SECOND DIVISION
[G.R. No. 248963. August 8, 2022.]
JEREMY ORAIS, petitioner, vs.ASSOCIATED SHIP MANAGEMENT SERVICES, INC., SEA GIANT SHIPMANAGEMENT, LTD. AND/OR WILMA T. PAGUNTALAN, respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Second Division, issued a Resolution datedAugust 8, 2022which reads as follows:
"G.R. No. 248963 (Jeremy Orais, petitionerv. Associated Ship Management Services, Inc., Sea Giant Shipmanagement, Ltd. and/or Wilma T. Paguntalan, respondents). — This petition for review 1 under Rule 45 assails the Decision 2 dated June 18, 2018, which nullified the National Labor Relations Commission's (NLRC) decision and dismissed petitioner's complaint for total permanent disability compensation, attorney's fees, and damages, and the Resolution 3 dated July 18, 2019, which denied petitioner's motion for reconsideration.
Respondent Associated Ship Management Services, Inc. (ASMS) is a duly registered manning or recruitment agency in the Philippines, with principal place of business in Malate, Manila. Respondent Sea Giant Shipmanagement Ltd. (SGS) is ASMS's foreign principal. Respondent Wilma T. Paguntalan (Paguntalan) is the crew officer and official representative of ASMS. On the other hand, petitioner Jeremy Orais is a seafarer formerly employed by respondents. 4
Sometime in January 2015, petitioner was employed by respondents for a period of 10 months with a basic monthly salary of US$440.00 and overtime rate of US$275.00 on a 48-hour work-week schedule. On February 3, 2015, he boarded marine vessel "UBC Luzon." Petitioner's employment was covered by a Philippine Overseas Employment Administration-Standard Employment Contract (POEA-SEC). 5
On August 7, 2015, while petitioner was installing a cradle grab on the ship, he lost his footing and fell three (3) to four (4) meters to the deck. As a result, he ruptured his right knee, fractured his right foot, and his right leg became swollen. 6 Eventually, on September 30, 2015, petitioner was repatriated to the Philippines. Upon disembarkation, he was immediately brought to St. Luke's Medical Center. 7
Petitioner was referred to the company-designated physician, Dr. Natalio Alegre II (Dr. Alegre), of Alegre Medical Center. On October 15, 2015, Dr. Alegre found petitioner to be suffering from "calcaneal fracture, right." This assessment was confirmed by subsequent medical examinations conducted during the following months. 8 In January 2016, Dr. Alegre issued an interim assessment of Grade 12 or 10.45% disability relative to petitioner's condition, pursuant to Section 32 of the POEA-SEC. On April 11, 2016, petitioner was assessed with the so-called final disability rating of Grade 12. 9 CHTAIc
Petitioner, however, was not satisfied with Dr. Alegre's assessment. He consulted another physician, Dr. Manuel Magtira (Dr. Magtira). After a month of medical examination and treatment, Dr. Magtira concluded that the nature and extent of petitioner's injuries rendered him permanently incapable of performing his job as seafarer. 10
Consequently, petitioner filed a complaint for total and permanent disability compensation, attorney's fees, and damages with the NLRC. 11
Ruling of the Labor Arbiter
By Decision dated October 17, 2016, Executive Labor Arbiter Amelia Docena granted the complaint, to wit:
"WHEREFORE, judgment is hereby rendered directing respondents Associated Ship Management Services, Inc./Sea Giant Shipmanagement Ltd./Wilma T. Paguntalan to pay complainant Jeremy C. Orais the amount of US$5,225.00 plus 10% attorney's fees or the total of US$5,747.50 or its peso equivalent at the time of payment.
All other claims are dismissed for lack of merit.
SO ORDERED." 12
Ruling of the NLRC
Dissatisfied, petitioner appealed to the NLRC. By Decision dated January 20, 2017, the NLRC reversed and increased his award, thus:
"WHEREFORE, premises considered, complainant's appeal is GRANTED. The Decision of the Executive Labor Arbiter below is REVERSED and SET ASIDE. A NEW ONE is ENTERED declaring respondents Associated Ship Management Services, Inc. liable to complainant Jeremy C. Orais for total and permanent disability compensation in the amount of US$60,000.00, or its peso equivalent at the time of payment plus 10% attorney's fees.
Other claims are denied for lack of merit.
