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G.R. No.L-21930
August 31, 1966

AGAPITAPAJARILLO,ETAL.,petitione
rs-appellants, vs.
SOCIALSECURITY
SYSTEM,respondent-appellee.

PaulinoManongdo for
petitioners-appellants.
OrlandoL.Espinasforrespondent
-appellee.

BARRER
A,J.:

ThisisanappealbyAgapitaPajarillo,etal.,fromtheresolutionoftheSocialSecurityCo
mmission,denying their petition tobeexempted fromcoverage
oftheSocialSecuritySystem.

Thereis nocontroversy as to the facts ofthis case.Appellants are owners

offishing boatsbeing used forfishing atsea, namely:

Owner Name
ofVessel
AgapitaPajarilloBagongKalaya
anBasilioMedina
StellaMaris
RosarioRellosoVillaFlorida
TeofilaCampanaSalenian
MeliciaTotanesNazarenoM
eliciaTotanesSanPedro
IreneoRacelisRicardo
SalvadorBoral
VillaRosario CesarKing
Felipa RamonKing
Tacia
JaimeKingAday
AmeliaReyes
QueenMary AmeliaReyes
NanayTeofiloNasisTeresit
a RosarioReyes
CharingUno Rosario
Reyes
CharingDos AuroraSales
Aurora

Assuchproperty-owners,theyenterintoagreement1withtheso-
calledpatronsorpilots,wherebythelattertake charge of appellants fishing vessels,
equipment, and gear used forfishing. Once entrusted with the equipment,
thepilot"hires"thecrewtomantheboatandsecurestheirprovisions.This
isusuallyfinancedfrom loans
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obtainedintheformofadvancesfromfishdealers,andpayableinkindwhentheboatret
urnswithcatchfrom thefishingtrip.(pp. 23-24,t.s.n.).

Thesefishingtrips arenotregular.Thefishermengoouttothesea
onlywhenthereisnomoonoritisnotyet verybright.Forthis
reason,eveninmonthsoffineweather,themostthataboatcanmakeare18fishingdays
everymonth.Thesemenhavenoregularincome.Ifthetripyields acatch,the
proceedsthereofaredividedinto threeparts:onepartgoestotheownerofthe boatand
equipment;onepartissetasidetocoverexpenses like
crudeoilandformaintenanceoftheboat,andtheotherone-
thirdisdividedamongthemen,withthepilot getting3timestheshare ofacrew-
member;andthe "machinist", whotends or operatesthe engine of the motorized
boat,receivingtwice theshareofacrew-member.(pp. 9, 23,t.s.n.).

The men (usually 12 for every vessel,including the pilot) are under no
obligation to stay in one outfit.
Sometimes,theyjoinasmembersofthecrewforonenightonly;sometimestwo,orthree
days.Then,they
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leave andjoinotheroutfits.(pp. 18-19,t.s.n.).Eventhepilot himselfis

notboundtoretainhischargeforany definiteduration.Hecanreturntheboatto
its owneranytime,ifhedoesnotwanttomanageitanymore.(p.11,
t.s.n.).Thevessel-owners,appellants inthe
presentcase,requiredtoregisterasemployerswiththeSocial Security
System, filed a joint petition with the Social Security Commission,
claiming that there existsno employer-
employeerelationshipbetweenthemandthecrew oftheirfishingvessels,and
prayingthattheybe exemptedfrom
thecompulsorycoverageofthelaw.Afterhearing,theirpetitionwasdenied,the
Commission holding thatwhile theservices ofthecrew-members are
engaged by thepilots, thelatteraremereemployees or agentsoftheboat-
owners.Thus,it iscontended,aboat-
ownercanabolishtheemploymentofthecrew-
membersbywithdrawingfromthepilottheauthoritytotakechargeofthevessel.
Appellants,consequently, weredirectedtoreport
theircoverageandthatoftheir respective pilotsandcrew-
memberstotheCommission
andtopaytheprescribedpremiumspursuanttoSections 18,19
and20oftheRepublicAct1161,asamended. The boat-owners filedthe
presentappeal.

TheonlyissueraisedbeforetheCommissionandpresentedinthisappealis,ass
tatedbytheCommission itself, "whether underthefactsset forth above,there
existsan employer-employee relationshipbetweenthe petitioners
andthecrew-members oftheirrespectivefishing boatswithinthemeaning
ofRepublic Act 1161, as amended.

