondent's treatment, and the approximate period
needed for him to fully recover.
The POEA-SEC clearly provides the primary responsibility
of a company-designated physician to determine the
disability grading or fitness to work of seafarers.88 To be
conclusive, however, company-designated physicians'
medical assessments or reports must be complete89 and
definite90 to give the proper disability benefits to
seafarers. As explained by this Court:
A final and definite disability assessment is necessary
in order to truly reflect the true extent of the sickness or
injuries of the seafarer and his or her capacity to resume
work as such. Otherwise, the corresponding disability
benefits awarded might not be commensurate with the
prolonged effects of the injuries suffered.91 (Emphasis in
the original)
In Monana v. MEC Global Shipmanagement and Manning
Corp.,92 this Court further stressed the overriding
consideration that there must be sufficient basis to
support the assessment:
Regardless of who the doctor is and his or her relation to
the parties, the overriding consideration by both the Labor
Arbiter and the National Labor Relations Commission
should be that the medical conclusions are based on (a)
the symptoms and findings collated with medically
acceptable diagnostic tools and methods, (b) reasonable
professional inferences anchored on prevailing scientific
findings expected to be known to the physician given his
or her level of expertise, and (c) the submitted medical
findings or synopsis, supported by plain English
annotations that will allow the Labor Arbiter and the
National Labor Relations Commission to make the proper
evaluation.93 (Emphasis supplied)
Thus, this Court has previously disregarded the findings of
company-designated physicians for being
incomplete,94 doubtful,95 clearly biased in favor of an
employer,96 or for lack of finality.97
In Maersk Filipinas Crewing, Inc. v. Mesina,98 this Court
found the opinion of a seafarer's physician to be more
reliable than that of a company designated physician:
After a circumspect evaluation of the conflicting medical
certifications of Drs. Alegre and Fugoso, the Court finds
that serious doubts pervade in the former. While both
doctors gave a brief description of psoriasis, it was only
Dr. Fugoso who categorically stated a factor that triggered
the activity of the respondent's disease — stress, drug or
alcohol intake, etc. Dr. Alegre immediately concluded that
it is not work-related on the basis merely of the absence
of psoriasis in the schedule of compensable diseases in
Sections 32 and 32-A of the POEA-SEC. Dr. Alegre failed
to consider the varied factors the respondent could have
been exposed to while on board the vessel. At best, his
certification was merely concerned with the examination
of the respondent for purposes of diagnosis and treatment
and not with the determination of his fitness to resume his
work as a seafarer in stark contrast with the certification
issued by Dr. Fugoso which categorically declared the
respondent as "disabled." The certification of Dr. Alegre is,
thus, inconclusive for purposes of determining the
compensability of psoriasis under the POEA-SEC.
Moreover, Dr. Alegre's specialization is General Surgery
while Dr. Fugoso is a dermatologist, or one with
specialized knowledge and expertise in skin conditions and
diseases like psoriasis. Based on these observations, it is
the Court's considered view that Dr. Fugoso's certification
deserves greater weight.99(Emphasis supplied, citation
omitted)
In HFS Philippines, Inc., et al. v. Pilar,100 this Court upheld
the findings of a seafarer's personal physician because it
was supported by his medical records. This Court also
noted that the company-designated physician downgraded
the seafarer's illness:
The company-designated physician declared respondent
as having suffered a major depression but was already
cured and therefore fit to work. On the other hand, the
independent physicians stated that respondent's major
depression persisted and constituted a disability. More
importantly, while the former totally ignored the diagnosis
of the Japanese doctor that respondent was also suffering
from gastric ulcer, the latter addressed this. The
independent physicians thus found that respondent was
suffering from chronic gastritis and declared him unfit for
work.101
In Island Overseas Transport Corp. v. Beja,102 a seafarer
suffered a knee injury while on board a vessel. Upon
repatriation on November 22, 2007, he was referred to a
company-designated physician who recommended a knee
operation. Roughly a month after the knee operation, or
on May 26, 2008, the company-designated physician
rendered Grades 10 and 13 partial disability grading of his
medical condition. This Court considered this assessment
as tentative because the seafarer continued his physical
therapy sessions, which even went beyond 240 days. It
further noted that the company-designated physician "did
not even explain how he arrived at the partial permanent
disability assessment"103 or provided any justification for
his conclusion that the seafarer was suffering from Grades
10 and 13 disability.104
Furthermore, while the assessment of a company-
designated physician vis à vis the schedule of disabilities
under the POEA-SEC is the basis for compensability of a
seafarer's disability, it is still subject to the periods
prescribed in the law.105 Otherwise, the fate of the
seafarer would completely rest in the hands of the
company-designated physician, without redress, should
the latter fail or refuse to give a disability rating.106
Accordingly, in Carcedo v. Maine Marine Philippines,
Inc.,107 this Court declared that a partial and permanent
disability could, by legal contemplation, become total and
permanent when a company-designated physician fails to
arrive at a definite assessment within the 120- or 240-day
periods prescribed under Article 198 [192](c)(1) of the
Labor Code and the Amended Rules on Employee
Compensation, implementing Book IV, Title II of the Labor
Code. Thus:
The Court in Kestrel Shipping Co., Inc. v. Munar108 held
that the declaration by the company-designated physician
is an obligation, the abdication of which transforms the
temporary total disability to permanent total disability,
regardless of the disability grade, viz.:
Indeed, under Section 32 of the POEA-SEC, only those
injuries or disabilities that are classified as Grade 1 may
be considered as total and permanent. However, if those
injuries or disabilities with a disability grading from 2 to
14, hence, partial and permanent, would incapacitate a
seafarer from performing his usual sea duties for a period
of more than 120 or 240 days, depending on the need for
further medical treatment, then he is, under legal
contemplation, totally and permanently disabled. In other
words, an impediment should be characterized as partial
and permanent not only under the Schedule of Disabilities
found in Section 32 of the POEA-SEC but should be so
under the relevant provisions of the Labor Code and the
Amended Rules on Employee Compensation (AREC)
implementing Title II, Book IV of the Labor Code. That
while the seafarer is partially injured or disabled, he is not
precluded from earning doing the same work he had
before his injury or disability or that he is accustomed or
trained to do. Otherwise, if his illness or injury prevents
him from engaging in gainful employment for more than
120 or 240 days, as the case may be, he shall be deemed
totally and , permanently disabled.
