FIRST DIVISION
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PHILIPPINE
TRANSMARINE CARRIERS, INC., Petitioner, - versus - JOHN MELCHOR A.
LAURENTE, substituted by JUAN A. LAURENTE, JR. and NATIVIDAD A. AQUINO, Respondents. |
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G. R. No. 158883 Present: PANGANIBAN, C.J. Chairperson, YNARES-SANTIAGO, AUSTRIA-MARTINEZ,
CALLEJO, SR., and CHICO-NAZARIO, JJ. Promulgated: April 19, 2006 |
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CHICO-NAZARIO, J.:
Assailed
in this Petition for Review under Rule 45 of the Rules of Court is the Decision[1]
dated 10 January 2003 of the Court of Appeals dismissing petitioner’s Special
Civil Action for Certiorari under
Rule 65, and the Resolution dated 30 June 2003 denying petitioner’s motion for
reconsideration.
The
factual and procedural antecedents of the case are as follows:
John
Melchor A. Laurente (John Melchor) was employed as Second Assistant Engineer by
petitioner Philippine Transmarine Carriers, Inc. for and in behalf of its
principal, Lucky Ocean Marine Corporation, after he underwent a pre-employment
medical examination at Physician’s Diagnostic Center, petitioner’s accredited
clinic, and was given a clean bill of health.
John Melchor signed a twelve-month contract with
a basic monthly salary of US$739.00.
On
20 June 1993, John Melchor embarked the vessel
“Standard Star,” where he was assigned at the engine room. After three months, he complained of
dizziness and nausea and requested for his repatriation. On 5 October 1993, he arrived in the
Philippines and immediately reported to petitioner, which referred him to a
doctor for medical treatment at its expense.
John Melchor was diagnosed with hypertension
and chronic renal failure classified as disability Grade I. On 7 June 1994, he underwent kidney
transplant. He was subsequently paid
sickness allowance in the amount of P78,962.15 covering the period from
6 October 1993 to 2 February 1994.
On
30 March 1995, John Melchor filed a complaint against
petitioner, Pioneer Insurance and Surety Corporation, and Lucky Ocean Marine
Corporation for payment of disability benefits on the basis of the amendment to
the Philippine Overseas Employment Administration (POEA) Standard Employment
Contract increasing the total disability benefit from US$11,000.00 to
US$50,000.00 effective 1 March 1994.
Petitioner
disputed John Melchor’s claim for disability benefit
alleging that the latter did not disclose his actual medical condition that he
had hypertension and kidney trouble during his pre-employment medical
examination; that John Melchor was on board the
vessel for only a little over three months such that his illness could not have
been the result of work; and that although John Melchor
was declared totally disabled only on 20 March 1994, his illness occurred on or
before 5 October 1993 when he disembarked from the vessel, i.e., prior to the effectivity of the new
rate of disability benefits on 1 March 1994.
Labor
Arbiter Pedro C. Ramos rendered a decision ordering petitioner to pay the
amount of US$50,000.00, or its peso equivalent, as disability benefit.
Petitioner
appealed to the National Labor Relations Commission (NLRC), which rendered a
decision on 31 May 1999 reversing the Labor Arbiter’s decision and reducing the
disability benefit to US$11,000.00.
However, on a motion for reconsideration filed by respondent, the NLRC
reinstated the award of the disability benefit in the amount of US$50,000.00 in
a Resolution dated 21 June 2000, which reads:
WHEREFORE,
our decision dated May 31, 1999 is reconsidered. In lieu of US$11,000.00, respondents are
hereby directed to jointly and severally pay the complainant his disability
benefit of US$50,000.00.[2]
Petitioner’s motion for
reconsideration thereof was denied in a Resolution dated 29 December 2000.
On
20 April 2001, petitioner filed a Special Civil Action for Certiorari under Rule 65.
This was dismissed by the Court of Appeals in the assailed Decision
dated 10 January 2003, and a motion for reconsideration thereof was denied by
the same court in the assailed Resolution dated 30 June 2003. The dispositive
portion of the Decision of the Court of Appeals reads:
WHEREFORE,
the petition is DISMISSED for lack of merit.[3]
Hence,
this appeal where petitioner raises but one issue: petitioner claims that the 1
March 1994 amendment to the POEA Standard Employment Contract, which increased
the disability benefits of seamen from US$11,000 to US$50,000, should not apply
to John Melchor’s claim. John Melchor, on
the other hand, claims that he should be entitled to US$60,000 instead of the
US$50,000 awarded by the NLRC and the Court of Appeals, citing Appendix 1-A of
the schedule of disability allowances in the POEA Standard Employment Contract,
which entitles those suffering from impediment Grade 1 to 120% of the maximum
rate of US$50,000.
