FIRST DIVISION

G.R. No. 152214             September 19, 2006

EQUI-ASIA PLACEMENT, INC., petitioner,

vs.
DEPARTMENT OF FOREIGN AFFAIRS (DFA) represented by the HON. DOMINGO L. SIAZON,
JR., SECRETARY, DEPARTMENT OF LABOR AND EMPLOYMENT (DOLE), represented by
HON. BIENVENIDO LAGUESMA, respondents.

DECISION

CHICO-NAZARIO, J.:

This is a Petition for Review on Certiorari of the Decision dated 4 October 2001 1 and Resolution
dated 18 February 2002 of the Court of Appeals in CA-G.R. SP No. 61904. The Decision denied
petitioner's petition for certiorari while the Resolution denied its Motion for Reconsideration.

The Court of Appeals summarized the facts of this case in this wise:

On September 16, 2000, Manny dela Rosa Razon, a native of Lemery, Batangas and an
overseas Filipino worker, died of acute cardiac arrest while asleep at the dormitory of the
Samsong Textile Processing Factory in South Korea. Informed thereof, the Philippine
Overseas Labor Office (POLO) at South Korea immediately relayed the incident to the
Philippine Embassy in South Korea. Forthwith, the [Labor] Attaché of the Philippine Embassy
dispatched a letter to Eleuterio N. Gardiner, administrator of the Overseas Workers Welfare
Administration (OWWA). The letter reads:

"VERY URGENT, POLO has recently received a report that OFW Manny dela Rosa
RAZON, an undocumented worker, died last Saturday, 16 September, from an
apparent pancreatic attack or 'bangungot.'

According to the verbal reports of Moises and Ronald Recarde, Manny's co-workers,
he was found already lifeless inside their quarters at around 11:00 in the morning of
the above date. They rushed him to Uri Hospital where the Doctor declared him dead
on arrival.

Per information gathered, the deceased is single, 29 years old, from Bukal, Lemery,
Batangas. His next-of-kins are Mrs. Rowena Razon (Auntie) and Mr. Razon (Uncle)
with telephone number (043)411-2308.

POLO is awaiting signed statements from the aforementioned workers who promised
to send it by fax this afternoon.

We are also coordinating with the deceased's employer for documentation

requirements and financial assistance for the repatriation of the remains.

We will highly appreciate if Home Office could advise the next-of-kins of the urgent
need to issue a Special Power of Attorney (SPA) to facilitate the repatriation
requirements of the subject.
 In anticipation of the next-of-kins' likely move to seek financial assistance from
OWWA for the repatriation of their loved [one], please be advised in advance that we
will need about US$4,000.00 to repatriate the cadaver (to include hospital and
morgue costs) to Manila. xxx"

In turn, the OWWA, through Atty. Cesar L. Chavez, indorsed the matter, for appropriate
action, to Director R. Casco of the Welfare Employment Office of the Philippine Overseas
Employment Administration (WEO-POEA).

Upon verification by the WEO-POEA on its data base, it was discovered that Manny Razon
was recruited and deployed by petitioner Equi-Asia Placement, Inc., and was sent to South
Korea on April 3, 2000 to work-train at Yeongjin Machinery, Inc. Thereupon, POEA
addressed the herein first assailed telegram-directive dated September 22, 2000 to the
President/General Manager of the petitioner. We quote the telegram:

"PLEASE PROVIDE PTA [Prepaid Ticket Advice] FOR THE REPATRIATION OF

REMAINS AND BELONGINGS OF OFW MANNY DELA ROSA RAZON AS PER
REQUEST OF PHILIPPINE EMBASSY, KOREA, YOU CAN COORDINATE WITH
YOUR FOREIGN EMPLOYER AND TO WAD/OWWA (MLA) AS REGARDS TO
THIS MATTER. YOU ARE GIVEN TWO (2) DAYS FROM RECEIPT HEREOF
WITHIN WHICH TO PROVIDE SAID TICKET AND ASSISTANCE, KINDLY SUBMIT
YOUR REPORT TO ASSISTANCE AND WELFARE DIVISION (AWD), 2/F POEA,
FAILURE TO DO SO WILL CONSTRAIN US TO IMPOSE APPROPRIATE
SANCTION UNDER OUR RULES"

Responding thereto, petitioner, thru its President Daniel Morga, Jr., faxed on September 26,
2000 the following message to the Assistance and Welfare Division of the POEA:

"In connection with your telegram, dated 09/22/2000, requiring us to report the
circumstances surrounding the death of OFW MANNY DELA ROSA RAZON in
Korea and requesting us to issue a PTA, etc., for the repatriation of the remains of
said OFW, this is to report to your good office the following:

1. The deceased was deployed by our agency on April 3, 2000 to Yeongjin Machine
Company in South Korea;

2. He violated his employment/training/dispatching contracts on June 25, 2000 by

unlawfully escaping/running away (TNT) from his company assignment without prior
KFSMB authorization and working/staying in unknown company/place;

3. He allegedly died of 'bangungot' thereafter;

In view thereof, we cannot heed your requests as embodied in your telegram.

However, his relatives can avail of the benefits provided for by OWWA in cases
involving undocumented/illegal Filipino workers abroad.

Trusting for your kind understanding"

On the same date – September 26, 2000 – Director Ricardo R. Casco of the WEO-POEA
sent to the petitioner the herein second assailed letter-directive, which pertinently reads:
 "We have received a copy of your fax message dated 26 September 2000 as
regards to your response to our request for PTA for aforesaid deceased OFW.
Nevertheless, may we remind you that pursuant to Sections 52, 53, 54 and 55 of the
Implementing Rules Governing RA 8042, otherwise known as the Migrant Workers
and Overseas Filipino Act of 1995, the repatriation of OFW, his/her remains and
transport of his personal effects is the primary responsibility of the principal or
agency and to immediately advance the cost of plane fare without prior determination
of the cause of worker's repatriation. The Rules further provide for the procedure to
be followed in cases when the foreign employer/agency fails to provide for the cost of
the repatriation, compliance of which is punishable by suspension of the license of
the agency or such sanction as the Administration shall deem proper. Hence, you are
required to provide the PTA for the deceased OFW in compliance with the
requirement in accordance with R.A. 8042. You are given forty-eight (48) hours upon
receipt hereof within which to provide said ticket. Failure in this regard will constrain
us to impose the appropriate sanction under our rules."

On September 27, 2000, petitioner wrote back Director Ricardo R. Casco, thus:

"In connection with your fax letter dated September 26, 2000, re: the repatriation of
the remains of the deceased, ex-trainee (OFW) MANNY DELA ROSA RAZON,
please be informed that the provisions of Section 53 as well as, and in relation to,
Section 55 of the Omnibus Rules and Regulations Implementing the Migrant Workers
and Overseas Filipinos Act of 1995 on the matters covering the following:

1. The responsibility of the agency to advance the cost of plane fare without
prior determination of the cause of the deceased worker's termination.

2. The recovery of the same costs from the estate of the dead worker before
the NLRC.

3. The action to be imposed by POEA for non-compliance therewith within 48

hours are violative of due process and/or the principle on due delegation of
power.

This is so because Sec. 15 of R.A. 8042 clearly contemplates prior notice and
hearing before responsibility thereunder could be established against the agency that
sets up the defense of sole fault – in avoidance of said responsibility -. Besides, the
sections in question unduly grant the powers to require advance payment of the
plane fare, to impose the corresponding penalty of suspension in case of non-
compliance therewith, within 48 hours and to recover said advance payment from the
dead worker's estate upon the return of his remains to the country before the NLRC,
when the law itself does not expressly provide for the grant of such powers.

x x x x x x x x x.

Please provide us immediately with the death certificate/post mortem report/police

report pertinent to above as proof of death and cause thereof."

Nonetheless, and apprehensive of the adverse repercussions which may ensue on account
of its non-compliance with the directive, petitioner, on September 29, 2000, advanced under
protest the costs for the repatriation of the remains of the late Manny dela Rosa Razon.
 Thereafter, petitioner went to this Court via the instant petition for certiorari, posing, for Our
consideration, the sole issue of –

"WHETHER OR NOT SECTIONS 52, 53, 54 AND 55 OF THE OMNIBUS RULES

AND REGULATIONS IMPLEMENTING THE MIGRANT WORKERS AND
OVERSEAS FILIPINOS ACT OF 1995 (R.A. 8042), ISSUED BY DFA AND POEA,
WHICH POEA SUMMARILY ORDERED THE HEREIN PETITIONER TO COMPLY
VIZ-A-VIZ THE PAYMENT IN ADVANCE OF THE EXPENSES FOR THE
REPATRIATION OF THE REMAINS OF A DECEASED WORKER-TRAINEE WHO,
AT THE TIME OF HIS DEATH, HAS NO EXISTING EMPLOYMENT
(DISPATCHING) CONTRACT WITH EITHER SAID PETITIONER OR HIS FOREIGN
PRINCIPAL AND NO VALID VISA OR IS NOT WORKING WITH THE FOREIGN
PRINCIPAL TO WHICH PETITIONER DEPLOYED HIM, IS ILLEGAL AND/OR
VIOLATIVE OF DUE PROCESS SUCH THAT POEA ACTED WITHOUT [OR IN]
EXCESS OF ITS JURISDICTION AND/OR IN GRAVE ABUSE OF DISCRETION IN
ISSUING SAID ORDER TO PAY SAID EXPENSES."2

On 4 October 2001, the Court of Appeals rendered the Decision which is now the subject of the
present petition. The dispositive portion of the Court of Appeals' Decision states:

WHEREFORE, for lack of merit, the instant petition is DENIED and is

accordingly DISMISSED.3

In dismissing the petition for certiorari, the Court of Appeals stated that petitioner was mainly
accusing the Philippine Overseas Employment Administration (POEA) of grave abuse of discretion
when it ordered petitioner to pay, in advance, the costs for the repatriation of the remains of the
deceased Manny dela Rosa Razon.

The Court of Appeals ruled that the POEA did not commit any grave abuse of discretion as its
directives to petitioner were issued pursuant to existing laws and regulations. 4 It likewise held that a
petition for certiorari, which was the remedy availed of by petitioner, is not the proper remedy as the
same is only available when "there is no appeal, or any plain, speedy, and adequate remedy in the
ordinary course of law."5 Section 62 of the Omnibus Rules and Regulations Implementing the
Migrant Workers and Overseas Filipinos Act of 1995 or Republic Act 8042 ("Omnibus Rules") states
that "the Labor Arbiters of NLRC shall have the original and exclusive jurisdiction to hear and decide
all claims arising out of employer-employee relationship or by virtue of any law or contract involving
Filipino workers for overseas deployment including claims for actual, moral, exemplary and other
forms of damages, subject to the rules and procedures of the NLRC." There is, therefore, an
adequate remedy available to petitioner.

Lastly, the Court of Appeals declared that it could not strike down as unconstitutional Sections 52,
53, 54, and 55 of the Omnibus Rules as the unconstitutionality of a statute or rules may not be
passed upon unless the issue is directly raised in an appropriate proceeding. 6

In the present recourse, petitioner submits the following issues for our consideration:

1. The Court of Appeals erred in the appreciation of the issue as it mistakenly considered, in
dismissing the petition before it, that petitioner is contesting the compliance and conformity of
the POEA directives with Sections 52, 53, 54, and 55 of the Omnibus Rules and Regulations
implementing in particular Section 15 of RA 8042;
 2. The Court of Appeals, in dismissing the petition, again erred in ruling that constitutional
questions cannot be passed upon and adjudged in a special civil action for certiorari under
Rule 65 of the 1997 Rules of Civil Procedure;

3. The Court of Appeals erred in not holding that, under the facts of the case that gave rise to
the petition before it, the same sections of the said rules and regulations are illegal, invalid
and/or violative of the right of petitioner to due process of law and, therefore, the POEA
directives issued pursuant thereto constitute acts committed without, or in excess of,
jurisdiction and/or in grave abuse of discretion.7

In Our Resolution of 20 November 2002, we gave due course to the present petition and directed the
parties to submit their respective memoranda. 8 On 28 August 2006, we resolved to dispense with the
memorandum of the estate/heirs of deceased Manny dela Rosa Razon.

At the center of this petition are the following provisions of the omnibus rules:

Section 52. Primary Responsibility for Repatriation. – The repatriation of the worker, or

his/her remains, and the transport of his/her personal effects shall be the primary
responsibility of the principal or agency which recruited or deployed him/her abroad. All costs
attendant thereto shall be borne by the principal or the agency concerned.

Section 53. Repatriation of Workers. – The primary responsibility to repatriate entails the

obligation on the part of principal or agency to advance the cost of plane fare and to
immediately repatriate the worker should the need for it arise, without a prior determination of
the cause of the termination of the worker's employment. However, after the worker has
returned to the country, the principal or agency may recover the cost of repatriation from the
worker if the termination of employment was due solely to his/her fault.

Every contract for overseas employment shall provide for the primary responsibility of
agency to advance the cost of plane fare, and the obligation of the worker to refund the cost
thereof in case his/her fault is determined by the Labor Arbiter.

Section 54. Repatriation Procedure. – When a need for repatriation arises and the foreign
employer fails to provide for it cost, the responsible personnel at site shall simultaneously
notify OWWA and the POEA of such need. The POEA shall notify the agency concerned of
the need for repatriation. The agency shall provide the plane ticket or the prepaid ticket
advice (PTA) to the Filipinos Resource Center or to the appropriate Philippine Embassy; and
notify POEA of such compliance. The POEA shall inform OWWA of the action of the agency.

Section 55. Action on Non-Compliance. – If the employment agency fails to provide the

ticket or PTA within 48 hours from receipt of the notice, the POEA shall suspend the license
of the agency or impose such sanctions as it may deem necessary. Upon notice from the
POEA, OWWA shall advance the costs of repatriation with recourse to the agency or
principal. The administrative sanction shall not be lifted until the agency reimburses the
OWWA of the cost of repatriation with legal interest.

Said provisions, on the other hand, are supposed to implement Section 15 of Republic Act No.
80429 which provides:

SEC. 15. Repatriation of Workers; Emergency Repatriation Fund. – The repatriation of the

worker and the transport of his personal belongings shall be the primary responsibility of the
 agency which, recruited or deployed the worker overseas. All costs attendant to repatriation
shall be borne by or charged to the agency concerned and/or its principal. Likewise, the
repatriation of remains and transport of the personal belongings of a deceased worker and
all costs attendant thereto shall be borne by the principal and/or the local agency. However,
in cases where the termination of employment is due solely to the fault of the worker, the
principal/employer or agency shall not in any manner be responsible for the repatriation of
the former and/or his belongings.