SO ORDERED." 13
Respondents sought a reconsideration which was denied under Resolution dated March 16, 2017. 14
Proceedings Before the Court of Appeals
On certiorari, respondents argued that petitioner did not comply with the third-doctor referral rule outlined in the POEA-SEC and the Collective Bargaining Agreement (CBA) before he filed his complaint with the NLRC. Having been prematurely filed, the complaint should have been dismissed. Too, the findings of Dr. Alegre, the company-designated physician, should prevail over Dr. Magtira's findings, since Dr. Alegre had conducted a more extensive medical examination. Thus, the NLRC gravely abused its discretion when it sustained Dr. Magtira's findings. Lastly, the award of attorney's fees was not warranted in the absence of bad faith on their part. 15
By its assailed Decision 16 dated June 18, 2018, the Court of Appeals granted the petition. Under the POEA-SEC, the company-designated physician is the only one authorized to make a conclusive assessment on a seafarer's disability. If the employer and seafarer disagree, Section 20 (A) (3) of the POEA-SEC provides that the parties may seek the opinion of a third-party doctor. The decision of the third physician shall be final and binding on both parties. 17 The referral to a third physician is a mandatory procedure. Thus, petitioner's failure to refer the matter to a third physician rendered his complaint premature. 18 Further, the findings of the company-designated physician prevails when the seafarer did not abide by the third-physician referral rule. 19 In any event, there was no showing that Dr. Alegre's findings were biased against petitioner. His findings were based on several months of assessment and treatment. 20 Too, the fact that petitioner's medical treatment exceeded 240 days was not controlling. A disability grading does not depend on the number of days of treatment, 21 thus: EATCcI
WHEREFORE, the petition is GRANTED. The Decision dated January 20, 2017 and Resolution dated March 16, 2017 of the National Labor Relations in NLRC Case No. OFW-VAC-12-000065-16 are NULLIFIED. The Complaint is hereby DISMISSED without prejudice.
SO ORDERED. 22
Petitioner's motion for reconsideration was denied under the assailed Resolution dated July 18, 2019. 23
The Present Petition
Petitioner now seeks affirmative relief from this Court via petition 24 for review on certiorari under Rule 45. He avers that the Court of Appeals erred in dismissing his complaint against respondents and in upholding the assessment of the company-designated physician by reason of his failure to abide by the third physician referral rule. 25 A company-designated physician's assessment does not necessarily deserve more credit. 26 Since his own physician, Dr. Magtira, is a specialist in Orthopedics and Traumatology, the latter's assessment is more credible. 27 Lastly, in the event the parties fail to agree on the services of a third physician, he has the right to file a complaint. 28
In their Comment 29 dated December 3, 2019, respondents pray for the dismissal of the petition on three (3) grounds: First, petitioner's complaint before the NLRC was premature. 30 Second, as noted by the Court of Appeals, the issue on the third-physician referral rule was not resolved by the NLRC despite having been timely raised by respondents. 31 Third, Dr. Magtira's assessment does not deserve credence because it did not indicate any disability rating and merely pronounced petitioner unfit to resume his duties as a seafarer. 32
Our Ruling
The petition is meritorious.
First off, the Court notes that the issues presented in this case are factual in nature. Ordinarily, this Court is not a trier of facts and does not embark in the evaluation of evidence adduced during trial. This rule, however, allows for exceptions when the factual findings of the quasi-judicial agencies concerned are conflicting with those of the Court of Appeals, as here. When there is a variance in the factual findings, the Court may undertake to examine the facts once again. 33
Petitioner is entitled to
Pertinent to the factual issues here of compensability and compliance, the Court refers to the 2010 POEA-SEC, which was in effect when petitioner was employed by the companies in 2015. Section 20 (A) states:
SECTION 20. COMPENSATION AND BENEFITS. —
A. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS
The liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract are as follows:
xxx xxx xxx
2. x x x However, if after repatriation, the seafarer still requires medical attention arising from the said injury or illness, he shall be so provided at cost to the employer until such time he is declared fit, or the degree of his disability has been established by the company-designated physician.