Moreover, the company-designated physician is expected
to arrive at a definite assessment of the seafarer's fitness
to work or permanent disability within the period of 120 or
240 days. That should he fail to do so and the seafarer's
medical condition remains unresolved, the seafarer shall
be deemed totally and permanently disabled.109 (Emphasis
supplied)
Aside from the belated assessment of respondent's injury,
the medical report dated May 29, 2008 did not contain
any definitive declaration as to the seafarer's fitness to
work. On the contrary, the report stated that as of his last
check up on March 17, 2008, respondent was still
complaining of left knee pain especially upon doing left
knee flexion. Under the circumstances of this case, it
would be improbable to expect that by March 30, 2008, or
the last day of the 240-day period, respondent would
have fully recovered from his injury or regained his pre-
injury capacity as to be able to go back to his sea duty.
In Fil-Pride Shipping Company, Inc. v. Balasta,110 this
Court awarded permanent and total disability benefits to a
seafarer despite the premature filing of his complaint
before the lapse of the 240-day period. This Court held
that by that time, it was already evident that the seafarer
would be unable to return to his work given his delicate
post-operative condition and a definitive assessment by a
company-designated physician was, under the
circumstances, unnecessary.
Concededly, the period September 18, 2005 to April 19,
2006 is less than the statutory 240-day — or 8-month —
period. Nonetheless, it is impossible to expect that by May
19, 2006, or on the last day of the statutory 240-day
period, respondent would be declared fit to work when
just recently — or on February 24, 2006 — he underwent
coronary artery bypass graft surgery; by then, respondent
would not have sufficiently recovered. In other words, it
became evident as early as April 19, 2006 that respondent
was permanently and totally disabled, unfit to return to
work as seafarer and earn therefrom, given his delicate
post-operative condition; a definitive assessment by Dr.
Cruz before May 19, 2006 was unnecessary. Respondent
would to all intents and purposes still be unfit for sea-
duty. Even then, with Dr. Cruz's failure to issue a definite
assessment of respondent's condition on May 19, 2006, or
the last day of the statutory 240-day period, respondent
was thus deemed totally and permanently disabled
pursuant to Article 192 (c) (1) of the Labor Code and Rule
X, Section 2 of the AREC.111
It is well to point out that in disability compensation, "it is
not the injury which is compensated, but rather it is the
incapacity to work resulting in the impairment of one's
earning capacity."112 Total disability refers to an
employee's inability to perform his or her usual work. It
does not require total paralysis or complete
helplessness.113 Permanent disability, on the other hand,
is a worker's inability to perform his or her job for more
than 120 days, or 240 days if the seafarer required
further medical attention justifying the extension of the
temporary total disability period, regardless of whether or
not he loses the use of any part of his body.114
In Belchem Philippines, Inc. v. Zafra, Jr.,115 this Court
held that:
[P]ermanent partial disability presupposes a seafarer's
fitness to resume sea duties before the end of the
120/240-day medical treatment period despite the injuries
sustained. The premise is that such partial injuries did not
disable a seafarer to earn wages in the same kind of work
or similar nature for which he was trained. 116
The facts of this case show respondent's inability to
perform his customary sea duties and the company-
designated physician's failure to declare his fitness or
unfitness to work, despite the lapse of 240 days. This
entitles respondent, under the law, to permanent and
total disability compensation.
In this regard, non-compliance with the third-doctor-
referral provision as provided in the POEA-SEC will not
prejudice respondent's claim. The third-doctor rule does
not apply when there is no valid final and definitive
assessment from a company-designated physician.117
In Kestrel Shipping Co., Inc. v. Munar:118
In addition, that it was by operation of law that brought
forth the conclusive presumption that Munar is totally and
permanently disabled, there is no legal compulsion for him
to observe the procedure prescribed under Section 20-B
(3) of the POEA-SEC. A seafarer's compliance with such
procedure presupposes that the company-designated
physician came up with an assessment as to his fitness or
unfitness to work before the expiration of the 120-day or
240-day periods. Alternatively put, absent a certification
from the company-designated physician, the seafarer had
nothing to contest and the law steps in to conclusively
characterize his disability as total and permanent.
(Emphasis supplied)119
Without a valid final and definitive assessment from the
company-designated physician, respondent's temporary
and total disability, by operation of law, became
permanent and total.