Petitioner contends that the Court of Appeals misappreciated the issue it presented in its petition
for certiorari when, instead of resolving whether Sections 52, 53, 54, and 55 of the Omnibus Rules
are illegal and violative of due process, it merely confined itself to the question of whether or not the
POEA committed grave abuse of discretion in issuing its directives of 22 September 2000 and 27
September 2000.

Petitioner also contends that, contrary to the finding of the Court of Appeals, a special civil action
for certiorari is the appropriate remedy to raise constitutional issues.

Also, petitioner insists that the subject portions of the omnibus rules are invalid on the ground that
Section 15 of Republic Act No. 8042 does not impose on a recruitment agency the primary
responsibility for the repatriation of a deceased Overseas Filipino Worker (OFW), while Section 52 of
the Omnibus Rules unduly imposes such burden on a placement agency.

Moreover, petitioner argues that the word "likewise" at the start of the third sentence of Section 15 of
Republic Act No. 8042 is used merely as a connective word indicating the similarity between a
recruitment agency's financial obligation in the repatriation of living and a deceased OFW. It does
not, however, necessarily make a placement agency primarily responsible for the repatriation of a
deceased OFW unlike in the case of an OFW who is alive.

As for Section 53 of the Omnibus Rules, petitioner submits that the same is invalid as Section 15 of
Republic Act No. 8042 clearly states that a placement agency shall not in any manner be
responsible for the repatriation of the deceased OFW and his or her belongings should the
termination of the OFW's employment be due to his or her fault. However, as Section 53 of the
Omnibus Rules stipulates that a placement agency or principal shall bear the primary responsibility
of repatriating an OFW and of advancing the payment for his or her plane fare, the omibus rules, as
far as this section is concerned, is an invalid exercise of legislative power by an administrative
agency.

In addition, petitioner claims Section 53 of the Omnibus Rules violates the due process clause of the
constitution as it deprives the deploying agency of the right to prior notice and hearing through which
it can prove that it should not bear the burden of repatriating an OFW.

Finally, petitioner points out that it should be the Overseas Workers Welfare Administration which
should advance the costs of repatriation of the deceased Razon with the resources coming out of
the emergency repatriation fund of said agency.

The Solicitor General for its part counters that Sections 52, 53, 54, and 55 of the Omnibus Rules are
valid quasi-legislative acts of respondents Department of Foreign Affairs and Department of Labor
and Employment.10 Because of this, the requirements of prior notice and hearing are not essential.
Besides, there are cases where even in the exercise of quasi-judicial power, administrative agencies
are allowed, sans prior notice and hearing, to effectuate measures affecting private property, such
as:
 1) [F]or the summary abatement of nuisance per se which affects the immediate safety of
persons and property, or 2) in summary proceedings of distraint and levy upon the property
of delinquent taxpayers in the collection of internal revenue taxes, fees or charges or any
increment thereto, or 3) in the preventive suspension of a public officer pending
investigation. x x x.11

The Solicitor General also adds that since petitioner is engaged in the recruitment of Filipino workers
for work abroad, the nature of its business calls for the exercise of the state's police power in order
to safeguard the rights and welfare of the Filipino laborers. One such measure is the primary
responsibility imposed upon placement agencies with regard to the repatriation of an OFW or of his
remains.

The Solicitor General also argues that the wording of Section 15 of Republic Act No. 8042 leaves no
doubt that a recruitment agency shall bear the primary responsibility for the repatriation of an OFW
whether the latter is dead or alive.

Lastly, the Solicitor General insists that actions assailing the validity of implementing rules and
regulations are within the original jurisdiction of the regional trial courts.

We shall first address the procedural question involved in the present petition.

There is no denying that regular courts have jurisdiction over cases involving the validity or
constitutionality of a rule or regulation issued by administrative agencies. Such jurisdiction, however,
is not limited to the Court of Appeals or to this Court alone for even the regional trial courts can take
cognizance of actions assailing a specific rule or set of rules promulgated by administrative bodies.
Indeed, the Constitution vests the power of judicial review or the power to declare a law, treaty,
international or executive agreement, presidential decree, order, instruction, ordinance, or regulation
in the courts, including the regional trial courts.12

Section 1, Rule 65 of the 1997 Rules of Civil Procedure states:

SECTION 1. Petition for Certiorari. – When any tribunal, board or officer exercising judicial or
quasi-judicial functions has acted without or in excess of its or his jurisdiction, or with grave
abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal, nor
any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved
thereby may file a verified petition in the proper court, alleging the facts with certainty and
praying that judgment be rendered annulling or modifying the proceedings of such tribunal,
board or officer, and granting such incidental reliefs as law and justice may require.

The petition shall be accompanied by a certified true copy of the judgment, order or
resolution subject thereof, copies of all pleadings and documents relevant and pertinent
thereto, and a sworn certification of non-forum shopping as provided in the third paragraph of
Section 3, Rule 46.

From this, it is clear that in order for a petition for certiorari to prosper, the following requisites must
be present: (1) the writ is directed against a tribunal, a board or an officer exercising judicial or quasi-
judicial functions; (2) such tribunal, board or officer has acted without or in excess of jurisdiction, or
with grave abuse of discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal
or any plain, speedy and adequate remedy in the ordinary course of law.
It bears emphasizing that administrative bodies are vested with two basic powers, the quasi-
legislative and the quasi-judicial. 13 In Abella, Jr. v. Civil Service Commission,14 we discussed the
nature of these powers to be –

In exercising its quasi-judicial function, an administrative body adjudicates the rights of

persons before it, in accordance with the standards laid down by the law. The determination
of facts and the applicable law, as basis for official action and the exercise of judicial
discretion, are essential for the performance of this function. On these considerations, it is
elementary that due process requirements, as enumerated in Ang Tibay, must be observed.
These requirements include prior notice and hearing.

On the other hand, quasi-legislative power is exercised by administrative agencies through

the promulgation of rules and regulations within the confines of the granting statute and the
doctrine of non-delegation of certain powers flowing from the separation of the great
branches of the government. Prior notice to and hearing of every affected party, as elements
of due process, are not required since there is no determination of past events or facts that
have to be established or ascertained. As a general rule, prior notice and hearing are not
essential to the validity of rules or regulations promulgated to govern future conduct.

In this case, petitioner assails certain provisions of the Omnibus Rules. However, these rules were
clearly promulgated by respondents Department of Foreign Affairs and Department of Labor and
Employment in the exercise of their quasi-legislative powers or the authority to promulgate rules and
regulations. Because of this, petitioner was, thus, mistaken in availing himself of the remedy of an
original action for certiorari as obviously, only judicial or quasi-judicial acts are proper subjects
thereof. If only for these, the petition deserves outright dismissal. Be that as it may, we shall proceed
to resolve the substantive issues raised in this petition for review in order to finally remove the doubt
over the validity of Sections 52, 53, 54, and 55 of the Omnibus Rules.

It is now well-settled that delegation of legislative power to various specialized administrative

agencies is allowed in the face of increasing complexity of modern life. Given the volume and variety
of interactions involving the members of today's society, it is doubtful if the legislature can
promulgate laws dealing with the minutiae aspects of everyday life. Hence, the need to delegate to
administrative bodies, as the principal agencies tasked to execute laws with respect to their
specialized fields, the authority to promulgate rules and regulations to implement a given statute and
effectuate its policies.15 All that is required for the valid exercise of this power of subordinate
legislation is that the regulation must be germane to the objects and purposes of the law; and that
the regulation be not in contradiction to, but in conformity with, the standards prescribed by the
law.16 Under the first test or the so-called completeness test, the law must be complete in all its terms
and conditions when it leaves the legislature such that when it reaches the delegate, the only thing
he will have to do is to enforce it.17 The second test or the sufficient standard test, mandates that
there should be adequate guidelines or limitations in the law to determine the boundaries of the
delegate's authority and prevent the delegation from running riot. 18

We resolve that the questioned provisions of the Omnibus Rules meet these requirements.

Basically, petitioner is impugning the subject provisions of the Omnibus Rules for allegedly
expanding the scope of Section 15 of Republic Act No. 8042 by: first, imposing upon it the primary
obligation to repatriate the remains of the deceased Razon including the duty to advance the cost of
the plane fare for the transport of Razon's remains; and second, by ordering it to do so without prior
determination of the existence of employer-employee relationship between itself and Razon.
Petitioner's argument that Section 15 does not provide that it shall be primarily responsible for the
repatriation of a deceased OFW is specious and plain nitpicking. While Republic Act No. 8042 does
not expressly state that petitioner shall be primarily obligated to transport back here to the
Philippines the remains of the deceased Razon, nevertheless, such duty is imposed upon him as the
statute clearly dictates that "the repatriation of remains and transport of the personal belongings of a
deceased worker and all costs attendant thereto shall be borne by the principal and/or the local
agency." The mandatory nature of said obligation is characterized by the legislature's use of the
word "shall." That the concerned government agencies opted to demand the performance of said
responsibility solely upon petitioner does not make said directives invalid as the law plainly obliges a
local placement agency such as herein petitioner to bear the burden of repatriating the remains of a
deceased OFW with or without recourse to the principal abroad. In this regard, we see no reason to
invalidate Section 52 of the omnibus rules as Republic Act No. 8042 itself permits the situation
wherein a local recruitment agency can be held exclusively responsible for the repatriation of a
deceased OFW.

Nor do we see any reason to stamp Section 53 of the Omnibus Rules as invalid for allegedly
contravening Section 15 of the law which states that a placement agency shall not be responsible for
a worker's repatriation should the termination of the employer-employee relationship be due to the
fault of the OFW. To our mind, the statute merely states the general principle that in case the
severance of the employment was because of the OFW's own undoing, it is only fair that he or she
should shoulder the costs of his or her homecoming. Section 15 of Republic Act No. 8042, however,
certainly does not preclude a placement agency from establishing the circumstances surrounding an
OFW's dismissal from service in an appropriate proceeding. As such determination would most likely
take some time, it is only proper that an OFW be brought back here in our country at the soonest
possible time lest he remains stranded in a foreign land during the whole time that recruitment
agency contests its liability for repatriation. As aptly pointed out by the Solicitor General –

Such a situation is unacceptable.

24. This is the same reason why repatriation is made by law an obligation of the agency
and/or its principal without the need of first determining the cause of the termination of the
worker's employment. Repatriation is in effect an unconditional responsibility of the agency
and/or its principal that cannot be delayed by an investigation of why the worker was
terminated from employment. To be left stranded in a foreign land without the financial
means to return home and being at the mercy of unscrupulous individuals is a violation of the
OFW's dignity and his human rights. These are the same rights R.A. No. 8042 seeks to
protect.19

As for the sufficiency of standard test, this Court had, in the past, accepted as sufficient standards
the following: "public interest," "justice and equity," "public convenience and welfare," and "simplicity,
economy and welfare."20

In this case, we hold that the legislature's pronouncements that Republic Act No. 8042 was enacted
with the thought of upholding the dignity of the Filipinos may they be here or abroad and that the
State shall at all times afford full protection to labor, both here and abroad, meet the requirement and
provide enough guidance for the formulation of the omnibus rules.

WHEREFORE, the Petition for Review is DENIED. The Court of Appeals' Decision dated 4 October
2001 and Resolution dated 18 February 2002 are hereby AFFIRMED. With costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 117056 February 24, 1998

ABD OVERSEAS MANPOWER CORPORATION, petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION, MARS INTERNATIONAL MANPOWER, INC. and
MOHMINA MACARAYA, respondents.

ROMERO, J.:

Can an accredited transferee recruitment agent of a foreign employer/recruitment office be held liable
under POEA Rules and Regulations (POEA Rules) for the illegal dismissal of an overseas worker who
filed the case prior to the transferee agent's accreditation?

In December 1989, respondent Mohmina Macaraya applied for employment as a dressmaker with
respondent Mars International Manpower, Inc. (MARS). After paying MARS the amount of P12,000.00 as
processing or recruitment fee, she signed a two-year employment contract whereby she would earn a
monthly salary of US$250.00. Without her knowledge, however, MARS submitted to the POEA an
overseas contract worker information sheet stating that she would be employed as a domestic helper for
two years with a monthly salary of US$200.00.

On January 30, 1990, Macaraya was deployed to Riyadh, Saudi Arabia, Her employer took the only copy
of her employment contract and never returned it to her. She was made to work as a domestic helper
over her objections and in violation of the contract she signed in Manila. After working for three months
and thirteen days, Macaraya was dismissed by her employer, paid merely 700.00 Saudi riyals, and
repatriated to the Philippines on May 13, 1990.

Immediately upon her arrival in the Philippines, Macaraya filed with the POEA a complaint  for illegal
1

dismissal and salary underpayment/nonpayment against MARS, M.S. Al Babtain Recruitment

Office and Times Surety and Insurance Co. Later, in her position paper, she included claims for
overtime pay and attorney's fees. MARS filed an answer to the complaint on July 5, 1990, through
its president and general manager, Adelaida Manabat.

After several hearings, with hopes of an amicable settlement getting more remote, the case was
submitted for decision. On January 9, 1992, MARS filed a manifestation and motion praying that
petitioner ABD Overseas Manpower Corporation be impleaded in the case, because the latter
apparently became the accredited recruitment agency in this country of M.S. Al Babtain
Recruitment Office on September 8, 1990. Thus, after being summoned, petitioner filed an answer
alleging affirmative and special defenses, notably, that MARS had no cause of action against it.
Petitioner also filed a cross-claim against MARS which the latter never answered.