1. n In addition to the above obligation of the employer to provide medical attention, the seafarer should also receive sickness allowance from his employer in the amount equivalent to this basic wage computed from the time he signed off until he's declared fit to work or the degree of disability has been assessed by the company designated physician. The period within which the seafarer shall be entitled to his sickness allowance shall not exceed 120 days. Payment of the sickness allowance shall be made on a regular basis, but not less than once a month. DHITCc
xxx xxx xxx
For this purpose, the seafarer shall submit himself to a post-employment medical examination by a company-designated physician within three working days upon his return except when he is physically incapacitated to do so, in which case, a written notice to the agency within the same period is deemed as compliance. In the course of the treatment, the seafarer shall also report regularly to the company-designated physician specifically on the dates as prescribed by the company-designated physician and agreed to by the seafarer. Failure of the seafarer to comply with the mandatory reporting requirement shall result in his forfeiture of the right to claim the above benefits.
If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be agreed jointly between the employer and the seafarer. The third doctor's decision shall be final and binding on both parties.
xxx xxx xxx
Pursuant to the POEA-SEC, when a seafarer suffers a work-related injury or illness in the course of employment, the company-designated physician is obligated to arrive at a definite assessment of the former's fitness or degree of disability within a period of 120 days from repatriation. 34 During this period, the seafarer shall be deemed on temporary total disability and shall receive his basic wage until he is declared fit to work or his temporary disability is acknowledged by the company to be permanent, either partially or totally, as defined under the POEA-SEC and by applicable Philippine laws. If the 120-day period, however, is exceeded and no definitive declaration is made because the seafarer requires further medical attention, the temporary total disability period may be extended up to a maximum of 240 days, subject to the right of the employer to declare within this period that a permanent partial or total disability already exists. 35 But before the company-designated physician may avail of the allowable 240-day extended treatment period, he or she must perform some significant act to justify the extension of the original 120-day period. Otherwise, the law grants the seafarer the relief of permanent total disability benefits due to such non-compliance. 36
In Elburg Shipmanagement Philippines, Inc. v. Quiogue, 37 the Court summarized the rules for claims of total and permanent disability benefits by seafarers, viz.:
In summary, if there is a claim for total and permanent disability benefits by a seafarer, the following rules shall govern:
1. The company-designated physician must issue a final medical assessment on the seafarer's disability grading within a period of 120 days from the time the seafarer reported to him;
2. If the company-designated physician fails to give his assessment within the period of 120 days, without any justifiable reason, then the seafarer's disability becomes permanent and total;
3. If the company-designated physician fails to give his assessment within the period of 120 days with a sufficient justification (e.g., seafarer required further medical treatment or seafarer was uncooperative), then the period of diagnosis and treatment shall be extended to 240 days. The employer has the burden to prove that the company-designated physician has sufficient justification to extend the period; and
4. If the company-designated physician still fails to give his assessment within the extended period of 240 days, then the seafarer's disability becomes permanent and total, regardless of any justification. (emphasis supplied) 38
Verily, two (2) requisites must concur: 1) an assessment must be issued within the 120/240-day window; and 2) the assessment must be final and definitive. 39
The assessment was issued
Here, petitioner was medically repatriated on September 30, 2015. Thereafter, he was referred to Dr. Alegre, the company-designated physician. After 16 days, or on October 15, 2015, Dr. Alegre issued an initial medical assessment, finding petitioner to be suffering from "calcaneal fracture, right." Subsequent medical examinations were then conducted. In January 2016, Dr. Alegre issued an interim assessment of Grade 12, pursuant to Section 32 of the employment contract. Finally, on April 11, 2016, or 195 days after repatriation and within the 240-day period, petitioner was assessed with a final disability of Grade 12 on account of "right calcaneal fracture." cEaSHC
These medical assessments were timely issued by the company-designated physician. As will be discussed, the timeliness of the issuance of the medical reports is of no moment since the alleged final medical report was not at all final. 40
The company-designated
The POEA-SEC clearly provides the primary responsibility of a company-designated physician to determine the disability grading or fitness to work of seafarers. To be conclusive, however, company-designated physician's medical assessments or reports must be complete and definite to give the proper disability benefits to seafarers. 41
A final and definite disability assessment is necessary to reflect the true extent of the seafarer's sickness or injuries and his or her capacity to resume work as such. Otherwise, the corresponding disability benefits awarded might not be commensurate with the prolonged effects of the injuries suffered. Before the disability ratings from the company-designated physician may be considered, they should first be properly established and contained in a valid and timely medical report. Thus, the foremost consideration of the courts should be to determine whether the company-designated physician's medical assessment or report was complete and appropriately issued; otherwise, the medical report shall be set aside, and the disability grading contained therein cannot be seriously appreciated. 42