Thus, the Court of Appeals did not err in reversing and
setting aside the National Labor Relations Commission's
decision and granting respondent permanent and total
disability benefits.
The standard provisions in the 2000 POEA-SEC is a
regulatory attempt to balance the constitutional protection
to labor with the need for shipping and manning agencies
to have an efficient basis for the resolution of claims
against them. Hence, the 120- and 240-day periods within
which a company-designated physician should make a
full, complete, and definitive assessment are
accommodations for them. Generally, between companies
and an ordinary Filipino seafarer, it is the former that has
the better capability to comply with the requirements for
determining disabilities of a claimant. Certainly, the period
given to them is more than sufficient and it would be the
height of inequity for this Court to grant them more at the
expense of the seafarer.
II
This Court finds no ground to disturb the uniform findings
of the Labor Arbiter, National Labor Relations Commission,
and the Court of Appeals in awarding attorney's fees.
Since respondent was compelled to litigate due to
petitioners' denial of his valid claims, the award for
attorney's fees was proper.120
On damages, the Labor Arbiter denied respondent's claims
for lack of sufficient basis. The National Labor Relations
Commission affirmed the findings of the Labor Arbiter.
The Court of Appeals, likewise, did not award moral and
exemplary damages.
Respondent contends that he suffered depression and
anxiety because of this case. He also claims exemplary
damages for the inhumane treatment he received from
petitioners.
In Sharpe Sea Personnel, Inc. v. Mabunay, Jr., this
121
Court affirmed the award of moral and exemplary
damages because of an employer's bad faith in belatedly
releasing and submitting the disability rating.
By not timely releasing Dr. Cruz's interim disability
grading, petitioners revealed their intention to leave
respondent in the dark regarding his future as a seafarer
and forced him to seek diagnosis from private physicians.
Petitioners' bad faith was further exacerbated when they
tried to invalidate the findings of respondent's private
physicians, for his supposed failure to move for the
appointment of a third-party physician as required by the
POEA-SEC, despite their own deliberate concealment of
their physician's interim diagnosis from respondent and
the labor tribunals. Thus, this Court concurs with the
Court of Appeals when it stated:
We also grant petitioner's prayer for moral and exemplary
damages. Private respondents acted in bad faith when
they belatedly submitted petitioner's Grade 8 disability
rating only via their motion for reconsideration before the
NLRC. By withholding such disability rating from
petitioner, the latter was compelled to seek out opinion
from his private doctors thereby causing him mental
anguish, serious anxiety, and wounded feelings, thus,
entitling him to moral damages of P50,000.00. Too, by
way of example or correction for the public good,
exemplary damages of P50,000.00 is awarded.122
In Magsaysay Maritime Corp. v. Chin, Jr.,123 Oscar D.
Chin, Jr. (Chin), a seafarer, was found by a company-
designated physician to have a moderate rigidity of tract a
year after his operation. When he claimed for disability
compensation, his employer offered US$30,000.00, which
Chin accepted. Chin then executed a Release and
Quitclaim in favor of Magsaysay Maritime Corporation.
Subsequently, Chin filed a complaint for underpayment of
disability benefits and damages. The labor tribunals
dismissed his complaint. The Court of Appeals ruled that
Chin was entitled to permanent and total disability benefit
of US$60,000.00 and remanded the case to the Labor
Arbiter for determination of Chin's other monetary claims.
The Labor Arbiter awarded Chin P200,000.00 as moral
damages and P75,000.00 as exemplary damages, among
others. This Court sustained the awards of damages, but
reduced the amounts for being excessive. The amount of
P30,000.00 as moral damages was deemed
commensurate to the anxiety and inconvenience Chin
suffered. Furthermore, the award of P25,000.00 as
exemplary damages was considered "sufficient to
discourage petitioner Magsaysay from entering into
iniquitous agreements with its employees that violate
their right to collect the amounts to which they are
entitled under the law."124
In this case, respondent's travails started when, due to no
fault of his, petitioners' ship sunk. Respondent did not
receive any disability rating from the company-designated
physician despite the lapse of more than seven (7)
months of treatment. He demanded disability benefits
from petitioners, considering that he had not yet fully
recovered from his knee injury, but his demands were
unheeded.125 The uncertainty of his medical condition
caused his anxiety about his future as a seafarer.
Indeed, petitioners only submitted the medical report with
the Grade 11 disability rating when they filed their
Position Paper126 dated May 27, 2008 with the Labor
Arbiter and, accordingly, expressed their willingness to
pay disability benefits equivalent only to Grade 11
disability. This reveals petitioners' disregard of
respondent's unfortunate plight. Petitioners' bad faith is
further evident when they tried to invalidate respondent's
complaint for his supposed failure to move for the
appointment of a third-party physician as required by the
POEA-SEC, when they knew that no prognosis whatsoever
was issued by the company-designated physician other
than the medical report dated May 29, 2008.
Considering the blithe manner in which petitioners dealt
with respondent's condition and the rulings in Sharp
Sea and Magsaysay Maritime, the amount of P100,000.00
as moral damages would be commensurate to the anxiety
and inconvenience suffered by respondent. Exemplary
damages of P100,000.00 is also granted by way of
example or correction for the public good.
This Court notes the sacrifice that many of our seafarers
have to contend with just to earn decent wages so their
families could live a dignified existence. Their absence
often imprints into their families' psyche. There will be
many significant moments when their families will need
the seafarers' presence but which will not be possible
because they will be devoting their time with companies
represented by petitioners.