On January 12, 1993, the POEA, ruling that Macaraya had been illegally dismissed as both her
foreign employer and recruitment agency failed to prove that the dismissal was for a just and valid
cause, rendered a decision,  the dispositive portion of which reads as follows:
2
 WHEREFORE, judgment is hereby rendered in favor of the complainant Mohmina
Macaraya and against respondents ABD Overseas Manpower Corporation and M.S. Al
Babtain Recruitment Office, ordering the latter to pay, jointly and severally, to complainant
the following amounts:

1. FOUR THOUSAND ONE HUNDRED THIRTEEN & 39/100 US DOLLARS (US$4,113.39) or

its equivalent in Philippine Currency at the time of payment, representing the salaries
corresponding to the unexpired portion of complainant's contract; and

2. SIX HUNDRED EIGHTY SIX & 71/100 US DOLLARS (US$686.71) less SEVEN HUNDRED
SAUDI RIYALS (SR 700.00), or its equivalent in Philippine Currency, at the time of actual
payment, representing the salary differentials.

All other claims are dismissed for lack of merit.

The Complaint and the Cross-claim against Mars International Manpower Inc. is (sic)
likewise dismissed for lack of merit.

SO ORDERED.

On the issue of whether or not petitioner should be liable with her foreign employer for the
monetary awards, the POEA, relying on Section 6, Rule I, Book III, of the POEA Rules, declared
that:

(The r)ecords undisputably show that the foreign principal and now co-respondent M.S. Al
Babtain Recruitment Office of Saudi Arabia is presently accredited to ABD which is valid
up to 06 August 1992. This fact was established by a Certification dated 07 November 1991
issued by the Accreditation Branch, this Administration.

The Office is convinced that respondent ABD was not fully aware of the import and
consequences of transfer of accreditation it entered into and between the other
respondents, which transfer was duly registered with and approved by the Accreditation
Branch. But ignorance of the same does not serve as a valid excuse in defeating its
liability or obligation to the complainant.

As a consequence, the transferee agency, ABD, now assumes full and complete
responsibility to the contractual obligation of the principal, M.S. Al Babtain Recruitment
Office(,) to herein complainant originally recruited and processed by the former agency,
MARS. 3

On appeal to the National Labor Relations Commission, petitioner prayed for the reversal of the
POEA's decision and the invalidation of Section 6, Rule I, Book III of the POEA Rules, citing the
rule against unjust enrichment. Thus, it alleged:

14.1 Macaraya was deployed January 30, 1990 by MARS; she stayed and worked in Riyadh
only for three (3) months and 13 days and was repatriated on May 13, 1990. She filed the
complaint against MARS on May 14, 1990. Hence, her cause of action ripened and/or
accrued as of that early date as against MARS, her placement agency. Further, it is
significant to state here that MARS filed its answer to the complaint on July 5,
1990 wherein it made admissions and averred its affirmative defenses by way of
confession and avoidance of liability. How then could ABD be made to "assume full and
complete responsibility to all contractual obligations" under the aforecited Rule when the
accreditation of M.S. Al Babtain in its favor was made only on September 3, 1990 per
 POEA records, and was only "impleaded" in this case by motion of MARS on January 9,
1992?

14.2 When MARS filed its answer on July 5, 1990, long before ABD was made a party
respondent, it caused a joinder of issues in the case. Under the well-settled principle of
estoppel, it cannot (after filing such answer) now be heard to say one and a half years
later (on January 9, 1992 when it impleaded ABD in the case) that ABD must "be
summoned to answer for the claims of herein Complainant." . . . That late, and in filing its
answer to the complaint, MARS is certainly estopped from shifting to ABD whatever
liability it had under the contract it entered into with Macaraya, or for any violations
thereof by its principal, or any POEA rules/regulations — which all accrued/occurred when
accreditation was NOT yet transferred to ABD. Ignoring these facts/circumstances
constitute a clear case of grave abuse of discretion on the part of the Hon.
Administrator.  (Emphasis supplied)
4

By resolution dated March 21, 1994,  the NLRC dismissed the appeal. Petitioner's motion for
5

reconsideration met the same fate on August 10, 1994.  Hence, this petition for certiorari.
6

Petitioner alleges that in the assailed resolution of March 21, 1994, the NLRC merely quoted the
findings of the POEA Administrator and concluded that it should "assume full and complete
responsibility to the contractual obligation" of the foreign principal to Macaraya. Petitioner
questions the failure of the NLRC to make "categorical rulings on the issues" it had raised in its
memorandum on appeal and, therefore, the NLRC should be charged with "evasion of positive
duty or a virtual refusal to perform the duty enjoined" by law. MARS had allegedly already
answered the complaint when petitioner became the transferee recruitment agency. Petitioner was
impleaded in the case one-and-a-half years after the filing of MARS' answer the complaint. Hence,
the failure of MARS to prove the legality of Macaraya's dismissal from employment should not
mean that the same burden should fall upon petitioner who was not even privy to Macaraya's
employment contract. If it were to be held liable for the monetary awards in favor of Macaraya,
then it would result in undue enrichment on the part of MARS. It must be noted that none of these
allegations was mentioned in the March 21, 1994, resolution.

Thus, after stating the facts that are clearly culled from the POEA decision, the questioned
resolution of March 21, 1994, quotes the discussion of the POEA on the liabilities for monetary
awards of petitioner and its foreign principal. Consequently, in the nine-page resolution, the NLRC
merely contributed two pages, including its conclusions, viz.:

After a careful perusal of the records of the case, We agree with the POEA Administrator
findings and conclusion th(a)t the transferee agency, ABD must assume full and complete
responsibility to the contractual obligation of the principal, M.S. Al Babtain Recruitment
Office to the complainant who was recruited by MARS.

Section 6, Rule I, Book III of the POEA Rules and Regulation provides: 7

x x x           x x x          x x x

It is clear from the aforementioned provision of the POEA Rules and Regulation that the
transferee agency shall assume full and complete responsibility to all contractual
obligations of the principals to its workers originally recruited and processed by its former
agency.

In the case at bar, respondent ABD Overseas Manpower Corporation(,) being the
transferee agency(,) must assume (the) full liability of the principal, M.S. Al Babtain(,) to
 the complainant originally recruited and process(ed) by its former agency(,) Mars
International Manpower Inc.

We find no grave abuse of discretion on the part of the POEA Administrator.

WHEREFORE, in view of the foregoing considerations, the Motion for Reconsideration  is 8

dismissed for lack of merit.

SO ORDERED.

Section 13, Rule VII of the New Rules of Procedure of the NLRC provides as follows:

Sec. 13. Form of Decision/Resolution/Order. — The Decision/Resolution shall state clearly

and distinctly the findings of facts, issues and conclusions of law on which it is based and
the relief granted, if any. If the decision or resolution involves monetary awards, the same
shall contain the specific amount awarded as of the date the decision is rendered.

This provision of the Rules is obviously in consonance with Section 14, Article VIII of the
Constitution providing that "(n)o decision shall be rendered by any court without expressing
therein clearly and distinctly the facts and the law on which it is based." Interpreting this:
constitutional provision, in Nicos Industrial Corporation v. Court of Appeals,  the Court said:
9

It is a requirement of due process that the parties to a litigation be informed of how it was
decided, with an explanation of the factual and legal reasons that led to the conclusions of
the court. The court cannot simply say that judgment is rendered in favor of X and against
Y and just leave it at that without any justification whatsoever for its action. The losing
party is entitled to know why he lost, so he may appeal to a higher court, if permitted,
should he believe that the decision should be reversed. A decision that does not clearly
and distinctly state the facts and the law on which it is based leaves the parties in the dark
as to how it was reached and is especially prejudicial to the losing party, who is unable to
pinpoint the possible errors of the court for review by a higher tribunal.

In this case, the NLRC left petitioner "in the dark" by its failure to discuss why the facts it pointed
out in its memorandum on appeal would not affect the unqualified application of Section 6, Rule I,
Book III of the POEA Rules. It is possible that the NLRC fully believed that said rule should be
applied literally. This should not, however, have given premium to brevity in its resolution  to the
10

point that the very underpinnings for a party's appeal it would be completely disregarded and left
unresolved. As this Court declared, "(b)revity is doubtless an admirable trait, but it should not and
cannot be substituted for substance."  The need for a clear dissertation on the issues raised on
11

appeal was underscored in Francisco v.  Permskul.  In said case, although the Court upheld the
12

validity of Section 40 of Batas Pambansa Blg. 120, allowing the rendition of memorandum
decisions, especially in appealed cases, it nevertheless stated that:

Despite the convenience afforded by the memorandum decision, it is still desirable that
the appellate judge exert some effort in restating in his own words the findings of fact of
the lower court and presenting his own interpretation of the law instead of merely
parroting the language of the court a quo as if he cannot do any better. There must be less
intellectual indolence and more pride of authorship in the writing of a decision, especially
if it comes from an appellate court.

It ill becomes an appellate judge to write his rulings with a pair of scissors and a pot of
paste as if he were a mere researcher. He is an innovator, not an echo. The case usually
becomes progressively simpler as it passes through the various levels of appeal and
many issues become unimportant or moot and drop along the way. The appellate judge
 should prune the cluttered record to make the issues clearer. He cannot usually do this by
simply mimicking the lower court. He must use his own perceptiveness in unraveling
the rollo and his own discernment in discovering the law. No less importantly, he must use
his own language in laying down his judgment. And in doing so, he should also guard
against torpidity lest his pronouncements excite no more fascination than a technical tract
on the values of horse manure as a fertilizer. A little style will help liven the opinion
trapped in the tortuous lexicon of the law with all its whereases and wherefores. A judicial
decision does not have to be a bore.

We should add that much more than being stylish, a decision or resolution, especially one
resolving an appeal, should directly meet the issues for resolution; otherwise, the appeal would
be pointless. It is immaterial that the NLRC is a quasi-judicial body and not a regular court. In any
controversy, the appellant needs enlightenment on the issues that befuddle him. Accordingly,
assuming that petitioner should indeed be liable to Macaraya, the NLRC should have discussed
why Section 6, Rule I, Book III of the POEA Rules should be applied notwithstanding the factual
circumstances pointed out by petitioner. As it was, petitioner's theory that the case does not merit
the application of Section 6, Rule I, Book III of the POEA Rules was merely glossed over, such that
it was left with no other recourse but to file a motion for reconsideration and, after its denial, the
instant petition.

Worth stressing is the fact that petitioner does not question the validity of the monetary awards to
Macaraya. The basic issue here is: "As between petitioner and MARS, who should be held liable
for such awards?" This can only be resolved by interpreting Section 6, Rule I, Book III of the POEA
Rules which states as follows:

Sec. 6. Transfer of Accreditation. — The accreditation of a principal or a project may be

transferred to another agency provided that transfer shall not involve any diminution of
wages and benefits of workers.

The transferee agency in these instances shall comply with the requirements for
accreditation and shall assume full and complete responsibility for all contractual
obligations of the principals to its workers originally recruited and processed by the
former agency. Prior to the transfer of accreditation, the Administration shall notify the
previous agency and principal of such application.

A cursory reading of this provision lends the impression that an accreditation transferee assumes
the contractual responsibility of the transferor under all circumstances, without qualification. We
find, however, that a strict application of said  proviso in this case may result in a grave injustice
to petitioner which became liable only when it "stepped into the shoes," as it were, of its
predecessor after the issues had been met in the illegal dismissal case filed against the latter, and
after the POEA had failed to discharge its duty of deciding the simple illegal dismissal case with
dispatch.

The rule on transfer of accreditation was prescribed under the general policies of the POEA to
"establish the environment conducive to the continued operations of legitimate, responsible and
professional private agencies" and to "afford protection to Filipino workers and their families,
promote their interests and safeguard their welfare."  In line with these policies, Book III of the
13

same rules provides for the accreditation of a principal or "any foreign person, partnership or
corporation hiring Filipino workers through an agency."   Principals may be accredited in this
14

country only through licensed local

agencies.  A land-based principal shall be accredited to only one agency but the POEA may grant
15

accreditation to a second agent as may be deemed necessary.  In the same manner, the
16

accreditation of a principal may be transferred to another agency under the aforequoted Section 6,
Rule I, Book III of the POEA Rules.
In the case at bar, petitioner became the accredited recruitment agency of the principal, M.S. Al
Babtain Recruitment Office, on September 3, 1990, after MARS had filed on July 5, 1990, its
answer to Macaraya's complaint for illegal dismissal. Petitioner got involved only on January 9,
1992, when it was impleaded in the case upon MARS' motion. The case having been submitted for
decision long before it became a party, petitioner naturally filed an answer alleging its own claims
against MARS.

Under the Rules of Court which were then in effect and applicable to the case at bar, when MARS
failed to file an answer to petitioner's cross-claim, it should have been declared in default with
respect to such claim.  In labor cases, however, technical rules of procedure are not
17

applicable,  but may apply only by analogy or in a suppletory character, for instance, when there
18

is a need to attain substantial justice and an expeditious, practical and convenient solution to a
labor problem.  Hence, when the POEA opted to overlook petitioner's cross-claim against MARS,
19

petitioner was denied substantial justice.

MARS impleaded petitioner in the case after it had been submitted for decision and one-and-a-half
years after it had filed its answer. During this hiatus, the case lay dormant in the POEA. It should
be noted that petitioner became the accredited recruitment agency on September 3, 1990, two
months after MARS had filed its answer to the complaint. The POEA's inaction ad interim provided
MARS with an opportunity to escape liability.

Basic principles of justice and equity, however, dictate that MARS should not be totally cleared of
its liability to Macaraya under the peculiar circumstances of this case. Section 6, Rule II, Book III
of the POEA Rules may not be used as a shield against liability by a recruitment agency that has
been substituted by a foreign principal as its local recruitment agency after it has clearly incurred
liability in favor of an overseas worker. After all, the POEA is presumed by law to have intended
right and justice to prevail  in promulgating its rules. Consequently, considering that it was MARS
20

with whom Macaraya entered into a contract and that it had been accorded due process at the
proceedings before the POEA, it is but meet and just that MARS be the one to be held accountable
for her claims.