The definiteness of a medical report pertains to the assessment by the company-designated physician of the seafarers' fitness to work or permanent disability within the period of 120 or 240 days. The company physician must declare the seafarer fit to work or assess the degree of his or her permanent disability. Without this, the characterization of a seafarer's condition as total and permanent will ensue because the ability to return to one's accustomed work before the applicable periods elapse cannot be shown. 43
Here, Dr. Alegre issued the so-called final medical assessment on April 11, 2016, to wit:
"Grade 12 — depression of the arch of a foot resulting in a weak foot." 44
As worded, the medical assessment was far from final. For one, the company-designated physician made no explicit declaration as to petitioner's fitness or unfitness for further sea duty. Another, the alleged finality of the medical report was negated by the fact that petitioner needed further medical treatment, i.e., he underwent another series of medical examinations and treatment with Dr. Magtira, his chosen physician, for about a month. That he was not redeployed after the incident as a seafarer lends credence to the fact that he still needed further medical attention and far from healed. 45
In Magsaysay Mol Marine, Inc. v. Atraje, 46 the Court held that respondent's inability to perform his customary sea duties, coupled with the company-designated physicians' abdication of their primary duty to declare his fitness or unfitness to work within the prescribed period, transformed his disability to permanent and total by operation of law. There, the company-designated physicians, Shiphealth, clearly breached their duty to provide a definite assessment of respondent's condition. Despite medication and physical therapy, respondent was not restored to his pre-injury health status.
Further, in Chan v. Magsaysay Maritime Corp., 47 the Court held that the medical assessment issued by the company-designated physician cannot be considered complete, final, and definite as it did not show how the disability assessment was arrived at. The assessment merely stated that petitioner had attained maximum medical treatment and declared petitioner's disability at Grade 10. A declaration of disability in the medical assessment, without more, cannot be considered complete, final, and definite. CTIEac
Thus, the Court finds the so-called April 11, 2016 final medical assessment to have fallen short of the parameters for a final and definite medical report. Even if the company-designated physician was justified in extending petitioner's medical treatment to more than 120 days, yet, as earlier stated, the so-called final medical report is far from final. 48
Without a valid final and definite assessment from the company-designated physician within the 120/240-day period, the law already steps in to consider petitioner's disability as total and permanent. 49 Thus, a temporary total disability becomes total and permanent by operation of law. 50
Petitioner is entitled to attorney's fees
The general rule is that attorney's fees cannot be recovered as part of damages because of the policy that no premium should be placed on the right to vindicate one's rights, including access to the courts and other dispute-resolution means. For this reason, they are not to be awarded every time a party wins a suit. 51
This rule, however, takes a different turn when it comes to labor cases. Article 111 of the Labor Code, 52 as amended, contemplates a concept of attorney's fees that is an exception to the declared policy of strict construction in the award of attorney's fees. Although an express finding of facts and law is still necessary to prove the merit of the award, there need not be any showing that the employer acted maliciously or in bad faith when it withheld wages or any other employee-related benefits. 53 Where an employee was forced to litigate and as a result incur expenses to protect his or her rights and interests, a monetary award by way of attorney's fees is justified under Article III of the Labor Code; Section 8, Rule VIII, Book III of its Implementing Rules; and paragraph 8, Article 2208 of the Civil Code. 54
In C.F. Sharp Crew Management, Inc. v. Perez, 55 the Court held that a seafarer is entitled to attorney's fees as he was forced to litigate and incur expenses to protect his rights and interest. Cutanda v. Marlow Navigation Phils., Inc.56 allowed attorney's fees equivalent to 10% of the total monetary award to a seafarer who has suffered total and permanent disability due to a work-related illness. In Orient Hope Agencies, Inc. v. Jara, 57 the Court awarded attorney's fees to a seafarer who resorted to litigation when his claim for permanent and total disability benefits was denied but after litigation was validated and endorsed.
In fine, the award of attorney's fees is sanctioned here. Petitioner was unlawfully and unjustifiably denied wages and benefits. He was compelled to litigate and protect his rights and interests. 58
Lastly, consistent with the ruling in Nacar v. Gallery Frames, 59 the Court imposes on the monetary award for total and permanent disability benefits an interest at the legal rate of 6% per annum from the date of finality of this Resolution until full satisfaction. 60
FOR THESE REASONS, the petition is GRANTED. The Decision dated June 18, 2018 and Resolution dated July 18, 2019 of the Court of Appeals in CA-G.R. SP No. 10831 are REVERSED. A NEW ONE is ENTERED declaring respondents Associated Ship Management Services, Inc., Sea Giant Shipmanagement Ltd., and/or Wilma T. Paguntalan jointly and severally liable to petitioner Jeremy Orais for the following:
1. US$60,000.00 or its Philippine Peso equivalent at the time of payment as total and permanent disability rating in accordance with the 2010 Philippine Overseas Employment Administration Standard Employment Contract;
2. Ten percent (10%) of the total monetary award as attorney's fees; and
3. Six percent (6%) interest per annum of the total monetary award from the finality of this Resolution until fully paid.