Respondent was injured and forced to go home because
the ship he was on sunk. He waited for more than 240
days to get an assessment that he deserved. Moral and
exemplary damages are due him for his travails.
WHEREFORE, the Petition is DENIED. The Court of
Appeals August 15, 2012 Decision and November 6, 2012
Resolution in CA-G.R. SP No. 113214 are AFFIRMED
with MODIFICATION. Petitioners Orient Hope Agencies,
Inc. and/or Zeo Marine Corporation are ordered to pay
respondent Michael E. Jara US$60,000.00 as permanent
and total disability benefits, P100,000.00 as moral
damages, P100,000.00 as exemplary damages, and
attorney's fees equivalent to ten percent (10%) of the
total of these amounts.
SO ORDERED.
 G.R. No. 223731, August 30, 2017 rehabilitation and continue his medications.19

ROBELITO MALINIS
TALAROC, Petitioner, v. ARPAPHIL SHIPPING
CORPORATION, EPIDAURUS S.A., AND/OR
NATIVIDAD PAPPAS, Respondents.
DECISION
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 are the
Decision2 dated October 9, 2015 and the
Resolution3 dated March 21, 2016 of the Court of Appeals
On April 29, 2013, petitioner was again admitted to the
hospital due to "left facial asymmetry, loss of balance and
left leg weakness" and referred to a neurologist who found
him to have "Right Brainstem Infarct."20 He underwent
physical therapy on an in-patient basis until his discharge
on May 2, 2013, after which he was directed to continue
his prescribed medications, as well as rehabilitation as an
out-patient.21
Thereafter, in a confidential medical report22 dated May
14, 2013 (May 14, 2013 medical report), the company
designated physician assessed petitioner's condition as
follows:
cha nRoblesv irt ual Lawlib rary

This is with regards to your query regarding the

(CA) in CA-G.R. SP No. 138842, which reversed and set
case of 3rd Officer Robelito M. Talaroc who was
aside the Decision4 dated September 17, 2014 and the
initially seen here at Metropolitan Medical Center on
Resolution5 dated November 28, 2014 of the National
March 27, 2013 and was diagnosed to have Gastric
Labor Relations Commission (NLRC) in NLRC LAC No.
Ulcer; Duodenitis; Hypertension; L-3 - L-4 and L4 -
OFW-M-07-000582-14, and instead, reinstated the
L-5 Generalized Disc Bulge; L5 - S1, Left Paracentral
Decision6 dated May 30, 2014 of the Labor Arbiter (LA) in
Disc Protrusion.
NLRC NCR OFW Case (M)-08-12057-13 dismissing the
complaint for total and permanent disability benefits but
Gastric Ulcer and Duodenitis are part of the spectrum of
ordered respondents to solidarity pay petitioner Robelito
acid-related diseases listed under Section 32-a Item # 22
Malinis Talaroc (petitioner) his unpaid sickness allowance,
of the amended POEA Contract.
with modification deleting the award of attorney's fees.
The etiology/cause of Hypertension is not work-related. It
The Facts
is multifactorial in origin which includes genetic
predisposition, poor lifestyle, high salt intake, smoking,
Petitioner was employed by respondent Arpaphil Shipping
Diabetes Mellitus, age and increased sympathetic activity.
Corporation (ASC) for its foreign principal Epidaurus S.A.
This is already pre-existing.
as Third Officer on board the vessel MV Exelixis under a
six (6)-month contract7 that was signed on February 18,
Disc bulge and disc protrusion can be
2013, with a basic monthly salary of US$1,113.00
precipitated/aggravated by heavy work or lifting/pushing
exclusive of overtime and other benefits.8 After
or pulling heavy objects. This is degenerative in nature.
undergoing the required pre-employment medical
examination (PEME) where he was declared fit for sea
Patient also had acute onset of headache and diplopia
duty9 by the company designated physician, petitioner
with left leg weakness on the last week of April 2013.
boarded the vessel on March 8, 2013.10
He was then noted with acute brainstem infarction
On March 16, 2013, the Ship Master informed respondent
on CT Scan. This occurred while he is currently
Epidaurus S.A. that petitioner could not perform his duties
undergoing treatment here in the Philippines for his
due to fever and back pain.11 Petitioner claimed that while
Gastric Ulcer, Hypertension and back pain.
he was collecting the mooring rope, he felt a sudden click
in his lower back accompanied with pain.12 He was
Risk factors for Lacunar Infarct are age, smoking, alcohol
examined by a port doctor in Algeria and injected with
intake, Hypertension and Hypercholesterolemia. All of
pain reliever for his back. He was also treated for sore
which are not work-related. This is not work-related.
throat that caused his fever and given medication for his
hypertension.13 Thereafter, petitioner also complained of
The specialists opine that patient's prognosis for returning
stomach pain and dizziness, for which the Ship Master
to sea duties is guarded and fitness to work is unlikely
recommended that he be confined in a hospital for further
due to risk of another cerebrovascular event.
treatment and opined that he was not fit to work.14 In a
Medical Report15 dated March 24, 2013, petitioner was
His estimated length of further treatment is
found to be suffering from lumbago with stomach pains, in
approximately 3 more months before he reached his
addition to his hypertension, and recommended that he
maximum medical improvement.
be repatriated for further medical treatment.
