Valencia II v. NYK-Fil Ship Management, Inc.

FIRST DIVISION

[G.R. No. 250761. September 14, 2021.]

MARK ANTHONY A. VALENCIA II, petitioner, vs.NYK-FIL SHIP MANAGEMENT, INC., and NYK CRUISES COMPANY, LTD., respondents.

[G.R. No. 250762. September 14, 2021.]

NYK-FIL SHIP MANAGEMENT, INC., and NYK CRUISES COMPANY, LTD., petitioners, vs.MARK ANTHONY A. VALENCIA II, respondent.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, First Division, issued a Resolution datedSeptember 14, 2021which reads as follows:

"G.R. No. 250761 — Mark Anthony A. Valencia II v. NYK-FIL Ship Management, Inc., and NYK Cruises Company, Ltd. and G.R. No. 250762 —NYK-FIL Ship Management, Inc., and NYK Cruises Company, Ltd. v. Mark Anthony A. Valencia II

Valencia is entitled

It is undisputed that petitioner Mark Anthony A. Valencia II (Valencia) suffered from Ulcerative Colitis for which he was medically repatriated to the country on November 25, 2015. The only question to be resolved is whether he is entitled to Grade 1 total and permanent disability benefits.

Permanent disability is the inability of a worker to perform his job for more than 120 days, regardless of whether he loses the use of any part of his body. Total disability, on the other hand, means the disablement of an employee to earn wages in the same kind of work of similar nature that he was trained for, or accustomed to perform, or any kind of work which a person of his mentality and attainments could do. 1

Pertinent to the factual issues here of compensability and compliance, we refer to the 2010 Philippine Overseas Employment Administration-Standard Employment Contract (POEA-SEC), which was in effect when Valencia was employed by the companies, NYK-FIL Ship Management, Inc., and NYK Cruises Company, Ltd., in 2015. Section 20 (A) states: CaSAcH

SECTION 20. COMPENSATION AND BENEFITS. —

A. COMPENSATION AND BENEFITS FOR INJURY 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.

3. 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.

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 farmer's fitness or degree of disability within a period of 120 days from repatriation. 2 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 his condition is 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. 3 But before the company-designated physician may avail of the allowable 240-day extended treatment period, he 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 noncompliance. 4

In Elburg Shipmanagement Philippines, Inc. v. Quiogue, Jr., 5 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: IaHDcT

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)

The timely and definite declaration by the company-designated physician on the seafarer's fitness to work or permanent disability is an obligation. 6 Without a valid final and definitive assessment from the company-designated physician within the 120/240-day period, the law already steps in to consider the seafarer's disability as total and permanent. 7 Thus, a temporary total disability becomes total and permanent by operation of law. 8

Here, as found by NCMB and affirmed by the Court of Appeals, the Medical Report which assessed Valencia to be "fit-to-work" was issued only on April 8, 2016, or 133 days from his medical repatriation on November 25, 2015. Since the issuance was done beyond the 120-day period, it was incumbent upon NYK-FIL Ship Management, Inc. and NYK Cruises Company, Ltd. to adduce substantial evidence to justify such delay. They, however, failed to show why the company-designated physician belatedly issued the medical report and the period of diagnosis and treatment went beyond 120 days. Accordingly, Valencia's disability became permanent and total.

Valencia is entitled to

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. The power of the court to award attorney's fees under Article 2208 9 of the Civil Code demands factual, legal, and equitable justifications. Even when a claimant is compelled to litigate with third persons or to incur expenses to protect his or her rights, attorney's fees may not be awarded where there is no sufficient showing of bad faith could be reflected in a party's persistence in a case other than an erroneous conviction of the righteousness of his or her cause. 10

This rule, however, takes a different turn when it comes to labor cases. Article 111 of the Labor Code, 11 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 fact 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. 12 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. 13

In C.F. Sharp Crew Management, Inc. v. Perez, 14 the Court held that a seaman 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.15 allowed attorney's fees equivalent to ten percent (10%) of the total monetary award to a seafarer who has suffered permanent and total disability due to a work-related illness. In Orient Hope Agencies, Inc. v. Jara, 16 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. Valencia was unlawfully and unjustifiably denied wages and benefits. He was compelled to litigate and protect his rights and interests. In labor cases, unlike in ordinary civil disputes, attorney's fees are awarded as a recompense against one who without cause, in good faith and more so in bad faith, delayed an employee's access to the fruits of his or her labor. 17 DEIHAa