SO ORDERED." (J. M. Lopez, on official leave).
By authority of the Court:
(SGD.) TERESITA AQUINO TUAZONDivision Clerk of Court
Footnotes
1. Rollo, pp. 3-23.
2. Penned by Associate Justice Marilyn B. Lagura-Yap and concurred in by Associate Justices Gabriel T. Ingles and Gabriel T. Robeniol; id. at 29-39.
3. Id. at 26-28.
4. Id. at 29.
5. Id. at 30.
6. Id.
7. Id.
8. Id.
9. Id. at 31.
10. Id.
11. Id.
12. Id.
13. Id. at 32.
14. Id.
15. Id. at 33.
16. Id. at 29-39.
17. Id. at 35.
18. Id. at 35-36.
19. Id. at 37.
20. Id.
21. Id. at 37-38.
22. Id. at 39.
23. Id. at 26-28.
24. Id. at 3-23.
25. Id. at 17.
26. Id. at 17-18.
27. Id. at 19.
28. Id. at 20-21.
29. Id. at 42-65.
30. Id. at 48-49.
31. Id. at 49-60.
32. Id. at 60-63.
33. General Milling Corp. v. Viajar, 702 Phil. 532, 540 (2018) [per J. Reyes, First Division].
34. Sunit v. OSM Maritime Services, Inc., 806 Phil. 505, 518 (2017) [per J. Velasco, Third Division].
35. Vergara v. Hammonia Maritime Services and Atlantic Marine Ltd., 588 Phil. 895, 912 (2008) [per J. Brion, Second Division].
36. Gamboa v. Maunlad Trans, Inc., G.R. No. 232905, August 20, 2018, 878 SCRA 180, 201.
37. 765 Phil. 341, 362-363 (2015).
38. Id.
39. Chan v. Magsaysay Maritime Corporation, G.R. No. 239055, March 11, 2020.
40. Calera v. Hoegh Fleet Services Philippines, Inc., G.R. No. 250584, June 14, 2021.
41. Orient Hope Agencies, Inc. v. Jara, 832 Phil. 380, 399-400 (2018) [per J. Leonen, Third Division].
42. Olidana v. Jebsens Maritime, Inc., 772 Phil. 234, 245 (2015) [per J. Mendoza, Second Division].
43. Belchem Philippines, Inc. v. Zafra, 759 Phil. 514, 526-527 (2015) [per J. Mendoza, Second Division].
44. Rollo, p. 15.
45. Supra note 40.
46. 836 Phil. 1061, 1081 (2018).
47. Supra note 39.
48. Supra note 40.
49. Supra note 36 at 202.
50. Tamin v. Magsaysay Maritime Corp., 794 Phil. 286, 301 (2016) [per J. Velasco, Jr., Third Division].
51. Sps. Timado v. Rural Bank of San Jose, Inc., 789 Phil. 453, 460 (2016) [per J. Brion, Second Division].
52.Art. 111, Labor Code. Attorney's fees. — (a) In cases of unlawful withholding of wages, the culpable party may be assessed attorney's fees equivalent to ten percent of the amount of wages recovered x x x.
53. PCL Shipping Phils., Inc. v. NLRC, 540 Phil. 65, 84 (2006) [per J. Austria-Martinez, First Division].
54. Tangga-an v. Philippine Transmarine Carriers, Inc., 706 Phil. 339, 353-354 (2013) [per J. Del Castillo, Second Division].
55. 752 Phil. 46, 57-58 (2015) [per J. Villarama, Jr., Third Division].
56. 817 Phil. 1106, 1132 (2017) [per J. Peralta, Second Division].
57. Supra note 41.
58. Alva v. High Capacity Security Force, Inc., 820 Phil. 677, 681 (2017).
59. 716 Phil. 267 (2013).
60. Supra note 39.
nNote from the Publisher: Copied verbatim from official document.