On
30 October 2003, and during the pendency of this
appeal, John Melchor died of pulmonary congestion at
41 years of age.[4] A motion for substitution filed by John Melchor’s parents, Juan A. Laurente,
Jr. and Natividad A. Aquino,
was granted by this Court on 29 March 2004.[5]
The 31
March 1994 amendment that increased the disability benefits of seamen should
apply to John Melchor’s claim.
The
NLRC ruled, and the Court of Appeals agreed, that the 31 March 1994 amendment
to the POEA Standard Employment Contract increasing the disability benefits of
seamen from US$11,000 to US$50,000 should apply to John Melchor’s
claim. This is pursuant to Section 2 of
the primary contract between petitioner and John Melchor
which provides that “the terms and conditions of the Revised Employment
Contract for seafarers governing the employment of all Filipino Seafarers
approved by the POEA/DOLE on July 14, 1989 under Memorandum Circular No. 41,
series of 1989, and amending circulars
relative thereto shall be strictly and faithfully observed.”[6]
The
NLRC further ruled:
The
employment contract of the complainant was twelve (12) months (June 20, 1993 to
June 1994). The illness of the
complainant was discovered on May 20, 1994, a date within the twelve-month
period of the employment contract and already covered by the effectivity of the new rate of disability benefits under
the Revised Employment Contract for seafarers.
The revision of the rate of disability benefits under the amended POEA
Standard Employment Contract is corrective in nature and favorable to the
seafarers. To conform with the
prevailing rate, there is a need to adjust the disability benefits awarded to
the complainant.[7]
Petitioner
contests this ruling, asserting the inapplicability of the 31 March 1994
amendment: (a) because John Melchor’s cause of
action, if any, arose at a time prior to the effectivity
of the amendment; and (b) because the employment contract between John Melchor and petitioner was no longer in force when the said
amendment took effect.[8]
Petitioner
asserts that John Melchor’s employment was deemed
terminated when he was repatriated upon his request, arriving in the
Philippines on 5 October 1993. According
to petitioner, the termination was in accordance with Section H of the POEA
Standard Employment Contract which states:
SECTION H.
TERMINATION OF EMPLOYMENT. x x x The Master shall have the right to discharge
or sign off the seaman at any place abroad in accordance with the terms and
conditions of the contract and specifically for any of the following reasons:
(a) if the seaman x x x is
continuously incapacitated for the duties for which he was employed by reason
of illness or injury.[9]
This
argument had been raised in the Court of Appeals, to which the latter ruled:
While it is
true that private respondent was repatriated on October 5, 1993 upon his
request because of his complaints of dizziness and nausea, however, it was only
on May 20, 1994, after undergoing complete physical and laboratory
examinations, that he was diagnosed to have hypertension and chronic renal
failure and was declared unfit to work due to total permanent disability. In other words, private respondent was not
yet considered incapacitated for work when he was repatriated on October 5,
1993.[10]
We
rule in favor of John Melchor.
Findings
of fact of administrative agencies such as the NLRC are binding when supported
by substantial evidence[11];
moreover, they become conclusive when such findings are affirmed by an
appellate court.[12] Therefore, the findings of the NLRC,
sustained by the Court of Appeals, that the illness of the complainant was
discovered only on 20 May 1994,[13]
is conclusive to this Court. It was only
on 20 May 1994, after undergoing complete physical and laboratory examinations,
that John Melchor was diagnosed to have hypertension
and chronic renal failure and was declared unfit to work due to total permanent
disability. John Melchor
was not yet considered incapacitated for work when he was repatriated on 5
October 1993. Consequently, the 31 March
1994 amendment should apply to John Melchor’s claim.