He will also undergo repeat Gastroscopy once
Upon arrival in Manila, or on March 26, 2013, petitioner
neurologically and cardiac stable for treatment monitoring
was referred to the company-designated physician of ASC,
of his gastric ulcer.
Dr. Esther G. Go (Dr. Go), and was diagnosed to have
hypertension, "[t]o [c]onsider Gastrointestinal Bleeding
xxxx
[p]robably [secondary to Gastric Ulcers," and lumbar
muscle strain.16 After undergoing a series of laboratory
If patient is entitled to a disability, his suggested
tests and examinations, petitioner was found to be
disability grading is Grade 10 - slight brain
suffering from gastric ulcer, duodenitis, and
functional disturbance that requires little
hypertension.17 His lumbosacral x-ray showed an "L3-L4
attendance or aid and which interferes to a slight
and L4-L5 Generalized Disc Bulge," while his MRI of the
degree with the working capacity of the
lumbar spine showed an "L5-S1, Left Paracentral Disc
patient.23(Emphases supplied)
Protrusion."18 He was advised by Dr. Go to undergo
Accordingly, petitioner was directed to appear in a series
of follow-up check-ups by Dr. Go on May 16 and 20,
2013, June 3 and 20, 2013, July 11, 2013, and August 1
and 22, 2013.24 In all of the follow-up sessions, petitioner
persistently complained of left leg weakness, low back
pain and occasional dizziness, to which Dr. Go merely
advised him to continue his medications and rehabilitation
program. In a medical report25 dated August 22, 2013
(August 22, 2013 medical report), petitioner was cleared
by the specialist, Dr. Chen Pen Lim, of his gastric ulcer
and gastro-intestinal disorder.
Unconvinced of the true state of his condition, petitioner
consulted an independent physician, Dr. Manuel Fidel M.
Magtira (Dr. Magtira), who, in a Medical Report26 dated
September 20, 2013, found him unfit to return to work as
a seafarer after evaluating his previous MRI and upon
physical examination, pointing out that in view of his
persistent back pain, he has lost his pre-injury capacity
that rendered him permanently disabled.27
In the interim, or on August 28, 2013, petitioner filed a
complaint28 for underpayment of sick leave pay, non-
payment of salaries/wages, reimbursement of
transportation expenses, payment of sickness allowance,
moral and exemplary damages, and attorney's fees
against ASC, its Owner/Manager/President Natividad A.
Pappas, and Epidaurus S.A. (respondents), before the
NLRC, docketed as NLRC NCR OFW Case (M)-08-12057-
13. The complaint was subsequently amended29 on
October 2, 2013 to include a claim for total and
permanent disability benefits in view of Dr. Magtira's
independent medical report finding petitioner unfit to
resume his usual work as a seafarer.30
In support of his claim, petitioner averred that from the
time he was repatriated for his back injury, he was no
longer capable of resuming work as a seafarer that lasted
for more than 240 days despite medical treatment and
therapy. By reason thereof, he had lost his capacity to
obtain further sea employment and an opportunity to earn
an income, thus entitling him to payment of total disability
compensation in the full amount of US$90,000.00
pursuant to the P.N.O "TCC" Collective Agreement for
Crews on Flag of Convenience Ships31 (CBA) that was
enforced during his last employment contract. Petitioner
also sought for the payment of moral and exemplary
damages in view of respondents' unjustified refusal to
settle the matter and their evident bad faith in dealing
with him, as well as attorney's fees pursuant to Article
2208, paragraphs (2) and (8) of the Civil Code.32
For their part,33 respondents maintained that petitioner
was not entitled to permanent and total disability benefits
under the CBA since the latter's illness did not arise from
an accident.34 They contended that petitioner's diagnosed
illnesses, namely, Gastric Ulcer and Duodenitis, were
already resolved as shown in the August 22, 2013 medical
report, while his other illnesses, namely, hypertension,
generalized disc bulge and left paracentral disc protrusion,
and lacunar infarct, were all declared by Dr. Go to be not
work-related, hence, not compensable.35 Finally, they
argued that petitioner's action was premature as the 240-
day extended medical treatment has not yet expired at
the time he filed his complaint and that he failed to
comply with the provisions of the Philippine Overseas
Employment Agency (POEA) Standard Employment
Contract (POEA-SEC) in case of conflict in medical findings
by the parties' respective doctors.36 They further denied
petitioner's other monetary claims asserting that his
sickness allowance had already been paid, while his claim
for reimbursement of transportation expenses was
unsupported by receipts. Petitioner was also not entitled
to moral and exemplary damages having been treated
fairly and in good faith, as well as to attorney's fees for
lack of basis.37
The LA Ruling
In a Decision38 dated May 30, 2014, the LA dismissed the
complaint for lack of cause of action, holding that the
claim for disability benefits was filed before the lapse of
the allowable 240-day extended medical treatment period.