In sum, the Court of Appeals correctly affirmed the NCMB's grant of 100% permanent and total disability benefits to Valencia per POEA-SEC in the amount of Sixty Thousand US Dollars ($60,000.00). It, however, erred in deleting the award of attorney's fees. By being compelled to litigate and protect his rights and interests as a seafarer, and in accordance with the Labor Code, its corresponding Implementing Rules and Regulations, and the Civil Code, Valencia is also entitled to 10% of the total award as attorney's fees or Six Thousand US Dollars ($6,000.00), as correctly imposed by the Panel.

Lastly, consistent with the ruling in Nacar v. Gallery Frames, 18 the Court imposes on the monetary award for permanent and total disability benefits interest at the legal rate of 6% per annum from finality of this Resolution until full satisfaction. 19

WHEREFORE, the Court resolves to:

1) GRANT the Petition for Review dated January 25, 2020, in G.R. No. 250761 and DENY the Petition for Review dated December 23, 2019, in G.R. No. 250762; and

2) AFFIRM with MODIFICATION the assailed Decision dated May 31, 2019, and Resolution dated November 27, 2019, of the Court of Appeals in CA-G.R. SP No. 151320. Petitioner Mark Anthony Valencia II is AWARDED $60,000.00 as total and permanent disability benefits plus 10% attorney's fees equivalent to $6,000.00, with legal interest of six percent (6%) per annum on the total monetary award from finality of this resolution until fully paid.

SO ORDERED."

By authority of the Court:

(SGD.) LIBRADA C. BUENADivision Clerk of Court

By:

MARIA TERESA B. SIBULODeputy Division Clerk of Court

 

Footnotes

1.Hanseatic Shipping Philippines, Inc. v. Ballon, 769 Phil. 567, 584 (2015).

2.Sunit v. OSM Maritime Services, Inc., et al., 806 Phil. 505, 518 (2017).

3.Vergara v. Hammonia Maritime Services and Atlantic Marine Ltd., 588 Phil. 895 (2003).

4.Gamboa v. Maunlad Trans, Inc., G.R. No. 232905, August 20, 2018.

5. 765 Phil. 341, 363 (2015).

6.Pastrana v. Bahia Shipping Services, Inc., et al., G.R. No. 227419, June 10, 2020.

7.Talaroc v. Arphaphil Shipping Corporation, et al., 817 Phil. 598, 618 (2017).

8.Tamin v. Magsaysay Maritime Corporation, et al., 794 Phil. 286, 301 (2016).

9.Art. 2208. In the absence of stipulation, attorney's fees, and expenses of litigation, other than judicial costs, cannot be recovered, except:

(1) When exemplary damages are awarded;

(2) When the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest;

(3) In criminal cases of malicious prosecution against the plaintiff;

(4) In case of a clearly unfounded civil action or proceeding against the plaintiff;

(5) Where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiff's plainly valid, just and demandable claim;

(6) In actions for legal support;

(7) In actions for the recovery of wages of household helpers, laborers and skilled workers;

(8) In actions for indemnity under workmen's compensation and employer's liability laws;

(9) In a separate civil action to recover civil liability arising from a crime;

(10) When at least double judicial costs are awarded;

(11) In any other case where the court deems it just and equitable that attorney's fees and expenses of litigation should be recovered.

In all cases, the attorney's fees and expenses of litigation must be reasonable.

10.Spouses Timado v. Rural Bank of San Jose, Inc., et al., 789 Phil. 453, 460 (2016).

11.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.

12.PCL Shipping Philippines, Inc. v. NLRC, 540 Phil. 65, 84-85 (2006).

13.Tangga-an v. Philippine Transmarine Carriers, Inc., 706 Phil. 339, 353 (2013).

14. 752 Phil. 46, 57-58 (2015).

15. 817 Phil. 1106, 1132 (2017).

16. 832 Phil. 380, 404 (2018).

17.SeeAlva v. High Capacity Security Force, Inc., 820 Phil. 677, 692 (2017).

18. 716 Phil. 267, 283 (2013).

19.SeeChan v. Magsaysay Corporation, et al., G.R. No. 239055, March 11, 2020.