In so ruling, the Court is not in any way invalidating Section 6, Rule II, Book III of the POEA Rules.
The presumption of its validity remains. Its application in this case should, however, be an
exception to the rule. Petitioner shall pay Macaraya the amount due her under the assailed POEA
decision, without prejudice to its right to be reimbursed by MARS under the provision of the Civil
Code that "(w)hoever pays for another may demand from the debtor what he has paid." 21

WHEREFORE, the resolutions of the NLRC dated March 21, 1994, and August 10, 1994, are hereby
AFFIRMED, subject to the modification at respondent Mars International Manpower, Inc. shall
reimburse petitioner ABD Overseas Manpower Corporation the amount awarded therein to
respondent Mohmina Macaraya. This Decision is immediately executory. No costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

THIRD DIVISION

G.R. Nos. 182978-79               April 7, 2009

BECMEN SERVICE EXPORTER AND PROMOTION, INC., Petitioner,

vs.
SPOUSES SIMPLICIO and MILA CUARESMA (for and in behalf of their daughter, Jasmin G. Cuaresma), WHITE FALCON
SERVICES, INC. and JAIME ORTIZ (President,White Falcon Services, Inc.), Respondents.

x - - - - - - - - - - - - - - - - - - - - - - -x

G.R. Nos. 184298-99               April 7, 2009

SPOUSES SIMPLICIO and MILA CUARESMA (for and in behalf of their daughter, Jasmin G. Cuaresma), Petitioners,
vs.
WHITE FALCON SERVICES, INC. and BECMEN SERVICE EXPORTER AND PROMOTION, INC., Respondents.

DECISION

YNARES-SANTIAGO, J.:

These consolidated petitions assail the Amended Decision1 of the Court of Appeals dated May 14, 2008 in CA-G.R. SP No. 80619
and CA-G.R. SP No. 81030 finding White Falcon Services, Inc. and Becmen Service Exporter and Promotion, Inc. solidarily liable to
indemnify spouses Simplicio and Mila Cuaresma the amount of US$4,686.73 in actual damages with interest.

On January 6, 1997, Jasmin Cuaresma (Jasmin) was deployed by Becmen Service Exporter and Promotion, Inc. 2 (Becmen) to
serve as assistant nurse in Al-Birk Hospital in the Kingdom of Saudi Arabia (KSA), for a contract duration of three years, with a
corresponding salary of US$247.00 per month.

Over a year later, she died allegedly of poisoning.

Jessie Fajardo, a co-worker of Jasmin, narrated that on June 21, 1998, Jasmin was found dead by a female cleaner lying on the
floor inside her dormitory room with her mouth foaming and smelling of poison. 3

Based on the police report and the medical report of the examining physician of the Al-Birk Hospital, who conducted an autopsy of
Jasmin’s body, the likely cause of her death was poisoning. Thus:

According to letter No. 199, dated 27.2.1419H, issued by Al-Birk Police Station, for examining the corpse of Jasmin Cuaresma,
12.20 P.M. 27.2.1419H, Sunday, at Al-Birk Hospital.

1. The Police Report on the Death

2. The Medical Diagnosis

Sex: Female Age: 25 years Relg: Christian

The said person was brought to the Emergency Room of the hospital; time 12.20 P.M. and she was unconscious, blue, no
pulse, no respiration and the first aid esd undertaken but without success.

3. Diagnosis and Opinion: Halt in blood circulation respiratory system and brain damage due to an apparent poisoning
which is under investigation.4

Name : Jasmin Cuaresma

 Sex : Female

Marital Status : Single Nationality: Philipino (sic)

Religion : Christian

Profession : Nurse

Address : Al-Birk Genrl. Hospital Birth Place: The Philippines

On 27.2.1419H, Dr. Tariq Abdulminnem and Dr. Ashoki Komar, both have examined the dead body of Jasmin Cuaresma, at 12.20
P.M., Sunday, 22.2.14189H, and the result was:

1. Report of the Police on the death

2. Medical Examination: Blue skin and paleness on the Extrimes (sic), total halt to blood circulation and respiratory system
and brain damage. There were no external injuries. Likely poisoning by taking poisonous substance, yet not
determined. There was a bad smell in the mouth and unknown to us.5 (Emphasis supplied)

Jasmin’s body was repatriated to Manila on September 3, 1998. The following day, the City Health Officer of Cabanatuan City
conducted an autopsy and the resulting medical report indicated that Jasmin died under violent circumstances, and not poisoning as
originally found by the KSA examining physician. The City Health Officer found that Jasmin had abrasions at her inner lip and gums;
lacerated wounds and abrasions on her left and right ears; lacerated wounds and hematoma (contusions) on her elbows; abrasions
and hematoma on her thigh and legs; intra-muscular hemorrhage at the anterior chest; rib fracture; puncture wounds; and abrasions
on the labia minora of the vaginal area. 6

On March 11, 1999, Jasmin’s remains were exhumed and examined by the National Bureau of Investigation (NBI). The toxicology
report of the NBI, however, tested negative for non-volatile, metallic poison and insecticides. 7

Simplicio and Mila Cuaresma (the Cuaresmas), Jasmin’s parents and her surviving heirs, received from the Overseas Workers
Welfare Administration (OWWA) the following amounts: P50,000.00 for death benefits; P50,000.00 for loss of life; P20,000.00 for
funeral expenses; and P10,000.00 for medical reimbursement.

On November 22, 1999, the Cuaresmas filed a complaint against Becmen and its principal in the KSA, Rajab & Silsilah Company
(Rajab), claiming death and insurance benefits, as well as moral and exemplary damages for Jasmin’s death. 8

In their complaint, the Cuaresmas claim that Jasmin’s death was work-related, having occurred at the employer’s premises; 9 that
under Jasmin’s contract with Becmen, she is entitled to "iqama insurance" coverage; that Jasmin is entitled to compensatory
damages in the amount of US$103,740.00, which is the sum total of her monthly salary of US$247.00 per month under her
employment contract, multiplied by 35 years (or the remaining years of her productive life had death not supervened at age 25,
assuming that she lived and would have retired at age 60).

The Cuaresmas assert that as a result of Jasmin’s death under mysterious circumstances, they suffered sleepless nights and
mental anguish. The situation, they claim, was aggravated by findings in the autopsy and exhumation reports which evidently show
that a grave injustice has been committed against them and their daughter, for which those responsible should likewise be made to
pay moral and exemplary damages and attorney’s fees.

In their position paper, Becmen and Rajab insist that Jasmin committed suicide, citing a prior unsuccessful suicide attempt
sometime in March or April 1998 and relying on the medical report of the examining physician of the Al-Birk Hospital. They likewise
deny liability because the Cuaresmas already recovered death and other benefits totaling P130,000.00 from the OWWA. They insist
that the Cuaresmas are not entitled to "iqama insurance" because this refers to the "issuance" – not insurance – of iqama, or
residency/work permit required in the KSA. On the issue of moral and exemplary damages, they claim that the Cuaresmas are not
entitled to the same because they have not acted with fraud, nor have they been in bad faith in handling Jasmin’s case.

While the case was pending, Becmen filed a manifestation and motion for substitution alleging that Rajab terminated their agency
relationship and had appointed White Falcon Services, Inc. (White Falcon) as its new recruitment agent in the Philippines. Thus,
White Falcon was impleaded as respondent as well, and it adopted and reiterated Becmen’s arguments in the position paper it
subsequently filed.

On February 28, 2001, the Labor Arbiter rendered a Decision10 dismissing the complaint for lack of merit. Giving weight to the
medical report of the Al-Birk Hospital finding that Jasmin died of poisoning, the Labor Arbiter concluded that Jasmin committed
suicide. In any case, Jasmin’s death was not service-connected, nor was it shown that it occurred while she was on duty; besides,
her parents have received all corresponding benefits they were entitled to under the law. In regard to damages, the Labor Arbiter
found no legal basis to warrant a grant thereof.

On appeal, the National Labor Relations Commission (Commission) reversed the decision of the Labor Arbiter. Relying on the
findings of the City Health Officer of Cabanatuan City and the NBI as contained in their autopsy and toxicology report, respectively,
the Commission, via its November 22, 2002 Resolution11 declared that, based on substantial evidence adduced, Jasmin was the
victim of compensable work-connected criminal aggression. It disregarded the Al-Birk Hospital attending physician’s report as well
as the KSA police report, finding the same to be inconclusive. It declared that Jasmin’s death was the result of an "accident"
occurring within the employer’s premises that is attributable to her employment, or to the conditions under which she lived, and thus
arose out of and in the course of her employment as nurse. Thus, the Cuaresmas are entitled to actual damages in the form of
Jasmin’s lost earnings, including future earnings, in the total amount of US$113,000.00. The Commission, however, dismissed all
other claims in the complaint.

Becmen, Rajab and White Falcon moved for reconsideration, whereupon the Commission issued its October 9, 2003
Resolution12 reducing the award of US$113,000.00 as actual damages to US$80,000.00.13 The NLRC likewise declared Becmen and
White Falcon as solidarily liable for payment of the award.

Becmen and White Falcon brought separate petitions for certiorari to the Court of Appeals. 14 On June 28, 2006, the appellate court
rendered its Decision,15 the dispositive portion of which reads, as follows:

WHEREFORE, the subject petitions are DENIED but in the execution of the decision, it should first be enforced against White
Falcon Services and then against Becmen Services when it is already impossible, impractical and futile to go against it (White
Falcon).

SO ORDERED.16

The appellate court affirmed the NLRC’s findings that Jasmin’s death was compensable, the same having occurred at the dormitory,
which was contractually provided by the employer. Thus her death should be considered to have occurred within the employer’s
premises, arising out of and in the course of her employment.

Becmen and White Falcon moved for reconsideration. On May 14, 2008, the appellate court rendered the assailed Amended
Decision, the dispositive portion of which reads, as follows:

WHEREFORE, the motions for reconsideration are GRANTED. Accordingly, the award of US$80,000.00 in actual damages is
hereby reduced to US$4,686.73 plus interest at the legal rate computed from the time it became due until fully paid. Petitioners are
hereby adjudged jointly and solidarily liable with the employer for the monetary awards with Becmen Service Exporter and
Promotions, Inc. having a right of reimbursement from White Falcon Services, Inc.

SO ORDERED.17

In the Amended Decision, the Court of Appeals found that although Jasmin’s death was compensable, however, there is no
evidentiary basis to support an award of actual damages in the amount of US$80,000.00. Nor may lost earnings be collected,
because the same may be charged only against the perpetrator of the crime or quasi-delict. Instead, the appellate court held that
Jasmin’s beneficiaries should be entitled only to the sum equivalent of the remainder of her 36-month employment contract, or her
monthly salary of US$247.00 multiplied by nineteen (19) months, with legal interest.

Becmen filed the instant petition for review on certiorari (G.R. Nos. 182978-79). The Cuaresmas, on the other hand, moved for a
reconsideration of the amended decision, but it was denied. They are now before us via G.R. Nos. 184298-99.

On October 6, 2008, the Court resolved to consolidate G.R. Nos. 184298-99 with G.R. Nos. 182978-79.

In G.R. Nos. 182978-79, Becmen raises the following issues for our resolution:

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT GAVE MORE CREDENCE AND WEIGHT TO THE AUTOPSY
REPORT CONDUCTED BY THE CABANATUAN CITY HEALTH OFFICE THAN THE MEDICAL AND POLICE REPORTS ISSUED
BY THE MINISTRY OF HEALTH OF KINGDOM OF SAUDI ARABIA AND AL-BIRK HOSPITAL.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN ON THE BASIS OF THE POSITION PAPERS AND ANNEXES THERETO
INCLUDING THE AUTOPSY REPORT, IT CONCLUDED THAT THE DEATH OF JASMIN CUARESMA WAS CAUSED BY
CRIMINAL AGGRESSION.
(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD THAT THE DEATH OF JASMIN CUARESMA WAS
COMPENSABLE PURSUANT TO THE RULING OF THE SUPREME COURT IN TALLER VS. YNCHAUSTI, G.R. NO. 35741,
DECEMBER 20, 1932, WHICH IT FOUND TO BE STILL GOOD LAW.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE FOR THE DEATH OF JASMIN CUARESMA
NOTWITHSTANDING ITS ADMISSIONS THAT "IQAMA INSURANCE" WAS A TYPOGRAPHICAL ERROR SINCE "IQAMA" IS
NOT AN INSURANCE.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT CONCLUDED THAT THE DEATH OF JASMIN WAS WORK RELATED.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE TO JASMIN’S BENEFICIARIES FOR THE
REMAINDER OF HER 36-MONTH CONTRACT COMPUTED IN THIS MANNER: MONTHLY SALARY OF US$246.67
MULTIPLIED BY 19 MONTHS, THE REMAINDER OF THE TERM OF JASMIN’S EMPLOYMENT CONTRACT, IS EQUAL TO
US$4,686.73.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE TO PAY INTEREST AT THE LEGAL RATE
FROM THE TIME IT WAS DUE UNTIL FULLY PAID.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN AND WHITE FALCON JOINTLY AND SEVERALLY
LIABLE WITH THE EMPLOYER NOTWITHSTANDING THE ASSUMPTION OF LIABILITY EXECUTED BY WHITE FALCON IN
FAVOR OF BECMEN.

On the other hand, in G.R. Nos. 184298-99, the Cuaresmas raise the following issues:

(THE COURT OF APPEALS) GRAVELY ERRED IN APPLYING THE PROVISIONS OF THE CIVIL CODE CONSIDERED
GENERAL LAW DESPITE THE CASE BEING COVERED BY E.O. 247, R.A. 8042 AND LABOR CODE CONSIDERED AS
SPECIAL LAWS.

(THE COURT OF APPEALS) GRAVELY ERRED IN NOT APPLYING THE DECEASED’S FUTURE EARNINGS WHICH IS (AN)
INHERENT FACTOR IN THE COMPUTATION OF DEATH BENEFITS OF OVERSEAS FILIPINO CONTRACT WORKERS.

(THE COURT OF APPEALS) GRAVELY ERRED IN REDUCING THE DEATH BENEFITS AWARDED BY NLRC CONSIDERED
FINDINGS OF FACT THAT CANNOT BE DISTURBED THROUGH CERTIORARI UNDER RULE 65 OF THE RULES OF COURT.

The issue for resolution is whether the Cuaresmas are entitled to monetary claims, by way of benefits and damages, for the death of
their daughter Jasmin.