The LA pointed out that Dr. Go's assessment on May 14,
2013 giving petitioner a Grade 10 disability rating was
only interim and that the latter's resort to an independent
physician was premature as the former has yet to issue
his final assessment within the agreed extended 240-day
extended treatment period.39 Nevertheless, the LA found
merit in petitioner's claim for sickness allowance, noting
that he was paid for a period of 93 days only and not 120
days as provided under the POEA-SEC.40 The other claims
for unpaid salaries, medical expenses and damages were
denied for lack of basis, while an award of ten (10%)
percent attorney's fees was found reasonable under the
circumstances as petitioner was compelled to litigate to
protect his interest in accordance with Article 2208 (7) of
the Civil Code, as well as Article 111 of the Labor Code
and Section 8, Rule VIII, Book III of the Omnibus Rules
Implementing the Labor Code.41
Aggrieved, petitioner filed an appeal42 to the NLRC.
The NLRC Ruling
In a Decision43 dated September 17, 2014, the NLRC set
aside the LA decision,44 ruling that the 240-day extended
medical treatment was not an automatic application in
case of disability claim. It pointed out that there must be
a need for further medical treatment before the 120-day
period may be extended which Dr. Go failed to show. It
observed that the May 14, 2013 medical report, which
showed that the estimated length of petitioner's treatment
was approximately three (3) months, was self-serving and
devoid of any probative value as there was no mention of
the particular treatment or rehabilitation needed. It added
that while there was no question as to his medications,
there was, however, no proof showing that petitioner, in
fact, underwent rehabilitation, or if there was, that it went
beyond the 120-day period. On the contrary, it held that
the company's specialists' opinion that the "prognosis for
returning to sea duties is guarded and fitness to work is
unlikely due to risk of another cerebrovascular event" was
an indication that there was no need to extend the 120-
day period since the unlikeliness of working was due to
the fact that (a) petitioner was permanently disabled, and
(b) that an extended treatment was unnecessary
considering that it would no longer restore petitioner to
his pre-injury condition. It ruled that Dr. Go's assessment
of a Grade 10 disability was not interim or conditional
absent any similar import suggesting the same, and that
there was no need to await a final assessment given that
it referred to petitioner's slight brain functional
disturbance, and not his lumbar spondylosis, that
incapacitated him to resume work for more than 120-
days.45
Further, the NLRC found that petitioner's incapacity is
work-related, stating that it is of no moment that his work
as a Third Officer or even his working conditions on board
respondents' vessel was not the sole or direct cause of his
lumbar spondylosis, as it suffices that his work, at the
very least, aggravated his illness.46
Accordingly, the NLRC ordered respondents to jointly and
severally pay petitioner total and permanent disability
benefits in the amount of US$60,000.00 pursuant to the
provisions of the POEA-SEC and not the CBA, as the
disability did not arise from an accident, as well as ten
percent (10%) attorney's fees.47
Respondents filed a motion for reconsideration,48 while
petitioner moved to reconsider49 the amount of his
disability benefits asserting that he was entitled to
US$90,000.00 pursuant to the overriding provisions of the
existing CBA.50
In a Resolution51 dated November 28, 2014, the NLRC
denied both motions prompting respondents to file a
petition for certiorari52 before the CA, docketed as CA-G.R.
SP No. 138842.
The CA Ruling
In a Decision53 dated October 9, 2015, the CA gave due
course to the petition finding the NLRC to have gravely
abused its discretion,54 and reinstated the LA's Decision
dated May 30, 2014 with modification deleting the award
of attorney's fees.55 It ruled that since petitioner was
advised to continue with his rehabilitation program in the
medical report56 dated August 1, 2013 and to undergo
laboratory examinations and gastroscopy on his next
check-up scheduled on August 22, 2013, the company-
designated physician, Dr. Go, had until November 22,
2013 (240th day) to determine with finality the former's
fitness to work or disability. There being no final
assessment yet, the complaint for total and permanent
disability benefits was premature. The CA added that
assuming the company designated physician's assessment
in the May 14, 2013 medical report was final, petitioner
committed a breach of his contractual obligation when he
failed to resort to the opinion of a third doctor as
mandated in Section 20 (B) (3) of the 2010 POEA-SEC.
Consequently, the CA deleted the award of attorney's fees
holding that there was no unlawful withholding of
benefits.57
Dissatisfied, petitioner filed a motion for
reconsideration,58 which was, however, denied in a
Resolution59dated March 21, 2016; hence, this petition.
The Issue Before the Court
The essential issue is whether or not the CA erred in
holding that the NLRC gravely abused its discretion when
it ruled that petitioner was entitled to total and permanent
disability benefits.
The Court's Ruling
The petition is meritorious.
I then the seafarer's disability becomes permanent and
To justify the grant of the extraordinary remedy
of certiorari, the petitioner must satisfactorily show that
the court or quasi-judicial authority gravely abused the
discretion conferred upon it. Grave abuse of discretion
connotes a capricious and whimsical exercise of judgment,
done in a despotic manner by reason of passion or
personal hostility, the character of which being so patent
and gross as to amount to an evasion of positive duty or
to a virtual refusal to perform the duty enjoined by or to
act at all in contemplation of law.60
In labor disputes, grave abuse of discretion may be
ascribed to the NLRC when, inter alia, its findings and
conclusions are not supported by substantial evidence, or
that amount of relevant evidence which a reasonable mind
might accept as adequate to justify a conclusion.61
Guided by the foregoing considerations, the Court finds
that the CA committed reversible error in granting
respondent's certiorari petition since the NLRC did not
gravely abuse its discretion in awarding petitioner total
and permanent disability benefits.