Under the law, anemployeris a "person,natural or juridical, domestic or

foreign, who carries on in the Philippinesanytrade,business,
industry,undertaking,oractivityofanykindandusestheservicesofanother
personwhois underhis ordersas regards theemployment." 2Inthecase at
bar,thepilotsare not underthe ordersoftheboat-
ownersasregardstheiremployment.Theygoouttoseanotupondirectionofthe
boat-
owners, but upon their ownvolition as towhen, howlong andwhere to
gofishing.Muchless do the boat-owners inanywaycontrolthecrew-
memberswithwhom theformerhavenorelationshipwhatsoever.Thesecrew-
memberssimplyjoineverytripforwhichthepilotsallowthem,withoutanyrefere
ncetotheownersofthe vessel.

Ontheotherhand, anemployeeisdefinedas
a"personwhoperformsservicesforan'employer'inwhich either
orbothmentalandphysicaleffortsareusedandwhoreceivescompensationfor
suchservices,wherethereis anemployer-employeerelationship."3
Inthepresentcase,neitherthepilotsnorthecrew-membersreceive
compensationfromtheboat-
owners.Theyonlyshareintheirowncatchproducedbytheirownefforts.Thereis
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noshowingthat outside oftheirone-thirdshare,the boat-owners have

anythingto dowiththe distribution ofthe restofthecatch amongthepilots
andthecrew-members.Thelatterperformnoservicefortheboat-owners,but
mainly fortheir own benefit.1äwphï1.ñët

Intheundertaking inquestion,theboat-
ownersobviouslyarenotresponsibleforthe wage,salary,orfee ofthe
pilotandcrew-
members.Theirsoleparticipationintheventureisthefurnishingordeliveryofthe
equipment usedforfishing, afterwhich,theymerelywaitforthe boat'sreturn
and receivetheirshareinthecatch,ifthereis
any.Forthispart,apersonwhojoinstheoutfitisentitledtoashareorparticipationi
nthefruitofthefishingtrip.
Ifitgivesnoreturn,themengetnothing.Itappearstous,therefore,thattheundert
akingisinthenatureofa jointventure,withtheboat-
ownersupplyingtheboatanditsequipments,andthepilot andcrew-members
contributing thenecessarylabor,and the parties gettingspecific
sharesfortheirrespectivecontributions.

But,evenassumingarguendo thatthepilotandcrew-
membersmaybetreatedasemployeesoftheboat- owners,they cannot also
bemadesubjecttocompulsory coverage undertheSocialSecurity
Act.Aspreviously stated,themen are under no obligation toremainin the
outfitfor any definite period.Thus,onecan be thecrew-
memberofanoutfitforone dayandbethememberofthecrew
ofanothervesselthenextday.Also,afishing boathasno
regularscheduleoffishingtrips.Italldependsontheweatherandothernaturalco
nditions,and the volitionofthepilotsandcrew-
menthemselves.And,evenwhenafishingtrip iscompleted, it
isnoassuranceof incomeforthefishermen andthe boat-owneras
well.Clearly,theservices rendered by thefishermen are no
differentfromtheagriculturallaborperformedbyashareorleaseholdtenantorw
orker,whichisspecifically
excluded fromthe definition of "employment", 4and exempted
fromthecoverageoftheSocialSecurity Act.

Addtothistheextremedifficulty,ifnotimpossibility,ofdeterminingthemonthly
wageofearningofthese
fishermenforthepurposeoffixingtheamountoftheirandthesupposedemploye
r'scontributions,5andthereis
evenreasontoexemptthepartiestothiskindofundertakingfrom
compulsoryregistrationwiththeSocial securitySystem.

Inviewoftheforegoingconsiderations,theresolutionoftheSocialSecurityCom
missionappealedfromis herebysetaside,andpetitioners-appellants
aredeclaredexemptedfromcompulsorycoverageoftheSocial
Securitylaw.Nocosts.So ordered.
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Concepcion,C.J.,Reyes,J.B.L.,Dizon,Makalintal,Bengzon,J.P.,ZaldivarSa
nchez andCastro,JJ.,concur. Regala,J.,is onleave.