The terms and conditions of Jasmin’s 1996 Employment Agreement which she and her employer Rajab freely entered into
constitute the law between them. As a rule, stipulations in an employment contract not contrary to statutes, public policy, public
order or morals have the force of law between the contracting parties.18 An examination of said employment agreement shows that it
provides for no other monetary or other benefits/privileges than the following:

1. 1,300 rials (or US$247.00) monthly salary;

2. Free air tickets to KSA at the start of her contract and to the Philippines at the end thereof, as well as for her vacation at
the end of each twenty four-month service;

3. Transportation to and from work;

4. Free living accommodations;

5. Free medical treatment, except for optical and dental operations, plastic surgery charges and lenses, and medical
treatment obtained outside of KSA;

6. Entry visa fees will be shared equally between her and her employer, but the exit/re-entry visa fees, fees for Iqama
issuance, renewal, replacement, passport renewal, sponsorship transfer and other liabilities shall be borne by her;

7. Thirty days paid vacation leave with round trip tickets to Manila after twenty four-months of continuous service;

8. Eight days public holidays per year;

 9. The indemnity benefit due her at the end of her service will be calculated as per labor laws of KSA.

Thus, the agreement does not include provisions for insurance, or for accident, death or other benefits that the Cuaresmas seek to
recover, and which the labor tribunals and appellate court granted variably in the guise of compensatory damages.

However, the absence of provisions for social security and other benefits does not make Jasmin’s employment contract infirm.
Under KSA law, her foreign employer is not obliged to provide her these benefits; and neither is Jasmin entitled to minimum wage –
unless of course the KSA labor laws have been amended to the opposite effect, or that a bilateral wage agreement has been
entered into.

Our next inquiry is, should Jasmin’s death be considered as work-connected and thus compensable? The evidence indicates that it
is not. At the time of her death, she was not on duty, or else evidence to the contrary would have been adduced. Neither was she
within hospital premises at the time. Instead, she was at her dormitory room on personal time when she died. Neither has it been
shown, nor does the evidence suggest, that at the time she died, Jasmin was performing an act reasonably necessary or incidental
to her employment as nurse, because she was at her dormitory room. It is reasonable to suppose that all her work is performed at
the Al-birk Hospital, and not at her dormitory room.

We cannot expect that the foreign employer should ensure her safety even while she is not on duty. It is not fair to require
employers to answer even for their employees’ personal time away from work, which the latter are free to spend of their own
choosing. Whether they choose to spend their free time in the pursuit of safe or perilous undertakings, in the company of friends or
strangers, lovers or enemies, this is not one area which their employers should be made accountable for. While we have
emphasized the need to observe official work time strictly,19 what an employee does on free time is beyond the employer’s sphere of
inquiry.

While the "employer’s premises" may be defined very broadly not only to include premises owned by it, but also premises it leases,
hires, supplies or uses,20 we are not prepared to rule that the dormitory wherein Jasmin stayed should constitute employer’s
premises as would allow a finding that death or injury therein is considered to have been incurred or sustained in the course of or
arose out of her employment. There are certainly exceptions, 21 but they do not appear to apply here. Moreover, a complete
determination would have to depend on the unique circumstances obtaining and the overall factual environment of the case, which
are here lacking.

But, did Jasmin commit suicide? Rajab, Becmen and White Falcon vehemently insist that she did; thus, her heirs may not claim
benefits or damages based on criminal aggression. On the other hand, the Cuaresmas do not believe so.

The Court cannot subscribe to the idea that Jasmin committed suicide while halfway into her employment contract. It is beyond
human comprehension that a 25-year old Filipina, in the prime of her life and working abroad with a chance at making a decent
living with a high-paying job which she could not find in her own country, would simply commit suicide for no compelling reason.

The Saudi police and autopsy reports – which state that Jasmin is a likely/or apparent victim of poisoning – are patently
inconclusive. They are thus unreliable as evidence.

On the contrary, the autopsy report of the Cabanatuan City Health Officer and the exhumation report of the NBI categorically and
unqualifiedly show that Jasmin sustained external and internal injuries, specifically abrasions at her inner lip and gums; lacerated
wounds and abrasions on her left and right ears; lacerated wounds and hematoma (contusions) on her elbows; abrasions
and hematoma on her thigh and legs; intra-muscular hemorrhage at the anterior chest; a fractured rib; puncture wounds;
and abrasions on the labia minora of the vaginal area. The NBI toxicology report came up negative on the presence of poison.

All these show that Jasmin was manhandled – and possibly raped – prior to her death.

Even if we were to agree with the Saudi police and autopsy reports that indicate Jasmin was poisoned to death, we do not believe
that it was self-induced. If ever Jasmin was poisoned, the assailants who beat her up – and possibly raped her – are certainly
responsible therefor.

We are not exactly ignorant of what goes on with our OFWs. Nor is the rest of the world blind to the realities of life being suffered by
migrant workers in the hands of some foreign employers. It is inconceivable that our Filipina women would seek employment abroad
and face uncertainty in a foreign land, only to commit suicide for unexplained reasons. Deciding to leave their family, loved ones,
and the comfort and safety of home, to work in a strange land requires unrivaled strength and courage. Indeed, many of our women
OFWs who are unfortunate to end up with undesirable employers have been there more times than they care to, beaten up and
broken in body – yet they have remained strong in mind, refusing to give up the will to live. Raped, burned with cigarettes, kicked in
the chest with sharp high-heeled shoes, starved for days or even weeks, stabbed, slaved with incessant work, locked in their rooms,
forced to serve their masters naked, grossly debased, dehumanized and insulted, their spirits fought on and they lived for the day
that they would once again be reunited with their families and loved ones. Their bodies surrendered, but their will to survive
remained strong.
It is surprising, therefore, that Rajab, Becmen and White Falcon should insist on suicide, without even lifting a finger to help solve
the mystery of Jasmin’s death. Being in the business of sending OFWs to work abroad, Becmen and White Falcon should know
what happens to some of our OFWs. It is impossible for them to be completely unaware that cruelties and inhumanities are inflicted
on OFWs who are unfortunate to be employed by vicious employers, or upon those who work in communities or environments
where they are liable to become victims of crime. By now they should know that our women OFWs do not readily succumb to the
temptation of killing themselves even when assaulted, abused, starved, debased and, worst, raped.

Indeed, what we have seen is Rajab and Becmen’s revolting scheme of conveniently avoiding responsibility by clinging to the
absurd theory that Jasmin took her own life. Abandoning their legal, moral and social obligation (as employer and recruiter) to assist
Jasmin’s family in obtaining justice for her death, they immediately gave up on Jasmin’s case, which has remained under
investigation as the autopsy and police reports themselves indicate. Instead of taking the cudgels for Jasmin, who had no relative or
representative in the KSA who would naturally demand and seek an investigation of her case, Rajab and Becmen chose to take the
most convenient route to avoiding and denying liability, by casting Jasmin’s fate to oblivion. It appears from the record that to this
date, no follow up of Jasmin’s case was ever made at all by them, and they seem to have expediently treated Jasmin’s death as a
closed case. Despite being given the lead via the autopsy and toxicology reports of the Philippine authorities, they failed and refused
to act and pursue justice for Jasmin’s sake and to restore honor to her name.

Indeed, their nonchalant and uncaring attitude may be seen from how Jasmin’s remains were repatriated. No official representative
from Rajab or Becmen was kind enough to make personal representations with Jasmin’s parents, if only to extend their condolences
or sympathies; instead, a mere colleague, nurse Jessie Fajardo, was designated to accompany Jasmin’s body home.

Of all life’s tragedies, the death of one’s own child must be the most painful for a parent. Not knowing why or how Jasmin’s life was
snuffed out makes the pain doubly unbearable for Jasmin’s parents, and further aggravated by Rajab, Becmen, and White Falcon’s
baseless insistence and accusation that it was a self-inflicted death, a mortal sin by any religious standard.

Thus we categorically hold, based on the evidence; the actual experiences of our OFWs; and the resilient and courageous spirit of
the Filipina that transcends the vilest desecration of her physical self, that Jasmin did not commit suicide but a victim of murderous
aggression.

Rajab, Becmen, and White Falcon’s indifference to Jasmin’s case has caused unfathomable pain and suffering upon her parents.
They have turned away from their moral obligation, as employer and recruiter and as entities laden with social and civic obligations
in society, to pursue justice for and in behalf of Jasmin, her parents and those she left behind. Possessed with the resources to
determine the truth and to pursue justice, they chose to stand idly for the sake of convenience and in order that they may avoid
pecuniary liability, turning a blind eye to the Philippine authorities’ autopsy and toxicology reports instead of taking action upon them
as leads in pursuing justice for Jasmin’s death. They have placed their own financial and corporate interests above their moral and
social obligations, and chose to secure and insulate themselves from the perceived responsibility of having to answer for and
indemnify Jasmin’s heirs for her death.

Under Republic Act No. 8042 (R.A. 8042), or the Migrant Workers and Overseas Filipinos Act of 1995, 22 the State shall, at all times,
uphold the dignity of its citizens whether in country or overseas, in general, and Filipino migrant workers, in particular. 23 The State
shall provide adequate and timely social, economic and legal services to Filipino migrant workers.24 The rights and interest
of distressed25 overseas Filipinos, in general, and Filipino migrant workers, in particular, documented or undocumented, are
adequately protected and safeguarded. 26

Becmen and White Falcon, as licensed local recruitment agencies, miserably failed to abide by the provisions of R.A. 8042.
Recruitment agencies are expected to extend assistance to their deployed OFWs, especially those in distress. Instead, they
abandoned Jasmin’s case and allowed it to remain unsolved to further their interests and avoid anticipated liability which parents or
relatives of Jasmin would certainly exact from them. They willfully refused to protect and tend to the welfare of the deceased Jasmin,
treating her case as just one of those unsolved crimes that is not worth wasting their time and resources on. The evidence does not
even show that Becmen and Rajab lifted a finger to provide legal representation and seek an investigation of Jasmin’s case. Worst
of all, they unnecessarily trampled upon the person and dignity of Jasmin by standing pat on the argument that Jasmin committed
suicide, which is a grave accusation given its un-Christian nature.

We cannot reasonably expect that Jasmin’s parents should be the ones to actively pursue a just resolution of her case in the KSA,
unless they are provided with the finances to undertake this herculean task. Sadly, Becmen and Rajab did not lend any assistance
at all in this respect. The most Jasmin’s parents can do is to coordinate with Philippine authorities as mandated under R.A. 8042,
obtain free legal assistance and secure the aid of the Department of Foreign Affairs, the Department of Labor and Employment, the
POEA and the OWWA in trying to solve the case or obtain relief, in accordance with Section 23 27 of R.A. 8042. To our mind, the
Cuaresmas did all that was within their power, short of actually flying to the KSA. Indeed, the Cuaresmas went even further. To the
best of their abilities and capacities, they ventured to investigate Jasmin’s case on their own: they caused another autopsy on
Jasmin’s remains as soon as it arrived to inquire into the true cause of her death. Beyond that, they subjected themselves to the
painful and distressful experience of exhuming Jasmin’s remains in order to obtain another autopsy for the sole purpose of
determining whether or not their daughter was poisoned. Their quest for the truth and justice is equally to be expected of all loving
parents. All this time, Rajab and Becmen – instead of extending their full cooperation to the Cuaresma family – merely sat on their
laurels in seeming unconcern.
In Interorient Maritime Enterprises, Inc. v. NLRC,28 a seaman who was being repatriated after his employment contract expired,
failed to make his Bangkok to Manila connecting flight as he began to wander the streets of Bangkok aimlessly. He was shot to
death by Thai police four days after, on account of running amuck with a knife in hand and threatening to harm anybody within sight.
The employer, sued for death and other benefits as well as damages, interposed as defense the provision in the seafarer agreement
which provides that "no compensation shall be payable in respect of any injury, incapacity, disability or death resulting from a willful
act on his own life by the seaman." The Court rejected the defense on the view, among others, that the recruitment agency should
have observed some precautionary measures and should not have allowed the seaman, who was later on found to be mentally ill, to
travel home alone, and its failure to do so rendered it liable for the seaman’s death. We ruled therein that –

The foreign employer may not have been obligated by its contract to provide a companion for a returning employee, but it cannot
deny that it was expressly tasked by its agreement to assure the safe return of said worker. The uncaring attitude displayed by
petitioners who, knowing fully well that its employee had been suffering from some mental disorder, nevertheless still
allowed him to travel home alone, is appalling to say the least. Such attitude harks back to another time when the landed
gentry practically owned the serfs, and disposed of them when the latter had grown old, sick or otherwise lost their
usefulness.29 (Emphasis supplied)

Thus, more than just recruiting and deploying OFWs to their foreign principals, recruitment agencies have equally significant
responsibilities. In a foreign land where OFWs are likely to encounter uneven if not discriminatory treatment from the foreign
government, and certainly a delayed access to language interpretation, legal aid, and the Philippine consulate, the recruitment
agencies should be the first to come to the rescue of our distressed OFWs since they know the employers and the addresses
where they are deployed or stationed. Upon them lies the primary obligation to protect the rights and ensure the welfare of our
OFWs, whether distressed or not. Who else is in a better position, if not these recruitment agencies, to render immediate aid to their
deployed OFWs abroad?

Article 19 of the Civil Code provides that every person must, in the exercise of his rights and in the performance of his duties, act
with justice, give everyone his due, and observe honesty and good faith. Article 21 of the Code states that any person who wilfully
causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for
the damage. And, lastly, Article 24 requires that in all contractual, property or other relations, when one of the parties is at a
disadvantage on account of his moral dependence, ignorance, indigence, mental weakness, tender age or other handicap, the
courts must be vigilant for his protection.

Clearly, Rajab, Becmen and White Falcon’s acts and omissions are against public policy because they undermine and subvert the
interest and general welfare of our OFWs abroad, who are entitled to full protection under the law. They set an awful example of
how foreign employers and recruitment agencies should treat and act with respect to their distressed employees and workers
abroad. Their shabby and callous treatment of Jasmin’s case; their uncaring attitude; their unjustified failure and refusal to assist in
the determination of the true circumstances surrounding her mysterious death, and instead finding satisfaction in the unreasonable
insistence that she committed suicide just so they can conveniently avoid pecuniary liability; placing their own corporate interests
above of the welfare of their employee’s – all these are contrary to morals, good customs and public policy, and constitute taking
advantage of the poor employee and her family’s ignorance, helplessness, indigence and lack of power and resources to seek the
truth and obtain justice for the death of a loved one.