The Labor Code and the Amended Rules on Employees
Compensation (AREC) provide that the seafarer is
declared to be on temporary total disability during the
120-day period within which the seafarer is unable to
work.62 However, a temporary total disability lasting
continuously for more than 120 days days, except as
otherwise provided in the Rules, is considered as a total
and permanent disability.63
The exception referred to above pertains to a situation
when the sickness "still requires medical attendance
beyond the 120 days but not to exceed 240 days" in
which case the temporary total disability period is
extended up to a maximum of 240 days.64 Note, however,
that for the company-designated physician to avail of the
extended 240-day period, he must first perform some
significant act to justify an extension (e.g., that the illness
still requires medical attendance beyond the initial 120
days but not to exceed 240 days); otherwise, the
seafarer's disability shall be conclusively presumed to be
permanent and total.65
In sum, the following guidelines are observed when a
seafarer claims permanent and total disability benefits: chanRob lesvi rtu alLawli bra ry
1. The company-designated physician must issue a final
medical assessment on the seafarer's disability grading
within a period of 120 days from the time the seafarer
reported to him;
2. If the company-designated physician fails to give his
assessment within the period of 120 days, without any
justifiable reason, then the seafarer's disability becomes
permanent and total;
3. If the company-designated physician fails to give his
assessment within the period of 120 days with a sufficient
justification (e.g., seafarer required further medical
treatment or seafarer was uncooperative), then the period
of diagnosis and treatment shall be extended to 240 days.
The employer has the burden to prove that the company-
designated physician has sufficient justification to extend
the period; and
4. If the company-designated physician still fails to give
his assessment within the extended period of 240 days,
total, regardless of any justification.66
In this case, the Court finds that the NLRC did not gravely
abuse its discretion in ruling that there was no sufficient
justification for the extension of petitioner's treatment
from the initial 120-day period to 240 days.
Records disclose that respondents issued a confidential
medical report on May 14, 2013, which was within 120
days from the time petitioner was repatriated on March
26, 2013. In this report, the company-designated
physician, Dr. Go, pointed out that petitioner suffered
from numerous illnesses, namely: (a) Gastric Ulcer; (b)
Duodenitis; (c) Hypertension; (d) L3 - L4 and L4 - L5
Generalized Disc Bulge; (e) L5 - S1 Left Paracentral Disc
Protrusion; and (f) acute brainstem infarction, and
suggested that "[i]f [petitioner] is entitled to a disability,
his suggested disability grading is Grade 10 - slight brain
functional disturbance that requires little attendance or
aid and which interferes to a slight degree with the
working capacity of the patient."67
While the May 14, 2013 medical report states that
"[petitioner's] estimated length of further treatment [for
his temporary total disability] is approximately 3 more
months before he reached his maximum medical
improvement,"68 the NLRC correctly pointed out that aside
from simply alleging "maximum medical improvement,"
the same report failed to indicate what kind of further
treatment the seafarer would be subjected to. At most, it
mentions that petitioner would be made to undergo
gastroscopy (for his ulcer), which is not only unrelated to
his temporary total disability for "slight brain functional
disturbance" but was likewise recommended for
monitoring purposes only. Moreover, while petitioner's
medical progress reports mention that he was "advised to
continue his rehabilitation and medication," they
nonetheless failed to indicate what kind of rehabilitation
he has to undergo. In fact, there is no proof that
petitioner actually underwent any rehabilitation or further
treatment.69 On the contrary, respondents themselves
concede that petitioner was not treated as he unilaterally
abandoned his medical treatment.70 Notably, however,
respondents' claim of medical abandonment was not
substantiated by any evidence.
Thus, for all these reasons, the Court agrees with the
NLRC that respondents failed to sufficiently show that
further medical treatment would address petitioner's
alleged temporary total disability, which therefore,
discounts the proffered justification to extend the 120-day
period to 240 days. As such, petitioner had rightfully
commenced his complaint for disability compensation.
In C.F. Sharp Crew Management, Inc. v. Taok,71 the Court
held that "a seafarer may pursue an action for total
and permanent disability benefits if x x x the
company-designated physician failed to issue a
declaration as to his fitness to engage in sea duty or
disability even after the lapse of the 120-day period
and there is no indication that further medical
treatment would address his temporary total
disability, hence, justify an extension of the period
to 240 days x x x,"72 as in this case.
Additionally, it deserves mentioning that aside from the
lack of substantiation on the further treatment petitioner
supposedly needed, the May 14, 2013 medical report was,
in itself, riddled with material inconsistencies. For one,
while the report states that petitioner is suffering from
"slight brain functional disturbance that requires little
attendance or aid and which interferes to a slight degree
with the working capacity of the patient," the same report
contradictorily states that "[t]he specialists opine that
patient's prognosis for returning to sea duties is guarded
and fitness to work is [already] unlikely due to risk of
another cerebrovascular event."73 The specialists' finding
insinuates that petitioner's disability was not only
temporary and total, but rather, permanent and total. The
Court observes that this latter statement, in fact, finds
more bearing in the records as petitioner's medical reports
show that he still complained of lower back pain during
prolonged sitting, residual left leg weakness and instability
in balancing, as well as dizziness.74 On this score, the case
of Fil-Star Maritime Corporation v. Rosete75 illumines
that:chanRoblesvi rtua lLawl ibra ry
A total disability does not require that the employee be
completely disabled, or totally paralyzed. What is
necessary is that the injury must be such that the
employee cannot pursue his or her usual work and
earn from it. On the other hand, a total disability is
considered permanent if it lasts continuously for more
than 120 days. What is crucial is whether the
employee who suffers from disability could still
perform his work notwithstanding the disability he
incurred.76
It should also be pointed out that the Grade 10 disability
rating was given for petitioner's slight brain functional
disturbance, which risk factors, however, were
inconsistently stated to be not work-related. As the NLRC
aptly mused, "[w]hy would the company doctor even base
his disability assessment on an incapacity which is not
even work-related? His assessment should have focused
on the incapacity brought about by [petitioner's] Lumbar
Spondylosis (disc bulge and disc protrusion) which is the
illness which [the latter] averred in his Position Paper and
Memorandum of Appeal and by reason of which he now
seeks compensation."77
II.