Petitioner’s
claim that John Melchor was terminated on 5 October
1993 goes against the evidence available on record. In addition to the fact that the diagnosis
declaring him unfit to work came after said date, John Melchor
was also paid sickness allowance on 7 June 1994, covering the period from 6
October 1993 to 2 February 1994. This
goes to show that petitioner still recognized John Melchor
as an employee even after he returned to the Philippines. Neither was John Melchor
given any notice of his termination prior to 20 May 1994, when Philippine labor
laws and jurisprudence are ripe with the mandate that notice must be given to
employees before their termination even when such termination is for just and
authorized causes.[14]
It
is also an undeniable fact that, according to the primary contract between
petitioner and John Melchor, all amendments to
Memorandum Circular No. 41 shall be strictly and faithfully observed. This provision was apparently inserted to
protect the rights of John Melchor, who, despite the
possible amendments to the POEA Standard Employment Contract, cannot
renegotiate the primary contract terms while he is out of the country. As it is unclear whether such amendments can
be held applicable to obligations that have already accrued but have not yet
been paid, we are compelled to choose the interpretation that would favor
labor. Therefore, even if we consider
for the sake of argument that John Melchor was
terminated on 5 October 1993 as petitioner claims, this clause still makes the
31 March 1994 amendment applicable. As
we held in Marcopper Mining Corporation v. National Labor
Relations Commission,[15] contracts relating to employment should
be interpreted keeping in sight the avowed policy of the State, enshrined in
our Constitution, to accord utmost protection and justice to labor.
John Melchor is entitled to 120% of the maximum rate of
US$50,000.
Even
earlier, in his comment to petitioner’s appeal with the Court of Appeals, until
presently before this Court, John Melchor has
consistently pointed out that a careful perusal of the Appendix 1-A of the
schedule of disability allowances in the POEA Standard Employment Contract
would reveal that those suffering from impediment Grade 1 are entitled to 120%
of the maximum rate of US$50,000.[16]
There
is no question that the chronic renal failure of John Melchor,
which eventually caused his death, is an impediment Grade 1 under the POEA
Standard Employment Contract. Petitioner
never disputed such fact. John Melchor is therefore entitled to 120% of the US$50,000
maximum amount, or a total of US$60,000. The terms of the POEA Standard
Employment Contract on this point is clear, and thus there is no room for
interpretation.
No
less than the Constitution requires the State to afford full protection to
labor, whether local or overseas.[17] Pursuant to such mandate, Executive Order No.
247[18]
empowered the POEA[19]
to secure the best terms and conditions of employment of Filipino contract
workers.[20] The
POEA, in compliance therewith, prescribed standard employment contracts which
provide the minimum terms and conditions of employment for Filipino contract
workers. These minimum terms and
conditions are deemed read into the parties’ primary contracts, and as such
must be complied with in good faith.
WHEREFORE,
the petition is DENIED. The Decision
dated 10 January 2003 and the Resolution dated 30 June 2003 of the Court of
Appeals are hereby AFFIRMED, with the modification that the award of disability
benefit be increased to US$60,000.
Costs against petitioner.
SO ORDERED.
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MINITA V. CHICO-NAZARIO
Associate
Justice |
WE
CONCUR:
Chief Justice
Chairperson
Associate Justice
Associate Justice
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ROMEO J. CALLEJO, SR. Associate Justice |
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Pursuant to Article VIII,
Section 13 of the Constitution, it is hereby certified that the conclusions in the
above Decision were reached in consultation before the case was assigned to the
writer of the opinion of the Court’s Division.
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ARTEMIO V. PANGANIBAN Chief Justice |
[1] Penned by Associate Justice Marina L. Buzon with Associate Justices Josefina Guevara-Salonga and Danilo B. Pine concurring; Rollo, pp. 23-30.
[2] CA rollo, p. 40.
[3] Rollo, p. 30.
[4]
[5]
[6]
[7] CA rollo, p. 38.
[8] Rollo, p. 114.
[9]
[10]
[11] Pabu-aya v. Court of Appeals, G.R. No. 128082, 18 April 2001, 356 SCRA 651, 657.
[12] Miralles v. Hon. Go, 402 Phil. 638, 651 (2001).
[13] CA rollo, p. 130.
[14] See RULES IMPLEMENTING BOOK VI OF THE LABOR CODE, Rule I, Sec. 2(d); Agabon v. National Labor Relations Commission, G.R. No. 158693, 17 November 2004, 442 SCRA 573, 608; Serrano v. National Labor Relations Commission, 380 Phil. 416, 439 (2000); Wenphil Corporation v. National Labor Relations Commission, G.R. No. 80587, 8 February 1989, 170 SCRA 69, 76.
[15] 325 Phil. 618, 634-635 (1996).
[16] CA rollo, p. 56.
[17] Constitution, Art. XIII, Sec. 3, par. 1.
[18] Approved on 24 July 1987.
[19] This was formerly performed by the National Seamen Board under Article 20(a)-2 of the Labor Code.
[20] Executive Order No. 247, Sec. 3(f).