Giving in handily to the idea that Jasmin committed suicide, and adamantly insisting on it just to protect Rajab and Becmen’s
material interest – despite evidence to the contrary – is against the moral law and runs contrary to the good custom of not
denouncing one’s fellowmen for alleged grave wrongdoings that undermine their good name and honor. 30

Whether employed locally or overseas, all Filipino workers enjoy the protective mantle of Philippine labor and social legislation,
contract stipulations to the contrary notwithstanding. This pronouncement is in keeping with the basic public policy of the State to
afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed, and regulate
the relations between workers and employers. This ruling is likewise rendered imperative by Article 17 of the Civil Code which states
that laws which have for their object public order, public policy and good customs shall not be rendered ineffective by laws or
judgments promulgated, or by determinations or conventions agreed upon in a foreign country. 31

The relations between capital and labor are so impressed with public interest, 32 and neither shall act oppressively against the other,
or impair the interest or convenience of the public. 33 In case of doubt, all labor legislation and all labor contracts shall be construed in
favor of the safety and decent living for the laborer.34

The grant of moral damages to the employee by reason of misconduct on the part of the employer is sanctioned by Article 2219
(10)35 of the Civil Code, which allows recovery of such damages in actions referred to in Article 21. 36

Thus, in view of the foregoing, the Court holds that the Cuaresmas are entitled to moral damages, which Becmen and White Falcon
are jointly and solidarily liable to pay, together with exemplary damages for wanton and oppressive behavior, and by way of example
for the public good.

Private employment agencies are held jointly and severally liable with the foreign-based employer for any violation of the recruitment
agreement or contract of employment. This joint and solidary liability imposed by law against recruitment agencies and foreign
employers is meant to assure the aggrieved worker of immediate and sufficient payment of what is due him. 37 If the
recruitment/placement agency is a juridical being, the corporate officers and directors and partners as the case may be, shall
themselves be jointly and solidarily liable with the corporation or partnership for the aforesaid claims and damages. 38

White Falcon’s assumption of Becmen’s liability does not automatically result in Becmen’s freedom or release from liability. This has
been ruled in ABD Overseas Manpower Corporation v. NLRC.39 Instead, both Becmen and White Falcon should be held liable
solidarily, without prejudice to each having the right to be reimbursed under the provision of the Civil Code that whoever pays for
another may demand from the debtor what he has paid.40

WHEREFORE, the Amended Decision of the Court of Appeals dated May 14, 2008 in CA-G.R. SP No. 80619 and CA-G.R. SP No.
81030 is SET ASIDE. Rajab & Silsilah Company, White Falcon Services, Inc., Becmen Service Exporter and Promotion,
Inc., and their corporate directors and officers are found jointly and solidarily liable and ORDERED to indemnify the heirs of
Jasmin Cuaresma, spouses Simplicio and Mila Cuaresma, the following amounts:

1) TWO MILLION FIVE HUNDRED THOUSAND PESOS (P2,500,000.00) as moral damages;

2) TWO MILLION FIVE HUNDRED THOUSAND PESOS (P2,500,000.00) as exemplary damages;

3) Attorney’s fees equivalent to ten percent (10%) of the total monetary award; and,

4) Costs of suit.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 156029             November 14, 2008

SANTOSA B. DATUMAN, petitioner,
vs.
FIRST COSMOPOLITAN MANPOWER AND PROMOTION SERVICES, INC., respondent.

DECISION

LEONARDO-DE CASTRO, J.:

Before us is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended,
assailing the Court of Appeals (CA) Decision1 dated August 7, 2002, in CA-G.R. SP No. 59825, setting aside the
Decision of the National Labor Relations Commission (NLRC).

The facts are as follows:

Sometime in 1989, respondent First Cosmopolitan Manpower & Promotion Services, Inc. recruited petitioner Santosa
B. Datuman to work abroad under the following terms and conditions:

Site of employment - Bahrain

Employees Classification/Position/Grade - Saleslady

Basic Monthly Salary - US$370.00

Duration of Contract - One (1) year

Foreign Employer - Mohammed Sharif Abbas Ghulam Hussain2

On April 17, 1989, petitioner was deployed to Bahrain after paying the required placement fee. However, her
employer Mohammed Hussain took her passport when she arrived there; and instead of working as a saleslady, she
was forced to work as a domestic helper with a salary of Forty Bahrain Dinar (BD40.00), equivalent only to One
Hundred US Dollars (US$100.00). This was contrary to the agreed salary of US$370.00 indicated in her Contract of
Employment signed in the Philippines and approved by the Philippine Overseas Employment Administration (POEA).3

On September 1, 1989, her employer compelled her to sign another contract, transferring her to another employer as
housemaid with a salary of BD40.00 for the duration of two (2) years.4 She pleaded with him to give her a release
paper and to return her passport but her pleas were unheeded. Left with no choice, she continued working against
her will. Worse, she even worked without compensation from September 1991 to April 1993 because of her
employer's continued failure and refusal to pay her salary despite demand. In May 1993, she was able to finally
return to the Philippines through the help of the Bahrain Passport and Immigration Department.5

In May 1995, petitioner filed a complaint before the POEA Adjudication Office against respondent for underpayment
and nonpayment of salary, vacation leave pay and refund of her plane fare, docketed as Case No. POEA ADJ. (L)
95-05-1586.6 While the case was pending, she filed the instant case before the NLRC for underpayment of salary for
a period of one year and six months, nonpayment of vacation pay and reimbursement of return airfare.

When the parties failed to arrive at an amicable settlement before the Labor Arbiter, they were required to file their
respective position papers, subsequent pleadings and documentary exhibits.

In its Position Paper,7 respondent countered that petitioner actually agreed to work in Bahrain as a housemaid for one
(1) year because it was the only position available then. However, since such position was not yet allowed by the
POEA at that time, they mutually agreed to submit the contract to the POEA indicating petitioner's position as
saleslady. Respondent added that it was actually petitioner herself who violated the terms of their contract when she
allegedly transferred to another employer without respondent's knowledge and approval. Lastly, respondent raised
the defense of prescription of cause of action since the claim was filed beyond the three (3)-year period from the time
the right accrued, reckoned from either 1990 or 1991.8

On April 29, 1998, Labor Arbiter Jovencio Mayor, Jr. rendered a Decision finding respondent liable for violating the
terms of the Employment Contract and ordering it to pay petitioner: (a) the amount of US$4,050.00, or its equivalent
rate prevailing at the time of payment, representing her salary differentials for fifteen (15) months; and, (b) the amount
of BD 180.00 or its equivalent rate prevailing at the time of payment, representing the refund of plane ticket, thus:

From the foregoing factual backdrop, the only crucial issue for us to resolve in this case is whether or not
complainant is entitled to her monetary claims.

xxx

In the instant case, from the facts and circumstances laid down, it is thus self-evident that the relationship of
the complainant and respondent agency is governed by the Contract of Employment, the basic terms a
covenants of which provided for the position of saleslady, monthly compensation of US$370.00 and duration
of contract for one (1) year. As it is, when the parties - complainant and respondent Agency - signed and
executed the POEA - approved Contract of Employment, this agreement is the law that governs them. Thus,
when respondent agency deviated from the terms of the contract by assigning the position of a housemaid
to complainant instead of a saleslady as agreed upon in the POEA-approved Contract of Employment,
respondent Agency committed a breach of said Employment Contract. Worthy of mention is the fact that
respondent agency in their Position Paper paragraph 2, Brief Statement of the Facts and of the Case
- admitted that it had entered into an illegal contract with complainant by proposing the position of a
housemaid which said position was then not allowed by the POEA, by making it appear in the
Employment Contract that the position being applied for is the position of a saleslady. As it is, we
find indubitably clear that the foreign employer had took advantage to the herein hopeless
complainant and because of this ordeal, the same obviously rendered complainant's continuous
employment unreasonable if not downright impossible. The facts and surrounding circumstances of her
ordeal was convincingly laid down by the complainant in her Position Paper, from which we find no flaws
material enough to disregard the same. Complainant had clearly made out her case and no amount of
persuasion can convince us to tilt the scales of justice in favor of respondents whose defense was anchored
solely on the flimsy allegations that for a period of more than five (5) years - from 1989 until 1995 - nothing
was heard from her or from her relatives, presuming then that complainant had no problem with her
employment abroad. We also find that the pleadings and the annexes filed by the parties reveal a total lapse
on the part of respondent First Cosmopolitan Manpower and Promotions - their failure to support with
substantial evidence their contention that complainant transferred from one employer to another without
 knowledge and approval of respondent agency in contravention of the terms of the POEA approved
Employment Contract. Obviously, respondent Agency anchored its disquisition on the alleged "contracts"
signed by the complainant that she agreed with the terms of said contracts - one (1) year duration only and
as a housemaid - to support its contention that complainant violated the contract agreement by transferring
from one employer to another on her own volition without the knowledge and consent of respondent agency.
To us, this posture of respondent agency is unavailing. These "documents" are self-serving. We could not
but rule that the same were fabricated to tailor-fit their defense that complainant was guilty of violating the
terms of the Employment Contract. Consequently, we could not avoid the inference of a more logical
conclusion that complainant was forced against her will to continue with her employment notwithstanding the
fact that it was in violation of the original Employment Contract including the illegal withholding of her
passport.

With the foregoing, we find and so rule that respondent Agency failed to discharge the burden of proving
with substantial evidence that complainant violated the terms of the Employment Contract, thus negating
respondent Agency's liability for complainant's money claims. All the more, the record is bereft of any
evidence to show that complainant Datuman is either not entitled to her wage differentials or have already
received the same from respondent. As such, we are perforce constrained to grant complainant's prayer for
payment of salary differentials computed as follows:

January 1992 April 1993 (15 months)

US$370.00 agreed salary

US$100.00 actual paid salary

US$270.00 balance

US$270.00 x 15 months = US$4050.00

We are also inclined to grant complainant's entitlement to a refund of her plane ticket in the amount of BD
180 Bahrain Dinar or the equivalent in Philippine Currency at the rate of exchange prevailing at the time of
payment.

Anent complainant's claim for vacation leave pay and overtime pay, we cannot, however, grant the same for
failure on the part of complainant to prove with particularity the months that she was not granted vacation
leave and the day wherein she did render overtime work.

Also, we could not grant complainant's prayer for award of damages and attorney's fees for lack of factual
and legal basis.

WHEREFORE, premises considered, judgment is hereby rendered, finding respondent Agency liable for
violating the term of Employment Contract and respondent First Cosmopolitan Manpower and Promotions is
hereby ordered:

To pay complainant the amount of US$ FOUR THOUSAND AND FIFTY (US$4,050.00), or its equivalent
rate prevailing at the time of payment, representing her salary differentials for fifteen (15) months;

To pay complainant the amount of BD 180.00 or its equivalent rate prevailing at the time of payment,
representing the refund of plane ticket;

All other claims are hereby dismissed for lack of merit.

SO ORDERED.9 (emphasis supplied)

On appeal, the NLRC, Second Division, issued a Decision10 affirming with modification the Decision of Labor Arbiter
Mayor, Jr., by reducing the award of salary differentials from US$4,050.00 to US$2,970.00 ratiocinating as follows:
 Accordingly, we find that the claims for salary differentials accruing earlier than April of 1993 had indeed
prescribed. This is so as complainant had filed her complaint on May 31, 1995 when she arrived from the
jobsite in April 1993. Since the cause of action for salary differential accrues at the time when it falls due, it is
clear that only the claims for the months of May 1993 to April 1994 have not yet prescribed. With an
approved salary rate of US$370.00 vis-à-vis the amount of salary received which was $100.00, complainant
is entitled to the salary differential for the said period in the amount of $2,970.00.

xxx

WHEREFORE, premises considered, judgment is hereby rendered MODIFYING the assailed Decision by
reducing the award of salary differentials to $2,970.00 to the complainant.

The rest of the disposition is AFFIRMED.

SO ORDERED.11

On July 21, 2000, respondent elevated the matter to the CA through a petition for certiorari under Rule 65.

On August 2, 2000,12 the CA dismissed the petition for being insufficient in form pursuant to the last paragraph of
Section 3, Rule 42 of the 1997 Rules of Civil Procedure, as amended.

On October 20, 2000,13 however, the CA reinstated the petition upon respondent's motion for reconsideration.14

On August 7, 2002, the CA issued the assailed Decision15 granting the petition and reversing the NLRC and the
Labor Arbiter, thus:

Under Section 1 (f), Rule II, Book II of the 1991 POEA Rules and Regulations, the local agency shall
assume joint and solidary liability with the employer for all claims and liabilities which may arise in
connection with the implementation of the contract, including but not limited to payment of wages, health and
disability compensation and repatriation.

Respondent Commission was correct in declaring that claims of private respondent "for salary differentials
accruing earlier than April of 1993 had indeed prescribed." It must be noted that petitioner company is privy
only to the first contract. Granting arguendo that its liability extends to the acts of its foreign principal, the
Towering Recruiting Services, which appears to have a hand in the execution of the second contract, it is
Our considered opinion that the same would, at the most, extend only up to the expiration of the second
contract or until 01 September 1991. Clearly, the money claims subject of the complaint filed in 1995 had
prescribed.

However, this Court declares respondent Commission as not only having abused its discretion, but as being
without jurisdiction at all, in declaring private respondent entitled to salary differentials. After decreeing the
money claims accruing before April 1993 as having prescribed, it has no more jurisdiction to hold petitioner
company for salary differentials after that period. To reiterate, the local agency shall assume joint and
solidary liability with the employer for all claims and liabilities which may arise in connection with the
implementation of the contract. Which contract? Upon a judicious consideration, we so hold that it is only in
connection with the  first contract. The provisions in number 2, Section 10 (a), Rule V, Book I of the Omnibus
Rules Implementing the Labor Code Section 1 (f), Rule II, Book II of the 1991 POEA Rules and Regulations
were not made to make the local agency a perpetual insurer against all untoward acts that may be done by
the foreign principal or the direct employer abroad. It is only as regards the principal contract to which it is
privy shall its liability extend. In Catan v. National Labor Relations Commission, 160 SCRA 691 (1988), it
was held that the responsibilities of the local agent and the foreign principal towards the contracted
employees under the recruitment agreement extends up to and until the expiration of the employment
contracts of the employees recruited and employed pursuant to the said recruitment agreement.

xxx

Foregoing considered, the assailed Decision dated 24 February 2000 and the Resolution dated 23 June
2000 of respondent Commission in NLRC NCR CA 016354-98 are hereby SET ASIDE.
 SO ORDERED.16

Petitioner's Motion for Reconsideration17 thereon was denied in the assailed Resolution18 dated November 14, 2002.