In similar vein, the Court finds that the NLRC correctly
ruled that petitioner's illnesses were work-related.
As a rule, a seafarer shall be entitled to compensation if
he suffers from a work-related injury or illness during the
term of his contract. Under the 2010 POEA-SEC, a
"work-related illness" is defined as "any sickness as a
result of an occupational disease listed under Section 32-A
of this Contract with the conditions set therein satisfied."
Corollarily, Section 20 (A) (4) thereof further provides
that "[t]hose illnesses not listed in Section 32 of this
Contract are disputably presumed as work-related."
Records reveal that petitioner's back pain - generalized
disc bulge and disc protrusion, non-listed illnesses -
occurred only while he was on board the vessel. While
said illness was claimed to be degenerative in nature, the
company doctor herself acknowledged that it may be
aggravated or precipitated by heavy work or
lifting/pushing or pulling of heavy objects, a manual task
basically demanded from a seafarer. Since there was no
proof to show that these activities were not performed by
petitioner while he was on board or were not part of his
duties while the ship was at berth as advanced by
respondents,78 it can be safely concluded that the arduous
nature of his job may have caused or at least aggravated
his condition more so since he was declared fit to work
prior to his deployment, hence, work-
related.79 Jurisprudence provides that "[p]robability, not
the ultimate degree of certainty, is the test of proof in
compensation proceedings. And probability must be
reasonable; hence it should, at least, be anchored on total and permanent.
credible information,"80 as in this case.
All told, the Court finds that the CA committed reversible
III. error in granting respondents' certiorari petition since the
NLRC did not gravely abuse its discretion in awarding total
Finally, respondents contend that petitioner failed to and permanent disability benefits in favor of petitioner.
observe the third-doctor-referral provision under the 2010
POEA-SEC, which thus similarly negates his claim for WHEREFORE, the petition is GRANTED. The Decision
disability benefits. dated October 9, 2015 and the Resolution dated March
21, 2016 of the Court of Appeals in CA-G.R. SP No.
Section 20 (A) (3) of the 2010 POEA-SEC reads: chanRoblesvi rtua lLaw lib rary
138842 are hereby REVERSED and SET ASIDE. The
SECTION 20. COMPENSATION AND BENEFITS Decision dated September 17, 2014 and the Resolution
dated November 28, 2014 of the National Labor Relations
A. COMPENSATION AND BENEFITS FOR INJURY OR Commission in NLRC LAC No. OFW-M-07-000582-14
ILLNESS are REINSTATED.

xxxx SO ORDERED.

3. x x x.

xxxx

If a doctor appointed by the seafarer disagrees with the

assessment, a third doctor may be agreed jointly between
the Employer and the seafarer. The third doctor's decision
shall be final and binding on both parties.
In Philippine Hammonia Ship Agency, Inc. v.
Dumadag,81 the Court held that the seafarer's non-
compliance with the said conflict-resolution procedure
results in the affirmance of the fit-to-work certification of
the company-designated physician.82

However, it should be pointed out that "[a] seafarer's

compliance with such procedure presupposes that the
company-designated physician came up with an
assessment as to his fitness or unfitness to work before
the expiration of the 120-day or 240-day periods."
In Kestrel Shipping Co., Inc. v. Munar:83
In addition, that it was by operation of law that brought
forth the conclusive presumption that Munar is totally and
permanently disabled, there is no legal compulsion for him
to observe the procedure prescribed under Section 20-
B(3) of the POEA-SEC. A seafarer's compliance with
such procedure presupposes that the company-
designated physician came up with an assessment
as to his fitness or unfitness to work before the
expiration of the 120-day or 240-day periods.
Alternatively put, absent a certification from the
company-designated physician, the seafarer has
nothing to contest and the law steps in to
conclusively characterize his disability as total and
permanent.84 (Emphasis supplied).
In this case, there was no showing that petitioner duly
received a conclusive and definitive assessment for his
lumbar spondylosis. The May 14, 2013 medical report was
a confidential document, which was not shown to have
been received by him. In fact, respondents did not
respond to his initial query regarding the true state of his
condition and whether or not he would be able to return
to his pre-injury capacity and resume work despite his
back pain.85 Thus, although petitioner did consult an
independent physician regarding his illness, the lack of a
conclusive and definite assessment from respondents left
him nothing to properly contest and perforce, negates the
need for him to comply with the third-doctor referral
provision under Section 20 (A) (3) of the 2010 POEA-SEC.
As case law states, without a valid final and definite
assessment from the company-designated physician, the
law already steps in to consider petitioner's disability as