Hence, the present petition based on the following grounds:

I.

THE HONORABLE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR WHEN IT ABANDONED

THE FACTUAL FINDINGS OF THE LABOR ARBITER AS AFFIRMED BY THE NATIONAL LABOR
RELATIONS COMMISSION.

II.

THE HONORABLE COURT OF APPEALS PATENTLY ERRED IN HOLDING THAT THE RESPONDENT
AGENCY IS ONLY A [sic] PRIVY AND LIABLE TO THE PRINCIPAL CONTRACT.

III.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT THE CAUSE OF
ACTION OF THE PETITIONER ALREADY PRESCRIBED.

The respondent counters in its Comment that the CA is correct in ruling that it is not liable for the monetary claims of
petitioner as the claim had already prescribed and had no factual basis.

Simply put, the issues boil down to whether the CA erred in not holding respondent liable for petitioner's money
claims pursuant to their Contract of Employment.

We grant the petition.

On whether respondent is solidarily liable for petitioner's monetary claims

Section 1 of Rule II of the POEA Rules and Regulations states that:

Section 1. Requirements for Issuance of License. - Every applicant for license to operate a private
employment agency or manning agency shall submit a written application together with the following
requirements:

xxx

f. A verified undertaking stating that the applicant:

xxx

(3) Shall assume joint and solidary liability with the employer for all claims and liabilities which may
arise in connection with the implementation of the contract; including but not limited to payment of
wages, death and disability compensation and repatriation. (emphasis supplied)

The above provisions are clear that the private employment agency shall assume joint and solidary liability with the
employer.19 This Court has, time and again, ruled that private employment agencies are held jointly and severally
liable with the foreign-based employer for any violation of the recruitment agreement or contract of
employment.20 This joint and solidary liability imposed by law against recruitment agencies and foreign employers is
meant to assure the aggrieved worker of immediate and sufficient payment of what is due him.21 This is in line with
the policy of the state to protect and alleviate the plight of the working class.
In the assailed Decision, the CA disregarded the aforecited provision of the law and the policy of the state when it
reversed the findings of the NLRC and the Labor Arbiter. As the agency which recruited petitioner, respondent is
jointly and solidarily liable with the latter's principal employer abroad for her (petitioner's) money claims. Respondent
cannot, therefore, exempt itself from all the claims and liabilities arising from the implementation of their POEA-
approved Contract of Employment.

We cannot agree with the view of the CA that the solidary liability of respondent extends only to the first contract (i.e.
the original, POEA-approved contract which had a term of until April 1990). The signing of the "substitute" contracts
with the foreign employer/principal before the expiration of the POEA-approved contract and any continuation of
petitioner's employment beyond the original one-year term, against the will of petitioner, are continuing breaches of
the original POEA-approved contract. To accept the CA's reasoning will open the floodgates to even more abuse of
our overseas workers at the hands of their foreign employers and local recruiters, since the recruitment agency could
easily escape its mandated solidary liability for breaches of the POEA-approved contract by colluding with their
foreign principals in substituting the approved contract with another upon the worker's arrival in the country of
employment. Such outcome is certainly contrary to the State's policy of extending protection and support to our
overseas workers. To be sure, Republic Act No. 8042 explicitly prohibits the substitution or alteration to the prejudice
of the worker of employment contracts already approved and verified by the Department of Labor and Employment
(DOLE) from the time of actual signing thereof by the parties up to and including the period of the expiration of the
same without the approval of the DOLE.22

Respondent's contention that it was petitioner herself who violated their Contract of Employment when she signed
another contract in Bahrain deserves scant consideration. It is the finding of both the Labor Arbiter and the NLRC -
which, significantly, the CA did not disturb - that petitioner was forced to work long after the term of her original
POEA-approved contract, through the illegal acts of the foreign employer.

In Placewell International Services Corporation v. Camote,23 we held that the subsequently executed side agreement
of an overseas contract worker with her foreign employer which reduced his salary below the amount approved by
the POEA is void because it is against our existing laws, morals and public policy. The said side agreement cannot
supersede the terms of the standard employment contract approved by the POEA.

Hence, in the present case, the diminution in the salary of petitioner from US$370.00 to US$100 (BD 40.00) per
month is void for violating the POEA-approved contract which set the minimum standards, terms, and conditions of
her employment. Consequently, the solidary liability of respondent with petitioner's foreign employer for petitioner's
money claims continues although she was forced to sign another contract in Bahrain. It is the terms of the original
POEA-approved employment contract that shall govern the relationship of petitioner with the respondent recruitment
agency and the foreign employer. We agree with the Labor Arbiter and the NLRC that the precepts of justice and
fairness dictate that petitioner must be compensated for all months worked regardless of the supposed termination of
the original contract in April 1990. It is undisputed that petitioner was compelled to render service until April 1993 and
for the entire period that she worked for the foreign employer or his unilaterally appointed successor, she should have
been paid US$370/month for every month worked in accordance with her original contract.

Respondent cannot disclaim liability for the acts of the foreign employer which forced petitioner to remain employed in
violation of our laws and under the most oppressive conditions on the allegation that it purportedly had no knowledge
of, or participation in, the contract unwillingly signed by petitioner abroad. We cannot give credence to this claim
considering that respondent by its own allegations knew from the outset that the contract submitted to the POEA for
approval was not to be the "real" contract. Respondent blithely admitted to submitting to the POEA a contract stating
that the position to be filled by petitioner is that of "Saleslady" although she was to be employed as a domestic helper
since the latter position was not approved for deployment by the POEA at that time. Respondent's evident bad faith
and admitted circumvention of the laws and regulations on migrant workers belie its protestations of innocence and
put petitioner in a position where she could be exploited and taken advantage of overseas, as what indeed happened
to her in this case.

We look upon with great disfavor the unsubstantiated actuations of innocence or ignorance on the part of local
recruitment agencies of acts of their foreign principals, as if the agencies' responsibility ends with the deployment of
the worker. In the light of the recruitment agency's legally mandated joint and several liability with the foreign
employer for all claims in connection with the implementation of the contract, it is the recruitment agency's
responsibility to ensure that the terms and conditions of the employment contract, as approved by the POEA, are
faithfully complied with and implemented properly by its foreign client/principal. Indeed, it is in its best interest to do so
to avoid being haled to the courts or labor tribunals and defend itself from suits for acts of its foreign principal.
On whether petitioner's claims for underpaid salaries have prescribed

It should be recalled that the Labor Arbiter and the NLRC similarly found that petitioner is entitled to underpaid
salaries, albeit they differed in the number of months for which salary differentials should be paid. The CA, on the
other hand, held that all of petitioner's monetary claims have prescribed pursuant to Article 291 of the Labor Code
which provides that:

Art. 291. Money Claims. - All money claims arising from employer-employee relations accruing during the
effectivity of this Code shall be filed within three years from the time that cause of action accrued;
otherwise, they shall be forever barred. (emphasis supplied)

We do not agree with the CA when it held that the cause of action of petitioner had already prescribed as the three-
year prescriptive period should be reckoned from September 1, 1989 when petitioner was forced to sign another
contract against her will. As stated in the complaint, one of petitioner's causes of action was for underpayment of
salaries. The NLRC correctly ruled the right to claim unpaid salaries (or in this case, unpaid salary differentials)
accrue as they fall due.24 Thus, petitioner's cause of action to claim salary differential for October 1989 only accrued
after she had rendered service for that month (or at the end of October 1989). Her right to claim salary differential for
November 1989 only accrued at the end of November 1989, and so on and so forth.

Both the Labor Arbiter and the NLRC found that petitioner was forced to work until April 1993. Interestingly, the CA
did not disturb this finding but held only that the extent of respondent's liability was limited to the term under the
original contract or, at most, to the term of the subsequent contract entered into with the participation of respondent's
foreign principal, i.e. 1991. We have discussed previously the reasons why (a) the CA's theory of limited liability on
the part of respondent is untenable and (b) the petitioner has a right to be compensated for all months she, in fact,
was forced to work. To determine for which months petitioner's right to claim salary differentials has not prescribed,
we must count three years prior to the filing of the complaint on May 31, 1995. Thus, only claims accruing prior to
May 31, 1992 have prescribed when the complaint was filed on May 31, 1995. Petitioner is entitled to her claims for
salary differentials for the period May 31, 1992 to April 1993, or approximately eleven (11) months.25

We find that the NLRC correctly computed the salary differential due to petitioner at US$2,970.00 (US$370.00 as
approved salary rate - US$100.00 as salary received = US$290 as underpaid salary per month x 11 months).
However, it should be for the period May 31, 1992 to April 1993 and not May 1993 to April 1994 as erroneously
stated in the NLRC's Decision.

A final note

This Court reminds local recruitment agencies that it is their bounden duty to guarantee our overseas workers that
they are being recruited for bona fide jobs with bona fide employers. Local agencies should never allow themselves
to be instruments of exploitation or oppression of their compatriots at the hands of foreign employers. Indeed, being
the ones who profit most from the exodus of Filipino workers to find greener pastures abroad, recruiters should be
first to ensure the welfare of the very people that keep their industry alive.

WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals dated August 7, 2002 and
Resolution dated November 14, 2002 in CA-G.R. SP No. 59825 are REVERSED AND SET ASIDE. The Decision of
the National Labor Relations Commission dated February 24, 2000 is REINSTATED with a qualification with respect
to the award of salary differentials, which should be granted for the period May 31, 1992 to April 1993 and not May
1993 to April 1994.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 179532               May 30, 2011

CLAUDIO S. YAP, Petitioner,
vs.
THENAMARIS SHIP'S MANAGEMENT and INTERMARE MARITIME AGENCIES,
INC., Respondents.

DECISION

NACHURA, J.:

Before this Court is a Petition for Review on Certiorari1 under Rule 45 of the Rules of Civil
Procedure, seeking the reversal of the Court of Appeals (CA) Decision 2 dated February 28, 2007,
which affirmed with modification the National Labor Relations Commission (NLRC) resolution 3 dated
April 20, 2005.

The undisputed facts, as found by the CA, are as follows:

[Petitioner] Claudio S. Yap was employed as electrician of the vessel, M/T SEASCOUT on 14
August 2001 by Intermare Maritime Agencies, Inc. in behalf of its principal, Vulture Shipping Limited.
The contract of employment entered into by Yap and Capt. Francisco B. Adviento, the General
Manager of Intermare, was for a duration of 12 months. On 23 August 2001, Yap boarded M/T
SEASCOUT and commenced his job as electrician. However, on or about 08 November 2001, the
vessel was sold. The Philippine Overseas Employment Administration (POEA) was informed about
the sale on 06 December 2001 in a letter signed by Capt. Adviento. Yap, along with the other
crewmembers, was informed by the Master of their vessel that the same was sold and will be
scrapped. They were also informed about the Advisory sent by Capt. Constatinou, which states,
among others:

" …PLEASE ASK YR OFFICERS AND RATINGS IF THEY WISH TO BE TRANSFERRED TO

OTHER VESSELS AFTER VESSEL S DELIVERY (GREEK VIA ATHENS-PHILIPINOS VIA
MANILA…

…FOR CREW NOT WISH TRANSFER TO DECLARE THEIR PROSPECTED TIME FOR
REEMBARKATION IN ORDER TO SCHEDULE THEM ACCLY…"

Yap received his seniority bonus, vacation bonus, extra bonus along with the scrapping bonus.
However, with respect to the payment of his wage, he refused to accept the payment of one-month
basic wage. He insisted that he was entitled to the payment of the unexpired portion of his contract
since he was illegally dismissed from employment. He alleged that he opted for immediate transfer
but none was made.

[Respondents], for their part, contended that Yap was not illegally dismissed. They alleged that
following the sale of the M/T SEASCOUT, Yap signed off from the vessel on 10 November 2001 and
was paid his wages corresponding to the months he worked or until 10 November 2001 plus his
seniority bonus, vacation bonus and extra bonus. They further alleged that Yap’s employment
contract was validly terminated due to the sale of the vessel and no arrangement was made for
Yap’s transfer to Thenamaris’ other vessels.4

Thus, Claudio S. Yap (petitioner) filed a complaint for Illegal Dismissal with Damages and Attorney’s
Fees before the Labor Arbiter (LA). Petitioner claimed that he was entitled to the salaries
corresponding to the unexpired portion of his contract. Subsequently, he filed an amended
complaint, impleading Captain Francisco Adviento of respondents Intermare Maritime Agencies, Inc.
(Intermare) and Thenamaris Ship’s Management (respondents), together with C.J. Martionos,
Interseas Trading and Financing Corporation, and Vulture Shipping Limited/Stejo Shipping Limited.

On July 26, 2004, the LA rendered a decision5 in favor of petitioner, finding the latter to have been
constructively and illegally dismissed by respondents. Moreover, the LA found that respondents
acted in bad faith when they assured petitioner of re-embarkation and required him to produce an
electrician certificate during the period of his contract, but actually he was not able to board one
despite of respondents’ numerous vessels. Petitioner made several follow-ups for his re-embarkation
but respondents failed to heed his plea; thus, petitioner was forced to litigate in order to vindicate his
rights. Lastly, the LA opined that since the unexpired portion of petitioner’s contract was less than
one year, petitioner was entitled to his salaries for the unexpired portion of his contract for a period
of nine months. The LA disposed, as follows:

WHEREFORE, in view of the foregoing, a decision is hereby rendered declaring complainant to

have been constructively dismissed. Accordingly, respondents Intermare Maritime Agency
Incorporated, Thenamaris Ship’s Mgt., and Vulture Shipping Limited are ordered to pay jointly and
severally complainant Claudio S. Yap the sum of $12,870.00 or its peso equivalent at the time of
payment. In addition, moral damages of ONE HUNDRED THOUSAND PESOS (₱100,000.00) and
exemplary damages of FIFTY THOUSAND PESOS (₱50,000.00) are awarded plus ten percent
(10%) of the total award as attorney’s fees.

Other money claims are DISMISSED for lack of merit.

SO ORDERED.6

Aggrieved, respondents sought recourse from the NLRC.

In its decision7 dated January 14, 2005, the NLRC affirmed the LA’s findings that petitioner was
indeed constructively and illegally dismissed; that respondents’ bad faith was evident on their wilful
failure to transfer petitioner to another vessel; and that the award of attorney’s fees was warranted.
However, the NLRC held that instead of an award of salaries corresponding to nine months,
petitioner was only entitled to salaries for three months as provided under Section 10 8 of Republic
Act (R.A.) No. 8042,9 as enunciated in our ruling in Marsaman Manning Agency, Inc. v. National
Labor Relations Commission.10 Hence, the NLRC ruled in this wise:

WHEREFORE, premises considered, the decision of the Labor Arbiter finding the termination of
complainant illegal is hereby AFFIRMED with a MODIFICATION. Complainant[’s] salary for the
unexpired portion of his contract should only be limited to three (3) months basic salary.

Respondents Intermare Maritime Agency, Inc.[,] Vulture Shipping Limited and Thenamaris Ship
Management are hereby ordered to jointly and severally pay complainant, the following:
 1. Three (3) months basic salary – US$4,290.00 or its peso equivalent at the time of actual
payment.

2. Moral damages – ₱100,000.00

3. Exemplary damages – ₱50,000.00

4. Attorney’s fees equivalent to 10% of the total monetary award.

SO ORDERED.11

Respondents filed a Motion for Partial Reconsideration, 12 praying for the reversal and setting aside of
the NLRC decision, and that a new one be rendered dismissing the complaint. Petitioner, on the
other hand, filed his own Motion for Partial Reconsideration, 13 praying that he be paid the nine (9)-
month basic salary, as awarded by the LA.

On April 20, 2005, a resolution14 was rendered by the NLRC, affirming the findings of Illegal
Dismissal and respondents’ failure to transfer petitioner to another vessel. However, finding merit in
petitioner’s arguments, the NLRC reversed its earlier Decision, holding that "there can be no choice
to grant only three (3) months salary for every year of the unexpired term because there is no full
year of unexpired term which this can be applied." Hence –

WHEREFORE, premises considered, complainant’s Motion for Partial Reconsideration is hereby

granted. The award of three (3) months basic salary in the sum of US$4,290.00 is hereby modified in
that complainant is entitled to his salary for the unexpired portion of employment contract in the sum
of US$12,870.00 or its peso equivalent at the time of actual payment.

All aspect of our January 14, 2005 Decision STANDS.

SO ORDERED.15

Respondents filed a Motion for Reconsideration, which the NLRC denied.

Undaunted, respondents filed a petition for certiorari 16 under Rule 65 of the Rules of Civil Procedure
before the CA. On February 28, 2007, the CA affirmed the findings and ruling of the LA and the
NLRC that petitioner was constructively and illegally dismissed. The CA held that respondents failed
to show that the NLRC acted without statutory authority and that its findings were not supported by
law, jurisprudence, and evidence on record. Likewise, the CA affirmed the lower agencies’ findings
that the advisory of Captain Constantinou, taken together with the other documents and additional
requirements imposed on petitioner, only meant that the latter should have been re-embarked. In the
same token, the CA upheld the lower agencies’ unanimous finding of bad faith, warranting the
imposition of moral and exemplary damages and attorney’s fees. However, the CA ruled that the
NLRC erred in sustaining the LA’s interpretation of Section 10 of R.A. No. 8042. In this regard, the
CA relied on the clause "or for three months for every year of the unexpired term, whichever is less"
provided in the 5th paragraph of Section 10 of R.A. No. 8042 and held:

In the present case, the employment contract concerned has a term of one year or 12 months which
commenced on August 14, 2001. However, it was preterminated without a valid cause. [Petitioner]
was paid his wages for the corresponding months he worked until the 10th of November. Pursuant to
the provisions of Sec. 10, [R.A. No.] 8042, therefore, the option of "three months for every year of
the unexpired term" is applicable. 17
Thus, the CA provided, to wit:

WHEREFORE, premises considered, this Petition for Certiorari is DENIED. The Decision dated
January 14, 2005, and Resolutions, dated April 20, 2005 and July 29, 2005, respectively, of public
respondent National Labor Relations Commission-Fourth Division, Cebu City, in NLRC No. V-
000038-04 (RAB VIII (OFW)-04-01-0006) are hereby AFFIRMED with the MODIFICATION that
private respondent is entitled to three (3) months of basic salary computed at US$4,290.00 or its
peso equivalent at the time of actual payment.

Costs against Petitioners.18

Both parties filed their respective motions for reconsideration, which the CA, however, denied in its
Resolution19 dated August 30, 2007.

Unyielding, petitioner filed this petition, raising the following issues:

1) Whether or not Section 10 of R.A. [No.] 8042, to the extent that it affords an illegally
dismissed migrant worker the lesser benefit of – "salaries for [the] unexpired portion of his
employment contract or for three (3) months for every year of the unexpired term, whichever
is less" – is constitutional; and

2) Assuming that it is, whether or not the Court of Appeals gravely erred in granting petitioner
only three (3) months backwages when his unexpired term of 9 months is far short of the
"every year of the unexpired term" threshold.20

In the meantime, while this case was pending before this Court, we declared as unconstitutional the
clause "or for three months for every year of the unexpired term, whichever is less" provided in the
5th paragraph of Section 10 of R.A. No. 8042 in the case of Serrano v. Gallant Maritime Services,
Inc.21 on March 24, 2009.

Apparently, unaware of our ruling in Serrano, petitioner claims that the 5th paragraph of Section 10,
R.A. No. 8042, is violative of Section 1,22 Article III and Section 3,23 Article XIII of the Constitution to
the extent that it gives an erring employer the option to pay an illegally dismissed migrant worker
only three months for every year of the unexpired term of his contract; that said provision of law has
long been a source of abuse by callous employers against migrant workers; and that said provision
violates the equal protection clause under the Constitution because, while illegally dismissed local
workers are guaranteed under the Labor Code of reinstatement with full backwages computed from
the time compensation was withheld from them up to their actual reinstatement, migrant workers, by
virtue of Section 10 of R.A. No. 8042, have to waive nine months of their collectible backwages
every time they have a year of unexpired term of contract to reckon with. Finally, petitioner posits
that, assuming said provision of law is constitutional, the CA gravely abused its discretion when it
reduced petitioner’s backwages from nine months to three months as his nine-month unexpired term
cannot accommodate the lesser relief of three months for every year of the unexpired term. 24

On the other hand, respondents, aware of our ruling in Serrano, aver that our pronouncement of
unconstitutionality of the clause "or for three months for every year of the unexpired term, whichever
is less" provided in the 5th paragraph of Section 10 of R.A. No. 8042 in Serrano should not apply in
this case because Section 10 of R.A. No. 8042 is a substantive law that deals with the rights and
obligations of the parties in case of Illegal Dismissal of a migrant worker and is not merely
procedural in character. Thus, pursuant to the Civil Code, there should be no retroactive application
of the law in this case. Moreover, respondents asseverate that petitioner’s tanker allowance of
US$130.00 should not be included in the computation of the award as petitioner’s basic salary, as
provided under his contract, was only US$1,300.00. Respondents submit that the CA erred in its
computation since it included the said tanker allowance. Respondents opine that petitioner should be
entitled only to US$3,900.00 and not to US$4,290.00, as granted by the CA. Invoking Serrano,
respondents claim that the tanker allowance should be excluded from the definition of the term
"salary." Also, respondents manifest that the full sum of ₱878,914.47 in Intermare’s bank account
was garnished and subsequently withdrawn and deposited with the NLRC Cashier of Tacloban City
on February 14, 2007. On February 16, 2007, while this case was pending before the CA, the LA
issued an Order releasing the amount of ₱781,870.03 to petitioner as his award, together with the
sum of ₱86,744.44 to petitioner’s former lawyer as attorney’s fees, and the amount of ₱3,570.00 as
execution and deposit fees. Thus, respondents pray that the instant petition be denied and that
petitioner be directed to return to Intermare the sum of US$8,970.00 or its peso equivalent. 25

On this note, petitioner counters that this new issue as to the inclusion of the tanker allowance in the
computation of the award was not raised by respondents before the LA, the NLRC and the CA, nor
was it raised in respondents’ pleadings other than in their Memorandum before this Court, which
should not be allowed under the circumstances.26

The petition is impressed with merit.

Prefatorily, it bears emphasis that the unanimous finding of the LA, the NLRC and the CA that the
dismissal of petitioner was illegal is not disputed. Likewise not disputed is the tribunals’ unanimous
finding of bad faith on the part of respondents, thus, warranting the award of moral and exemplary
damages and attorney’s fees. What remains in issue, therefore, is the constitutionality of the 5th
paragraph of Section 10 of R.A. No. 8042 and, necessarily, the proper computation of the lump-sum
salary to be awarded to petitioner by reason of his illegal dismissal.

Verily, we have already declared in Serrano that the clause "or for three months for every year of the
unexpired term, whichever is less" provided in the 5th paragraph of Section 10 of R.A. No. 8042 is
unconstitutional for being violative of the rights of Overseas Filipino Workers (OFWs) to equal
protection of the laws. In an exhaustive discussion of the intricacies and ramifications of the said
clause, this Court, in Serrano, pertinently held:

The Court concludes that the subject clause contains a suspect classification in that, in the
computation of the monetary benefits of fixed-term employees who are illegally discharged, it
imposes a 3-month cap on the claim of OFWs with an unexpired portion of one year or more in their
contracts, but none on the claims of other OFWs or local workers with fixed-term employment. The
subject clause singles out one classification of OFWs and burdens it with a peculiar disadvantage. 27

Moreover, this Court held therein that the subject clause does not state or imply any definitive
governmental purpose; hence, the same violates not just therein petitioner’s right to equal protection,
but also his right to substantive due process under Section 1, Article III of the
Constitution.28 Consequently, petitioner therein was accorded his salaries for the entire unexpired
period of nine months and 23 days of his employment contract, pursuant to law and jurisprudence
prior to the enactment of R.A. No. 8042.

We have already spoken. Thus, this case should not be different from Serrano.

As a general rule, an unconstitutional act is not a law; it confers no rights; it imposes no duties; it
affords no protection; it creates no office; it is inoperative as if it has not been passed at all. The
general rule is supported by Article 7 of the Civil Code, which provides:
Art. 7. Laws are repealed only by subsequent ones, and their violation or non-observance shall not
be excused by disuse or custom or practice to the contrary.

The doctrine of operative fact serves as an exception to the aforementioned general rule. In Planters
Products, Inc. v. Fertiphil Corporation,29 we held:

The doctrine of operative fact, as an exception to the general rule, only applies as a matter of equity
and fair play. It nullifies the effects of an unconstitutional law by recognizing that the existence of a
statute prior to a determination of unconstitutionality is an operative fact and may have
consequences which cannot always be ignored. The past cannot always be erased by a new judicial
declaration.

The doctrine is applicable when a declaration of unconstitutionality will impose an undue burden on
those who have relied on the invalid law. Thus, it was applied to a criminal case when a declaration
of unconstitutionality would put the accused in double jeopardy or would put in limbo the acts done
by a municipality in reliance upon a law creating it.30

Following Serrano, we hold that this case should not be included in the aforementioned exception.
After all, it was not the fault of petitioner that he lost his job due to an act of illegal dismissal
committed by respondents. To rule otherwise would be iniquitous to petitioner and other OFWs, and
would, in effect, send a wrong signal that principals/employers and recruitment/manning agencies
may violate an OFW’s security of tenure which an employment contract embodies and actually profit
from such violation based on an unconstitutional provision of law.

In the same vein, we cannot subscribe to respondents’ postulation that the tanker allowance of
US$130.00 should not be included in the computation of the lump-sum salary to be awarded to
petitioner.

First. It is only at this late stage, more particularly in their Memorandum, that respondents are raising
this issue. It was not raised before the LA, the NLRC, and the CA. They did not even assail the
award accorded by the CA, which computed the lump-sum salary of petitioner at the basic salary of
US$1,430.00, and which clearly included the US$130.00 tanker allowance. Hence, fair play, justice,
and due process dictate that this Court cannot now, for the first time on appeal, pass upon this
question. Matters not taken up below cannot be raised for the first time on appeal. They must be
raised seasonably in the proceedings before the lower tribunals. Questions raised on appeal must
be within the issues framed by the parties; consequently, issues not raised before the lower tribunals
cannot be raised for the first time on appeal.31
1avvphi1

Second. Respondents’ invocation of Serrano is unavailing. Indeed, we made the following

pronouncements in Serrano, to wit:

The word salaries in Section 10(5) does not include overtime and leave pay. For seafarers like
petitioner, DOLE Department Order No. 33, series 1996, provides a Standard Employment Contract
of Seafarers, in which salary is understood as the basic wage, exclusive of overtime, leave pay and
other bonuses; whereas overtime pay is compensation for all work "performed" in excess of the
regular eight hours, and holiday pay is compensation for any work "performed" on designated rest
days and holidays.32

A close perusal of the contract reveals that the tanker allowance of US$130.00 was not categorized
as a bonus but was rather encapsulated in the basic salary clause, hence, forming part of the basic
salary of petitioner. Respondents themselves in their petition for certiorari before the CA averred that
petitioner’s basic salary, pursuant to the contract, was "US$1,300.00 + US$130.00 tanker
allowance."33 If respondents intended it differently, the contract per se should have indicated that
said allowance does not form part of the basic salary or, simply, the contract should have separated
it from the basic salary clause.

A final note.

We ought to be reminded of the plight and sacrifices of our OFWs. In Olarte v. Nayona, 34 this Court
held that:

Our overseas workers belong to a disadvantaged class. Most of them come from the poorest sector
of our society. Their profile shows they live in suffocating slums, trapped in an environment of
crimes. Hardly literate and in ill health, their only hope lies in jobs they find with difficulty in our
country. Their unfortunate circumstance makes them easy prey to avaricious employers. They will
climb mountains, cross the seas, endure slave treatment in foreign lands just to survive. Out of
despondence, they will work under sub-human conditions and accept salaries below the minimum.
The least we can do is to protect them with our laws.

WHEREFORE, the Petition is GRANTED. The Court of Appeals Decision dated February 28, 2007
and Resolution dated August 30, 2007 are hereby MODIFIED to the effect that petitioner is
AWARDED his salaries for the entire unexpired portion of his employment contract consisting of nine
months computed at the rate of US$1,430.00 per month. All other awards are hereby AFFIRMED.
No costs.

SO ORDERED.